E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 108 CONGRESS, FIRST SESSION

Vol. 149 WASHINGTON, FRIDAY, SEPTEMBER 26, 2003 No. 134 House of Representatives The House was not in session today. Its next meeting will be held on Monday, September 29, 2003, at 12 noon. Senate FRIDAY, SEPTEMBER 26, 2003

The Senate met at 9:30 a.m. and was RECOGNITION OF THE MAJORITY necessary, or offer amendments on the called to order by the President pro LEADER supplemental. Thus, it will require the tempore [Mr. STEVENS]. The PRESIDENT pro tempore. The attention and focus of our colleagues majority leader is recognized. throughout the week. PRAYER I wanted Senators to begin to plan f their schedules with this in mind. I do The Chaplain, Dr. Barry C. Black, of- SCHEDULE thank all colleagues. I will outline fered the following prayer: Mr. FRIST. Mr. President, this morn- Monday’s schedule a bit later today. Let us pray. ing the Senate will immediately re- f Immortal, invisible, God only wise, sume consideration of the DC appro- the kingdom, power, glory, and honor priations bill. The managers are here RECOGNITION OF THE ACTING belong to You. You have given us the and ready to work. Therefore, we do MINORITY LEADER gift of this new day and the oppor- hope Members will come forward with The PRESIDENT pro tempore. The tunity for a fresh start. Thank You for their amendments during today’s ses- acting Democratic leader is recognized. the continuous flow of Your blessings; sion. If a rollcall vote is ordered on an Mr. REID. Before the majority leader great is Your faithfulness. amendment, we will stack that vote for leaves the floor, I indicated to the Sen- Help us to find contentment in the Monday’s session. As I announced last ator last week that we should have knowledge that nothing can separate night, there will be no rollcall votes done something else rather than bring- us from Your love. Remind us that You today. ing up the DC bill. I don’t see the DC have not only made us for time, but Yesterday we made progress on the bill moving. I don’t see us being able to also for eternity. Guide our Senators bill, and I thank the managers for their complete it on Monday. I think we today, deliver them from weariness and efforts in moving the bill forward. I do have other appropriations bills we impatience and strengthen them with hope we can finish this bill on Monday. could move through fairly quickly. Your peace. Make each of them reso- I understand there may be further With the voucher issue involving the lute to do Your will. We lift to You our amendments from the other side of the DC bill, it makes it very difficult to world leaders. They face tasks that aisle, but it is our desire to complete slog through the bill. I know how we cannot be accomplished by human ef- this bill early next week. I do expect have to put a positive note on every- forts alone. Whisper Your wisdom and the Senate to begin consideration of thing—especially you—but I think we guide their steps. the urgent supplemental request at the will have a lot of trouble in completing We pray this in Your holy name. earliest possible time next week. Given the DC appropriations bill Monday or Amen. that schedule, it is imperative that we any time in the near future. expedite the DC appropriations bill. Mr. FRIST. Mr. President, listening f With regard to next week’s schedule, very carefully, I am disappointed. I I want to forewarn all Members, it will think we have an opportunity in this be a very busy week. I anticipate that body to address a tragedy, and that is PLEDGE OF ALLEGIANCE we will have late sessions Tuesday that there are impoverished children The PRESIDENT pro tempore led the night, Wednesday, Thursday, and pos- trapped in today’s schools that are not Pledge of Allegiance, as follows: sibly Friday. We will have votes serving them well. We have an oppor- I pledge allegiance to the Flag of the throughout that session. Our discus- tunity to reach out and help those chil- United States of America, and to the Repub- sion on the floor yesterday reflected in dren. We have today to work on it. We lic for which it stands, one nation under God, large part the interest in having time have Monday to work on it. But if the indivisible, with liberty and justice for all. to discuss and debate and amend, if other side of the aisle feels we cannot

∑ This ‘‘bullet’’ symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor.

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VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00001 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.000 S26PT1 S12028 CONGRESSIONAL RECORD — SENATE September 26, 2003 make progress on it, I will listen, but I ing an amendment to strike the schol- knows about this, as the chairman of am very disappointed in that. arship provision. He certainly has the the committee has been very cognizant Ms. LANDRIEU. Mr. President, if I opportunity to do so, and we can have of this and helped us to deal with these may make a suggestion—Senator a very rigorous debate. We started that problems in the District of Columbia as DEWINE can speak for himself—this bill discussion yesterday, and we can con- we have worked with the Mayor. This is so important and this subject is so tinue it. We hope we can get a vote at bill continues to try to address these important to so many people, I am some point on that issue. problems. wondering if we could just be flexible My friend and colleague, the ranking Thirdly, the bill also addressed some and move the discussion of DC in and member on the committee, has had of the long-term infrastructure prob- out of other things, not stopping any- some suggestions. I assume those will lems of the District of Columbia. These thing else that is important or would become an amendment at some point. are issues that are not very glitzy or take precedence, but this issue really We had a good debate last night, along exciting but what we have to deal with deserves full debate. As you know, the with our colleague from Delaware. in the long-term. So this is a strong hours of Senate debate are not always They have some ideas that will become bill, a more reasoned bill, a bill within completely and fully taken. I offer for a part of an amendment at some point, budget, but it is a bill of which we all consideration that we have time this we assume. We can debate that. can be very proud. Let me turn to the fourth item which morning, we will have time on Monday, There is good opportunity for good is, frankly, the only contentious issue and if the leadership wants to move to debate. I encourage my colleagues to in this bill, the scholarship program. I something else, we could temporarily get those into the form of an amend- believe it is a very well-balanced, well- set this aside and come back to it. ment, get down here, and let’s debate it thought-out section of the bill. It is There are many Members, at least on and move this bill forward. something that Senator FEINSTEIN, as our side, who really want some time to This is a good bill. This is a bill my colleague from Louisiana and I have we discussed yesterday, has been so speak about this issue. They are most very helpful in crafting. As I said yes- certainly entitled to because it is a worked long and hard on. As we discussed yesterday, it is a bill terday, she went so far to help improve very important issue—not just for the the language. The bill in front of us District but for the Nation. I lay that that is focused to a large extent on the children of the District of Columbia. It today, frankly, is a better bill because out to my friend and colleague as a of what my colleague from California, suggestion. has a provision I take a lot of pride in, and I know my colleague takes a lot of Senator FEINSTEIN, has contributed in f pride in, and it has to do with foster her suggestions. She came to Senator RESERVATION OF LEADER TIME care. We have heard the horror stories, GREGG and to me and to the chairman and said she had some suggestions that The PRESIDENT pro tempore. Under and we have read the excellent series of would improve the constitutionality, the previous order, the leadership time articles that appeared in the Wash- allow the Mayor to be much more in- ington Post—very frightening and is reserved. volved, and would make the system troubling articles that the Post has run f much more accountable so we can over a series of months about the hor- measure how well the children are DISTRICT OF COLUMBIA rible situation in the foster care sys- doing, and we incorporated those APPROPRIATIONS ACT, 2004 tem in the District of Columbia. Chil- changes. The PRESIDENT pro tempore. Under dren have been neglected and abused; Then, yesterday, she had an addi- the previous order, the Senate will re- they have not been taken care of. tional amendment that provided for sume consideration of H.R. 2765, which This bill says, for the first time, that testing being the same for the children the clerk will report. the Federal Government and this Sen- who would be in the program as chil- The legislative clerk read as follows: ate intend to try to do something dren not in the program. We adopted about it. Senator LANDRIEU and I held A bill (H.R. 2765) making appropriations that by voice vote yesterday. So she for the Government of the District of Colum- hearings. We brought in experts from has been a great trigger to this bill, bia and other activities chargeable in whole across the country, brought in experts and this scholarship program will be a or in part against the revenues of said Dis- from the District of Columbia. We lot better because of what she has trict for the fiscal year ending September 30, brought everybody together and said, 2004, and for other purposes. done. OK, what is the problem? They told us Pending: As I was saying, it is a very balanced some of the problems, and we got ex- program. It is a program, as we talked DeWine/Landrieu Amendment No. 1783, in perts from outside the District who the nature of a substitute. about yesterday, that was designed— told us of some of the problems as they and I think this is significant and we The PRESIDENT pro tempore. The perceived them. We took that advice need to keep it in mind—not by us but Senator from Ohio. and came up with three or four ideas— by the Mayor of the District of Colum- Mr. DEWINE. Mr. President, we made not our ideas but the experts’ ideas— bia. If anybody has any doubts about very good progress yesterday on the and we put them together in this bill this, they can just go ask the Mayor. District of Columbia bill. We were able and provided a significant amount of The Mayor is the one who designed this to approve a very constructive amend- money. That is what is in the bill. So program. The Mayor said: Give me ment by my colleague and friend from we have the Federal Government tak- more help with public schools. So we California. Senator FEINSTEIN brought ing some responsibility in this area and said, yes—with $13 million more for the to the floor an amendment that beginning to move forward. public schools. brought about more accountability in It is our intention with this bill that The Mayor said: Give me more help regard to the section of the bill having this will be the first step. Senator with the charter schools. The Mayor to do with the scholarship provision. LANDRIEU and I have pledged, as long has been working to expand the charter We did make very good progress. As as we have anything to do with this schools. My colleague from Louisiana the majority leader said, we have the bill—which I imagine will be for the has been very helpful in this regard. opportunity to keep this bill moving next several years—that we will move She has taken the charter schools on forward. We have the opportunity forward to try to help these foster care as something in which she has been today for Members to come to the floor children. So this is something of which very much involved. We have done that and discuss the bill. We will have the Members of this body can be very with this bill with $13 million more to opportunity all day Monday for Mem- proud. expand the charter schools. It will bers to come to the floor to offer This bill also continues our efforts to allow for the creation of three or four amendments. We are certainly going to deal with the homeland security prob- or five more charter schools in the Dis- be open for business Monday for Mem- lems. Since September 11, we have be- trict of Columbia. bers to come to the Chamber and offer come even more aware of the unique The third prong the Mayor outlined amendments. security needs of the District of Colum- was this: He said give me some help to I know my colleague from Illinois bia. We are a target; we understand create these new scholarships for chil- was on the floor and talked about offer- that. My colleague in the chair well dren, and they and their families will

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00002 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.002 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12029 have choice. That is what the bill pro- are struggling to find common ground, The report did not seek to lay blame on in- vides: money for public schools, money and I am not sure we will be able to be- dividual managers but focused on physical for charter schools, and money for the cause principles are very important in causes of the accident and the ‘‘broken safe- ty culture’’ within NASA that allowed risks new scholarships for the parents to go terms of education reform and account- to be underplayed. But Congress has opened out and choose schools—private ability. several lines of inquiry into the mission, and schools—if that is what they want to I want to start this discussion this holding individuals accountable is part of do. Again, this is what the bill does: $13 morning on that proposal by sharing an the agenda. million for public schools, $13 million article that I read in the paper this In interviews with numerous engineers, for charter schools, and $13 million for morning on a completely different sub- most of whom have not spoken publicly until the choice to go out on these scholar- ject, but I think it makes the point now, the discord between NASA’s engineers and managers stands out in stark relief. ships and choose the private schools. It very well. Mr. Rocha, who has emerged as a central is a well-balanced approach, designed We woke up this morning to read a figure in the 16 days of the Columbia’s fight, by the Mayor, by the people of the Dis- headline in the New York Times on the was a natural choice of his fellow engineers trict of Columbia. front page. The headline says: ‘‘Dogged as a go-between on the initial picture re- Mr. President, this is a well-devel- Engineer Pressed NASA on Shuttle, quest. He had already sent an e-mail message oped bill, a well-designed bill. I think but Rebuffs Were Constant.’’ to the shuttle engineering office asking if it is something of which we can all be I submit this article for the RECORD the astronauts could visually inspect the im- very proud. So I encourage my col- because it is lengthy and it is very de- pact area through a small window on the leagues to come down to the floor tailed, but it is excellent. I ask unani- side of the craft. And as Mr. Rocha was chief engineer in Johnson Space Center’s struc- today and debate this bill, and then as mous consent to print the article in tural engineering division and a man with a we begin this process today and con- the RECORD. reputation for precision and integrity, his tinue the process on Monday, come to There being no objection, the mate- words were likely to carry great weight. the floor on Monday and offer these rial was ordered to be printed in the ‘‘I said, ‘Yes, I’ll give it a try,’’’ he recalled amendments so that we can proceed. RECORD, as follows: in mid-September, in the course of five hours We got a great start with the adoption [From the New York Times, Sept. 26, 2003] of recent interviews at a hotel near the space center. of the Feinstein amendment yesterday. DOGGED ENGINEER’S EFFORT TO ASSESS In its report, the independent Columbia We now need to move forward and con- SHUTTLE DAMAGE Accident Investigation Board spoke of Mr. tinue the process. I thank the Chair. I (By James Glanz and John Schwartz) Rocha, 52, as a kind of NASA Everyman—a know my colleague from Louisiana HOUSTON.—Over and over, a projector at typical engineer who suspected that all was wants to discuss this bill. one end of a long, pale-blue conference room not well with the Columbia but could not At this point, I yield the floor. in Building 13 of the Johnson Space Center save it. The PRESIDING OFFICER (Mr. showed a piece of whitish foam breaking ‘‘He’s an average guy as far as personality, but as far as his engineering skills, he’s a CHAFEE). The Senator from Louisiana away from the space shuttle Columbia’s fuel is recognized. tank and bursting like fireworks as it struck very, very detail-oriented guy,’’ said Dan Diggins, who did many of the interviews for Ms. LANDRIEU. Mr. President, I the left wing. In twos and threes, engineers at the other the report’s chapter on the space agency’s want to begin by commending, as I end of the cluttered room drifted away from decision-making during the flight and wrote have often, my colleague from Ohio for their meeting and watched the repetitive, al- that chapter’s first draft before it was re- his leadership on this issue. It has been most hypnotic images with deep puzzlement: worked and approved by the board. Never in a joy and a privilege to work with him because of the camera angle, no one could hours of interviews did Mr. Diggins find a as we have alternated the chairman- tell exactly where the foam had hit. contradiction between Mr. Rocha’s state- ship of this very important committee It was Tuesday, Jan. 21, five days after the ments and facts established by other means, foam had broken loose during liftoff, and he said. for this region and this Nation and, ob- Mr. Rocha’s experience provides perhaps viously, for the residents of the Dis- some 30 engineers from the National Aero- nautics and Space Administration and its the clearest and most harrowing view of a trict itself. It has been a real joy to aerospace contractors were having the first NASA safety culture that, the board says work with him. We have found a tre- formal meeting to assess potential damage must be fixed if the remaining shuttles are mendous amount of common ground in when it struck the wing. to continue flying. the course of these few years, and I Virtually every one of the participants— EARLY LOVE WITH SHUTTLE think we have made a lot of progress in those in the room and some linked by tele- Alan Rodney Rocha loved the Columbia some of the most complex challenges conference—agreed that the space agency long before it was lost. In August 1978, as a here in the District. He noted this should immediately get images of the impact young NASA engineer, he took his first busi- area, perhaps by requesting them from ness trip for the agency to Palmdale, Calif., morning the challenge, still, with the American spy satellites or powerful tele- foster care system and its weaknesses, where the still unfinished Columbia sat in a scopes on the ground. hangar among the Joshua trees, awaiting its and he outlined how this committee They elected one of their number, a soft- first mission. and this Congress has worked in part- spoken NASA engineer, Rodney Rocha, to Working from 6 p.m. to 6 a.m. each night, nership, very closely, with all the city convey the idea to the shuttle mission man- he had the job of climbing into the orbiter’s leaders to recognize the problems, agers. wheel well, through the fuselage and among admit them, and begin to put in the re- Mr. Rocha said he tried at least half a the labyrinth of tubes, wires, struts and par- sources and the management changes dozen times to get the space agency to make titions in the right wing, to check that each the requests. There were two similar efforts necessary to make that child welfare of 200 strain gauges were just where the by other engineers. All were turned aside, plans said they should be. And the Columbia system much better and, hopefully, a Mr. Rocha (pronounced ROE-cha) said a took its place in his heart. model for the Nation. manager told him that he refused to be a ‘‘I felt so privileged to be there,’’ he said. I am proud to have worked with him, ‘‘Chicken Little.’’ The Columbia took its maiden flight in 1981; along with other Senators. Senator The Columbia’s flight director, Le-Roy five years later its sister vessel the Chal- DURBIN is one, along with Senator Cain, wrote a curt e-mail message that con- lenger was lost with its crew of seven when HUTCHISON from Texas and others, who cluded, ‘‘I consider it to be a dead issue.’’ O-ring seals in one of the solid rocket boost- worked on some initial foundation New interviews and newly revealed e-mail ers failed in the launching, severing a strut sent during the fatal Columbia mission show work on restoring fiscal discipline, if connecting the booster to the shuttle’s ex- that the engineers’ desire for outside help in ternal fuel tank. you will, and fiscal health to the Dis- getting a look at the shuttle’s wing was For Mr. Rocha, the Columbia disaster trict. That is another accomplishment more intense and widespread than what was began on the eve of its final liftoff. That of which we can be very proud, both on described in the Aug. 26 final report of the afternoon, he and other engineers were the Democratic and Republican sides. board investigating the Feb. 1 accident, stunned to learn of new tests at a NASA lab- So as my colleague from Ohio has which killed all seven astronauts aboard. oratory showing that a ring attaching the said, there is a lot to be proud of in The new information makes it clear that rocket boosters to the external tank had not this bill. There is a tremendous the failure to follow up on the request for met minimum strength requirements. As he outside imagery, the first step in discovering amount of progress that has been watched, managers hastily considered the the damage and perhaps mounting a rescue problem at a prelaunching meeting begin- made, and we will continue to find effort, did not simply fall through bureau- ning at 12:10 a.m. on Jan. 16. common ground where we can. But cratic cracks but was actively, even hotly re- Instead of halting the launching on the there is one area of this bill where we sisted by mission managers. spot, Mr. Rocha said, the shuttle manager,

VerDate jul 14 2003 02:18 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00003 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.005 S26PT1 S12030 CONGRESSIONAL RECORD — SENATE September 26, 2003 Linda Ham, granted a temporary waiver that ‘‘I said, ‘Rodney, that’s a significant docu- their analysis, and on Sunday, Jan. 26, he reduced the strength requirements, on the ment,’’’ Mr. Campbell said in an interview. wrote a congratulatory e-mail message to basis of data that the investigation board ‘‘I probably got more concerned or angry colleagues, saying the full analysis showed later found to be flawed. Mr. Rocha would than he did at the time. We could not believe no ‘‘safety of flight’’ risk. ‘‘This very serious draw on an old rocketry term—‘‘launch what was going on.’’ case could not be ruled out and it was a very fever’’—to describe what had happened at the But Mr. Rocha still decided he should push good thing we carried it through to a finish,’’ meeting. his concerns through official channels. Engi- he wrote. The launching went ahead that Thursday neers were often told not to send messages But his anxiety quickly spiked again. He morning. The ring held, but an unrelated much higher than their own rung in the lad- slept poorly. Mr. Diggins said, ‘‘I think that problem turned up when insulating foam der, he said. what was gnawing away at him was that he tore away from an attachment to the exter- TAKING THE ISSUE HIGHER didn’t have enough engineering data to set- nal tank 81.7 seconds after liftoff and struck The next day, Mr. Rocha spoke with Bar- tle the question he had in his mind.’’ With the orbiter’s left wing. days to go in the mission, Mr. Rocha contin- bara Conte, a worker in mission operations, Mr. Rocha said that when he learned of the ued to discuss the possibility of damage with about spy telescopes. In a written response foam strike in a phone call on Friday after- Mr. Campbell, the expert in landing gear. noon, he gasped. All weekend he watched the to reports’ questions, Ms. Conte said her col- ‘‘He started coming by my desk every video loop showing the strike, and at 11:24 league ‘‘was more keyed-up and troubled day,’’ Mr. Campbell recalled. ‘‘He was trying p.m. on Sunday, he sent an e-mail message than I had ever previously encountered to be proper and go through his manage- to the manager of the shuttle engineering of- him.’’ ment,’’ he said, but ‘‘he was too nice about That day, she and another NASA em- fice, Paul Shack, suggesting that the astro- it, because he’s a gentleman; he didn’t get ployee, Gregory Oliver, took the issue to Mr. nauts simply take a look at the impact area. nasty about the problem.’’ Mr. Shack never responded. But by Tues- Cain, the Columbia’s flight director for land- ing, at an unrelated meeting. BEING THERE FOR RE-ENTRY day afternoon, Mr. Rocha was showing the On Feb. 1, the last day of the Columbia’s loop to the so-called debris assessment team ‘‘We informed LeRoy of the concern from Rodney’’ and offered to help arrange an ob- flight, Mr. Rocha rose before dawn. He want- at the meeting in Building 13, where he had ed to be in the mission evaluation room, an his own office. As arresting as the images servation by military satellites, Mr. Oliver wrote on March 6—a month after the acci- engineering monitoring center on the first were, the team agreed, they were too floor of NASA’s Building 30, by 6:45 a.m., well sketchy to draw conclusions without new dent—in a previously unreleased e-mail chro- before the shuttle fired its rockets to drop images. nology of shuttle events. The message con- out of orbit. Normally, he would just watch To engineers familiar with the situation, tinued, ‘‘LeRoy said he would go talk to the request was an easy call. ‘‘We all had an Linda Ham and get back to us.’’ the landing on NASA–TV, the space agency’s intense interest in getting photos,’’ said Ste- About two hours later, at 12:07 p.m. that channel, but he said he wanted to see the ven Rickman, a NASA engineer whose staff day, Mr. Cain sent out his own e-mail mes- data from the wing sensors. The room was jammed with people and members served on the assessment team. sage saying he had spoken with management computers. There was a pervasively upbeat ‘‘As engineers they’re always going to want officials, who had no interest in obtaining the images. Therefore, Mr. Cain wrote, ‘‘I mood. more information.’’ Before long, things began to go wrong—and In his second e-mail appeal for satellite consider it to be a dead issue.’’ in the ways that Mr. Rocha had feared. The imagery, Mr. Rocha wrote in boldface to Mr. It was not over for Mr. Rocha, though. On scrolling numbers giving temperature read- Shack and other managers, ‘‘Can we petition Thursday afternoon, Jan. 23, he encountered (beg) for outside agency assistance?’’ Mr. Schomburg, the expert on the heat-re- ings for the left and right wings began to di- But Mr. Rocha did not know that the sisting tiles, on the sixth floor of Building 1, verge. Then, at 7:54 a.m., four temperature strange politics of the NASA culture had al- where most of the managers had offices. sensors on the left wing’s wheel well failed. ready been set in motion. Calvin Schomburg, They sat down in the anteroom of an office In fact, the hole that the foam had a veteran engineer who was regarded as an and began arguing about the need for imag- punched into the wing 16 days before had expert on the shuttle’s thermal protection ing, said Mr. Rocha and the investigative been allowing the superheated gases of re- system—though his expertise was in heat-re- board’s report. entry to torch through the structure for sisting tiles, not the reinforced carbon-car- Mr. Schomburg insisted that because some several minutes, and observers on the bon that protected the wings’ leading edges— smaller pieces of foam had broken off and ground had already seen bright flashes and had been reassuring shuttle managers, Mr. struck shuttles on previous flights without pieces shedding from the damaged craft. Diggins said. Mr. Schomburg either ‘‘sought dire consequences, the latest strike would re- As the number of alarming sensor readings them out or the managers sought him out to quire nothing more than a refurbishment quickly mounted, ‘‘I started getting the sick ask his opinion,’’ Mr. Diggins said. after the Columbia landed. Mr. Rocha main- feeling,’’ Mr. Rocha said, pointing to his Whether because of Mr. Schomburg’s influ- tained that the damage could be severe stomach. He looked up from the fog of fear ence or because managers simply had no in- enough to allow hot gases to burn through and saw another engineer, Joyce Seriale- tention of taking the extraordinary step of the wing on re-entry and threaten the craft. Grush, in tears. He approached her and she asking another agency to obtain images, Mr. As their voices rose, Mr. Rocha recalled, said, ‘‘We’ve lost communication with the Rocha’s request soon found its way into a bu- Mr. Schomburg thrust out an index finger crew.’’ reaucratic dead end. and said, ‘‘Well, if it’s that bad, there’s not Mr. Rocha did the only thing he could On Wednesday, an official Mr. Schomburg a damn thing we can do about it.’’ think of: He called his wife. ‘‘I want you to had spoken to—Ms. Ham, the chairwoman of On Jan. 24, eight days into the mission, en- say some prayers for us right now,’’ he said. the mission management team—canceled gineers and managers held a series of meet- ‘‘Things aren’t good.’’ Finally, they got word Mr. Rocha’s request and tow similar requests ings in which the debris strike was discussed. that observers on the ground had seen the from other engineers associated with the At a 7 a.m. meeting, Boeing engineers pre- shuttle break up over Texas. mission, according to the investigation sented their analysis, which they said Emergency plans came out of binders; en- board. Late that day, Mr. Shack informed showed that the shuttle probably took the gineers locked their doors to outsiders and Mr. Rocha of management’s decision not to hit without experiencing fatal damage. began to store data from the flight for the seek images. Those results were hastily carried into the inevitable investigation. Frank Benz, the Astonished, Mr. Rocha sent an e-mail mes- 8 a.m. meeting of the mission management Johnson Space Center director of engineer- sage asking why. Receiving no answer, he team, led by Ms. Ham. When a NASA engi- ing, and his assistant, Laurie Hansen, came phoned Mr. Shack, who said, ‘‘I’m not going neer presented the results of the Boeing in. Mr. Rocha recalled that Ms. Hansen, try- to be Chicken Little about this,’’ Mr. Rocha analysis and then began to discuss the lin- ing to console him, said, ‘‘Oh, Rodney, we recalled. gering areas of uncertainty, Ms. Ham cut lost people, and there’s probably nothing we ‘‘Chicken Little?’’ Mr. Rocha said he him off and the meeting moved along. The could have done.’’ shouted back. ‘‘The program is acting like wing discussion does not even appear in the For the third time in two weeks, Mr. an ostrich with its head in the sand.’’ official minutes. Rocha raised his voice to a colleague. ‘‘I’ve Mr. Shack, Mr. Schomburg and Ms. Ham Mr. Diggings, the accident board investi- been hearing that all week,’’ he snapped. declined to comment for this article or did gator, said it should not be surprising that ‘‘We don’t know that.’’ not respond to detailed requests for inter- such a critical issue received short shrift. A He was instantly ashamed, he said, and views relayed through the space agency’s mission management meeting, he said, is thought, ‘‘I’m being rude.’’ public affairs office. simply ‘‘an official pro forma meeting to get TROUBLED SLEEP, LATE THANKS On the day he talked with Mr. Shack, Mr. it on the record.’’ The decision to do noting The next days passed in a blur. Mr. Rocha Rocha wrote an anguished e-mail message more, he said, had long been made. was assigned to the team to investigate the that began, ‘‘In my humble technical opin- By then, Mr. Rocha said, he decided to go mission. At the same time, he was working ion, this is the wrong (and bordering on irre- along. ‘‘I lost the steam, the power drive to with the team that was looking into the at- sponsible) answer.’’ He said his finger hov- have a fight, because I just wasn’t being sup- tachment ring problem that nearly scuttled ered over the ‘‘send’’ key, but he did not ported,’’ he said. ‘‘And I had faith in the the mission the night before liftoff, while push the button. Instead, he showed the draft abilities of our team.’’ handling his other duties. message to a colleague, Carlisle Campbell, He waited through the weekend until the At one point he got to ask Ralph Roe, a an engineer. Boeing engineers closed out the last bit of shuttle manager, why the photo request had

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00004 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.004 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12031 been denied. He got no direct answer, he re- But the way we got to this point I wish The Mayor, for whom I have the called. Instead, Mr. Roe replied: ‘‘I’d do any- to share with my colleagues this morn- greatest respect for many reasons— thing now to get a photo. I’d take a million ing. one, because he is an out-of-the-box photos.’’ The President offered earlier in the thinker, he is innovative, he is gutsy, Mr. Rocha’s sleep was still troubled—now, by nightmares, he said, describing some: he year in his State of the Union Address he is smart, he is honest—had a very was in the shuttle as it broke up; his rel- a choice initiative. The President, in difficult choice. As I have told him, if atives were on the shuttle; ‘‘Columbia has his budget, basically said: Despite the I were the Mayor, I am not sure I would miraculously been reassembled, and we’re fact I am not going to fully fund Leave have made a different choice than he looking at the wiring and it’s got rats in No Child Behind, I am not going to did. But because we are Senators and there.’’ fund it at the authorized level as prom- not mayors, we have a respectfully dif- Since the accident, Mr. Rocha said, engi- ised and implied, instead, I am going to ferent perspective. neers and other colleagues have thanked him offer—his budget shows—a $75 million He said: I will take the money. I will enthusiastically for speaking up, saying take the $40 million. I have schools things like, ‘‘I can’t imagine what it was like voucher initiative for the country, and to be in your shoes.’’ His immediate super- it is going to be put—the budget that have leaky roofs. I have schools visor has been supportive as well, he said. showed and the administration said—in that have no computers. I have chil- But from management, he said: ‘‘Silence. No the Health and Human Services appro- dren in my schools who haven’t had talk. No reference to it. Nothing.’’ priations bill. That is how this whole gym classes in 10 years. I have an obe- Except, that is, from the highest-up high- issue began. sity problem. I have children who can er-up. One day Mr. Rocha read an interview The administration said one thing, play music but they have no instru- with the NASA administrator, Sean O’Keefe, but I want to focus on what the budget ments. I have children who will be who wondered aloud why engineers had not actually showed. The budget that was great in science except they have no raised the alarm through the agency’s safety reporting system. This time, Mr. Rocha laid down showed: We are not going to microscopes. And I have children who broke the rules: he wrote an e-mail message fully fund Leave No Child Behind, but can learn but I have 40 kids in a class directly to Mr. O’Keefe, saying he would be this administration wants to fund a and I need more teachers. If I were the happy to explain what really happened. choice program for the Nation and they Mayor, I would have taken the money, Within a day, he heard from Mr. O’Keefe, want to fund that through the Health but I am not the Mayor. who then dispatched the NASA general coun- and Human Services appropriations The Mayor was forced to make a sel, Paul G. Pastorek, to interview him and bill. pretty difficult decision driven by report back. In a recent interview, Mr. The Health and Human Services ap- voucher proponents who will not give O’Keefe said Mr. Rocha’s experience under- scored the need to seek the dissenting view- propriations bill is chaired by the Sen- up on the vouchers. Even though we point and ask, ‘‘Are we talking ourselves ator from Iowa and the Senator from passed Leave No Child Behind, there is into this answer?’’ Pennsylvania, Mr. HARKIN and Mr. a determined group of people who will NASA, following the board’s recommenda- SPECTER. They together, and their not give up on vouchers. The Mayor, as tion, has reached agreements with outside staffs, basically sent word back that we best as he could—and he has my re- agencies to take images during every flight. would not have a voucher proposal in spect and admiration—at least took a And 11 of the 15 top shuttle managers have their bill. There was bipartisan agree- really rotten proposal and crafted a been reassigned, including Ms. Ham, or have ment: We do not want vouchers in this three-pronged approach and said: OK, retired. bill. We do not want to support Federal let’s present it: a third for charter Ms. LANDRIEU. Mr. President, my vouchers. And so it was removed from schools, a third for public schools, and point is, as we seek the truth in what that bill. the transitional schools, the great re- happened with the tragedy of the crash It managed to find its way into the forms that are underway, and, all of the shuttle, we will have to explore DC appropriations bill because this right, I will take a third for vouchers. the tragedy in detail, and if we con- bill, for better or worse, is sometimes Then it went forth: This is the Mayor’s tinue to press and focus on the details, the bill that is used to make political proposal; this is what the Mayor has the truth will emerge. If we continue points instead of good public policy. asked. to focus on the details and take the That is what the record will reflect. I hope the truth has been spoken, and time, the truth will emerge, and when That is the truth, and I will submit for if any of my colleagues want to debate the truth emerges, if the truth is al- the RECORD those details as this debate those points or submit for the RECORD lowed to emerge, then the appropriate goes forward. a different view or a different story, actions can be taken. The voucher program finds its way please do. But that is how we got to NASA, of course, says that safety is into the DC appropriations bill, of this point. their highest priority. There is not a which committee I am the ranking Every time we get on this subject, person I know who ever worked for member. the proponents want to say this was NASA or who works for NASA today or When the proponents of vouchers say the Mayor’s idea and the Mayor is a who will work for NASA in the future this was the Mayor’s idea, I have to Democrat; he is an African-American who does not believe that safety is im- comment on this for a moment. The Democrat; this was his idea. I want to portant. Mayor will be able to express publicly, be clear for the record, this was not the When we explore the details, as this as he has, his position and can respond Mayor’s idea. This was the President’s article does beautifully, we will be able in any way, but the Mayor said—and I idea, the administration’s idea laid to say: They say that, but what do they say this as respectfully as I can, and I down in a budget, rejected by the Re- really mean? They say safety is impor- think he has said this publicly—that he publican chairman and a Democratic tant, but when this engineer—I believe at no time went to the White House to ranking member of the Health and his name is Mr. Rocha, and they go ask for a voucher program. He did not Human Services Appropriations Sub- through in detail about his pleas that say: I need money for my schools and I committee, that has made its way to went unheard, his sterling reputation am convinced the voucher program will the DC Appropriations Subcommittee, that was pushed aside by others who work and I would like vouchers for the and then was modified to become the were basically ready to launch. We will District. issue we are discussing today. find the truth. What happened was, this money was The Mayor, from his perspective, I The same is going to be true in this drifting in the budget, finding its way could argue, made the best choice for debate with the District of Columbia to DC, being pushed to DC by pro- his city, but that might not be the on this scholarship voucher program ponents of vouchers, and the Mayor choice the Senate needs to make, for because the details of it are very im- was given a very difficult choice, which obvious reasons. portant. The details will show us the any mayor would be tempted to take, One of those obvious reasons, to any- truth about what happened. which was: Mr. Mayor, we have some body with an open mind, is that we I wish to begin by saying that my money. Your school system needs help, should not, as a Senate or Congress, at colleague from Ohio is correct in the and we are happy to give you some this critical time in the funding his- sense that the Mayor does support this money, but—but—we need you to agree tory of education reform, in any way three-pronged approach. He is correct. to a voucher component. send any signal to any city that they

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00005 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.007 S26PT1 S12032 CONGRESSIONAL RECORD — SENATE September 26, 2003 cannot get money from Washington, and state—but if one could manage to scholarship program that would in- they cannot get new money from Wash- get through those very important clude, amongst other things, a com- ington, unless they take a voucher pro- issues, one of the key reasons for mov- parison of the academic achievements gram. ing in this direction would be to dem- of scholarship students in high-per- They keep saying this is new money. onstrate definitively whether this forming schools and nonscholarship One could argue that, but let’s just works. students attending high-performing take it as new money. The only way Why is this important? Because those public or charter schools. someone can get money is if they enter of us who are trying to find the ways to Let me repeat that it would require a into a voucher proposal. It should be bring excellence to education through full and independent evaluation for the obvious to people who are following a public system with as much choice as scholarship programs that would in- this debate that that would be an inap- possible, to every child, regardless of clude, among other things, a compari- propriate signal, and a dangerous sig- the kind of family or resources to son of the academic achievement of nal, to send out as States, cities, coun- which they are born, we believe strong- scholarship recipients in high-per- ties, and parishes, as in the State of ly that this Nation can and should— forming private schools and nonschol- Louisiana, are struggling with making and if it stays the path—do what no arship students attending high-per- decisions about how can we get more other nation has ever done in the forming public or charter schools, be- money for these reforms, where should world, and that is a belief that every cause that is what we do not know. we allocate them. They have flexibility child can learn if we provide resources Let me explain what we do know. We now. for every child to learn, whether they do know if you take a poor child out of Let me say on that point that vouch- are blind, deaf, in a wheelchair, have a school that is mismanaged and er proponents do not want to listen to some disease, or they were born with underresourced and put that child in a what the truth is. They do not want to incomplete mental capacity. This Na- private school that is better managed listen, but this is the truth: Under the tion believes no child should be left be- and better resourced, that child will do historic bipartisan bill that, if imple- hind. better. It does not take a genius to mented, funded, and followed, can im- For 200 years, we have struggled know that. Anybody knows that. We prove schools in America, under title I through segregation times, through don’t need a study. We don’t need a dollars, under tutorial services that are slavery times, through lots of times to thing. We know it. in that bill, communities today can reach that goal. We are making I will tell you what we don’t know. craft private school vouchers or choice progress on that goal. Are there lots of What we don’t know is, if you take a in their local jurisdictions. It is not problems? Yes, there are lots of prob- poor child and put that child in a high- done because there are very serious and lems, but we are making progress. performing or moderately performing reasonable people on both sides of the Those of us over the decades, way be- private school, and then you take that debate, but local jurisdictions can do fore we were in this Senate, who same poor child and put that child in a that now. The question is, Should the fought—and some in some instances high or moderately performing public Federal Government have basically a died—over this principle continue to school or a public charter school or mandate for vouchers over, for in- work today. So those of us who are public contract school, does that child stance, charter schools, transitional committed to keeping our eyes on the do better or worse? That is what we public schools, public contract schools, prize—and the prize is excellence in need to know because what we need to or other kinds of newly innovative re- education for every child and equity know is does the scholarship itself forms? The answer is obviously no. and equality, without pulling the chil- make a difference? Does the scholar- So when Senator CARPER and I of- dren from the top down but by pushing ship, the act of giving the scholarship fered the amendment to the other side all the children up—keep our eyes on to the parent and the choice and the saying, look, we just cannot support a that prize. freedom, make a difference when all Federal mandate for vouchers—al- People ask me: Why, Senator, do you other things are controlled? Nobody in though we as cosponsors of this impor- feel so strongly about this evaluation America or the world knows that. tant and significant legislation under- component? It is because I think there So Senator CARPER and I said we stand where the Mayor is coming would be some good reason—actually, I would like to know that. We would be from—would you please remove the would argue to my colleagues who are willing, maybe, to put this debate to Federal mandate, we were told no. opposed to vouchers, and I respect rest once and for all if we could com- There is a reason: Because the vouch- them all for their very strong views, mit to a rigorous evaluation by outside er proponents want a Federal pref- that if they were going to do a scholar- experts who are not from the Demo- erence for vouchers. But they will not ship program, one value for the Nation cratic spin room or the Republican spin get it in the long run. They may have would be to have a demonstration room. Then maybe we could be for this. the power now to get it in the short project that could show once and for They said no. run, but they will not get it in the long all, to those who think vouchers are Let me go to two more points, brief- run because the people of the United the greatest thing since sliced bread ly. I see my colleague from South Da- States do not want a Federal mandate and to those who think it is the worst kota is here and he probably wants to for vouchers. Particularly, the people thing since the Devil himself, to come speak on this, or perhaps other sub- of the United States—Republicans and together and have the data and reason jects, but there are two issues I want to Democrats, Independents, Black, together and say it either worked or it hit before we move to something else. White, Hispanic, and Asian—who sup- did not work. Last night several of my colleagues port the new reforms in education do So when Senator CARPER submitted came to the floor and argued for vouch- not think vouchers are a superior our amendment and we said, all right, ers on the basis that we do this for method to charter schools, to public we are reluctant, but if we could do higher education and we have one of school innovation, to accountability, this, this evaluation has to be tight— the finest higher education systems in and that was a great victory that, in Milwaukee has had this for 13 years. I the world. And they are right. We are my opinion, they are not willing to will be submitting for the RECORD con- proud of our system of higher edu- undo. stant referrals to that written by al- cation. It has been developed over hun- Another part I wish to speak about most every objective newspaper in the dreds of years. People from all over the this morning is the evaluation compo- country. There are some that are not, world want to come to use our higher nent. The reason Senator CARPER and but most newspapers are objective. education system. Even given some of others have argued with the vouchers- Most of the newspapers, whether they its weaknesses, it is a pretty remark- always-only-and-forever crowd, basi- are conservative or liberal—I am not able institution we have created. cally, is that if a scholarship program talking about very partisan papers— But there is a fundamental difference is going to be offered, recognizing that state it is inconclusive because there is between higher education and elemen- there is a tremendous amount of oppo- no evaluation component. So we put tary and secondary education that can- sition to it on legitimate constitu- one in our proposal that requires full not be ignored. It is one of the details tional grounds—separation of church and independent evaluation for the that is very important to understand.

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00006 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.009 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12033 Higher education is not mandatory in some quality time debating this pro- He goes on: the United States. If you want to go, posal. There are many concerned Mem- Why a three-sector approach? The most you can go. If you don’t want to go, bers on both sides, I am certain, based compelling reasons focus on fairness, the leg- you do not have to go. But elementary on the level of intensity and the discus- acy of Federal/District relations, and a and secondary education is basically sions at the committee level. strong sense that choice means the most mandatory in the United States. Chil- Since I was chair or ranking member when a number of quality educational op- tions is maximized. Specifically, I mean that dren have to go to school. There are of those committees, I was on the front while DCPS faces considerable administra- some exceptions for children in home row for those debates. I am confident tive and operational challenges that tran- schooling, which I actually support. there are Members on both sides who scend any particular funding level, our pub- Some people don’t, but I think home want some time to talk about this lic schools are paying the price of a legacy of schoolers do a beautiful job over time, issue and to debate it in full. There is disinvestment and crumbling school build- as long as they are held accountable, no reason that could not continue for ings, many constructed originally by the and that is true in some States. But weeks, as we take up other matters and Federal Government. While bearing the cost education in this country is manda- move decisively based on agreements associated with both the local school dis- tricts and a state system, the city has the tory; at least we have to offer it. It has that can be reached. tax base of neither. As the recent GAO report to be universally offered. As the ranking member, I go on documented, the city needs ongoing assist- In America today, even considering record to both Republican and Demo- ance from the Federal Government in ad- how great our higher education system cratic leadership, it would be my dressing the structural imbalance. is, only 20 percent of adults have col- strong suggestion we continue to de- So let me take the Mayor’s words, lege degrees. In African-American or bate this issue. The details are ex- the Mayor’s position, to make some Hispanic populations, that may be tremely important for the Nation to points. down to 10 or 15 percent. Maybe the na- grasp so we can move on to education First of all, this statement should tional average is about 20 or 25. reform. make it clear that the Mayor himself We would like 100 percent of children There was debate earlier regarding and Councilman Chavous and edu- to have a high school degree. They can the District of Columbia. A lot has cation President Peggy Cooper Cafritz drop out, but our goal as a Nation is 100 been said about the Mayor’s position. have soundly rejected the vouchers- percent to have a high school degree. Yesterday, Mayor Williams was in the only approach. Yet to this day, on the So the systems in their essence are dif- Senate. He has been a tireless advocate floor of the Senate, at this hour—we ferent. for school reform in the District. He have now been debating this issue on I will say maybe the word mandatory should be commended. and off over the last several months; is a little strong. It is a goal of the I will read the Mayor’s own words re- not publicly in this Chamber, but this United States to have 100 percent of garding his position. I believe his posi- debate has been raging in committees, our population to have a high school tion has been misconstrued by oppo- in conference rooms, and meetings all degree. nents of vouchers. His words will clar- over America—we have not had a defin- So you cannot compare these sys- ify his position, so I will read into the itive statement from this administra- tems. While choice, as I said, is desir- RECORD this morning the Mayor’s com- tion that they, too, reject the vouch- able, with the freedom like we have in ments before the Governmental Affairs ers-only approach and that they will the higher education system, because Committee in the House of Representa- protect the three-pronged approach we do not have a policy that says we tives. through this process. want to provide 16 years mandatory He says: Let me repeat, the administration through college, then the freedoms Along with city council education com- has not, to my knowledge—if they that can exist in higher education are mittee chair Kevin Chavous [who is another have, please, someone, send me a letter very different than what the public very strong and respected leader in the city or a telegram or an e-mail that would could support or afford for elementary for education reform] and board of education say: Senator, you are wrong. The ad- president Peggy Cooper Cafritz [who also has and secondary education. ministration only supports a three-sec- I wanted to get that statement on done an excellent job of leading reforms in the school district in Washington, DC] I sup- tor approach, we will commit to that the record. port a 3-sector approach that would focus and make that possible by using the I see my colleague from South Da- new Federal resources towards increasing power of the White House—which is kota who wants to speak as in morning the availability of quality education options considerable—to ensure that happens. business. I will resume the discussion for district students and families. In fact, one of the reasons I am par- of Leave No Child Behind and the He says, I repeat, ‘‘I support a 3-sec- ticularly puzzled is because yesterday scholarship tuition debate when he has tor approach . . . ’’ the administration released a state- concluded. It does not say: ‘‘I support a voucher- ment of policy. For every bill, as we all The PRESIDING OFFICER. The Sen- only approach.’’ know, when we are debating bills, ator from South Dakota. He says: which is appropriate, the administra- Mr. JOHNSON. I ask unanimous con- I support a three-sector approach that tion says to Congress: These are the sent to speak in morning business. would focus new Federal resources towards things I like about your bill. These are The PRESIDING OFFICER. Without increasing the availability of quality edu- the things I do not like about the bill. objection, it is so ordered. cation options for District students and fam- And as the system goes, if we do not Mr. JOHNSON. I thank my colleague ilies. This strategy would require a signifi- get a little bit more in line, usually, from Louisiana for her extraordinary cant and ongoing investment toward the fol- with what the administration wants— lowing: One, the development of a Federally leadership on education issues. I do not whether they are Republican or Demo- want to take long on another topic. funded scholarship program for students to attend nonpublic schools; two— cratic Presidents—sometimes they will (The remarks of Mr. JOHNSON are veto what we do. That is process. So it And this a detail that is extremely printed in today’s RECORD under is important to hear from the adminis- important that has been overlooked by ‘‘Morning Business.’’) tration about what they are thinking some and undercut by others— Ms. LANDRIEU. Mr. President, back so we can decide if we are willing to to the budget of the District of Colum- a permanent and predictable support for the risk a veto. So we like to get these District of Columbia’s public schools— bia, earlier this morning it was said by statements. It is helpful to this proc- our friends on the other side of the ‘‘permanent and predictable support ess. aisle that perhaps we should just have for the District of Columbia’s public I hold in my hand the President’s a debate today and Monday and move schools’’— statement, and I am going to submit it off of this bill, indicating a permanent targeted at leadership and instructional ex- again for the RECORD: move off of this bill. cellence and student achievement; and, The administration is pleased the com- I argue there is certainly a way, if three, a fiscally sound and comprehensive mittee bill included $13 million for the Presi- this body desires—and I hope they approach to the acquisition and renovation dent’s school choice initiative fund. This in- would continue this very important de- of charter school facilities. novative reform will increase the capacity of bate—to figure out a way to spend This is the Mayor’s position. the District to provide parents, particularly

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00007 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.011 S26PT1 S12034 CONGRESSIONAL RECORD — SENATE September 26, 2003 low-income parents, with more options for But the problem is, there has been cause it lacks rigor, there is no quality obtaining a quality education for their chil- limited money in the Federal budget. control in the current proposal, which dren who are trapped in low-performing Basically, there has been limited is one of the reasons the mayor’s posi- schools. The administration appreciates the tion is actually, when read and under- committee’s support for strengthening the money for charter schools, so there is a District’s school system and strongly urges waiting list of children to get into stood, quite different from the voucher the Senate to retain this initiative. quality charter schools. Because the proposal, at least seemingly from the Now, unless I missed a paragraph— funding has been short on the Federal administration, based on their own and I don’t think I did, because it is level, and perhaps maybe short on the statement, and definitely from the only two pages long, and the others go local level, we cannot create more House Republican leadership. on to other issues—there is nothing charter schools. I would like to read Chairman here on the three-sector approach. But the answer for the proponents of DAVIS’s comments into the RECORD. He There is no charter school language. vouchers is, we are not going to give said: There is no public school initiative lan- additional money for charter schools. Some are making a mountain out of a We are just going to lay down a vouch- molehill over the fact that this legislation guage. authorizes funding for school choice but not So in one hand I have the Mayor’s er-only proposal. Clearly, the Mayor said that would not be his position. enhanced funding for DC public schools or comments, which speak of a three-sec- charter schools. The reason for this is sim- tor approach, and in the other hand I And finally, the Mayor says in his ple. This bill deals with authorization for a have the administration’s comments. statement: new and historic program. Authorization for That is why Senator CARPER and I laid The city needs ongoing assistance from the spending on DC public schools and charter down an amendment to try to clarify Federal Government to address the struc- schools already exists. The debate will be this issue. To date, it has not been tural imbalance. over how low and how high that spending clarified. So here is really the big picture that should be. In all fairness to my colleague from is quite troubling. This administration, That is what Representative DAVIS Ohio, he did say last night—and I be- instead of coming to the District of Co- said. But what the Mayor says is dif- lieve what he said is true—that a clari- lumbia initially and saying, ‘‘We want ferent. What the Mayor says is that fying statement is on its way. Perhaps to help you fund your reform efforts this strategy ‘‘would require a signifi- it is here and it just has not reached that are underway. We want to really cant and ongoing investment that is me. If it is, I will be happy to submit encourage you in terms of your charter permanent and predictable.’’ These are that for the RECORD at any time any- schools. We recognize your structural two very different positions. one can produce it for me. But I do not deficit, and we want to help with your Again, the Mayor of the District of have it, and neither does my staff. So structural deficit,’’ instead of saying, Columbia: that is an important point to clarify. ‘‘We acknowledge that your public We need a three-sector approach with pre- Maybe that will be clarified as this de- schools need some additional re- dictable and permanent support. bate goes on. sources,’’ the administration and the This is the House leadership ap- The other part of the Mayor’s com- House—I should say specifically the proach: Some people are making a ments that I think sheds a lot of light House Republican leadership—has not mountain out of a molehill. We don’t on the detail of what this argument is offered anything in the budget toward really have to authorize any new, pre- about, and I actually agree with the those ends. dictable, permanent funding—I am Mayor—not all Democrats do—but I They have offered kind words. They paraphrasing—for public schools and agree with him when he says: ‘‘a strong have offered comments. But they charter schools because they already sense that choice means the most when haven’t offered anything in the budg- exist. This debate will be simply how the number of quality educational op- et—which is the only thing you can high or how low that spending should tions is maximized.’’ take to the bank, the only thing you be. Now, let me put a few things on the can count on—to the District. They One of the problems Senator CARPER record that the proponents of vouchers- have offered a $10 million, now $13 mil- and I have, and it is a significant prob- only want to continue to say that is lion, voucher only—not just voucher lem, is in recognizing this disparity. fundamentally untrue. It is just un- only to go to kids, children in failing We went to our friends on the other true. What they say is, families in the schools, they want to have a voucher side and said: These are totally dif- District of Columbia have no choice. It program for children to go to any ferent positions. I know what you are is my understanding—and I am going school. saying, but these are different posi- to submit it for the RECORD because if Some of us wanted to work with the tions. Can you clarify that for us? We I am wrong I would like to be cor- other side of the aisle and did work would be willing, if you all would rected—that recently—I am not sure with this administration to pass Leave admit or agree, to not a $40 million on what day or year—but in the last No Child Behind that allowed great new authorization but a $200 million few years, under the District’s reform flexibility at the local level, that en- authorization over 5 years. It is not initiatives, there is districtwide choice couraged and pushed for more choice just $40 million for 1 year. And the only in public schools. within the constitutional limits, and permanent part of that $40 million is Not every jurisdiction in America that suggested front and foremost that the voucher component. We said: If you has districtwide choice, but it is my quality was not only important for the want to do a 5-year program, we could understanding—and I think I am cor- student and parents but for the tax- even agree if you would say we are rect—that in the District of Colum- payers who are picking up this tab. going to do $200 million over 5 years, bia—unlike New York City or San And it is a big lift for taxpayers all $40 million a year for 5 years—a third, Francisco or even New Orleans, which I over this Nation, not just to help the a third, and a third—so that we would am more familiar with, or Baton Rouge District with its funding and the tax- have for 5 years a predictable source of or Shreveport, which I am more famil- payers here. But taxpayers all over this Federal revenue that, no matter what iar with, those cities being in Lou- Nation pay a lot of money in property happened, no matter what the under- isiana—there is widespread choice. Par- taxes and in sales taxes and in other lying budgets did, no matter how big ents can move from school to school fees associated with supporting the deficit got, no matter how tough with greater ease. That is a very im- schools. The taxpayers deserve to know the war turned out to be, at least this portant component. if that money is resulting in a quality demonstration project would be $200 Also, it is my understanding that product. The mayor acknowledges million—a third for public schools, a there are more charter schools in the that. third for charter schools, and a third District of Columbia than any other ju- Unfortunately, the proposal, in its for this new voucher program. But at risdiction per capita in the Nation, detail—not what is said about it but in the end of 5 years, we would have ac- with 14,000 out of the 67,000 children en- its detail—gives no assurance for qual- complished one great thing, and that rolled in public charter schools, and ity. There is no evaluation component would be a definitive answer as to there are waiting lists for charter that is rigorous enough. There is a whether or not scholarships work, be- schools. modest evaluation component. But be- cause for the greatest school system in

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00008 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.015 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12035 the world today, our future depends on up choice, let’s create new charters, Mr. President, I suggest the absence knowing that. but let’s do it in the public realm; and of a quorum. The rhetoric is so high on both sides, when we are spending public dollars, The PRESIDING OFFICER. The with some people saying, you will let’s have accountability and have re- clerk will call the roll. never fix public schools if you don’t ports like this so the parents know, the The assistant legislative clerk pro- have vouchers, and some people saying, students know, and the taxpayers know ceeded to call the roll. if you go to vouchers, you will wreck where we are getting the money we are Mr. TALENT. Mr. President, I ask the system. Those of us who are inter- spending. unanimous consent that the order for ested in school reform and quality and I could not be more complimentary the quorum call be rescinded. the truth would be interested in fund- or excited about the fact that in our The PRESIDING OFFICER (Mr. ing a predictable $200 million Federal budget Senator DEWINE and I have GRAHAM of South Carolina). Without demonstration project in a city such as every year tried to do what we could to objection, it is so ordered. this, where the Mayor is supportive support this wonderful effort underway Mr. TALENT. Mr. President, it is a and several key leaders, but, let me be by adding some money. It hasn’t been a real pleasure for me to rise on the sub- quick to say, in a city that has voted huge amount because our budget is ject of opportunity scholarships for against vouchers and in a city with tight and we have limits. But in each kids in the District of Columbia. Be- equally respectful leaders on the other of the budgets, we have tried to put in fore I make my statement, I am going side. some money for the charter school ef- to ask that a couple of items be printed But our colleagues said no because fort. So we are not just saying we in the RECORD. My good friend and col- they are not, to my knowledge or my think charter schools are good; Sen- league from Louisiana, I understand, view, the proponents—again, this is not ator DEWINE and I are saying not only has suggested that the administration my colleague from Ohio but the pro- do we think the effort is good, but it is does not or may not support those as- ponents of vouchers only, and there are worthy of our support. We put our pects of this bill which provide funds some—are evidently only interested in money where our mouth is, and we will for DC public schools directly or for this $10 million voucher program for continue to do that. If we can get gen- charter schools. the District, even in a district where eral agreement from others to do that, I have a letter signed by the Sec- the people are on record in the last ref- perhaps we could make some progress. retary of Education. I ask unanimous erendum as voting 81 percent against Another charter school called the consent that the letter be printed in vouchers. That remains a point of con- Tree of Life Charter School says the re- the RECORD. tention. sults were quite impressive for a sec- There being no objection, the mate- Let me move now to a discussion ond-year school. Most significant is the rial was ordered to be printed in the about charter schools for a moment. I fact that 88 percent of the school stu- RECORD, as follows: will submit some more items for the dents improved in reading. This rep- THE SECRETARY OF EDUCATION, RECORD. resents the largest percentage of stu- Washington, DC, September 26, 2003. There has been no disagreement be- dents showing positive gain among all Hon. MIKE DEWINE, tween Senator DEWINE and me, as the charter schools this year. More than U.S. Senate, chairman and ranking member of this half of the students improved in math. Washington, DC. committee. Again, without his support, Students showed good progress in per- DEAR SENATOR DEWINE: I am writing today this would not be possible. The Senator formance levels, with 75 percent of the to express my strong support for the District from Illinois, Mr. DURBIN, the Senator of Columbia education improvement initia- students performing at basic or above tive that is contained in the DC appropria- from Texas, Mrs. HUTCHISON—of course, in math and 72 percent at basic or tions bill now pending before the Senate. they speak for themselves—have been above in reading. Debate in the Senate this week has high- leaders for charter schools as well. It should be noted that the majority, lighted the fact that excellence in education Without their support, the District 91 percent of the school’s population, is is critical to the future of the District’s would not be in the enviable place it is low income. The Tree of Life Charter school children and to the economic and so- today; that is, having more students School is another example of what is cial vitality of DC as a whole. Yet the DC per capita having options for charter working in the District and what we as public school system has not yet taken the schools. So far, this very worthy and the Congress should continue to fund steps needed to reform its operations and worthwhile experiment seems to be raise student achievement to the level re- in a predictable and dependable way. quired. That is why we need a package of re- working. Most of the charter schools Again, that is what is missing in this forms that both improves DC public schools are doing a very good job. proposal today. There is, in the under- and gives parents and students additional In 2001, because rigorous evaluation lying bill, money for charter schools, educational options, including the option to components are in place, 99 percent of money for public schools, and money attend charter schools and private schools. the students in the Oyster School—this for vouchers. But there is no agree- The appropriations bill now before the Sen- is a very exciting initiative underway ment, no commitment, and there are ate would do just that. in the District, a bilingual, very cut- no solid statements that have been The bill includes a three-pronged initiative ting edge charter school in the Na- made or arrangements that have been to: (1) improve DC public schools that serve predominantly children from low-income tion—are performing above basic in made—which can be made—to indicate families; (2) create new charter schools and math and 100 percent are performing that the funding for charter schools ensure that DC charter schools have ade- above basic in reading. This is just one would even happen next year. I realize quate facilities; and (3) provide scholarships example of one of the 41 charter that appropriations are annual. I un- to a limited number of DC children so that schools that are operating in the Dis- derstand that. But I also realize when they can attend private schools in the Dis- trict. It is a pre-K through sixth grade this Federal Government wants to trict. Each of these three elements of the ini- school; 362 students are attending. The make a point about making sure that tiative is critical and each must be retained students-for-teacher ratio is 11.7 stu- funding could be dependable, there are in the final bill. The debate in the Senate has clarified dents for every teacher, which is excel- ways that can be done; it has been done many facts about the scholarship component lent. They are in the District of Colum- in the past and it can be done now. of the program, which I know is the most bia public schools. You can get other So I, for one, would be open to a lim- controversial. It has shown that Mayor Wil- information from their Web page, but ited, carefully crafted opportunity for liams and other leaders of the District are they have 17 percent African-American, children in failing schools to go to pri- fully supportive of the entire initiative, in- 1 percent American-Indian, 3 percent vate schools, if there are seats avail- cluding the scholarship program; it is what Asian, 52 percent Hispanic, and 27 per- able and if there is a proper evaluation. they want and need. It has shown that the cent White students. I find it extremely disconcerting that scholarship program would be carefully eval- The details of this and the reports in this proposal there is not a similar uated, so that we know if a program like this can be successful in raising student achieve- look excellent. This is happening all commitment to charter schools and, as ment. And Senators have reiterated force- over the United States of America. a result, at this point it is one of the fully that the entire, three-pronged initia- This Congress has come to a point to reasons I am unable to support the pro- tive represents new money for the District. say let’s push the envelope, let’s open posal. There are many other reasons. It is simply untrue to state that any of it

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00009 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.018 S26PT1 S12036 CONGRESSIONAL RECORD — SENATE September 26, 2003 would take money from DC public schools, tell parents who yearn for an opportunity for stance abuse programs and on home and it would be tragic if any of this assist- their children to delay the same fulfillment ownership. It was all tremendously in- ance were denied to DC residents at this we can provide our own children. This is es- spiring. point. pecially so when we have extra assets in our I ended up filing the Community Re- I hope this letter conveys the commitment midst: openings in non-public schools. Obvi- that the Administration feels, and that I per- ously, the issue of whether federal funds newal Act first in 1995 on the House sonally feel, toward this very important ini- should be allocated to private schools is side with then-Congressman J.C. Watts tiative. If my staff or I can be of any assist- enormously difficult, but it is an issues that and Congressman Floyd Flake. Subse- ance to you in enacting this program, please has been settled by the Supreme Court. quently, a Senate bill was filed by let me know immediately. We are not advocating a national voucher then-Senator Abraham and my good Sincerely, policy. We, as local leaders, are simply im- friend from Connecticut, Mr. ROD PAIGE. ploring Congress to embrace our efforts to LIEBERMAN. We were all involved in help our long-neglected student population this and believed in it passionately. Mr. TALENT. In relevant part, it re- with every available tool. We believe the current proposal adequately addresses legiti- I remember I was in Indianapolis fers to the three funding initiatives in talking to some residents about their the bill, and then says each of these mate concerns about constitutionality, sepa- ration of church and state, accountability, community renewal efforts. They three elements of the initiative is crit- selection of students and other issues. We brought up the whole subject of oppor- ical and each must be retained in the have worked closely with the Bush adminis- tunity scholarships, or school choice, final bill. That is on behalf of the ad- tration and with congressional leaders in de- or whatever one wants to call it. This ministration. I think that makes clear veloping our proposal. Students receiving was a depressed urban area like many the administration is strongly sup- scholarships will be randomly selected and parts of the District of Columbia, and portive of all three aspects of this must fall within certain family income pa- rameters. Participating schools will be mon- they said we have to have good local measure and feels they are a package, schools because it does not do any good and I think that is true. That is how all itored by local authorities and the U.S. De- partment of Education. And our public for us to get jobs and safety on the of us who support this measure feel. schools will not be penalized financially for streets and the other things that are I know suggestions have been made the loss of students to private or parochial vital to community renewal if we do with regard to Mayor Williams’ sup- schools. The notion that this ‘‘school im- not have good local schools because, port of this measure, that it was some- provement imitative’’ is being imposed on us what happens is people get jobs and how foisted upon him by somebody or from on high belies the reality that this three-sector approach was conceived by us— then they leave. They do not stay be- some group. cause they have to have a good edu- I refer the Senate to an op-ed piece in D.C. officials duly elected by local citizens. No one should argue that private-school cation for their kids. the Washington Post, and I also ask scholarships are a panacea. Most students in I got involved with this issue at the unanimous consent that it be printed the District will remain in our public time, and in the bill we filed we had a in the RECORD. schools, and nothing will deter us from our little piece of it that was simply di- There being no objection, the mate- commitment to improve those schools. But rected to opportunity scholarships for rial was ordered to be printed in the we trust that, given additional options, D.C. the urban poor for kids going to failing parents will exercise sound judgment in se- RECORD, as follows: schools. I remember we introduced it [From the Washington Post, Sept. 3, 2003] lecting the right setting for their children. We are confident that the proposed legisla- at a press conference, and the press WASHINGTON’S CHILDREN DESERVE MORE tion will allow us to evaluate the effect of asked: Is this just something you are CHOICES school choice on youngsters whose parents doing to try to help the Catholic (By Anthony A. Williams, Kevin P. Chavous opt for it. Schools? That was one of the charges: and Peggy Cooper Cafritz) Funding for the initiative is correctly They said this is something the Catho- For those of us involved every day in urban placed in the D.C. appropriations bill and is lic Church is doing to help its schools. education, there are some staggering reali- not in competition with other federal edu- Spence Abraham thought about it, ties that keep us awake at night. Every child cation priorities. This is a welcome partner- who graduates without basic skills—or who ship between the District and Congress. The and he started to answer it. Then he drops out altogether—is on a potential path- discussion should not be burdened with agen- looked at the five of us standing there way to public assistance, to being alienated das and ideologies unrelated to the best in- and he said: Wait a minute. JIM, what from the full benefits of participation in so- terest of the school children in our city. denomination are you? ciety or, worse, to a life in the criminal jus- Mr. TALENT. It is written by the I said: I am a Presbyterian. tice system. The D.C. appropriations bill be- Mayor, along with Councilman He said: J.C., you are a Baptist youth fore Congress would provide $40 million in Chavous and the President of the Dis- pastor, are you not? new funding for K–12 education in the Dis- trict of Columbia Board of Education, J.C. Watts said: Yes. trict to be divided among public schools, Then he asked former Congressman in which they go into their reasons for public charter schools and scholarships for Floyd Flake: You are a pastor in the supporting this measure. It is a rather private and parochial schools. We think that AME Church? passionate explanation of why they be- this is an appropriate investment by the fed- Floyd said: Yes. eral government in the children of the na- lieve this measure is so important; in Then he turned to Senator tion’s capital. Without the resources ordi- fact, not just important but absolutely narily provided by a state, the District is LIEBERMAN: JOE, of course, you are an necessary to thousands of kids in the Orthodox Jew. more challenged than other cities in its ef- District of Columbia who otherwise forts to adequately fund public education JOE said: Yes. and foster innovative reform. would have little hope of getting a And he said: I am Greek Orthodox. Our children have endured decades of ne- good education. We are doing this as part of a con- glect in public education. But there is hope. That is the feeling I have noticed in spiracy by the Catholic Church to get We have a reconfigured school board and a all of us who have encountered this money into those schools? Those respected superintendent who have begun issue over time feel. I encountered the Catholics play a pretty deep game. needed reforms. Fifteen ‘‘transformation issue of opportunity scholarships for For the next few years, we debated schools’’ have been reconstituted from top to kids when I first started working on that measure and eventually passed bottom—new principles, new staff and extra community renewal, which is what our the Community Renewal Act without resources. In addition, we have the country’s little group used to call urban renewal, most robust charter school movement with the opportunity scholarship part of it. 40 schools educating 16 percent of our chil- and as some people call it. I got in- The point I am trying to make is, I dren. volved in that in the mid-1990s. As part have been back and forth for years now But despite these underpinnings, parents of that involvement, I toured a lot of with all of the arguments, pro and con, still want more choices. At town hall meet- places in Missouri and in the country on this. I have heard them all. I have ings, community picnics, hearings and PTA where people were revitalizing their participated in them all, in the House, meetings, we hear the same complaints: ‘‘I neighborhoods. They were doing it by and then in a race for Governor in Mis- can’t find the right setting for my child’’ or adopting the kind of measures that souri in the year 2000, then in the race ‘‘My child is not flourishing in this environ- ment.’’ brought small business investment in for the Senate in the year 2002. It is not Despite steady reform, change cannot their neighborhoods, working with the that those arguments are not impor- occur rapidly enough to provide relief to all police and community policing, work- tant, because they are. They have usu- public schools. As elected leaders, we cannot ing with local organizations on sub- ally been argued with great eloquence.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00010 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.001 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12037 They have been on the floor this morn- have been looking for this kind of re- It wasn’t. Boy, if it is, he is doing a ing. They were yesterday, and I was lis- lief for years. The House has voted it pretty good job dealing with something tening to some of them on both sides for years. The Senate has voted on it. that was foisted on him. I saw him and appreciating the eloquence and The idea that this is something new down here in the Senate the other day. vigor with which they argued. this President has presented is just not I don’t like to burden the Senate too But I am at the point where I have to correct. There are a bunch of us who much with my speeches. It is only ask myself, what difference do those have been involved in it one way or an- when I have dealt with something for a arguments really make in the face of other for a whole lot of years. Now we while where I feel strongly about some- the brute reality that every day thou- actually have a chance to pass it. Now thing. I do about this issue. I appre- sands of kids in the District of Colum- we have a chance to give these parents ciate the opportunity to talk and I ap- bia get up and go to school where their and their kids some options, and we preciate the passion and the sincerity parents and they know they are not just ought to do it. of those who oppose this. safe, they will not learn, and it is not The upside for these families is tre- I would like to reach out and say to going to change? That is the position mendous. The downside is just not that folks, let’s try this year. I think it is real people are in every day. They do great. If it doesn’t offer them a better going to work. These parents think it not have any other options. That is the education, they will not take advan- is going to work. We had 10,000 people reality. tage of these scholarships and the line up in 1997 for 1,000 part-time schol- I think of this more and more from money will revert—I guess to the Dis- arships. Let’s give these kids a chance. the standpoint of the parents, because trict of Columbia. Or does it revert to I think we will be glad we did, if we I have talked to a lot of them over the the Treasury? To the District of Co- will vote this in. years. I have three kids. They are 13 lumbia. Mr. President, I yield the floor. and 11 and 7. You will not be surprised OK, the arguments against it. I guess The PRESIDING OFFICER. The Sen- to find out that my wife and I spend a the argument—I had not heard this but ator from Alaska. lot of time talking about the education I suppose it could happen—the District f of these kids, trying to make the same of Columbia voted against vouchers 20 decisions parents all over the country years ago. It was 20 years ago. MORNING BUSINESS have to make about education: Which The argument I hear a lot, that op- Mr. STEVENS. Mr. President, I ask first grade teacher would be better for portunity scholarships or school choice unanimous consent that there now the 7-year-old? We spend a lot of time will hurt the public schools. begin a period of morning business, talking about that one. What kind of This is kind of ironic and I have dis- with Senators permitted to speak electives should the 7th grader take, cussed this with parents. Of course, ev- therein for up to 10 minutes. now that he can finally take electives? erybody else in the country, except The PRESIDING OFFICER. Without Should he be in the public presentation these, usually, single moms in these objection, it is so ordered. class or Spanish or what? We talk neighborhoods, has school choice. Talk f about this, and these decisions are very to somebody in the realtor business if important to our kids. These kinds of you do not believe that. When people MEASURE PLACED ON THE decisions for our kids might make a buy a house someplace what do they CALENDAR—S. 1657 difference in terms of how far they go ask about? They ask about the schools, Mr. STEVENS. Mr. President, I un- in life. It might make a difference in don’t they? Because, for the average derstand S. 1657 is at the desk and is terms of how successful they are in person in this country, if your school is due for a second reading. life, so we spend an awful lot of time on a school where you think your kid is The PRESIDING OFFICER. That is it. missing out, it is not a marginal ques- correct. But I am going to tell you these par- tion. If that school is really failing Mr. STEVENS. I ask we proceed. ents I talk to about this issue, they are your kid, for whatever reason, you are The PRESIDING OFFICER. The not making those kinds of decisions. going to do one of three things. You clerk will report. Those are not the kinds of things they are going to move, you are going to put The assistant legislative clerk read are debating. When I talk to them, your kid in a private school or a dif- as follows: there is a sense of urgency and some- ferent school of some kind, or—and A bill (S. 1657) to amend section 44921 of times a sense of panic in their eyes be- this is an increasing number of peo- title 49, United States Code, to provide for cause they know a lot more is at stake ple—you are home schooling your kids. the arming of cargo pilots against terrorism. than which teacher their kid is going You are going to do something. Mr. STEVENS. Mr. President, on be- to get in first grade. They know what But these moms can’t do that be- half of the leader, I object to further is at stake for their kids may be not cause they don’t have the money to proceeding on this measure so it can go how successful they are in life or how move, they don’t have the money to to the calendar. far they go in life but whether they put their kids in a private school, and The PRESIDING OFFICER. Under have a real shot at it at all. This is the they are working, so they don’t have the rule, the bill will be placed on the difference between a good education the time to stay home and home calendar. and not a good education when you are school. So they are stuck. f trying to raise kids on your own in Everybody else in the country has these neighborhoods and you don’t this kind of opportunity and that has SCHEDULED MARKUP OF THE have any help from anybody else any- not hurt the public schools. This is a EMERGENCY SUPPLEMENTAL way. That is why they feel this sense of country that believes in, and is en- Mr. STEVENS. Mr. President, I am panic, because they are looking at riched by, diversity, by people having here this morning to announce that we their kids and they know, if something different opportunities and different will have a markup of the supple- is not done quickly—and it is not going choices. Everybody has it except them. mental request presented by the Presi- to be done in the traditional system— They think that argument is quite dent, the emergency supplemental re- if something is not done quickly for ironic. quest for Iraq, on Tuesday morning at their kids, they are looking at kids The argument against this, that it 10 a.m. I wish to state some of the rea- who, if they are trapped in that school will cost the public schools money— sons that I have scheduled this hear- for their whole educational career, are Mr. President, do words have meaning? ing. a whole lot more likely to end up by It gives the public schools more money, Secretary Rumsfeld appeared before the time they are 25 years old in a gang $13 million more than they would oth- our committee and made several state- or on drugs or in jail or wounded or erwise get. If the scholarships don’t ments. I want to repeat a few quotes maybe dead. That is what these par- work, they will get more. The $13 mil- from his statement to our committee. ents are thinking. That is why this bill lion will revert to the Treasury and we He said: is important to them. can give that to them as well. Standing between our people and the gath- We ought to give them a chance. I have already gone over the argu- ering dangers is the courage of our men and That is for all they are asking. They ment that it was foisted on the Mayor. women in uniform.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00011 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.023 S26PT1 S12038 CONGRESSIONAL RECORD — SENATE September 26, 2003 The vast majority of the funds the Presi- We can’t do that without more money speed- ments in the countries we are involved dent has requested are going to troops who ing up particularly the training of the Iraqi with. Afghanistan is a good example. are risking their lives in this struggle. Of the police force which requires almost $2 billion. If you follow through on what this $87 billion the President requests, $66 billion Each month that goes by where we don’t person is stating, he is taking the posi- is to support ongoing military operations, start those projects is a month longer where money for military pay, fuel, transportation, those guys potentially leave our troops with tion of the RAND organization: maintenance, weapons, equipment, lifesaving some of the duties that I have outlined in my We at RAND believe that Iraq will require body armor, ammunition, and other critical statement. The same is true for the infra- substantial external funds for humanitarian military needs. structure. We need to get started letting assistance and budgetary support. It is high- Further on he says: contracts that we have to open—that we ly unlikely that taxes on the Iraqi oil sector have to open bids. It is going to take time. will be adequate to fund the reconstruction So $66 billion or 75 percent of this request If we can get started to get those bids start- of the Iraqi economy in the near future. is for troops. They need it and they need it ed now quickly, we can get the repairs start- Judging by the experience of Bosnia and soon. ed quickly. Kosovo, territories that have higher per cap- Again, continuing on through his ita incomes than Iraq, budgetary support Chairman WARNER asked General will be necessary for quite some time. To statement, he pointed out that: Abizaid: In less than 5 months virtually all major manage immediate operating expenditures, Is there a correlation, in your professional Iraqi hospitals and universities have been re- we suggest that post-conflict authorities in judgement, General? opened and hundreds of secondary schools, a Iraq first establish a reasonable level of ex- few months ago most often used as weapons The general said: penditures, then create a transparent tax system and ask foreign donors to pick up the caches, these have been rebuilt and are ready Sir, there certainly is. The more the Iraqis difference. to start the fall semester; 70,000 Iraqis have are policing and patrolling the security work been armed and trained in just a few months to defend their own country the sooner we We have a donors’ conference sched- and have been contributing to the security will be able to draw down our forces and the uled later next month. and defense of their country. A new Army is sooner we will be able to turn over the coun- The article goes on to say: being trained. More than 40,000 Iraqi troops try to the rightful owners, which are the Post-conflict stabilization and reconstruc- are conducting joint patrols with coalition Iraqis. tion with the objective of promoting a tran- forces. By contrast, it took 14 months to es- Chairman WARNER asked: sition to democracy appear to be the ines- tablish a police force in post-Germany, and capable responsibility of the world’s only su- 10 years to begin training a new German It has a correlation to the tragic death, perpower. Therefore, in addition to securing Army. loss of life and limb by our forces and our co- alition. Am I correct? the major resources that will be needed to He went on to say: carry through the current operation in Iraq General Abizaid said: As security improves, so does commerce. success, the United States ought to make Some 5,000 Iraqi small businesses opened Sir, there is a correlation. We should all the smaller long-term investments in its own since the liberation on May 1 and the Iraqi make sure we understand as long as Amer- institutional capacity to conduct such oper- Central Bank was established and a new cur- ican troops are in Iraq there will be casual- ations. rency announced just two months ago—ac- ties. I find this article very interesting in complishments that would have taken 3 I take the position that winning the terms of the problems we face. I ask years in postwar Germany. war on terrorism requires us to finish unanimous consent that it be printed He mentioned other items. He said our job in Iraq. Very clearly, we are in in the RECORD at the end of my re- that all of this and more has taken a different situation now than we were marks. place in less than 5 months. The speed in World War II. In World War II, after The PRESIDING OFFICER. Without and breadth of what Ambassador the defeat of the Nazis, we went to the objection, it is so ordered. Bremer, GEN Tom Franks, GEN Rick point of having an occupation force See exhibit 1. Sanchez, and GEN Abizaid and the ci- there for over 4 years. That occupation Mr. STEVENS. Mr. President, going vilian military and civilian teams have force had a military government. We back to the statements made before accomplished is impressive and it may have determined not to establish a our committee, as Ambassador Bremer be without historical parallel, whether military government in Iraq. We want said to us on September 22: compared to postwar Japan, Germany, to move toward having the Iraqis There are some things I would like to point Bosnia, or Kosovo. themselves start a new form of govern- out about this $87 billion request. No one I listened with great interest to the ment for themselves. In doing so, we part of the supplemental is indispensable and Secretary of Defense, and I am con- are in a position where the lives of our no part is more important than the others. vinced he has made the case for the soldiers and our military there in Iraq This is a carefully considered request. This is early consideration of this supple- depend upon the speed with which urgent. The urgency of military operations mental. these people can establish their own is self-evident. The funds for nonmilitary ac- Before the Armed Services Com- government and their own military. tion in Iraq are equally urgent. Most Iraqis welcome us as liberators and we glow with mittee, my distinguished colleague I came across an article this past the pleasure of that welcome. Now the re- from West Virginia, Senator BYRD, week in the RAND Review for the sum- ality of foreign troops on the streets is start- asked Ambassador Bremer: mer of 2003. It is a most interesting ar- ing to chafe. Some Iraqis are beginning to re- I believe you said you didn’t need the ticle about ‘‘The Inescapable Responsi- gard us as occupiers and not as liberators. money until January. I believe you said in bility of the World’s Only Super- Some of this is inevitable, but faster the Appropriations Committee or in the power.’’ It points out that, from Ger- progress in reconstruction will help. Unless Democratic caucus—whichever request it many to Afghanistan, we had a period this supplemental passes quickly, the Iraqis was. Is that a fact? of training. In terms of the training for will face darkness eight hours daily. The Ambassador Bremer said: safety of our troops is indirect but real. The the operations we are facing now in people who ambush our troops are small in No, Senator. We need this money right Iraq, each succeeding effort—what this number and do not do so because they have away. I think there is some confusion. I was person calls ‘‘nation building’’—was undependable electricity. However, the popu- asked a specific question which was, When somewhat better managed than the lation of a few is directly related to their co- does the Iraqi government run out of money? previous one. This article compares operation in hunting down those who attack And I said sometime in January. That’s not Germany, Japan, Somalia, Haiti, Bos- us. Earlier progress gives an edge against the same as this. We have got to get these terrorists. reconstruction programs going right away as nia, Kosovo, and Afghanistan to Iraq in quickly as possible. There is nothing more terms of the problems we face. As chairman of the Appropriations urgent. I find it very interesting to note, Committee, I take the position that we Later, in response to a question by quoting the article: should act as quickly as possible on Senator WARNER, Ambassador Bremer Among the recent operations, the United this bill. If we can get it to third read- said: States and its allies have put 25 times more ing before we leave here the next week, money and 50 times more troops on a per the House will act on the bill while we Yes, Senator. This is the most important capita basis in post-conflict Kosovo than thing that is accelerated by the supple- are gone. We can marry our version of into post-conflict Afghanistan. mental. There are the security parts where the bill to the House version of the bill we can speed up the training of the Iraqi We are already learning how to move here in the Senate and take it up the army; instead of taking two years, take one. forward and establish the new govern- first week we are back after the recess.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00012 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.025 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12039 If we do that, we should be able to get people to take over their own govern- force and the level of casualties. The higher this bill to the President and to the De- ment, their own security, and their the proportion of troops relative to the resi- partment of Defense and to Ambas- own future. dent population, the lower the number of sador Bremer’s operation by mid-Octo- If we can act quickly, we can escape casualties suffered and inflicted. Indeed, most of the post-conflict operations that ber at the latest. It is urgent we do a long period of occupation. Compare were generously manned suffered no casual- that. the two sections of this bill: $66 billion ties at all. We have the option to demonstrate for defense, $20 billion for the humani- Neighboring states can exert significance to the world we are not going there to tarian and governmental activities. influence, for good or bad. It is nearly impos- occupy Iraq. We did not intend to oc- The longer we keep our troops in Iraq, sible to put together a fragmented nation if cupy Iraq. As a matter of fact, under the more expensive it will become from its neighbors try to tear it apart. Every ef- the Iraq Liberation Act enacted in 1998, a military point of view. The sooner we fort should be made to secure their support. Congress stated the policy: can help these people establish their Accountability for past injustices can be a powerful component of democratization. It should be the policy of the United States own government, provide their own se- Such accountability can be among the most to support efforts to remove the regime curity, their own army, the sooner we difficult and controversial aspects of any na- headed by Saddam Hussein from power in can bring our people out of Iraq and re- tion-building endeavor, however, and there- Iraq and to promote the emergence of a lease these extraordinary expenses. fore should be attempted only if there is a democratic government to replace that re- The President has enabled us to view deep and long-term commitment to the over- gime. those expenses. all operation. Further, it stated: The bill we just passed, and the There is no quick fix for nation-building. It is the sense of the Congress once the President will soon sign for 2004 for De- None of our cases was successfully completed in less than seven years. Saddam Hussein regime is removed from partment of Defense, does not contain power in Iraq, the United States should sup- These lesions are drawn from the ‘‘best money for Iraq. The money for Iraq is practices’’ of nation-building over the past 60 port Iraq’s transition to democracy by pro- in a separate bill and demonstrates to viding immediate and substantial humani- years. We explain the lessons in greater de- tarian assistance to the Iraqi people, by pro- everyone how expensive it is to keep an tail below and then suggest how they might viding democracy transition to Iraqi parties army in Iraq. be applied to future operations and, in par- and movements with democratic goals, and Our goal is to get that $20.3 billion as ticular, to Iraq. Although the combat phase by convening Iraq’s foreign creditors to de- quickly as possible. It is needed as of the war against Iraq went very well and velop a multilateral response to Iraq’s for- much as the Defense money. I hope the the regime collapsed much faster than many eign debt incurred by Saddam Hussein’s re- Senate will work with us next week as had expected, the United States has been left gime. with the unenviable task of seeking to build we try to bring this bill to the floor a democratic, economically vibrant Iraqi na- That is what we are trying to do. We and get it to third reading before we re- tion. are trying to escape the long delay of cess on the 3rd. FROM GERMANY TO AFGHANISTAN military occupation and carry out our EXHIBIT 1 The cases of Germany and Japan set a goal of liberation of the Iraqi people as [From the Rand Review, Summer, 2003] standard for post-conflict nation-building we decided in 1998. NATION-BUILDING that has not been matched since. Both were It is essential we proceed with this (By James Dobbins) comprehensive efforts at social, political, markup and get the bill to the Senate We at the RAND Corporation have com- and economic reconstruction. These suc- as quickly as possible. It is my hope it piled what we have found to be the most im- cesses demonstrated that democracy was would be on the floor by Tuesday portant lessons learned by the United States transferable, that societies could be encour- night. I hope the leader will give us the in its nation-building efforts since World aged to transform themselves, and that time during the next week to take this War II. Not all these hard-won lessons have major transformations could endure. yet been fully applied to America’s most re- For the next 40 years, there were few at- bill, that provides the funds, to third tempts to replicate these early successes. reading so we can act as an Appropria- cent nation-building efforts in Afghanistan and Iraq. During the cold war with the Soviet Union, tions Committee in conjunction with We define nation-building as ‘‘the use of America employed its military power to pre- our colleagues from the House on the armed force in the aftermath of a conflict to serve the status quo, not to alter it; to man- bill they will produce when we are on underpin an enduring transition to democ- age crises, not to resolve the underlying recess. racy.’’ We have compared the levels of problems; to overthrow unfriendly regimes Nothing is more important than dem- progress toward this goal among seven his- and reinstall friendly ones, not to bring onstrating to those people in uniform torical cases: Germany, Japan, Somalia, about fundamental societal change. After 1989, a policy of global containment in Iraq that we mean business. We need Haiti, Bosnia, Kosovo, and Afghanistan. These are the most important instances in of the Soviet Union no longer impelled the this money. There is no question they United States to preserve the status quo. need this money. which American military power has been used in the aftermath of a conflict to under- Washington was now free to overlook re- Because of the requests made during pin democratization elsewhere around the gional instability in places like Yugoslavia the debate on the last supplemental, world since World War II. and Afghanistan as long as the instability we convinced the administration to From our review of the historical cases, we did not directly threaten American interests. submit a 2004 Defense bill. The 2004 De- at RAND have derived a number of over- At the same time, though, the United States fense bill did not contain any money arching conclusions: had the unprecedented opportunity of using for Iraq. That was in the separate sup- Many factors—such as prior democratic ex- its unrivaled power to resolve, not just to manage or to contain, international prob- plemental submitted to us in response perience, level of economic development, and social homogeneity—can influence the ease lems of strategic importance. In addition, to the request from the Congress to do or difficulty of nation-building, but the sin- the United States could secure broader inter- just that. gle most important controllable determinant national support for such efforts than ever For the first time in history the seems to be the level of effort, as measured before. President has requested money in ad- in troops, money, and time. Multilateral na- Throughout the 1990s, each successive post- vance to conduct a war. All Presidents tion-building is more complex and time-con- cold war effort became wider in scope and in the past have taken money from ex- suming than a unilateral approach. But the more ambitious in intent than its prede- isting Government funds, spent them, multilateral approach is considerably less cessor had been. In Somalia, the original ob- jective was purely humanitarian but was and then came to Congress to replace expensive for individual participants. Multilateral nation-building can produce subsequently expanded to democratization. the funds from which those moneys more thorough transformations and greater In Haiti, the objective was to reinstall a were taken. regional reconciliation than can unilateral president and to conduct elections according This President submitted a concise efforts. to an existing constitution. In Bosnia, the request. As a matter of fact, one Mem- United of command is as essential in peace objective was to create a multiethnic state ber of the other side of the aisle in the operations as it is in war. This unity of com- out of a former Yugoslav republic. In budget markup asked for $100 billion mand can be achieved even in operations Kosovo, the objective was to establish a for the Iraqi defense activities. This with broad multilateral participation when democratic polity and market economy vir- the major participants share a common vi- tually from scratch. President asked for a total of $66 bil- sion and tailor the response of international From Somalia in 1992 to Kosovo in 1999, lion plus $20.3 billion for the activities institutions accordingly. each nation-building effort was somewhat conducted under Ambassador Bremer’s There appears to be an inverse correlation better managed than the previous one (see aegis to hasten the ability of the Iraqi between the size of the military stabilization table). Somalia was the nadir. Everything

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00013 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.034 S26PT1 S12040 CONGRESSIONAL RECORD — SENATE September 26, 2003 that could go wrong did. The operation cul- ized in the book and film ‘‘Black Hawk command. Despite its failure, the Somalia minated in the withdrawal of U.S. troops in Down,’’ was largely the result of an unneces- mission taught America crucial lessons for 1994 after a sharp tactical setback that had sarily complicated U.S. and United Nations the future. One was the importance of unity resulted in 18 American deaths in October command structure that had three distinct of command in peace operations as well as in 1993. This reverse, which became memorial- forces operating with three distinct chains of war. Second was the need to scale mission AMERICA’S HISTORY OF NATION-BUILDING

Country or territory Years Peak U.S. troops International cooperation Assessment Lessons learned

West Germany ...... 1945–1952 ...... 1.6 million ...... Joint project with Britain and France, Very successful. Within 10 years an economically stable Democracy can be transferred. Military forces can un- eventually NATO. democracy and NATO member. derpin democratic transformation. Japan ...... 1945–1952 ...... 350,000 ...... None ...... Very successful. Economically stable democracy and re- Democracy can be exported to non-Western societies. gional security anchor within a decade. Unilateral nation-building can be simpler (but more expensive) than multilateral. Somalia ...... 1992–1994 ...... 28,000 ...... United Nations (U.N.) humanitarian Not successful. Little accomplished other than some Unity of command can be as essential in peace as in oversight. humanitarian aid delivered in Mogadishu and other combat operations. Nation-building objectives need cities. to be scaled to available resources. Police may need to be deployed alongside military forces. Haiti ...... 1994–1996 ...... 21,000 (plus 1,000 international po- U.N. help in policing ...... Not successful. U.S. forces restored democratically Exit deadlines can be counterproductive. Need time to lice). elected president but left before democratic institu- build competent administrations and democratic in- tions took hold. stitutions. Bosnia ...... 1995-present ...... 20,000 ...... Joint effort by NATO, U.N., and Orga- Mixed success. Democratic elections within two years, Unity of command is required on both military and civil nization for Security and Coopera- but government is constitutionally weak. sides. Nexus between organized crime and political tion in Europe. extremism can be serious challenge to enduring democratic reforms. Kosovo ...... 1999-present ...... 15,000 (plus 4,600 international po- NATO military action and U.N. sup- Modest success. Elections within 3 years and strong Broad participation and extensive burden-sharing can lice). port. economic growth. But no final resolution to Kosovo’s be compatible with unity of command and American status. leadership. Afghanistan ...... 2001-present ...... 10,000 ...... Modest contribution from U.N. and Too early to tell. No longer launch pad for global ter- Low initial input of money and troops yields low output nongovernmental organizations. rorism. But little democratic structure and no real of security, democratization, and economic growth. government authority beyond Kabul.

objectives to available resources in troops, to the transformational efforts still under the second-highest level of economic assist- money, and staying power. A third lesson way in Bosnia and Kosovo and comparable in ance per capita, Kosovo enjoyed the most was the importance of deploying significant its enormous scale to the earlier American rapid recovery in levels of per capita GDP. In numbers of international police alongside occupations of Germany and Japan. Nation- contrast, Haiti, which received much less per international military forces to places where building, it appears, is the inescapable re- capita than Kosovo, has experienced little the local law enforcement institutions had sponsibility of the world’s only superpower. growth in per capita GDP. disappeared or become illegitimate. QUANTITATIVE COMPARISONS OF CASES America applied these lessons to Haiti in Germany and Japan both stand out as un- For each of the seven historical cases of equaled success stories. One of the most im- the mid-1990s. We had unity of command nation-building, we at RAND compared throughout the operation. We did not have portant questions is why both operations quantitative data on the ‘‘inputs’’ (troops, fared so well compared with the others. The parallel American and allied forces. We had money, and time) and ‘‘outputs.’’ The out- a single force under a single command with easiest answer is that Germany and Japan puts included casualties (or lack thereof), were already highly developed and economi- a clear hierarchy of decisionmaking. We de- democratic elections, and increases in per ployed a large number of police within weeks cally advanced societies. This certainly ex- capita gross domestic product (GDP). plains why it was easier to reconstruct their of the military deployment, and the police Troop levels varied widely across the cases. economies than it was to reconstruct those were armed with both weapons and arrest The levels ranged from 1.6 million U.S. in the other territories. But economics is not authority. Unfortunately, we were obsessed troops in the American sector in Germany at with exit strategies and exit deadlines in the the end of World War II to 14,000 U.S. and a sufficient answer to explain the transition wake of the Somalia debacle. So we pulled international troops currently in Afghani- to democracy. The spread of democracy to out of Haiti with the job at best half done. stan. Gross numbers, however, are not the poor countries in Latin America, Asia, and The Bosnia experience of the late 1990s, most useful numbers for comparison, because parts of Africa suggests that this form of was more successful. We set an exit deadline the size and populations of the nations being government is not unique to advanced indus- but wisely ignored it when the time came. built have been so disparate. We chose in- trial economies. Indeed, democracy can take On the negative side, there was a lack of co- stead to compare the numbers of U.S. and root in countries where neither Western cul- ordination between the military stabiliza- foreign soldiers per thousand inhabitants in ture nor significant economic development tion efforts of NATO and those organizations each occupied territory. We then compared exists. Nation-building is not principally responsible for civilian reconstruction. Con- the proportional force levels at specified about economic reconstruction, but rather sequently, the authority for implementing times after the conflict ended (or after the about political transformation. the civilian reconstruction projects became U.S. rebuilding efforts began). Because Germany and Japan were also eth- fragmented among numerous competing in- Figure 1 shows the number of international nically homogeneous societies, some people stitutions. To complicate the situation fur- troops (or in the German and Japanese cases, might argue that homogeneity is the key to ther, the international police who had been U.S. troops) per thousand inhabitants in success. We believe that homogeneity helps deployed were armed with neither weapons each territory at the outset of the interven- greatly but that it is not essential, either. It nor arrest authority. tion and at various intervals thereafter. As is true that Somalia, Haiti, and Afghanistan By the time of the Kosovo conflict in 1999, the data illustrate, even the proportional are divided ethnically, socioeconomically, or we and our allies had absorbed most of these force levels vary immensely across the oper- tribally in ways that Germany and Japan lessons. We then made smarter choices in ations. (The levels vary so tremendously were not. However, the kinds of communal Kosovo. We achieved unity of command on that they require a logarithmic, or expo- hatred that mark Somalia, Haiti, and Af- both the civil and military sides. As in Bos- nential, scale for manageable illustration.) ghanistan are even more pronounced in Bos- nia, NATO was responsible for military oper- Bosnia, Kosovo, and particularly the U.S.- nia and Kosovo, where the process of democ- ations. On the civil side, we established a occupied sector of Germany started with ratization has nevertheless made some clear hierarchical structure under a United substantial proportions of military forces, progress. Nations representative. Leadership was whereas the initial levels in Japan, Somalia, shared effectively between Europe and the Haiti, and especially Afghanistan were much What principally distinguishes Germany, United States. Working together, we de- more modest. The levels generally decreased Japan, Bosnia, and Kosovo from Somalia, ployed nearly 5,000 well-armed police along- over time. In Germany, the level then rose Haiti, and Afghanistan is not their levels of side military peacekeepers. Although far again for reasons having to do with the cold Western culture, democratic history, eco- from perfect, the arrangement was more suc- war. Overall, the differences in force levels nomic development, or ethnic homogeneity. cessful than it had been in Bosnia. across the cases had significant implications Rather, the principal distinction is the level During his presidential campaign in 2000, for other aspects of the operations. of effort that the United States and the George W. Bush criticized the Clinton ad- Figure 2 compares the amount of foreign international community have put into the ministration for this expansive nation-build- economic aid per capita (in constant 2001 democratic transformations. Among the re- ing agenda. As president, Bush adopted a U.S. dollars) provided to six of the territories cent operations, the United States and its al- more modest set of objectives when faced during the first two years. Although Ger- lies have put 25 times more money and 50 with a comparable challenge in Afghanistan. many received the most aid in raw dollar times more troops on a per capita basis into Nevertheless, the attempt to reverse the terms ($12 billion), the country did not rank post-conflict Kosovo than into post-conflict trend toward ever larger and more ambitious high on a per capita basis. Per capita assist- Afghanistan. These higher levels of input ac- U.S.-led nation-building operations has prov- ance there ran a little over $200. Kosovo, count in significant measure for the higher en short-lived. In Iraq, the United States has which ranked fourth in terms of total assist- levels of output in terms of democratic insti- taken on a task comparable in its vast scope ance, received over $800 per resident. With tution-building and economic growth.

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00014 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.011 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12041 Japan, one of the two undoubted successes, only 16 percent of the peacekeeping troops assistance and budgetary support. It is high- fully meets the criterion regarding the dura- and paying only 16 percent of the reconstruc- ly unlikely that taxes on the Iraqi oil sector tion of time devoted to its transformation. tion costs. will be adequate to fund the reconstruction In the first two years, Japan received consid- The efficacy of the Bosnia and Kosovo of the Iraqi economy in the near future. erably less external economic assistance per models has depended on the ability of the Judging by the experiences of Bosnia and capita than did Germany, Bosnia, or Kosovo, United States and its principal allies to at- Kosovo, territories that have higher per cap- indeed less than Haiti and about the same tain a common vision of the objectives and ita incomes than Iraq, budgetary support amount as Afghanistan. Japan’s correspond- then to coordinate the relevant institu- will be necessary for quite some time. To ingly low post-conflict economic growth tions—principally NATO, the Organization manage immediate operating expenditures, rates reflect this fact. Japan’s subsequent for Security and Cooperation in Europe, the we suggest that the post-conflict authorities growth of the 1950s, spurred by American European Union, and the United Nations—to in Iraq first establish a reasonable level of spending linked to the Korean War, helped to meet the objectives. These two models offer expenditures, then create a transparent tax consolidate public support for the demo- a viable fusion of burden-sharing and unity system, and ask foreign donors to pick up cratic reforms that had been put in place in of command. the difference until the nation gets on its the immediate postwar years. As with the In Afghanistan, in contrast, the United feet. We believe that this will be the most ef- German economic miracle of the 1950s, the States opted for parallel arrangements on ficacious avenue to economic recovery. experience in Japan suggests that rising eco- the military side and even greater diver- At the same time, we suspect that Iraq will nomic prosperity is not so much a necessary gence on the civil side. An international not receive the same per capita levels of for- precursor to political reform as a highly de- force—with no U.S. participation—operates eign troops, police, or economic aid as did ei- sirable successor and legitimizing factor. in the capital of Kabul, while a national and ther Bosnia or Kosovo. Figures of 500,000 In proportion to its population, Japan also mostly U.S. force operates everywhere else. troops or $36 billion in aid are beyond the ca- had a smaller military stabilization force The United Nations has responsibility for pacity of even the world’s only superpower (or, as it was then termed, occupation force) promoting political transformation, while to generate or sustain. Even half those levels than did Germany, Bosnia, or Kosovo, al- individual donors coordinate economic re- will require the United States to broaden though the force was larger than those in construction—or, more often, fail to do so. participation in Iraq’s post-conflict sta- Haiti and Afghanistan. The ability to secure The arrangement in Afghanistan is a mar- bilization and reconstruction well beyond Japan with a comparatively small force re- ginal improvement over that in Somalia, be- the comparatively narrow coalition that lates to both the willing collaboration of the cause the separate U.S. and international fought the war, thereby mounting a broader Japanese power structures and the homo- forces are at least not operating in the same international effort on the Balkan models. geneity of the population. A third important physical space. But the arrangement rep- According to the lessons learned, the ulti- factor was the unprecedented scale of Ja- resents a clear regression from what we mate consequences for Iraq of a failure to pan’s defeat—the devastation and con- achieved in Haiti, Bosnia, or, in particular, generate adequate international manpower sequent intimidation wrought by years of Kosovo. It is therefore not surprising that and money are likely to be lower levels of se- total war, culminating in the fire bombing of the overall results achieved to date in Af- curity, higher casualties sustained and in- its cities and finally two nuclear attacks. In ghanistan are better than in Somalia, not flicted, lower economic growth rates, and situations where the conflict has been termi- yet better than in Haiti, and not as good as slower, less thoroughgoing political trans- nated less conclusively and destructively (or in Bosnia or Kosovo. The operation in Af- formation. not terminated at all), such as Somalia, Af- ghanistan, though, is a good deal less expen- The second lesson for Iraq is that short de- ghanistan, and most recently Iraq, we have sive than those in Bosnia or Kosovo. parture deadlines are incompatible with na- tion-building. The United States will succeed seen more difficult post-conflict security APPLYING THE LESSONS TO IRAQ challenges. Indeed, it seems that the more only if it makes a long-term commitment to The challenges facing the United States in establishing strong democratic institutions swift and bloodless the military victory, the Iraq today are formidable. Still, it is possible more difficult can be the task of post-con- and does not beat a hasty retreat tied to ar- to draw valuable lessons from America’s pre- tificial deadlines. Moreover, setting pre- flict stabilization. vious experiences with nation-building. The seven historical cases have differed in mature dates for early national elections can There are four main lessons to be learned for terms of duration. The record suggests that be counterproductive. Iraq. Third, important hindrances to nation- although staying long does not guarantee The first lesson is that democratic nation- building include both internal fragmentation success, leaving early assures failure. To building can work given sufficient inputs of (along political, ethnic, or sectarian lines) date, no effort at enforced democratization resources. These inputs, however, can be and a lack of external support from neigh- has been brought to a successful conclusion very high. Regarding military forces, Figure boring states. Germany and Japan had ho- in less than seven years. 3 takes the numbers of troops used in the mogeneous societies. Bosnia and Kosovo had UNITY OF COMMAND previous cases of nation-building and neighbors that, following the democratic Throughout the 1990s, the United States projects, for each, a proportionally equiva- transitions in Croatia and Serbia, collabo- wrestled with the challenge of gaining wider lent force for the Iraqi population over the rated with the international community. participation in its nation-building endeav- next decade. For example, if Kosovo levels of Iraq could combine the worst of both worlds, ors while also preserving adequate unity of troop commitments were deployed to Iraq, lacking both internal cohesion and regional command. In Somalia and Haiti, the United the number would be some 500,000 U.S. and support. The United States should consider States experimented with sequential ar- coalition troops through 2005. (There are putting a consultative mechanism in place, rangements in which it initially managed roughly 150,000 coalition troops stationed in on the model of the Peace Implementation and funded the operations but then quickly Iraq today.) To provide troop coverage at Council in the Balkans or the ‘‘Two Plus turned responsibility over to the United Na- Bosnia levels, the requisite troop figures Six’’ group that involved Afghanistan’s six tions. In Bosnia, the United States succeeded would be 460,000 initially, falling to 258,000 by neighbors plus Russia and the United States, in achieving both broad participation and 2005 and 145,000 by 2008. as a means of consulting with the neigh- unity of command on the military side of the In addition to military forces, it is often boring countries of Iraq. operation through NATO. But in Bosnia the important to deploy a significant number of Fourth, building a democracy, a strong United States resisted the logic of achieving international civil police. To achieve a level economy, and long-term legitimacy depends a comparable and cohesive arrangement on comparable to the nearly 5,000 police de- in each case on striking the balance between the civil side. In Kosovo, the United States ployed in Kosovo, Iraq would need an infu- international burden-sharing and unity of achieved broad participation and unity of sion of 53,000 international civil police offi- command. As noted above, the United States command on both the military and civil cers through 2005 (in addition to the forces is unlikely to be able to generate adequate sides by working through NATO and the represented in Figure 3). levels of troops, money, or endurance as long United Nations. It is too early to predict with accuracy the as it relies principally upon the limited coa- None of these models proved entirely satis- required levels of foreign aid, but we can lition with which if fought the war. On the factory. However, the arrangements in draw comparisons with the previous histor- other hand, engaging a broader coalition, to Kosovo seem to have provided the best amal- ical cases. Figure 4 takes the amount of for- include major countries that will expect to gam to date of American leadership, Euro- eign aid provided in six of the seven previous secure influence commensurate with their pean and other participation, financial bur- cases of nation-building and projects propor- contributions, will require either new insti- den-sharing, and unity of command. Every tionally equivalent figures for the Iraqi pop- tutional arrangements or the extension of international official in Kosovo works ulti- ulation over the next two years. If Bosnia existing ones, such as NATO. mately for either the NATO commander or levels of foreign aid per capita were provided In its early months, the American-led sta- the Special Representative of the U.N. Sec- to Iraq, the country would require some $36 bilization and reconstruction of Iraq have retary General. Neither of these is an Amer- billion in aid from now through 2005. Con- not gone as smoothly as might be expected, ican. But by virtue of America’s credibility versely, aid at the same level as Afghanistan given abundant, recent, and relevant Amer- in the region and America’s influence in would total $1 billion over the next two ican experience. This is, after all, the sixth NATO and on the U.N. Security council, the years. major nation-building enterprise the United United States has been able to maintain a We at RAND believe that Iraq will require States has mounted in eleven years, and the satisfactory leadership role while fielding substantial external funds for humanitarian fifth in a Muslim nation or province.

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00015 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.015 S26PT1 S12042 CONGRESSIONAL RECORD — SENATE September 26, 2003 Many of the initial difficulties in Iraq have The PRESIDING OFFICER. Without Zelman v. Simmons-Harris, the case that de- been encountered elsewhere. Somalia, Haiti, objection, it is so ordered. termined that a properly structured school Kosovo, and Afghanistan also experienced voucher program is constitutional. When the the rapid and utter collapse of their prior re- f Court announced that decision, I hailed it as gimes. In each of those instances, the local DISTRICT OF COLUMBIA APPRO- one that could open doors of opportunity to police, courts, penal services, and militaries PRIATIONS ACT, 2004—Continued thousands of children and could transform were destroyed, disrupted, disbanded, and/or the educational landscape in our country. discredited. They were consequently unavail- Ms. LANDRIEU. Mr. President, I That statement is worth repeating today, as able to fill the post-conflict security gap. In know my colleagues will be coming to we think about how to improve and reform Somalia, Bosnia, Kosovo, and Afghanistan, the floor to speak more about the situ- elementary and secondary education in extremist elements emerged to fill the re- ation in Iraq, but I take a moment as Washington, DC. sultant vacuum of power. In all five cases, Mr. Chairman, I know that officials in my organized crime quickly developed into a one of the managers of the DC bill to Department and Members of Congress have major challenge to the occupying authority. give a few closing remarks on that sub- been concerned about the quality of edu- In Bosnia and Kosovo, the external sta- ject and wrap up a couple of issues this cation in the District of Columbia for many bilization forces ultimately proved adequate morning. Then I understand the Demo- years. D.C. public schools are only a short to surmount these challenges. In Somalia cratic leader will come to the floor. walk from our offices, we see District stu- and Afghanistan, they did not or have not When he does, I will be happy to yield. dents going to and from school each day, and yet, respectively. And I see one of my other colleagues. we read about the challenges of the D.C. pub- Throughout the 1990s, the management of lic schools in the newspapers almost daily. each major stabilization and reconstruction For the record, I follow up a couple of We all want the capital of the greatest na- mission represented a marginal advance over comments from my friend from Mis- tion on earth to have some of the finest its predecessor, but in the past several years souri who spoke just a few minutes ago schools on earth. At one time this city’s this modestly positive learning curve has not on the subject. schools were considered among the best in been sustained. The Afghan mission cannot One, he referred to a letter from Sec- the entire Nation. But for many years we yet be deemed more successful than the one retary Paige. We on our side do not have been disappointed by the performance in Haiti. It is certainly too early to evaluate of public schools in the District, and at the the success of the Iraqi nation-building mis- have a copy of that letter. It has not been submitted to us. We would be seeming inability of public school officials to sion, but its first few months do not raise it manage schools and programs effectively. above those in Bosnia and Kosovo at a simi- pleased to receive it if there is such a In some respects, the situation in the Dis- lar stage. letter indicating support for this three- trict may be no different from that in other Over the past decade, the United States sector approach, because all we have is urban school districts that educate large has made major investments in the combat the ‘‘Statement of Secretary of Edu- numbers of children living in poverty, but in efficiency of its forces. The return on invest- other respects the District has sometimes ment has been evident in the dramatic im- cation Rod Paige On the DC School seemed uniquely resistant to reform and im- provements demonstrated from one cam- Choice Initiative Before the House provement. I say that with full respect for paign to the next, from Desert Storm to the Committee on Government Reform,’’ Superintendent Vance and with appreciation Kosovo air campaign to Operation Iraqi dated June 24, 2003. for what he is trying to accomplish and for Freedom. But there has been no comparable I have spent the last 30 minutes re- some of the things he has achieved, but I increase in the capacity of U.S. armed forces, viewing again the statement, which I think it’s the truth. or of U.S. civilian agencies for that matter, had read once before, and there was no Let’s consider the performance of D.C. stu- to conduct post-combat stabilization and re- dents on the National Assessment of Edu- construction operations. mention at all in this statement of any cational Progress, or NAEP as it’s called, the Nation-building has been a controversial three-sector approach. It is approxi- assessment that measures the performance mission over the past decade, and the extent mately 20 pages long, and I have high- of this controversy has undoubtedly cur- of students over time in reading, writing, lighted every reference to the choice math, and other core academic subjects. In tailed the investments needed to do these initiative fund proposed by the Presi- tasks better. So has institutional resistance the most recent mathematics assessment, dent, and there is no reference in here administered in 2000, only 6 percent of D.C. in both the state and defense departments, for charter schools or for education re- neither of which regards nation-building fourth-graders tested at the ‘‘proficient’’ or among its core missions. As a result, succes- form for traditional public schools. ‘‘advanced’’ levels, the levels that show that sive administrations tend to treat each new So I want to submit this statement students have demonstrated competency such mission as if it were the first and, more for the RECORD. That is all we have on over challenging subject matter. A lower importantly, the last. this side. If there is a new statement percentage of students in D.C. demonstrated This expectation is unlikely to be realized proficiency than was the case for any State. from the Secretary, we would be happy At the other end of the scale, 76 percent of any time soon. In the 1990s, the Clinton ad- to review it. I ask unanimous consent ministration conducted a major nation- D.C. fourth-graders scored at the ‘‘below building intervention, on the average, every that the statement of Secretary Paige basic’’ level, which means that they could two years. The current administration, de- be printed in the RECORD. not demonstrate even partial mastery of the spite a strong disinclination to engage Amer- There being no objection, the mate- math skills and knowledge that are appro- ican armed forces in these activities, has rial was ordered to be printed in the priate at the fourth-grade level. The 2000 8th launched two major such enterprises in a pe- RECORD, as follows: grade math results were very similar; only 6 riod of eighteen months. percent of D.C. students tested at the ‘‘pro- STATEMENT OF SECRETARY OF EDUCATION ROD Post-conflict stabilization and reconstruc- ficient’’ or ‘‘advanced’’ levels, and 77 percent PAIGE ON THE DC SCHOOL CHOICE INITIATIVE tion with the objective of promoting a tran- were ‘‘below basic.’’ BEFORE THE HOUSE COMMITTEE ON GOVERN- sition to democracy appear to be the ines- The most recent NAEP reading assessment MENT REFORM, JUNE 24, 2003 capable responsibility of the world’s only su- took place in 2002, and the National Assess- perpower. Therefore, in addition to securing Chairman Davis and members of the Com- ment Governing Board announced the results the major resources that will be needed to mittee, thank you for the opportunity to ap- just last week. The results for D.C. students carry through the current operation in Iraq pear before you today to discuss the Bush were a little better than the 2000 math to success, the United States ought to make Administration’s proposal to initiate a pro- scores, but still were completely inadequate. the smaller long-term investments in its own gram to expand school choice in the District Only 10 percent of D.C. fourth-graders could institutional capacity to conduct such oper- of Columbia in fiscal year 2004. I welcome the read proficiently, while 69 percent were ations. In this way, the ongoing improve- opportunity to describe our proposal and ex- ‘‘below basic.’’ At the 8th grade level, 9 per- ments in combat performance of American plain our reasons for putting it forward. I am cent were ‘‘proficient’’ or ‘‘advanced’’ and 52 forces could be matched by improvements in also very pleased to appear at this hearing percent were ‘‘below basic.’’ the post-conflict performance of our govern- with Mayor Anthony Williams, who has Looking at the quality of a school system ment as a whole. been, and will continue to be, our partner in requires more than just reviewing scores on Mr. STEVENS. I yield the floor. developing this initiative. I truly appreciate achievement tests. But when we look at Ms. LANDRIEU. I suggest the ab- the Mayor’s willingness to work with us, and other indicators, they too show that D.C. sence of a quorum. the relationship we have developed around public schools are not providing the edu- The PRESIDING OFFICER. The the simple idea that wider educational op- cation that children in the District need or tions can benefit the children of the District deserve. The most recent edition of Quality clerk will call the roll. of Columbia. County, the annual review of education The legislative clerk proceeded to This hearing occurs very close to the anni- trends and data produced by the newspaper call the roll. versary of a very historic moment in the his- Education Week, gave the District a grade of Ms. LANDRIEU. I ask unanimous tory of educational choice in America. On only a D+ for having an acceptable system of consent that the order for the quorum Friday, we will observe the one-year anniver- academic standards and accountability, a C call be rescinded. sary of the Supreme Court’s decision in in the area of success in recruiting new

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00016 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.018 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12043 teachers, and a D+ for school climate. The D.C. public schools. This research also found accountable for meeting the educational D.C. public school system has a long history that parents who received support from the needs of students. And we will provide for a of management problems in such important Fund gave their children’s schools higher rigorous evaluation of the project in D.C. (as areas as facilities maintenance, personnel ratings than did parents of children in the well as the other projects funded by the na- and payroll, food service, procurements, and control group, and that their children were tional Choice Incentive Fund) by examining even in accurately counting enrollments. In doing more homework. Studies by these and the academic achievement of students, pa- addition, the system has historically failed equally eminent scholars in other cities, rental satisfaction, and other results, so that to comply with the requirements of Federal such as Milwaukee, San Antonio, Cleveland, the lessons can be applied to future programs programs, such as Title I and Special Edu- and Dayton, offer very similar results. and initiatives. We want to obtain solid evi- cation, to a point where the Department has What about the charge that voucher pro- dence on the benefits of expanding edu- had to enter into compliance agreements grams ‘‘cream’’ the best students from the cational options and making schools ac- with the District that call for implementa- public schools and thereby weaken public countable to parents while respecting the tion of major reforms within specific school systems? We find no evidence to but- flexibility and freedom of participating pri- timelines. We insisted on these agreements tress that claim. To the contrary, research vate schools. not because some paperwork wasn’t being by Caroline Hoxby of Harvard and others has Mr. Chairman, I know that this proposal filled out correctly, but because the District found that students who take advantage of has engendered a great deal of attention in was, for instance, failing quite egregiously to private school choice options are typically the media and elsewhere, including some vo- provide its disabled students with the free at least as educationally and economically ciferous criticism. Before I end my state- appropriate public education required under disadvantaged as students who remain in the ment, I would like to respond to some of the the Individuals with Disabilities Education public schools. To some extent, this is be- major criticisms, to set the record straight. Act. cause existing choice programs have explic- We’ve heard that the Administration is I would like to repeat what I said a few itly targeted children from low-income fami- trying to impose this initiative on the Dis- minutes ago: I support and respect the work lies, as our initiative would do. But even trict against the will of its citizens and with that Paul Vance is doing in the District. I without this targeting, programs that in- no input from its elected and appointed lead- know that he has taken on the major man- clude private-school options seem to attract ership. That is not the case. We have met not agement problems and having been a big-city students who are no more affluent, and have only with Mayor Williams, but with Council- school superintendent myself, I know that no better an educational profile, than other man Kevin Chavous, who is the Chairman of turning around a system is not easy. And Su- students. In addition, there is at least pre- the Council’s Education Committee, and perintendent Vance has shown some results. liminary evidence that school districts in with School Board President Peggy Cooper The District’s Stanford-9 achievement test which public schools have been exposed to Cafritz to discuss our proposal, and we look scores for 2002 showed minor improvements private-school options seem to attract stu- forward to continuing our discussions with at most grade levels in reading and math. dents who are no more affluent, and have no these and other local officials. I would like And the proliferation of charter schools in better an educational profile, than other stu- to commend these officials for the courage the District, including some that have dents. In addition, there is at least prelimi- they have shown in publicly endorsing a D.C. achieved great initial success, has given nary evidence that school districts in which school choice initiative and their willingness more choices and greater hopes to students public schools have been exposed to private- to work with us on the details. We want to and parents. But I believe the preponderance school competition, through a choice pro- implement a choice program that reflects of information demonstrates that schools in gram, have responded by improving edu- the needs of the District and reflects the the District are not achieving what they cational services. In Milwaukee and in the input of D.C.’s leadership; we don’t pretend should and that more needs to be done if Edgewood district in San Antonio, the pres- to have all the answers. children in the District are to achieve to the ence of a choice program was associated with I acknowledge that a choice initiative that high levels called for under the No Child Left gains in achievement in the public schools. includes private school options will probably Behind Act. Those findings are consistent with my own not, in the end, be what some of the political The Bush Administration has responded to experience directing the Houston Inde- leaders in the District want. It is, however, this problem by including, in our fiscal year pendent School District, the Nation’s sev- what I believe the parents want. The Wash- 2004 budget request, a school choice initia- enth-largest. In Houston, we didn’t resist ington Scholarship Fund has a waiting list of tive for D.C. You might ask whether expand- school choice; we embraced it. We created a approximately 5,000 children. One D.C. par- ing educational choice to include private- system of charter schools even before the ent, Virginia Walden-Ford, the leader of the school options is appropriate for the Dis- State did. We let children in low-performing D.C. Parents for School Choice, testified be- trict, whether it is likely to work, whether schools take their share of the funding— fore Councilman Chavous’s committee and giving students wider educational opportuni- $3,750 a year—to a private school. I believe said the following: ties is likely to help the D.C. public school that our acceptance of choice, our willing- ‘‘We have received hundreds of calls from system improve, and whether we should, in- ness to compete with charter and public parents who have not been lucky enough to stead, request more money for D.C. public schools, helped us to make the changes we get a scholarship through the many scholar- schools. Let me address those issues. needed to make in order to achieve the ship groups in town, WSF, Black Student We believe that the President’s budget in- learning gains for which we received na- Fund, etc., and parents who are camping out cludes more than adequate support for D.C.’s tional acclaim. for charter schools that are not keeping up public schools, including charter schools. For these reasons, the Administration has the pace of parents’ need to get out of failing Our request for Department of Education el- put forward our proposal. The outlines of schools. They contact us looking for better ementary and secondary education formula this proposal are very simple. The Presi- options for their children. Parents here in programs would provide some $92 million to dent’s budget request for fiscal year 2004 in- the District are daily expressing their frus- the District in 2004, an increase of 15 percent cludes $75 million for a national Choice In- tration in a school system that is taking too over the level only two years ago (2002). And centive Fund. Under this program, the De- long to fix itself.’’ let’s forget that D.C. already spends, per stu- partment would make grants to support I note also that a majority of people in the dent, more than all but a handful of urban projects that provide low-income parents, District of Columbia support choice, includ- districts across the country. If money were particularly those who have children attend- ing choice that includes private school op- the solution, then we would have solved the ing low-performing public schools, with the tions. In a 1998 Washington Post poll, 56 per- problems of public schooling in the District opportunity to transfer their children to cent of D.C. residents said that they sup- a long time ago. We believe, instead, that higher-performing public and private ported using Federal money to help send the tackling this problem will depend in large schools, including charter schools. A portion city’s low-income students to private or pa- measure on giving D.C. students more edu- of the money would be reserved for the Dis- rochial schools, while only 36 percent op- cational choices. trict of Columbia. posed. For African-Americans this support In the communities across the country We anticipate making a grant either to the was even stronger—60 percent were in that have experimented with publicly and D.C. public school system or to another, favor—and among African-Americans with privately funded school choice programs that independent entity to operate the program annual incomes of under $50,000, it was even include private-school options, the results in the District. The grantee would then de- stronger, with 65 percent in favor. have been extremely positive, for the stu- velop and implement procedures for certi- We in the Department have also heard that dents directly served by the programs and fying schools to participate in the program, this initiative will bleed money from the for the school system as a whole. For exam- informing D.C. families about the choices District’s public schools. That is also not the ple, research by Patrick Wolf of Georgetown available to them, selecting students to par- case. The Choice Incentive Fund proposed by University, along with Paul Peterson and ticipate, and then monitoring and reporting the President represents new money. It was Martin West of Harvard, on the first two on the program as it goes forward. The pro- not obtained by subtracting funds from the years of the scholarship program adminis- posal in our budget did not specify the max- other Federal programs that support D.C. tered by the privately funded Washington imum amount of assistance an individual public schools. If the initiative does not go Scholarship Fund (WSF), showed that the student could receive, but we want it to be forward in the District, my guess is that the math and reading achievement of African- sufficient to allow students a good choice of money will be used in other communities to American students who enrolled in private educational options. expand educational choices and improve edu- schools using support from the Fund was sig- We also see accountability as a major fea- cational outcomes in those communities. nificantly higher than the achievement of a ture of this initiative, because it will give We’ve also heard complaints that we are control group of students who remained in parents in D.C. the ability to hold schools supporting a voucher program when we could

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00017 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.021 S26PT1 S12044 CONGRESSIONAL RECORD — SENATE September 26, 2003 be supporting the District’s charter schools schools that are failing is absolutely mothers, poor single mothers who are instead. We find this complaint especially in- false. This proposal, as written, if any- working and can’t afford to send their teresting since it has recently been voiced by one reads it, is not limited or directed children to school. Please help. some who were never strong charter school to failing schools. It gives a preference And they show pictures of African- supporters before. But that’s all right with us because we strongly support charter to students in failing schools, but it is American single moms and Hispanic schools too. We will continue to fight to not designed to students in failing single mothers, kind of indicating, in a make sure the President’s charter school schools. very insulting way—I know they do not funding priorities are fulfilled, especially on That principle is worth fighting over mean it to be insulting, but you could the facilities front, so that this vibrant because the whole accountability sys- interpret it as that; and I know that is movement can keep flourishing. tem we have put into place is about not the intention—but there are those And, finally, we’ve heard that all the Ad- identifying schools that are failing, of us over here who think we spend a ministration cares about is launching a and then providing resources to those lot of time fighting for poor women. I voucher program in the District, that we don’t care about the children who will re- schools to make them better. have spent my whole life, basically, main in the public school system. That If the other side gets away with say- doing that. So it is really hard for me couldn’t be farther from the truth. Our De- ing, ‘‘Well, that is what we said, but to accept this criticism. But I am not partment has a record of reaching out to the that is not really what we meant, be- perfect, and maybe I have failed in D.C. Public Schools, to work with the sys- cause we aren’t interested in putting some way in that effort. But when my tem on overcoming its problems, of pro- resources into failing schools, we are friends say things to me, that we need viding it with information, technical assist- interested in putting resources into all to help single mothers, let me just ask ance, and other resources. We’ve adopted in- schools, because our job is to make them a question. Is it that party or dividual schools in the District and provided those schools with hands-on assistance. In parents happy,’’ I think that is just this party which does not support the our meetings with D.C. officials, we have such a foolish goal. increase in the minimum wage for said that we will continue these efforts, and Let me say why I think it is foolish. these same women? Is it that party on I’m happy to state that in public today. The As much as I would like to see every the other side of the aisle which refuses choice initiative should be just one element parent happy, in my 25 years in public to raise the wage from $5.15 to help in an effort to improve education in the Dis- life I don’t know how in the heck we poor women have more choices in their trict and ensure that all children can achieve would measure that because some par- life, or is it this side of the aisle? Is it to high standards. We want to contribute to ents are real happy, some parents are a that side of the aisle which refuses, the larger effort as well. Let me close with a quotation from Dr. little happy, and some parents are year after year, to put more money Howard Fuller, the former superintendent of happy in some ways and not happy in into day care so the same poor women schools in Milwaukee, currently the Director other ways, and I would have no way of who are working two jobs—early in the of the Institute for the Transformation of measuring what is a good measure for morning until late at night—could Learning at Marquette University, and a parental happiness. If someone in this have some sense of satisfaction that strong advocate of opening up wider edu- Chamber has any way to measure pa- their children will be well cared for cational choices for children and parents. Dr. rental happiness in a way that tax- while they are contributing to the Fuller has said: payers could know if parents are a lit- ‘‘In America, it is virtually impossible for great economy of this Nation, or is it our children to bring their dreams to reality tle happy, just a little happy, happy on our side? without an education. Unfortunately, far too Mondays and not on Fridays, and that So you have to understand—I hope many of our children are not only having was our goal, please tell me because I people understand—this is a very im- their dreams deferred, they are having them would be open to discuss it. portant debate. The facts will speak for destroyed. They are being destroyed by edu- It is foolishness. We should be direct- themselves. They can run all the ads cational systems that are undereducating ing revenues, if we are going to do they want, all the bumper stickers, and them, miseducating them, and pushing them that, to failing schools. This proposal all the headlines, but that is what the out by the thousands every day. We must is not directed to failing schools. They have a sense of urgency about changing this facts are. unacceptable situation.’’ can say it 1,000 times. I ask you to read I have this letter we received today. It is that ‘‘sense of urgency’’ that drives the details. It is dated September 26. It is from Sec- this proposal. Now my third point. I know my col- retary Paige. Thank you again for the opportunity to league has been very patient, but I I am writing today to express my strong testify today. I would be happy to respond to have to make this point. My colleague support for the District of Columbia edu- any questions that the Committee may have. from Missouri asked me, What dif- cation improvement initiative. . . . Ms. LANDRIEU. Mr. President, an- ference does it make? What difference This bill includes a three-pronged initia- other point I would like to make is does all this make? tive to:— that the Senator made a statement It makes a huge amount of dif- And here it is— that needs clarification. As I started ference. We, as a Congress, with this (1) improve DC public schools . . . (2) cre- out this morning, I said the details of President, in a bipartisan way, have ate new charter schools . . . and (3) provide this are very important, because if you embarked upon a new effort, a new scholarships. pursue the details and you dissect the journey, to take good public schools This is the first official letter we details, you will eventually get to the and make them great, knowing that have received. truth. So there is one detail I must re- some schools are excellent but some This letter is a step in the right di- peat. And I guess I am going to have to schools are really bad. And as a Nation, rection. stand here, I don’t know, every day or we are saying since 1965 our general I see the leader on the floor. But let a month or a year to continue to say plans are not working as well as they me just say, until this administration this until the other side cries uncle. should have, so let’s make a big adjust- says they will veto any bill that does This proposal is not—it never was, it is ment. We have made a big adjustment, not have this in it, the Members who not today—limited or designed for fail- and that difference is worth fighting are willing to negotiate on this have no ing schools. Let me repeat, this pro- for, the strengthening of public edu- assurance that this is the way it will posal is not—not when it was initially cation in the greatest democracy in the ultimately come out. proposed, not last week, not yesterday, world. So I thank the Secretary for clari- not last night, not today, not this People on my side say to me: Senator fying the position. I commend him for morning at 5 minutes to 12—limited to LANDRIEU, you have spent a lot of time his innovation. But again, until we children in failing schools. on this issue. For Louisiana, the State have a statement of a veto from the Although the proponents say they I represent, and for the country I President unless this proposal includes are interested in helping children in love—and all of us love our country these three provisions, with permanent failing schools, the real issue for pro- and our States—this is about as essen- funding for all three, we do not have ponents of vouchers is they simply be- tial as it gets. any assurance these words will actu- lieve in choice. That, of course, is their The fourth point I want to make: My ally match the rule of law. And that is prerogative. But to stand behind the friend from Missouri talks about the still a problem. visual of poor people struggling in single moms. Please help these single I see my leader and yield the floor.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00018 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.024 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12045 The PRESIDING OFFICER. The eral other Senate Democrats urging the reconstruction of Iraq. We will Democratic leader. the President to immediately and pub- begin writing an appropriations bill in Mr. DASCHLE. I thank the distin- licly call for all executive branch agen- response to all of this next Tuesday guished Senator from Louisiana. I ap- cies to provide their fullest and most morning at 10. preciate all of her effort in providing timely cooperation to the commission. I wish to bring to my colleagues’ at- leadership to the Senate on this appro- Unfortunately, no such call was tention a couple of things with respect priations bill. We will have more to say issued, 2 more months have elapsed, to this issue. First, when America about it next week. and we have another report form the sends its sons and daughters to defend f chairman and vice chairman that our interests, when America puts its should provide no comfort to those soldiers in harm’s way, it has an obli- ADMINISTRATION’S LACK OF CO- seeking the truth about what happened gation to provide the resources and OPERATION WITH 9/11 COMMIS- on 9/11. While stating that administra- funding needed to support their mis- SION tion cooperation has improved, at the sion. I will support that. I will vote for Mr. DASCHLE. Mr. President, I wish half-way mark of the commission’s that. I believe the Senate, the entire to use leader time to talk briefly about life, Chairman Kean said, ‘‘We have not Congress will do that. But, there is a another matter I call to my colleagues’ got everything. We have not gotten ev- difference between providing the fund- attention. erything that we feel we need to do our ing on an urgent basis for support of Late last year, I had the oppor- job.’’ our troops to carry out their mission in tunity—indeed the obligation—to work Chairman Hamilton indicated that Iraq and Afghanistan and the request on and support the most important the commission’s work is at a crunch for the reconstruction of Iraq. I want commission that has been established point and that unless the commis- to describe that difference. in all my years in public service. sioners receive satisfactory coopera- Iraq is a country with substantial re- In the aftermath of the terrible ter- tion from the White House the Com- sources. It is not a country desperately rorist attacks of September 11, the mission will be unable to meet its May, impoverished. It is a country with 24 families of the victims and all Ameri- 2004 reporting deadline. million people. It possesses the second cans turned to their elected leaders in Other commissioners have been more largest oil reserves in the world. Am- the White House and the Congress to stark in their assessment. According to bassador Bremer told us this week that help them obtain some answers to how a recent article in the Los Angeles when pumping at capacity, by next this tragedy occurred and what steps Times, two commissioners said, ‘‘the July he expects the Iraq oil fields to be should be taken to prevent future 9/11s. investigation is still hampered by heel- pumping at about 3 million barrels per Senate Democrats, led by Senators dragging by the White House and fed- day. That produces about $20 billion in LIEBERMAN and TORRICELLI, proposed eral agencies.’’ revenue per year, $16 billion of which is that the best way to provide these an- Despite the administration’s attitude available for export; therefore, the de- swers was to establish a blue-ribbon, toward the creation of this commis- velopment of currency as a result of independent panel to carefully sort sion, all of us who supported it hoped the export sales of $16 billion a year of through all the facts and evidence and that once established the administra- oil, each year, from the country of interview key policymakers. tion would recognize the significance Iraq. This is not an impoverished coun- The record will clearly show that and importance of its work and cooper- try. This a country with substantial this commission was strongly opposed ate fully. wealth under its sands. Pumping that by the White House. In fact, Vice Presi- We all owe an immense debt of grati- wealth in the form of oil and selling it dent CHENEY called me twice to indi- tude to the commissioners for their produces substantial revenue for the 24 cate, incorrectly in my view, that cre- hard work and dedication to this effort. million people. ating such a commission could jeop- Each of them has already spent count- With respect to the question of the ardize the administration’s efforts in less hours on this task and the families reconstruction, I want to go back to the war on terrorism. and the nation appreciate their work. April of this year and to a ‘‘Night Other Bush officials in other settings It would be a shame if the administra- Line’’ program in which Ted Koppel made it clear to the families and tion’s lack of cooperation prevented had on one of the top folks in the De- Democratic and Republican members them from completing their important partment of State who is in charge of of Congress that they were less than task. the U.S. Agency for International De- enthusiastic about having a commis- As Vice Chairman Hamilton’s re- velopment, Andrew Natsios. He was sion examine the administration’s ac- marks indicate, time is running out on asking Mr. Natsios about what would tions prior to 9/11. the administration to reverse course be required of the American taxpayers After it became clear that their oppo- and do right by this investigation. for the reconstruction of Iraq. I want sition was politically unsustainable, Time is running out on the commission to read this exchange because it oc- the administration switched gears and to get the information it needs to com- curred on the ABC television network 5 decided to support a commission pro- plete their work. And time is running months ago. vided that Congress remove several key out on the families and all Americans Ted Koppel says: You are saying that elements of the Lieberman/Torricelli to get the answers they deserve. I urge the top cost for the U.S. taxpayer will proposal designed to ensure the com- the administration to immediately and be $1.7 billion with respect to the re- mission functioned as effectively and completely cooperate with the commis- construction of Iraq? independently as possible. sion so this work can be completed suc- Mr. Natsios, one of the top officials Congress was effectively asked to cessfully to the expectations of those in the Department of State, who heads take it on faith that the executive families who have given so much. the USAID which has the mission for branch would work with the commis- I yield the floor. projects for reconstruction: Yes, for sion on a nonpartisan effort to shed The PRESIDING OFFICER. The Sen- the reconstruction. Then there is $700 light on the tragedy of 9/11. ator from North Dakota. million in the supplemental budget. Regrettably, that promise has not f He was referring to something we had been realized as the administration done earlier this year for humanitarian continues to throw roadblocks in front RECONSTRUCTION OF IRAQ relief. of the commission’s work. In July, the Mr. DORGAN. Mr. President, I have Koppel says: But as far as reconstruc- Chairman Kean and Vice Chairman just come from a meeting to discuss tion goes, the American taxpayer will Hamilton stated publicly that the Bush the Appropriations Committee work not be hit for more than $1.7 billion, no administration has been slow and unre- beginning next week on the request matter how long the process takes? sponsive in producing information from President Bush for $87 billion in Mr. Natsios: That is our plan. That is sought by the commission. urgent supplemental appropriations for our intention. Shortly after receiving this report, Iraq. Of that $87 billion, roughly $66 Koppel says: And these figures, out- the Senate unanimously approved an billion is in support of the military and landish figures I have seen, there is a amendment offered by myself and sev- the mission in Iraq; $21 billion is for bit of hoopla in all of this?

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00019 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.039 S26PT1 S12046 CONGRESSIONAL RECORD — SENATE September 26, 2003 Mr. Natsios says, in response to a hand them a bill. It is not this coun- training for private sector employ- question: That is correct. One point try’s obligation to bail out Saudi Ara- ment, $35 million; develop a program seven billion is the limit on recon- bia for debts that they allowed Saddam for computer literacy training in Iraq, struction for Iraq. Hussein to run up with their countries. $40 million; specialized computer train- Natsios says: The rest of it is going That is not our obligation. Iraqi oil ing in Iraq, $15 million; English as a to come from other countries. ought not to be used to repay Saudi second language in Iraq, $30 million; He says: We have arrangements with Arabia and Kuwait from money they modernize vocational training insti- other countries. loaned to Saddam Hussein. Saddam tutes, $25 million. Then he names the other countries. Hussein is gone. No one can find him. I could go on and on for 50 pages. I He says: In terms of the American tax- The Saddam Hussein government is out understand why they want to do this. payers’ contribution for the recon- of power. It doesn’t exist. What I don’t understand is why the struction of Iraq, $1.7 billion. The rest So then the question is, How do you American people are required to pay of the rebuilding of Iraq will be done by reconstruct this country? Well here is for this, when this country is a country other countries that have already made some of what American taxpayers are that has the second largest oil reserves pledges—Britain, Germany, Norway, being asked to pay for: Forty garbage in the world and has the capability to Japan, Canada, Iraq. trucks, $50,000 each; $9 million to cre- produce the revenue to pay for it them- He says: Eventually, in several years, ate a zip code for Iraq in the postal sys- selves. This makes no sense. It defies when it is up and running, and there is tem; $54 million for technical and busi- common sense. a new government that has been demo- ness process studies into a computer I am going to offer an amendment in cratically elected, they will finish the network for the Iraqi postal system; committee next Tuesday, and I will job with their own revenues. They are building seven new communities, 3,400 offer it on the floor if it doesn’t prevail going to get $20 billion a year in oil homes, including marketplaces, a in committee. I think we ought to do a revenues. But the American part of the church, and so on; two 4,000-bed prisons couple of things. One, I think we ought reconstruction for Iraq will be $1.7 bil- at $50,000 a bed. Well, that is just a to separate this issue and move the lion. We have no plans for any further start—fix some roads, fix up some elec- support for the troops immediately. I funding for this. tric grids. don’t think anybody here wants to That was this administration’s The interesting thing is that our withhold whatever necessary support is spokesman said in April of this year. ‘‘shock and awe’’ military campaign requested to support the military. We Well, 5 months later, we have a new explicitly did not target Iraq’s infra- sent them there; we have a require- request to the American taxpayers for structure. We didn’t take out their ment to support them with all they need to complete the mission. almost $21 billion to continue the re- power grid. We didn’t do it because we Second, I think we ought to separate construction of Iraq. didn’t want to. We didn’t destroy their the question of the reconstruction in Mr. Natsios said $1.7 billion. That is dams or their power grid or the infra- the country of Iraq and go back to all. We have no plans for any other structure of Iraq. Now we are told the April of 2003, 5 months ago, and the funding requests. Five months later, infrastructure must be reconstructed. promise made to us and the American they are asking for another $21 billion. Why? Because guerrillas and insurgent people by the head of the agency and Let me tell you what my contention movements inside Iraq have destroyed the State Department that is going to is on the $21 billion to reconstruct Iraq. some of the infrastructure in Iraq, and do the reconstruction, Mr. Natsios, My feeling is, rather than have the because Saddam Hussein let it deterio- when he said our total obligation we U.S. taxpayers provide $21 billion in rate for over 20 years. are going to ask the American tax- grants to reconstruct Iraq, the revenue So the question is, What do we do in payers to fund is $1.7 billion. Believe from Iraqi oil should be used to recon- Iraq, and who pays for it? me, he said that is the total amount That is a long route to get to my cen- struct Iraq. So I asked Ambassador the American people are going to have Bremer about that. tral point. I don’t believe it is the to fund. he said: Well, that is not possible. American taxpayers’ responsibility to Five months later, they came back I asked: Why? ante up $21 billion for the reconstruc- and said: By the way, because Iraq He said: Iraq has a substantial tion of a country that has the capacity owes money to Saudi Arabia and Ku- amount of debt. They have a lot of to borrow $30 billion, repay it in 10 wait, and Iraqi oil has to be pumped to debt. They have to repay this debt. years at 6 percent interest, with $4 bil- pay debts to them, we want the Amer- I said: To whom does Iraq owe debt? lion a year that comes from a $16 bil- ican taxpayer to pay for basic infra- He said: Germany and France and lion-a-year stream of revenue by pump- structure in the country of Iraq. Russia. ing oil out of the sands of Iraq. Com- I am telling you, there is something So after that hearing, I went and mon sense? Sure. Maybe there are some fundamentally flawed about that. I took a look at who Iraq owed money who cannot see that, but I think the hope my colleagues on the Appropria- to. Well, guess what. The top of the list American people will. tions Committee will see the same is not France, Russia, and Germany. At I have a September 2003 document. I thing. We are going to have a chance to the top of the list is Saudi Arabia and guess it is 55 pages. It is the recon- vote on my amendment. It is going to Kuwait and the other Arab States, and struction plan for the country of Iraq. be relatively simple. It says this: Let’s then, yes, there is some owed to France Let me say, I believe Iraq needs some fund the military request the President and Russia and Germany, as well. But reconstruction; there is no question sent to us and do so quickly, and in a at the top of the list is Saudi Arabia about that. The administration makes way that says there is no question and Kuwait. the point that the quicker this econ- about supporting the troops we have What the Ambassador was saying to omy gets up and moving, the quicker sent abroad. Second, here is the way we me is we cannot use Iraq’s oil to recon- you have a vibrant set of opportunities ought to reconstruct Iraq. The Presi- struct Iraq. That oil is going to have to in Iraq for the people, and the safer it dent is right. Iraq needs reconstruc- be pumped so they can sell it for cash will be for our troops. I agree with tion, but he is wrong to ask the Amer- and send money to Saudi Arabia and that. That is fine. But if you look at ican taxpayers to pay for that. The way Kuwait. So we will have the American what they are asking the American to reconstruct Iraq is to securitize the taxpayers pay some of their taxes so people to create in the country of Iraq oil to be pumped in Iraq at 3 million they can reconstruct Iraq. in these 55 pages, let me go through barrels a day, beginning in July, ac- Sound perverse? It sure does to me. I some of it: Private sector development, cording to Bremer, and use that think we should say to Saudi Arabia $200 million to establish an American- securitization for Iraqi oil to repay the and Kuwait: You loaned Saddam Hus- Iraqi enterprise fund to capitalize the securities from that over the next 10 to sein money. Well, you loaned money to enterprise fund to invest in a wide 20 years to reconstruct Iraq exactly as a government that doesn’t exist any- array of private enterprises. This is the administration wants it done. I more. You know that $50 billion Sad- sort of a venture capital fund of $200 don’t dispute any of these needs. I dam Hussein owes you, owed Saudi million. Expand networks of employ- don’t take issue with the administra- Arabia and Kuwait? Go find them and ment centers, $8 million; on-the-job tion saying this ought to be done. I

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00020 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.040 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12047 take very strong issue with the sugges- then have that country’s oil produce billions of dollars to Saudi Arabia and tion that somehow an administration the revenue to reconstruct the coun- Kuwait? that promised us 5 months ago the try. Somebody has to have some common total cost of reconstruction would be This is not a desperately impover- sense. We have to slow this thing down $1.7 billion, now says it is $21 billion in ished country. This is a country that and think about what we are doing. I reconstruction, which ought to come sits on top of massive quantities of think the administration is kind of dis- from American taxpayers’ funds, when money in the form of oil, and yet we combobulated. They are running we are dealing with the second largest are being told the American tax- around throwing out numbers they oil reserves in the world. payers—who are already facing very have not even thought through. That So we are going to have votes on this large, staggering deficits, I might say— just cannot be what the response of the in the Appropriations Committee. We that somehow the issues of building Congress is. are going to have votes on it on the dams, building prisons, building com- In light of this request for $87 bil- floor if it doesn’t prevail in committee. munities, doing job training, building lion—and that is the tip of the iceberg, I have been reading in the paper that hospitals, building health care facili- unfortunately. The fact is, it is very some colleagues feel the same way on ties, building roads, all of that should clear they are not going to get the $40 both sides of the aisle. They think this be borne by the American taxpayer at billion or $50 billion from anybody else makes no sense to talk about $21 bil- a time when they have the capability and they will be right back asking for tens of billions of dollars more. That lion in grants from the American tax- to produce the revenue in Iraq to pay cannot be the response. payers to fund these issues. I hope for all of that. This is inexplicable to Now, why not? First, it is not right. some of them will join me and that we me. It is not fair. The American taxpayer As I said to my colleague, I hope we can do what is right, use a big barrel should not be saddled with debts that full of common sense on an issue like have a healthy dose of common sense are not ours. We already have our own this, and help the American taxpayers that prevails on this question. Not on debts. We have a runaway freight train and the Iraqi people at the same time the military issue. I want some com- of debt in this country. and, most importantly, do what is nec- mon sense there, too, but I do not want In light of the President’s request for essary to support the American mili- anybody to question whether we are another $87 billion, I think it is time tary who is trying to carry out this going to support the military. We do. for us to go back to his State of the critical mission in that part of the On reconstruction, we really need to Union Address on January 28, 2003, world. go at this on behalf of the American when he said to us: God bless those men and women. We people, in their interest. It is not in This country has many challenges. We will pray for their safety. We pray for their their interest to have to add this to the not deny, we will not ignore, we will not pass families. As we work through this next Federal debt and say to America’s chil- along our problems to other Congresses, to week, I hope there is a healthy dose of dren, you pay for the reconstruction of other Presidents, and other generations. common sense in this Senate dealing a country that has oil to pay for its That is what he said to us. But look with this reconstruction issue. own reconstruction. at what has really happened. We are I yield the floor. I yield the floor. doing precisely what he said we will Mr. CONRAD. Will the Senator yield The PRESIDING OFFICER. The Sen- not do. The debt of the United States, for a question? ator from North Dakota. which will be passed on to future gen- Mr. DORGAN. I would be happy to Mr. CONRAD. I thank my colleague erations, which will be passed on to fu- yield. for giving an excellent presentation ture Congresses and to future Presi- Mr. CONRAD. The Senator has men- and an excellent suggestion. This coun- dents, is absolutely mushrooming out tioned that the President has come be- try has the second largest oil reserves of control. fore us and asked for $21 billion to re- in the world, and we are getting ready The President told us just 2 years ago construct Iraq. In addition to that, the to have the American people rebuild that in 2008 the debt would be virtually President is saying there is another $40 that nation. paid off. He said there would only be billion to $50 billion of needs next year There is something really wrong with $36 billion left. Now, we know if we for the reconstruction of Iraq that is the administration’s thinking on this enact the President’s policies, instead supposed to come from someplace else. matter, to come before us and ask for of virtually paying off the publicly The President and his people have said $21 billion, to say there is another $40 held debt by 2008, which is the smaller some of these other countries are going billion to $50 billion of need in the next part of the debt, it will be $6.2 trillion. to contribute. Is the Senator aware of year and that they are going to get it How much is that? That is 6,200 billion this additional $40 billion to $50 billion from somewhere else, when the some- dollars. That is how much the debt is of money for reconstruction of Iraq where else has promised $1.5 billion. So going to be by 2008, the point at which that the President has identified? there is a shortage of another $40 bil- the President had told us we were Mr. DORGAN. Mr. President, re- lion. Where is that going to come from, going to have virtually paid off the sponding to the question, I am, and and what is it being used for? debt. So the President was wrong, and Ambassador Bremer made the same My colleague from North Dakota wrong by a mile, on that assertion. The President told us: point as did Secretary Rumsfeld. pointed out what was in the Wash- There is a donor conference that is ington Post this morning, a detailed Tax relief is central to my plan to encour- age economic growth, and we can proceed being held in Spain in just a matter of analysis of some of these expenditures. with tax relief without fear of budget defi- a couple of weeks. We have asked what One that I found most unusual was $1 cits, even if the economy softens. is the proclivity of these countries to million per family in Iraq for a witness He told that to us 2 years ago. But begin helping and donating. Here is protection program for 100 families. let’s look at what we now know. What what we were told: I believe it is 69 That is $100 million—$1 million a fam- we now know is that instead of the as- countries have donated $1.5 billion ily. That is a pretty good deal. It is sertion by the President that there total. going to be used to build prisons in were not going to be budget deficits, we In this request, they are asking the Iraq for $50,000 a bed. Somebody is not have record budget deficits, the biggest American taxpayers for $21 billion but thinking straight. in the history of the country, and by a say there will be a dramatic amount They are going to create a ZIP Code, country mile. The President’s last pro- more that is needed but that is going millions of dollars to create a ZIP posal was reviewed by the Office of to come from somebody else. It appears Code; area codes for phone systems, Management and Budget, and they tell very unlikely it is going to come from millions of dollars paid for by Amer- us now that the deficit will be $535 bil- anybody else. That is my point. ican taxpayers. I do not think so. This lion next year. The first step is I think this adminis- in a country that has the second larg- The previous record deficit was in tration ought to work to have debt for- est oil reserves in the world. As my col- 1992, when the first President Bush was giveness with Saudi Arabia and Kuwait league has pointed out, the reason we in office, and the deficit was $290 bil- and others so they do not have that cannot use their oil money to rebuild lion. Now for next year, it is $535 bil- debt overhanging that country and their country is that they owe tens of lion. That is a record deficit. The

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00021 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.042 S26PT1 S12048 CONGRESSIONAL RECORD — SENATE September 26, 2003 President told us just 2 years ago it be wrong. Now the President is saying, 1950. You will recall one of his major would not occur. as a share of the whole national econ- justifications for the tax cuts 2 years Then the President told us the next omy they are relatively small. ago was that revenue was at a record year: The problem with that statement is percentage of gross domestic product. . . . our budget will run a deficit that will it is wrong, too. It is wrong, too. The Now we are headed for a record low, in be small and short-term. . . . next chart shows how big these deficits terms of revenue, and his answer is the He told us the budget deficit would are as a share of our national income. same: Cut revenue more. It doesn’t be small and short term. That was just This chart goes all the way back to the matter what the question is, the an- a year ago. This is according to the end of World War II—just after the end swer from this President, from this ad- President’s own budget documents. of World War II. You can see the pre- ministration, is the same: Cut the rev- This is what happens if his spending vious record deficit as a percentage of enue. If revenue is high, cut it. If rev- and his tax proposals are adopted. GDP was back in 1983—6 percent of enue is low, cut it some more. What we see is an ocean of red ink, and gross domestic product. It is not just a question of revenue one that grows year after year. These Next year, the deficit as percentage being low, it is also a question of are not small deficits, they are not of gross domestic product is going to be spending being increased. This chart short-term deficits, they are the big- 6.2 percent, if one excludes the Social shows, for this year, 92 percent of the gest deficits we have ever had. And the Security trust funds from the calcula- increased discretionary spending is in next 10 years is the budget sweet spot. tion. So if you are looking at the budg- just three categories: Defense, which They are the good times, according to et on an operating basis, if you are accounts for the vast majority of it; the President’s own analysis of his pro- looking at it as any private sector firm homeland security, which is the second posals. His own budget shows us that would have to look at its budget, what biggest chunk; and the third biggest his plan is taking this country right you see is the biggest deficit, as a per- chunk is rebuilding New York and pro- over the fiscal cliff. This is what he centage of gross domestic product, viding relief for the airlines, so badly says will happen to budget deficits. Not since World War II. And the President affected by what has occurred. So we only are they not small, they are says it is relatively small. It is not rel- have not only the lowest revenue since record. And they are not short term, atively small, it is huge. It is the big- 1950, we also have increased expenses they are endless. gest it has been since World War II. for defense, homeland security, re- This is the President’s analysis out Of course, what the President has left building New York. to the year 2050, and there is no break out is that the Social Security sur- Of course, all of us support those in- in deficits anywhere here. It is deficits pluses back in 1983 were virtually non- creased expenditures in order to meet each and every year. We are in this existent. So when the President—the the obligations the country has taken on under this President. part of the chart now, which shows the then-President—took those moneys, he The President is fond of saying, ‘‘It’s smallest deficits, and we know they are wasn’t taking much. But look at what has happened to the Social Security the people’s money.’’ record deficits, the biggest deficits we This is a place where I agree with the surpluses. They have been mounting have ever had in the history of the President absolutely. It is the people’s dramatically, and now this President is country. money, he is absolutely right about taking every dime of Social Security Next year alone, there is a deficit of that. This is the people’s money. But surplus to pay the operating expenses $535 billion. The truth is, it is much what the President has left out is that of the country. No private sector firm worse than that because they are going it is also the people’s debt. What he is to take $160 billion of Social Security would be able to do that. If you were in running up here is a debt that is truly money on top of that $535 billion of def- the private sector, you couldn’t take massive in scope. icit. They are going to take every the retirement funds of your employees This looks at the gross debt of the penny of Social Security surplus and and throw those into the pot to pay United States. Earlier we were talking throw that into the pot. So, on an oper- your operating expenses. If you did, about the publicly held debt. But if you ating basis, the deficit next year is you would be on your way to a Federal look at the gross debt, not only what really going to be $700 billion. institution, but it would not be the we owe those who have loaned money The debt of the United States at the White House. It would not be the Con- to the United States—which, by the time Jimmy Carter was President, gress of the United States. You would way, includes a lot of money from after 200 years of history in this coun- be on your way to the Federal peniten- Japan and Europe—we also see that we try, was around $750 billion, and we are tiary, because that is a violation of owe money to ourselves. We owe money going to add that much or virtually Federal law. to the Social Security trust fund that that much in 1 year under this Presi- Yet that is what this President is the President has been taking money dent’s plan. That is not the most seri- doing this year and next year, taking from in order to float this boat. That is ous part. That is not the part that real- every dime of Social Security trust truly stunning. ly worries this Senator. What really fund surplus. And not just this year We have a gross debt of $6.8 trillion worries me is, that is the tip of the ice- and next year. Under the President’s at the end of this year. But look at berg, according to the President’s own budget plan, he is going to take every what is going to happen in the next 10 analysis of his plans. penny of Social Security surplus this years. We are going to have a gross He says, if you adopt his budget plan, year and next year and the year after debt approaching $15 trillion. That is his spending, his tax plan, that the that and the year after that and the 15,000 billion dollars. That is real deficits grow geometrically when the year after that and for the next 10 money. And all of this is happening at baby boomers start to retire. At the years. Every penny is being taken to the worst possible time. very time the baby boomers retire, the pay the operating expenses of the Fed- Why the worst possible time? Be- cost of the tax cuts explode, pushing us eral Government. cause, as this chart shows right now, deep into deficit and debt, to levels This President is taking us down the the green bar, which is the Social Secu- never seen in the history of the United road that is a fiscal disaster of the first rity trust fund, the blue bar which is States. That is the plan the President order, and we had better start facing the Medicare trust fund, are running is pursuing. It is a reckless plan and it up to it. We are going to have an oppor- surpluses in anticipation of the retire- is a dangerous plan. tunity next week because the President ment of the baby boom generation. Un- The President presented his budget has come before us and asked for an- fortunately, the money is not being for fiscal year 2004, and it said: other $87 billion—put it on the charge used to prepare us for the retirement of Compared to the overall Federal budget card. No, this $87 billion has to be paid the baby boom generation. The money and the $10.5 trillion national economy, our for. We have to start getting back on is all being taken and spent on the op- budget gap is small by historical standards. track. erating expenses and to pay for the First of all, there weren’t going to be The President, in his latest esti- President’s tax cuts. That is where the any deficits. That proved to be wrong. mates, tells us that revenue as a per- money is going. Not to prepare for the Then the deficits were going to be centage of gross domestic product is retirement of the baby boom genera- small and short term. That proved to going to be at its lowest level since tion.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00022 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.044 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12049 The red part of these bars is the cost We just have to look at what has hap- Now some are saying deficits don’t of the President’s tax cuts. What one pened. We all can look and we can read really matter. It is really quite stun- sees is, when the trust funds go cash reality tests. Does it make sense? ning to hear some of our Republican negative, which happens in the next Two years ago, the President told us colleagues, who for years believed defi- decade—in fact, it begins to happen we could have it all. The President said cits did matter, all of sudden com- pretty soon because in 2008 the leading we could have massive tax cuts. He pletely change course and say deficits edge of the baby boom generation told us we could save Social Security don’t matter. The Chairman of the starts to retire. and Medicare without touching the Federal Reserve Board believes deficits Look at what happens when those trust funds. He said we could have matter. Here is what he said before the trust funds go cash-negative at the maximum paydown of the debt. He said Senate Banking Committee: very time the cost of the President’s we could have a big defense buildup. He There is no question that as deficits go up, tax cuts explode, dragging us deeper said we could do it all. He was wrong. contrary to what some have said, it does af- and deeper into deficits and debt. This He was wrong by a country mile. He fect long-term interest rates. It does have a is utterly unsustainable. It is leading was wrong on each and every count— negative impact on the economy, unless at- us to a crash landing. not protecting Medicare and Social Se- tended to. You don’t have to take my word for curity. He is taking every dime of the Again, we didn’t need to just listen it. Here is a report from the New York Social Security trust fund surpluses for to the head of the Federal Reserve Times of September 14 reporting on the the entire rest of the decade. Board. Hear what the head of the Con- Congressional Budget Office’s warning He said we wouldn’t have deficits. We gressional Budget Office said in testi- to all of us here in Congress. Let me have record deficits. He said he would mony before the Budget Committee quote from the New York Times: virtually pay off the debt. The debt is earlier this month. He said: exploding. The President is taking us This course— To the extent that going forward we run down a course that does not work. large sustained deficits in the face of full the fiscal course that the President has Most recently, he told us: employment, it will in fact crowd out capital embarked upon— It is important for you all to understand, accumulation and otherwise slow economic prompted the Congressional Budget Office to for our fellow Americans to understand, the growth. issue an unusual warning in its forecast last tax relief I have proposed—and will push for This is the testimony of Mr. Holtz- month: If congressional Republicans and the until enacted—will create 1.4 million new Eakin who was, again, put in office by administration get their wish and extend all jobs by the end of 2004. the Republicans who control both of their tax cuts now scheduled to expire, We are not at the end of 2004. So we Chambers, and came from the Presi- and if they pass a limited prescription drug can’t make a judgment on that. But we benefit for Medicare and keep spending at its dent’s own economic advisors saying current level, the deficit by 2013 will have can look back at 2001. that deficits do matter. They do hurt built up to $6.2 trillion. In 2001, he made the same kind of economic growth in the long term. claim. He said if you pass his plan, Again, I go back to the Comptroller That is not the gross debt. That is which we did, it was going to generate the publicly held debt—$6.2 trillion. General and his outstanding speech to millions of new jobs. the National Press Club on September That is 6,200 billion. Wrong again. He hasn’t generated They go on to say: 17. millions of new jobs. He has lost mil- The ‘‘bottom line’’ is, there is little ques- Once the baby boomers begin retiring at lions of jobs—3.3 million jobs lost by the end of this decade, that course will lead tion that deficits do matter, especially if August 2003 since this President took they are large, structural and recurring in either to drastically higher taxes, severe office. That is the worst record on jobs spending cuts, or ‘‘unsustainable levels of nature. In addition, our projected budget debt.’’ since Herbert Hoover. No other Presi- deficits are not ‘‘manageable’’ without sig- dent of either party has lost private- nificant changes in ‘‘status quo’’ programs, That is the course we are on. That is sector jobs during their entire term policies, processes and operations. the course the President has put us on. since the Great Depression. This Presi- I don’t know exactly when this Con- It is a disastrous course by any judg- dent has lost 3.3 million jobs with his gress is going to awaken to the threat ment. economic plan. that is barreling down on us, but we Again, we have heard from the Con- Once again, he is wrong—just wrong. face a circumstance just as clear as it gressional Budget Office. He is just wrong in assertion after as- can be: The largest deficits in our his- By the way, the head of the Congres- sertion after assertion. He is just tory in dollar terms, by far. Deficits as sional Budget Office used to be on the wrong. That is the hard reality we have a percentage of GDP fairly measured President’s budget team, his Council of to cope with. that are the largest since World War II Economic Advisers. He came from the If we look at this recovery that is un- and no relief in sight. Instead, deficits White House. derway—and there are signs of eco- as far as the eye can see, massive defi- You don’t have to just listen to me or nomic recovery, which one would ex- cits that are coming at the worst pos- to him. Here is the Comptroller Gen- pect—if you go and write $700 billion of sible time, right before the baby eral of the United States, David Walk- hot checks in a year on the Federal ac- boomers retire, right when we should er, in a speech on September 17 to the counts, you expect to give some lift to be paying down debt or prepaying the National Press Club. He said in that the economy. By spending all of this liability. speech: additional money, all of these tax cuts, Instead, we are taking the money, The ultimate alternatives to definitive and you would expect the economy to im- hundreds of billions of dollars; in fact, timely action are not only unattractive, prove, and it is improving. But we are over $2 trillion of Social Security sur- they are arguably infeasible. Specifically, not seeing much pickup in jobs. pluses alone over the next decade the raising taxes to levels far in excess of what We charted the last nine recessions the American people have ever supported be- President proposes taking to spend on fore, cutting total federal spending by un- which have occurred since World War other operations in government. That thinkable amounts, or further mortgaging II—the job recovery that occurred dur- is $2.4 trillion of Social Security the future of our children and grandchildren ing the recovery from those recessions. money, taking every dime. Not just to an extent that our economy, our competi- Here is the trend line that we see: In this year, not just next year, but every tive posture and the quality of life for Amer- each of those nine recessions, there has year for the next decade. icans would be seriously threatened. been a good pickup in jobs when the Two years ago the President told us This is the Comptroller General of economy started to recover. Here is the we could expect nearly $6 trillion in the United States put in place by the pattern in this recovery. This is like a surpluses over the next 10 years. In just bipartisan leadership of Congress warn- dead cat bouncing. Nothing is hap- 2 years that has turned into $4 trillion, ing us that the course the President pening. Jobs are not being recovered. $4,000 billion of deficits. has us on is a disastrous course. Jobs are still being lost, and the Presi- Where did the money go? Here is We don’t have to just listen to the dent told us he had a plan, he had a where it went: 39 percent went to the head of the Congressional Budget Of- strategy that was going to bring back tax cuts the President proposed and fice, or have to listen to the Comp- jobs—millions of jobs, he said. He was pushed through Congress; 28 percent troller General of the United States. wrong. went to increased spending, largely, as

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00023 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.046 S26PT1 S12050 CONGRESSIONAL RECORD — SENATE September 26, 2003 I indicated earlier, defense and Home- we say, ‘‘Just put it on the debt of the Continue to defeat all threats. Feb- land Security; 7 percent went to the American people’’? I don’t think so. ruary 4: Continue transfer responsi- economic downturn; 27 percent in rev- There has to be a better way. bility to the Iraqis. enue shortfalls not associated with the I yield the floor and suggest the ab- It is an insult to the American peo- tax cuts. So two thirds of the dis- sence of a quorum. ple. It is an insult to our troops who appearance of the surplus in the move The PRESIDING OFFICER. The are paying with their lives. For most of to deficits is on the revenue side of the clerk will call the roll. us, when it comes to Iraq, there is a equation. That is where the money has The assistant legislative clerk pro- widening credibility gap between rosy gone. ceeded to call the roll. descriptions of progress by the admin- Some are saying, we do not have to Mr. KENNEDY. Mr. President, I ask istration and the hard reality on the worry about this; we will grow our way unanimous consent that the order for ground for our troops and for the Iraqi out of it. Here is what the Comptroller the quorum call be rescinded. people. General of the United States said, The PRESIDING OFFICER. Without On September 14, Vice President CHE- again in a speech to the National Press objection, it is so ordered. NEY said ‘‘90 percent of the cities and Club: Mr. KENNEDY. Mr. President, we are towns and villages are governed by [T]he consensus opinion at a recent meet- in morning business? democratically elected or appointed ing of prominent economists representing a The PRESIDING OFFICER. The Sen- local councils.’’ He said that ‘‘all the wide variety of ideological viewpoints was ator is correct. schools are open, and that all the hos- that . . . ‘‘we cannot simply agree our way Mr. KENNEDY. I thank the Chair. pitals are up and functioning.’’ out of this problem.’’ Mr. President, early next week we In yesterday’s Washington Post, Sec- It is time to face up to reality. It is will take up what has now become the retary Rumsfeld wrote glowingly of our time to face up to the fact we have defining issue of this session of Con- ‘‘solid progress’’ in restoring Iraq. Yet again down a course that is not work- gress—the Bush administration’s pro- we all know that the reality on the ing. I am not casting aspersions on posal for $87 billion for Iraq. ground is quite different. And we are anyone’s intentions or motivations. I support our troops in Iraq. We all learning that there are even those That does no good. But we can now support our troops in Iraq. If that is within the administration who are re- look back at the President’s record ob- the issue, the vote will be 100 to noth- porting that things are not going well. jectively and clearly. We can see that ing in the Senate. Yet, those concerns are kept carefully statement after statement he has made The administration had an effective from public view. to this Congress was simply wrong. plan to win the war. The tragedy is In fact, the New York Times reported He said there would be no deficits. that our troops are paying with their just last week on September 17 that We have record deficits. He said they lives because the administration failed new intelligence reports conclude that would be small and short-term. They to prepare a plan to win the peace. ordinary Iraqis are turning against us. are massive and unending. He said they Our troops performed superbly in the And Defense Department officials be- are small as a percentage of our gross war. They are doing their very best lieve that ‘‘indications of that hostility domestic product. They are the biggest under enormously difficult cir- extend well beyond the Sunni heart- they have been since World War II as a cumstances now. They deserve the full land or Iraq, which has been the main percentage of gross domestic product, support of Congress, and they will get setting for attacks on American fairly measured. The President said it. forces.’’ We are still losing an American a this would all create jobs. He said it But they also deserve a realistic plan day. After going it alone on the war, would create millions of jobs. Millions from the administration. They deserve we have few allies to relieve our troops of jobs have been lost. to know how the administration will and join us in winning the all-impor- Now he says he needs another $87 bring in the international community, tant peace. million that he does not want to pay deliver on the promise of democracy, Secretary Rumsfeld admitted this for. Where is the money going? We and bring our troops home with honor. week that our failure to recruit suffi- The administration has refused to have heard a number of presentations cient foreign troops likely means addi- provide a realistic plan to the Congress this morning: 500 experts, at $200,000 tional callups for our reservists and and our troops. It has provided only a each, to investigate crimes against hu- guard units. General Abizaid told the 2-month-old, 28-page plan called manity in Iraq. Let me repeat that. Senate Armed Services Committee yes- ‘‘Achieving The Vision To Restore Full Here we are in the deepest deficit, in terday that ‘‘it doesn’t look like we’ll Sovereignty To The Iraqi People.’’ debt at the worst possible time, and have a coalition brigade. We have no I would like to know why it is called the President says one of the things we choice but to plan for American a working document. I would like to should do is get us 500 experts at forces.’’ He is not counting on foreign know why the administration is asking $200,000 each to investigate crimes troops. Clearly, the situation in Iraq is the Congress to write an $87 billion against humanity. I am all for inves- out of control. Our policies are not blank check based on the draft plan. tigating crimes against humanity, but working. Our plan in Iraq is an $87 bil- This is the draft plan. I will include I am all against spending $200,000 each lion failure, and our troops are paying it by reference rather than including for 500 people in one year to investigate the price. crimes against humanity in Iraq. Have all of it in the RECORD. It is 28 pages, The administration must admit that we completely taken leave of our including the cover page, ‘‘Coalition our plan is not working, that we can- senses around here? Provisional Authority, Baghdad, Iraq, not stay this course. We know it. The He wants to build prisons over there Achieving the Vision to Restore Full American people know it. Our allies at $50,000 a bed. He wants to have a wit- Sovereignty to the Iraqi People,’’ dated know it. We cannot afford just to stay ness protection program that will pro- July 21. It is a working document that the same failing course. We owe our vide $1 million per family. Yes, it is is the basis of the administration plan troops a change in plan. there. Read the Washington Post: A that was provided to the Armed Serv- Before the Congress writes a blank witness protection program for fami- ices Committee. check for $87 billion, we need to know lies of five, 100 families of five, at I will read from the provisions in the that the administration has a realistic $200,000 each in the family, five people, plan on security from August 1 to Oc- plan. Our troops who are paying with $200,000 each, and that is $1 million for tober 3, point 4: Locate and secure and their lives deserve no less. 100 families, for a total of $100 million. eliminate WMD capability. Then No- I suggest the absence of a quorum. We do not have a witness protection vember 3 to January 4: Continue to lo- The clerk will call the roll. program like that in this country. cate and secure and eliminate WMD ca- The assistant legislative clerk pro- Let’s get serious around here. We are pability. And then from February 4: ceeded to call the roll. in disastrous deficit and debt and we Continue to locate and secure and The PRESIDING OFFICER. In my are talking about these kind of expend- eliminate WMD. Point No. 1: Defeat in- capacity as a Senator from South Caro- itures in a country that has the second ternal armed threats. That is August lina, I ask unanimous consent that the largest oil reserves in the world, and to October. November to January 4: order for the quorum call be rescinded.

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00024 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.049 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12051 Without objection, it is so ordered. there is a response generated that That used to be the argument: There is f makes sense and is locally supported, public education moneys and the which has new Federal dollars, new ad- money will be taken from public edu- RECESS SUBJECT TO THE CALL OF ditional dollars coming in to support cation and diverted to nonpublic edu- THE CHAIR the initiatives, it is frustrating that if cation. That argument is bogus. It does The PRESIDING OFFICER. In my there are 4, 5, 6—I don’t know the num- not exist. This is new money that is capacity as a Senator from South Caro- ber of people who oppose choice in edu- coming into the system. lina, I ask unanimous consent that the cation and parental involvement, but if The record today in the District, in Senate stand in recess subject to the they have amendments, we can debate terms of educating children, has been call of the Chair. them. Then we can vote on these painted pretty well, but in too many Without objection, it is so ordered. amendments, and hopefully defeat ways it ends up being almost statistics There being no objection, the Senate, them, because I am a great believer in and coldhearted facts. But the cold- at 1:17 p.m., recessed subject to the call DC choice but at least allow us to de- hearted facts, I have to say, do tell the of the Chair and reassembled at 1:26 bate. story. We spend about $1,200 per stu- p.m. when called to order by the Pre- Avoiding offering amendments when dent right now, per capita, per kid, in siding Officer (Mr. CRAIG). time is being made available on the the District. In spite of that, the out- The PRESIDING OFFICER. The ma- floor, in response to the great needs comes, the scores, are lower than any jority leader is recognized. that we know exist, is frustrating and State in the country today. So the an- f in some ways disappointing. swer is not just money. We know that. The only amendment that has Only 10 percent, or 1 out of 10, of the RECAPPING THIS WEEK’S passed, in fact, was by Senator FEIN- LEGISLATION District’s fourth graders are proficient STEIN, who is an advocate for this bill. in math. Less than 12 percent of the Mr. FRIST. Mr. President, there are So really there have been no amend- District’s fourth graders can write at several issues I wish to take this oppor- ments proposed from the other side. grade level. Actually, it is fewer than tunity to comment on at the end of Yet, as we heard in the opening com- 10 percent of the District’s fourth grad- this week. First is the issue that has ments a few hours ago, the opposition ers are proficient at math, and right at been discussed for the last 3 days and insists that we cannot move this bill 10 percent are proficient in reading. which we will be coming back to on anytime soon. That means 90 percent are not pro- I say that despite the positive impact Monday—the issue of education of ficient at reading. Only 6 percent, that we know this bill can make on the young children in the District of Co- about 1 out of 20 or 1 out of 18, of Dis- District’s schoolchildren. I am not ex- lumbia. trict fourth graders can do math at a actly sure why there is this refusal to With the leadership of the Mayor and proficient level. working closely with the person who offer amendments and live with the Words were used like ‘‘disgrace,’’ day in and day out observes firsthand outcome, when the time is made avail- which I think it is, and ‘‘scandal,’’ not able and the issue is before us. I hope it what happens in the District, the head in the sense that there is misappropria- is not national politics because we are of the school board, and local officials, tion but a scandal in the fact that the talking about the District’s school- a proposal has been put together, gen- outcome is so poor for these students children. We are not talking about a erated at the local level, that we are and the disgrace is really in some ways currently talking about and debating partisan national debate. Our goal is to give children today the ours for not responding and responding before the Senate. That is the issue of aggressively and appropriately. That is allowing young children in school who very best education possible. So we need to debate it, we need to amend it, what we can do by passing this bill. are trapped—for the most part, impov- I should also add that I believe the erished children—in failing schools and if necessary, and, if not, we need to move on, have a vote on it, and express dropout rate in the District is around giving them the opportunity to expand, 42 percent, and nationwide it is about grow, learn, and become educated, and the will of this Senate for the benefit of the kids. 29 percent. So 42 percent do not go on thus giving them a shot at what we all The Senate Appropriations Com- to school. As I mentioned before, the know as the American dream. mittee has passed legislation that does ACTs and the SATs, which would allow Yesterday was a unique day in that offer this city’s schoolchildren a gen- one to go to college, are the lowest in on the floor of the Senate was Mayor uine opportunity to achieve an edu- the country as well. So kids who are Anthony Williams, who made a historic cation. It has been pointed out on the graduating from public school are grad- visit to the Senate floor at the invita- Senate floor, but it is important for me uating with an inability to read, write, tion of Senator FEINSTEIN. From his to again state it, that this is $40 mil- do math, and to add and subtract, real- presence here and in our many con- lion of new money, that is additional ly basic measures. versations with him, what is empha- money which, if this legislation passes, None of us in this Chamber would sized is how important this issue is to will come. If the legislation does not tolerate that sort of outcome for our the District, to the future of this Dis- pass, that additional $40 million is not own children, unable to complete sim- trict, because it has to do with children going to go into education today. The ple fourth grade mathematics, or in the and education. That is how important money is to be divided between the fourth grade an inability to write at this issue of choice is, empowering the supporting of public schools, of charter grade level. Would we tolerate it? The parents to have some sort of say in schools which are in the District, and answer is clearly, no. their children’s education. then a new nonpublic opportunity It has been pointed out that many of As Senator FEINSTEIN has so elo- scholarship program whereby over 2,000 the people who oppose school choice for quently argued, the District of Colum- students who are impoverished, who children and parents in the District, in bia choice program is the Mayor’s pro- are trapped in failing schools by defini- this body and in the House of Rep- gram. It is not our program—the Sen- tion in the legislation, are given the resentatives as well, send their kids to ate program or the House program, or opportunity to walk, with a check of private schools, and yet at the same the Federal Government program. It is $7,500, to any nonpublic school in the time, when the opportunity is there, the program of the District and for the District. If we pass the legislation, they do not give that same opportunity District’s children and families. It is they have that opportunity. If we do to other parents. what the leaders in the District of Co- not pass the legislation, they are not I mentioned Mayor Tony Williams, lumbia want. going to have that opportunity. It is as DC Board of Education president Peggy We have spent almost 3 whole days simple as that. Cooper Cafritz, City Council member on the bill, and we will spend, as I men- That is, again, why this is frustrating Kevin Chavous are all courageously ad- tioned, Monday on it. Today, only one to me as majority leader and as one vancing the cause of universal edu- amendment has been offered. It is frus- who is trying to schedule the Nation’s cation for DC’s kids. In addition to trating to me when we recognize the business accordingly. them are the parents of kids in the Dis- real problems that are in the District It is new money. It is not going to trict. All across the city, parents line today in terms of education and we see take resources from other education. up in order to obtain better options for

VerDate jul 14 2003 00:05 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00025 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.052 S26PT1 S12052 CONGRESSIONAL RECORD — SENATE September 26, 2003 their children. The need is so real and This week, several days ago, we re- neglected in many ways by the inter- so intense that the District public ceived word that the civil war that has national community. I am pleased school choice programs right now in raged there for 20 years and has since we first went in about 4 years the District are oversubscribed. claimed over 2 million lives, lives lost ago, the region has opened up to more Each year, more than 1,000 school- as a product of this civil war, a war relief and more transparency and much children are wait-listed for the city’s that has caused over 5 million families more of a spotlight, where the world magnet programs, those magnet pro- to leave their homes, to be displaced can see the human tragedy that has grams which give those unique oppor- from their homes and have to move to gone on in that part of the world. tunities for parents to choose, with another part of the country—that civil I also mentioned, as part of the their kids, the type of program that war may be one step closer to ending. agreement, the southern Blue Nile. best suits their individual needs— On Tuesday evening the Sudanese About 2 years ago I had the oppor- again, stressing the importance of pa- rebels and the Khartoum Government tunity to go to the Blue Nile region. I rental involvement, of matching needs reached an agreement on the position was in the Blue Nile region actually to sources. More than 1,000 children are and size of their respective armed just a day after a very significant bat- wait-listed trying to get into those pro- forces. A formal agreement, since that tle that had been fought in that region. grams. time, has been signed. This agreement It was just the night before. Again, I Right now the District has made includes three significant break- am delighted that is part of this forma- more headway than my own State of throughs: A substantial withdrawal of tion of an integrated force, both in the Tennessee in the development of char- government forces from the southern southern Blue Nile and the Nuba Moun- ter schools. About 15 percent of DC’s region of the country; redeployment of tains. kids are in charter schools. About the Sudan People’s Liberation Army, I have had the opportunity to go to 11,500 are in attendance in those char- the SPLA, forces in Khartoum, and Pabong, which is in the oil region, ter schools. Once again, because they third, the formation of an integrated where people have been displaced sev- get that opportunity to better match force in the southern Blue Nile region eral years ago. Although this whole resources to needs in an overall system and the Nuba Mountains. wealth sharing is an issue that has to that is failing and involves more What this typically means is that be addressed in the future, it is an choice, there is a waiting list of over units are integrated to include troops issue about which I am very hopeful, 1,000 kids in the District for charter from each side. That way, each side now that progress is being made along schools right now. acts as a check, a check and a balance the lines of increased peace in the Indeed, in this $40 million there is in- on each other. Sudan. creased funding for charter schools Sudan’s Vice President, Osman Ali, Last month I was able to operate and which are part of the public education says the deal ‘‘has paved the way for a perform surgery in a hospital called system in the District. comprehensive peace agreement.’’ Lui Hospitala, a hospital sponsored by Thinking in terms of choice and op- The Southern People’s Liberation the Samaritan’s Purse, a faith-based portunity scholarships, where indi- Army, SPLA, leader John Garang, con- organization here in the United States. vidual kids have the opportunity to curs, saying, ‘‘With this agreement, the When I first started going to that hos- take resources that are already being direction and orientation for peace in pital, it was just a schoolhouse. That spent on their behalf and allowing Sudan is irresponsible.’’ was about 6 or 7 years ago, 1997. Osama them to choose the school they could Clearly, while the agreement is key, bin Laden had just left, I think about go to, taking that same principle, there are still significant issues to be 1996, from the Sudan. When we first which is the principle behind, the fun- resolved. Many issues remain; for ex- went into the area of southern Sudan, damental power behind, DC choice, one ample, those regarding power and re- it was just a schoolhouse there. The need only to look at when John Walton garding the whole topic of wealth shar- original hospital had land mines and Ted Forstmann invested $2 million ing. But the good news and the encour- around it. in the children’s scholarship fund in aging news, the news that brings joy to Since that point in time, over the the District. What happened? my heart, having spent so much time last 6 or 7 years, the land mines have There were 1,000 seats and yet 10,000 in the Sudan personally, is that both been removed from the old hospital kids applied for those 1,000 seats— sides have looked at extending the grounds and now 30,000, 40,000, 50,000 pa- again, to show the pent-up demand cease-fire for 2 additional months, so tients are seen a year at that par- here for greater choice, greater oppor- they can keep talking and keep work- ticular facility. tunity to choose the type of school ing toward peace. Through these experiences, I have that best suits your needs. A 2-month cease-fire, what does that had the opportunity of seeing first On this particular issue, I just want mean? It means there will be less of the hand the shattering results of a brutal to close and say I do stand with those destructive killing, the bombing, the civil war. President Bush very early parents, with those people on those wars, and the battles that go on almost on, right after he began office as Presi- waiting lists, because we have an op- in a routine manner in that part of the dent, appointed Jack Danforth as a portunity to reverse that and to ex- world. special envoy to that region—again pand the opportunity for families to I was just in the Sudan about 4 weeks showing the importance to the United become involved and kids to have that ago. I had the opportunity to work at States to establish, to promote, and to choice. To me it is nonsensical for us the mission hospital there and become work for peace in that part of the to withhold from them that oppor- very intimately acquainted, again not world. tunity when it is within our power to as a Senator but as a doctor, with indi- In the Senate we passed the Sudan do so, to support each child’s right— viduals who have suffered, directly or Peace Act. We will continue to follow and it is a basic right—to learn to read indirectly, from these war injuries. I go very closely the situation. We will con- and to write and to add and subtract. to the Sudan about once a year, plus or tinue to work with the administration, Basic education for our schoolchildren minus several months, where in the Jack Danforth and President Bush, to simply just cannot wait. past I again have had the opportunity support the efforts of the Kenyan medi- f to treat people who have been hurt di- ator, Lazarus Sumbeiywo, to encourage rectly in the war, people who have lost and support this encouraging under- ENCOURAGING DEVELOPMENT IN their legs from the land mines which taking. SUDAN have been planted because of that war. It is the people of the Sudan—and Mr. FRIST. Mr. President, I want to I mentioned part of the agreement that’s who I spend most of the time discuss an encouraging development applied to the Nuba Mountains. It is with as part of this medical mission that most Americans have had no rea- now about 4 years ago that I first took work in these clinics and in the treat- son, at least initially, to pay attention a trip to the Nuba Mountains. At that ment and in the doctor-patient rela- to. That is what has happened in a time the United Nations did not allow tionship—it is the people of Sudan who country on another continent, the relief flights to go in that part of the long the most for the end of this vio- country being Sudan. world. The Nuba Mountains have been lence.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00026 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.056 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12053 So this reported progress from this sector of the economy. And it has been working with the President to create week is something that is very grati- extraordinarily successful. jobs and economic growth. Together fying and pleasing to me and leaves me Take, for example, one restaurant with the Small Business Administra- very optimistic about the future. It is chain, the Outback Steak House. It tion reauthorization, these progrowth a wonderful part of the world. may come as a surprise to some, but policies—these policies that create jobs f the Outback Steak House does not and grow the economy—will increase have its headquarters in Australia. No. productivity and make every con- THE SMALL BUSINESS It has its headquarters in Tampa, FL. sumer’s dollar go further. ADMINISTRATION In a little over 10 years, the Outback Remington Electric Shaver magnate Mr. FRIST. Mr. President, in a few Steak House has grown from a really and pitchman Victor Kiam once ob- minutes we will be formally addressing small restaurant operation into a din- served: the issue surrounding the Small Busi- ing phenomenon. Entrepreneurs are simply those who under- ness Administration. Thus, I would In February of 1990, the 21⁄2-year-old stand that there is little difference between like to briefly comment on the impor- company employed approximately 300 obstacle and opportunity, and are able to tance of small business in this country, people and had a net worth of less than turn both to their advantage. how the Senate is responding, and to $2 million. That year, there was an in- I think with the passage of this bill put a little bit of perspective around jection from the Small Business Ad- we can include ourselves—this body—in the importance of the United States ministration. Ten years later, the res- that description as well. doing everything it can—whether it is taurant chain employs not 300 people I applaud my colleagues for sup- with the regulatory burden, whether it but 38,000 people. That $2 million has porting the Small Business Adminis- is in making resources and capital grown into revenues of the dizzying tration, which in turn will reach out in available, or opening up other opportu- amount of $1.16 billion. The Outback support of America’s most important nities for small businesses in this coun- Steak House now has restaurants in 48 job creators, the small business owner. try—how important that is to overall States, 13 countries, and places as far f economic growth. away as Seoul and Rio de Janeiro. Benjamin Franklin once said: He who Staples is another dazzling example ROSH HASHANAH would fish must venture his bait. For- of a Small Business Administration in- Mr. FRIST. Mr. President, this tunately, in America we have millions jection of help with a catalytic effect. evening at sundown, Jews around the of creative and driven women and men It started as a single office supply store world will gather to begin their observ- and even teams ready to cast their in Brighton, MA, in 1986. The office ance of Rosh Hashanah, the Jewish reels. Fortunately, we have the Small supply store is now the country’s larg- New Year, and the beginning of the Business Administration ready to help est operator of office superstores, em- high holidays. them. You might say that the Small ploying more than 58,000 people, with Rosh Hashanah and Yom Kippur, Business Administration is an entre- annual gross sales of $11.6 billion. It in which will be observed over the next 10 preneur’s bait and tackle shop. turn is offering services and products days, are the most significant of all I believe by today’s action in a few to small businesses to help them cut Jewish holidays. They are a time for moments we will be passing the Small their own costs in the hopes that they celebration. They are a time for Business Administration’s 50th Anni- might also grow to such proportions. thanksgiving. They are a time for fam- versary Reauthorization Act of 2003. At a macro level during the last 4 fis- ily. They are a time of reflection and of This Federal agency has helped more cal years, just one financing program atonement. than 20 million Americans start, grow, within the Federal agency has helped Many today all over the world are re- and expand their businesses. It has be- create 1.3 million new jobs—newly cre- flecting over the last year and what come the Government’s most effective ated jobs all by this one financing pro- that last year has brought, and also to instrument for economic development. gram. look ahead to that next year with With its help, small companies have Over that same period of time, a sec- those hopes of what will come over the grown from a handful of employees ond lending program at the agency—a next 12 months. It is believed that on into literally thousands. The vitality program called the 504 Loan Program— Rosh Hashanah, God records the des- of the American economy is due in no helped create and retain an additional tiny of all mankind in the Book of Life. small part to this agency, which cele- 445,000 jobs. It is my hope that as we pray, we will brates its 50th anniversary this year. HUBZone is another program that do so for the enduring faith in God, and Thanks to today’s legislative victory, has been a job creator. In the last 2 also with the strong, the fervent hope this pivotal agency will continue work- years, this program which targets se- for the strength and the courage and ing with America’s job creators to verely economically distressed areas, the boldness and also the compassion grow the economy, to boost the econ- has helped create over 30,000 new jobs. to see us through these very difficult omy, and to expand the economy. These are just a few of the exam- times for America and the world. Just how important are small busi- ples—a smattering—of the programs at So as we end this week, I would like ness owners? Those innovators create the SBA that have helped and worked to wish all of my colleagues and all of 60 to 80 percent of new jobs nationwide. so effectively to add new jobs to the those around the world who observe Sixty to eighty percent of new jobs are economy. The SBA, it should be said, is these holidays a very happy and a very created by small businesses. They gen- just one of the many efforts that are healthy and a very sweet new year. erate more than 50 percent of the gross made by this body and by our Govern- L’shana Toua. domestic product. Small business own- ment to support job creative policies. f ers are the heart of the American mar- We think simply back to the 2003 ketplace, and their contributions to Jobs and Growth Tax Relief Act. We PRESIDENT BUSH’S AGENDA FOR jobs and productivity is its lifeblood. provided 23 million small business own- IRAQ In my home State of Tennessee, 97.1 ers with tax cuts averaging, through Mr. JOHNSON. Mr. President, as a percent of all businesses are small busi- that one bill, $2,200 each. In fact, small Member of the Appropriations Com- nesses. From the year 1999 to the year businesses received 80 percent of the mittee, having had the opportunity to 2000, Tennessee’s small businesses benefits of the reduction in the top listen carefully to Secretary of Defense added a net total of 36,806 employees, marginal tax rate. That 2003 Jobs and Rumsfeld lay out before the Senate and and 12,000 companies with fewer than Growth Tax Relief Act quadrupled the to the American people President 100 workers employed 44.9 percent of amount that small businesses can ex- Bush’s agenda for Iraq, I think I need the State’s nonfarm sector workers. pense for new capital investments, and to share my dismay at some Workers and consumers depend on the that in turn will lead to new invest- itemization of the President’s requests. small business sector to generate jobs, ment in technology, in machinery, and We all know, due to the lack of inter- products, and services. The Small Busi- new investments in equipment. nationalization and the go-it-alone ap- ness Administration helps fuel the cre- This legislation is yet another exam- proach in Iraq, that the cost in blood ativity and the dynamism of this vital ple of this body, our Government, and in money is almost exclusively

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00027 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.058 S26PT1 S12054 CONGRESSIONAL RECORD — SENATE September 26, 2003 American. That contrasts with Desert able to hide someone pretty well for Iraqi postal system—$54 million for Storm over a decade ago when George $200,000 a pop. Yet this is going to cost computer studies for the Iraqi postal Bush, senior, led that war. While the us $100 million. system. Where I come from, you can United States did the lion’s share of There is $10 million for 100 experts to buy a lot of computers for $54 million. the fighting, the financial cost, at assist prison reconstruction for 6 You could run a pretty good postal sys- least, was offset—not quite but almost months at $100,000 each. These experts tem in a small country with that. This entirely—by our allies. must be much cheaper than the $200,000 is just for computer studies—$54 mil- In this case, a unilateral or near uni- experts for crime investigation because lion. Think of the hospitals, nursing lateral preemptive effort, alienating prison construction is only $100,000 per homes, clinics, schools, daycare cen- our allies, has led us to a situation piece but we are going to have 100 of ters, afterschool programs—think of where, on the heels of the $70 billion them. what you could do with that kind of re- supplemental appropriations of a short There are 100 experts advising Iraq on source. time ago, the President has now asked how to build prisons in Iraq. There is There is $9 million to reengineer the for an additional $87 billion in yet an- $400 million—we are getting into big business practices of Iraq’s postal serv- other installment, and there will be money—for two new 4,000-bed prisons ice, including instituting ZIP Codes. more to come from the American tax- at $50,000 a bed; 4,000 prison beds at How has Iraq made it for these thou- payers. This is at a time when our $50,000 a bed. sands years without the Americans budget is deep in red ink, having gone I have a lot of constituents in my helping them develop a ZIP Code? It is from budget surpluses from the last State of South Dakota who live in amazing. How have they struggled? years of the Clinton administration to homes that do not cost $50,000 a bed- How can we expect these people to live now record deficits. room by far. Yet here we are building without our taking money out of the To put this $87 billion in some per- this immense infrastructure in Iraq Social Security trust fund to help them spective, that is roughly three times with American taxpayers’ money at develop a ZIP Code? What a generous what the Federal Government spends the time we are being told, no, we don’t thing for this administration to do for on K through 12 education for an entire have the money to help our police and other people on the other side of the year. At a time when we are told we do law enforcement in South Dakota and planet on our dime, borrowing money not have the money to come up with across the country. We don’t have the to do it. the additional $8 billion for Leave No resources for so many other needs We have another $2 million for gar- Child Behind, we have an $87 billion re- which we have. We are deep in debt and bage trucks at $50,000 apiece. Appar- quest here. This is, again, due to a woe- every dime of this is being paid for ently, for these thousands of years the ful lack of postwar planning for our from the Social Security trust fund? Iraqis have been unable to collect their circumstances in Iraq. The list goes on: garbage because they did not have a Much of this money will go for equip- There is $150 million to begin work modern garbage truck. They had other ment and pay and resources for our on a $500–$700 million children’s hos- vehicles for doing this. We are going to troops in the field. There, there will be pital with all the latest technology. We provide 40 of these at $50,000 a pop. no quibbling. There will be strong bi- all want to help the children of Iraq, I can tell you that I have a lot of peo- partisan support for that. My own son but I have to tell you that we have ple in communities in my State wish- fought with the 101st Airborne in Bagh- children in South Dakota—particularly ing they had some help for their infra- dad. No one is more supportive of our on our Indian reservations—who have structure—whether it is garbage, sew- troops than I. Although out of that im- access to virtually no health care at age, water, or a lot of other things. A mense amount of money, no doubt we all. We have people in rural areas with lot of communities are struggling but do need to scrutinize it carefully to hospitals that are on the verge of clos- they don’t have the resources for this make sure the money is well spent. ing because of the lack of Medicare re- kind of help. But on the other $20.3 billion request imbursement. We have hospitals, clin- for reconstruction—and when George ics, and nursing homes across America I am not suggesting that we cut and Bush says reconstruction, keep in mind that may not last a year given the in- run from Iraq. I am not suggesting that he is not talking about repairing adequacy of Medicare reimbursement, the United States doesn’t have a sig- things that were damaged in the war. particularly in the rural areas. nificant role to play in the reconstruc- He is talking about building whole new We have teaching hospitals that tion of that sad country. We are all water systems and communications train the next generation of medical glad Saddam Hussein is gone. Heaven systems and roads and schools and experts in America that are financed knows what is going to be in its place. housing systems that never have ex- on fumes and do not know where their We have demonstrated that we can isted before. So it was with some inter- money is going to come from for next win wars unilaterally. But winning the est that I looked at what some of the year. Yet we have this kind of expendi- peace, this President should have components are of our taxpayers’ ture request. learned long ago, requires significant money that George Bush recommends There is $100 million to build seven international assistance. Now that our that we authorize in this body. new cities, complete with 3,258 houses, allies have been largely alienated, it There is $164 million for the cur- roads, elementary schools, two high looks as if it is going to be our dollars riculum for training the Iraqi military. schools, a clinic, a place of worship, and our blood to do it. This doesn’t involve any training orga- and a market—seven new cities with There is $20.3 billion, and the list of nization hiring any troops or policing. new high schools. these kinds of things goes on and on. This is for a new textbook for a few for I have high schools all over South I think this requires serious scrutiny. curriculum training—$164 million? Dakota that can’t pass bond issues, I think this deserves debate in this There is $100 million to finance 500 that are falling down, that do not have Senate. Our friends in the Republican experts for investigating crimes infrastructure, and that literally are a leadership have told us they don’t want against humanity at $200,000 per ex- danger to the pupils. President Bush to segregate these issues from the fi- pert; 500 at $200,000 per expert to inves- says he would veto legislation that nancing of our troops because they tigate crimes in Iraq; $20 million to would include money to help rebuild don’t want the embarrassment of hav- protect 400 judges and prosecutors at and renovate schools in America. But ing a debate on this and amendments $50,000 a crack—$50,000 a person, or 400 guess who is getting the new schools. It offered and the possible rejection of judges. That is just this year. Heaven is not us. We are going to borrow more some of this. Apparently their goal is knows what this is going to be in the money out of the Social Security trust to wrap the whole thing up into one future. fund in order to do this. This is Presi- huge $87 billion item and anybody who There is $100 million to enroll 100 dent Bush’s priorities? What does that dares vote against that will have their families of five in a witness protection reflect on his values? Think of it. patriotism challenged. They will be program at $200,000 a person. Mr. Chair- There is $54 million for comprehen- told they are not good Americans be- man, $200,000 a person for witness pro- sive technical and business process cause they are not supporting our tection in Iraq? I think you ought to be studies for a computer network for the troops.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00028 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.026 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12055 We need a little sanity here. We need troops. We need to take care of those has prevented approximately 976,000 in- an opportunity—not to reject every- needs and have some certainty. dividuals from illegally acquiring a thing in the rebuilding of Iraq, but we I hope in the course of this debate firearm. The report went on to note have a role to play. We will step to the the American people are considering that 66 percent of the rejections were plate to do our share. the use of their dollars, that there be due to a felony record or outstanding But this administration has been told considerable scrutiny and the people warrant, and about 14 percent were re- in no uncertain terms that this understand what this President wants jected for a domestic violence mis- shouldn’t be exclusively our obligation; them to buy into. If that comprehen- demeanor conviction or restraining that when we do some rebuilding it sion is out there, there will be a lot of order. shouldn’t be at such a fabulous level of unhappiness in the land if, in fact, this Earlier this year, the Americans for extravagance far beyond what any Senate is unable to break out some of Gun Safety Foundation released a re- American community could possibly these expenditures; if we have to pass port entitled, ‘‘The Enforcement Gap: come to Washington and ask for. this up-or-down vote in one massive $87 Federal Gun Laws Ignored.’’ The report Our people deserve better. They de- billion item—three times America’s analyzed the Justice Department’s serve to know what is in George Bush’s education budget—for purposes that record enforcing and prosecuting gun request. They deserve to have some up- would make royalty blush. laws. The report examined prosecution and-down votes, and this shouldn’t be Our people deserve better. The Sen- data acquired under the Freedom of In- rushed through in a manner that the ate deserves an opportunity to consider formation Act from the Justice Depart- people do not actually understand what these issues with much more care than ment for fiscal years 2000 through 2002. they are buying into with an agenda is being suggested. The AGS study reveals a significant such as this. We will learn more, no doubt, about gap between the number of Federal gun I know we are going to go to markup the details of some of the proposed ex- crimes committed and the number of on this supplemental request very penditures from the Bush administra- Federal prosecutions initiated. quickly next week. The difficulty in tion in the days to come. I hope we The report found that 20 of the 22 shoving this thing through so fast is have a very real, sobering debate about major Federal gun laws are rarely pros- that the American taxpayer will have the use of our constituents’ money and ecuted. The two statutes consistently no idea what was in this thing. They whether this is the best use—some of enforced are laws against the use of a will be told it is $87 billion—a huge it, no doubt, is; but much of it, I sub- firearm in the commission of a Federal number. Who knows what that means mit, is an outrageous abuse to the crime and a felon in possession of a until you explain in some detail what American taxpayer. firearm. The 20 laws that address other you could buy with that kind of I yield the floor. illegal firearm activity, including gun money. Ms. LANDRIEU. I suggest the ab- trafficking, firearm theft, lying on a I think we need to have a national sence of a quorum. criminal background check form, re- debate about America’s role in the The PRESIDING OFFICER. The moving firearm serial numbers, and world and about the level and scope of clerk will call the roll. selling guns to minors are rarely en- the contributions that America is mak- The assistant legislative clerk pro- forced according to the AGS study. ing in rebuilding this country. Why has ceeded to call the roll. The statistics in the AGS report are this administration failed to attract Ms. LANDRIEU. Mr. President, I ask startling. According to AGS, in the fis- international financial support? If you unanimous consent that the order for cal year ending September 30, 2002, U.S. cannot get their troops, why not at the quorum call be rescinded. Attorneys filed only 578 cases against least some financial resources for this The PRESIDING OFFICER. Without individuals who lied on the criminal rebuilding? Why has that failed, as objection, it is so ordered. background check form to purchase a well? We need to know that. Ms. LANDRIEU. Mr. President, I was firearm despite the fact that over We need to know what will follow. I quite moved by my colleague from 100,000 people were denied purchases for assure this body, this is not the last re- South Dakota and his comments about that reason. President Bush and Attor- quest. This is an installment. There is the war, the budget and the choices ney General Ashcroft pledged to vigor- much more to come, both militarily that the Senate is going to have to ously enforce the gun laws on the and potentially in rebuilding. make. I thank my colleague for dis- books, but the AGS report seems to in- What has happened to the Iraqi oil cussing such specific, detailed, and pas- dicate that the Bush administration revenue? Is there a possibility of turn- sionate comments, and raising the has failed to live up to the promise. I ing some of this into loans rather than awareness of some of the very substan- believe vigorous law enforcement is a flatout grants? We are told we cannot tial issues at stake in making such a critical step toward reducing gun vio- loan the money because Iraq already compelling argument as to why this lence. I urge the Justice Department to has a lot of debt. Their debt is pri- discussion should continue for some step up its efforts to prosecute not only marily to Kuwait and Saudi Arabia. reasonable length of time so these people who commit gun crimes, but Apparently, it appears we are going to issues can be aired and the American those who illegally seek to buy a gun. put repaying their debts ahead of the people can have a better opportunity to f American taxpayer, ahead of our finan- come to their own conclusion based on cial needs. We are saying we have to facts as the Senator outlined this ADDITIONAL STATEMENTS give grants because these people have morning. to pay off their loans to Saudi Arabia I commend the Senator and thank TRIBUTE TO CAROLYN ‘‘KELLY’’ and Kuwait before they can do any- him. Other colleagues will speak of the EARL DAVIS thing for us. issues, including the international We have water projects in South Da- challenges that face America, as well ∑ Mr. DAYTON. Mr. President, I am kota. We have sewer wastewater prob- as the domestic challenges. delighted to honor a Minnesotan who lems. We have roads, railroads, all f recently reached the age of 90, after kinds of infrastructure that is under- having spent much of her life in dedi- funded. Those communities are being LIE AND BUY cated service in her community. Caro- asked for matching funds. Many Mr. LEVIN. Mr. President, on Sep- lyn ‘‘Kelly’’ Earl Davis was born on projects in South Dakota and across tember 18, 2003, the Bureau of Justice September 21, 1913, the daughter of Dr. the country are done by loans. And we Statistics released its annual report on George Earl and Lillian Earl. Growing have a grant level at $20.3 billion, with the National Instant Criminal Back- up, Carolyn, affectionately known mind-boggling levels of expenditure, ground Check System, also known as since childhood as ‘‘Kelly’’—the name for purposes that would leave any NICS. According to its report, approxi- given to her by her brother, Rol—loved American citizen shaking his head. mately 136,000, or 1.7 percent, of the 7.8 to play baseball. She was an all-star We do not want to delay anything un- million of the gun checks performed by player whose exploits on the field were necessarily. There are some urgent the NICS system resulted in a denial. greeted with exhortations of ‘‘Slide, needs in Iraq, particularly for our Since its inception, the NICS database Kelly, slide!’’

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00029 Fmt 0637 Sfmt 0634 E:\CR\FM\G26SE6.028 S26PT1 S12056 CONGRESSIONAL RECORD — SENATE September 26, 2003 Kelly lived in St. Paul, MN, and at- Ms. Niland, one of its reading clerks, S. 1666. A bill to amend the Public Health tended Summit School, where she took announced that the House has passed Service Act to establish comprehensive part in student government, sports, the following bill, in which it requests State diabetes control and prevention pro- grams, and for other purposes; to the Com- and volunteer work. She then attended the concurrence of the Senate: mittee on Health, Education, Labor, and Smith College and the University of H.R. 2557. An act to provide for the con- Pensions. Minnesota. In 1936, Kelly married Ed- servation and development of water and re- By Mr. BROWNBACK (for himself and ward P. ‘‘Ned’’ Davis, Jr., and the lated resources, to authorize the Secretary Mr. NICKLES): Davises, who eventually had three of the Army to construct various projects for S. 1667. A bill to exempt small trailer man- daughters, Sally, Janie, and Mary, improvements to rivers and harbors of the ufacturers from enhanced early warning re- lived in St. Paul until moving to United States, and for other purposes. porting requirements under the Transpor- tation Recall Enhancement, Accountability, f Bloomington’s Friendship Village re- and Documentation (TREAD) Act; to the tirement community. They had been ENROLLED BILLS SIGNED Committee on Commerce, Science, and married 60 years at the time of Ned’s Transportation. death in 1997. The following enrolled bills, pre- By Mr. BROWNBACK (for himself, Mr. Today, Kelly is the proud grand- viously signed by the Speaker of the MILLER, Mr. ALEXANDER, Mr. AL- mother of 6 and the great-grandmother House, were signed on September 25, LARD, Mr. ALLEN, Mr. BUNNING, Mr. of 3. Her family activities and interests 2003, by the President Pro Tempore BURNS, Mr. CHAMBLISS, Mr. CORNYN, have included canoeing, skiing, tennis, (Mr. STEVENS): Mr. CRAIG, Mr. CRAPO, Mr. ENSIGN, Mr. ENZI, Mr. FITZGERALD, Mr. H.R. 2555. An act making appropriations and golf. Throughout her life, Kelly has GRAHAM of South Carolina, Mr. for the Department of Homeland Security for also given of herself through a remark- HATCH, Mrs. HUTCHISON, Mr. INHOFE, the fiscal year ending September 30, 2004, and able career of volunteer service. During Mr. KYL, Mr. LOTT, Mr. MCCAIN, Ms. for other purposes. World War II, she served her country as MURKOWSKI, Mr. NICKLES, Mr. H.R. 2657. An act making appropriations SANTORUM, Mr. SESSIONS, Mr. a nurse’s aide with the Red Cross. She for the Legislative Branch for the fiscal year SUNUNU, Mr. THOMAS, and Mr. is a member of the House of Hope Pres- ending September 30, 2004, and for other pur- byterian Church, where she has been VOINOVICH): poses. S. 1668. A bill to establish a commission to president of the Women’s Association S. 111. An act to direct the Secretary of the conduct a comprehensive review of Federal Board, among other offices and com- Interior to conduct a special resource study agencies and programs and to recommend mittee memberships. She has taught to determine the national significance of the the elimination or realignment of duplica- Sunday school and has also been a Miami Circle site in the State of Florida as tive, wasteful, or outdated functions, and for leader of the Brownies and Girl Scouts. well as the suitability and feasibility of its other purposes; to the Committee on Govern- inclusion in the National Park System as mental Affairs. Her enthusiasm for sports motivated part of Biscayne National Park, and for her to teach tennis and skiing to un- By Mr. INHOFE (for himself and Mr. other purposes. BREAUX): derprivileged children, having collected S. 233. An act to direct the Secretary of the S. 1669. A bill to reauthorize the Dingell- the necessary equipment for them to Interior to conduct a study of Coltsville in Johnson Sport Fish Restoration Act; to the use. the State of Connecticut for potential inclu- Committee on Environment and Public Because education has been espe- sion in the National Park System. Works. S. 278. An act to make certain adjustments cially important to her, she belonged f to the alumni boards of the Saint Paul to the boundaries of the Mount Naomi Wil- derness Area, and for other purposes. ADDITIONAL COSPONSORS Academy and Summit School. She was also a member of Summit School’s f S. 50 At the request of Mr. JOHNSON, the Board of Trustees and chaired the MEASURES REFERRED school’s 1958 building fund. Even at the name of the Senator from North Da- age of 79, Kelly was still busy, serving The following bill was read the first kota (Mr. CONRAD) was added as a co- as the chairman of Summit School’s and the second times by unanimous sponsor of S. 50, a bill to amend title 75th anniversary celebration. consent, and referred as indicated: 38, United States Code, to provide for a The range of Kelly’s interests and H.R. 2557. An act to provide for the con- guaranteed adequate level of funding pursuits is formidable: the arts, public servation and development of water and re- for veterans health care, and for other health, employment, child and family lated resources, to authorize the Secretary purposes. welfare. She gave of her energies and of the Army to construct various projects for S. 736 improvements to rivers and harbors of the fund-raising talents to a variety of or- At the request of Mr. ENSIGN, the United States, and for other purposes; to the name of the Senator from Massachu- ganizations and causes, including the Committee on Environment and Public Junior League, the St. Paul Rehabili- Works. setts (Mr. KENNEDY) was added as a co- tation Center, the Children’s Hospital sponsor of S. 736, a bill to amend the Association, Neighborhood House, f Animal Welfare Act to strengthen en- Merriam Park Community Center, the MEASURES PLACED ON THE forcement of provisions relating to ani- Volunteer Bureau, the Family Nursing CALENDAR mal fighting, and for other purposes. S. 756 Service, Planned Parenthood, and the The following bill was read the sec- At the request of Mr. THOMAS, the Minnesota Public Health Association. ond time, and placed on the calendar: Despite the passing years, Kelly re- name of the Senator from Arkansas mained involved into her eighties. She S. 1657. A bill to amend section 44921 of (Mrs. LINCOLN) was added as a cospon- title 49, United States Code, to provide for sor of S. 756, a bill to amend the Inter- served for two terms on the Friendship the arming of cargo pilots against terrorism. Village residents council and held the nal Revenue Code of 1986 to modify the post of chair of the Friendship Village f qualified small issue bond provisions. ad hoc committee for the health care INTRODUCTION OF BILLS AND S. 876 center renovation. JOINT RESOLUTIONS At the request of Mr. WYDEN, the Kelly’s contributions are so numer- names of the Senator from Illinois (Mr. ous that they are almost impossible to The following bills and joint resolu- DURBIN) and the Senator from Min- catalogue. I am proud to salute this re- tions were introduced, read the first nesota (Mr. DAYTON) were added as co- markable lady for her exceptional and second times by unanimous con- sponsors of S. 876, a bill to require pub- record of community service and advo- sent, and referred as indicated: lic disclosure of noncompetitive con- cacy. Truly, Kelly has spent her life By Mr. LEVIN (for himself, Mr. ALEX- tracting for the reconstruction of the working with and enjoying people of all ANDER, Mr. MCCONNELL, Mr. infrastructure of Iraq, and for other ∑ LIEBERMAN, and Mr. SCHUMER): purposes. ages. S. 1665. A bill to permit reviews of criminal S. 1298 f records of applicants for private security of- At the request of Mr. AKAKA, the MESSAGE FROM THE HOUSE ficer employment; to the Committee on the Judiciary. name of the Senator from Massachu- At 11:44 a.m., a message from the By Mr. COCHRAN (for himself and Mr. setts (Mr. KENNEDY) was added as a co- House of Representatives, delivered by KENNEDY): sponsor of S. 1298, a bill to amend the

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00030 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.027 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12057 Farm Security and Rural Investment Mr. BROWNBACK. Mr. President, I ‘‘(4) to provide training and technical as- Act of 2002 to ensure the humane ask unanimous consent that the text of sistance to disadvantaged Native American slaughter of non-ambulatory livestock, the bill be printed in the RECORD. entrepreneurs and prospective entrepreneurs; and for other purposes. There being no objection, the bill was and ‘‘(5)’’ ordered to be printed in the RECORD, as S. 1558 On page 117, strike lines 9 through 14 and follows: At the request of Mr. ALLARD, the insert the following: name of the Senator from South Caro- S. 1667 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.— lina (Mr. GRAHAM) was added as a co- Be it enacted by the Senate and House of Rep- ‘‘(1) IN GENERAL.—There are authorized to sponsor of S. 1558, a bill to restore reli- resentatives of the United States of America in be appropriated to the Administrator Congress assembled, $15,000,000 for each of the fiscal years 2004 gious freedoms. SECTION 1. WEIGHT EXEMPTION FOR CLASSI- through 2006 to carry out the provisions of S. 1587 FICATION OF TRAILER MANUFAC- this section, which shall remain available At the request of Mr. BIDEN, the TURERS. until expended. name of the Senator from Georgia (Mr. Notwithstanding any other provision of ‘‘(2) TRAINING FOR NATIVE AMERICAN ENTRE- law, for purposes of the early warning re- PRENEURS.—In addition to the amount au- MILLER) was added as a cosponsor of S. porting requirements under section 30166(m) 1587, a bill to make it a criminal act to thorized under subsection (i)(1), there are au- of title 49, United States Code, manufactur- thorized to be appropriated to the Adminis- willfully use a weapon, explosive, ers of trailers with a gross vehicle weight trator $2,000,000 for each of the fiscal years chemical weapon, or nuclear or radio- rating of 26,000 pounds or less shall not, with 2004 through 2006 to carry out the provisions active material with the intent to respect to such trailers, be subject to the ad- of subsection (c)(4), which shall remain cause death or serious bodily injury to ditional reporting requirements under sec- available until expended.’’ any person while on board a passenger tion 579.24 of title 49, Code of Federal Regula- On page 190, strike line 21 and all that fol- tions, that are applicable to manufacturers vessel, and for other purposes. lows through ‘‘(iii)’’ on page 191, line 1, and that produce, import, offer for sale, or sell insert the following: S. 1600 500 or more vehicles during the calendar year ‘‘(ii)’’. At the request of Mr. CAMPBELL, the of a reporting period or during each of the On page 192, strike line 11 and all that fol- name of the Senator from South Da- prior two calendar years. lows through page 193, line 6, and insert the kota (Mr. JOHNSON) was added as a co- f following: SEC. 403. SMALL BUSINESS PARTICIPATION IN sponsor of S. 1600, a bill to provide for AMENDMENTS SUBMITTED AND periodic Indian needs assessments, to PRIME CONTRACTING. PROPOSED (a) RESERVED CONTRACTS.—Section 15(j) of require Federal Indian program evalua- the Small Business Act (15 U.S.C. 644(j)) is tions, and for other purposes. SA 1788. Mr. FRIST (for Ms. SNOWE (for herself and Mr. KERRY)) proposed an amend- amended by adding at the end the following: S. 1630 ment to the bill S. 1375, to provide for the re- ‘‘(4) Any adjustment to the simplified ac- At the request of Mrs. CLINTON, the authorization of programs administered by quisition threshold (as defined in section name of the Senator from Georgia (Mr. the Small Business Administration, and for 4(11) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(11))), shall be imme- MILLER) was added as a cosponsor of S. other purposes. SA 1789. Mr. FRIST (for Mr. GRAHAM, of diately matched by an identical adjustment 1630, a bill to facilitate nationwide South Carolina) proposed an amendment to to the small business reserve for purposes of availability of 2–1–1 telephone service the resolution S. Res. 219, to encourage the this subsection.’’. for information and referral services, People’s Republic of China to establish a (b) PARTICIPATION IN MULTIPLE AWARD CON- and for other purposes. market-based valuation of the yuan and to TRACTS.—Section 15(j) of the Small Business Act (15 U.S.C. 644(j)) is amended— S. 1638 fulfill its commitments under international trade agreements. (1) in paragraph (2), by striking ‘‘(2) In car- At the request of Mr. GRASSLEY, the rying out paragraph (1)’’ and inserting ‘‘(3) f name of the Senator from Mississippi In carrying out paragraphs (1) and (2)’’; (Mr. LOTT) was added as a cosponsor of TEXT OF AMENDMENTS (2) in paragraph (3), by striking ‘‘(3) Noth- S. 1638, a bill to amend title II of the ing in paragraph (1)’’ and inserting ‘‘(4) Higher Education Act of 1965 to in- Nothing in this subsection’’; and SA 1788. Mr. FRIST (for Ms. SNOWE (3) by adding after paragraph (1) the fol- crease teacher familiarity with the (for herself and Mr. KERRY)) proposed educational needs of gifted and tal- lowing: an amendment to the bill S. 1375, to ‘‘(2)(A) In the case of orders under multiple ented students, and for other purposes. provide for the reauthorization of pro- award contracts, including Federal Supply S. RES. 228 grams administered by the Small Busi- Schedule contracts and multi-agency con- At the request of Mr. MILLER, his ness Administration, and for other pur- tracts, that are subject to the small business name was added as a cosponsor of S. poses; as follows: reserve, contracting officers shall consider not less than 2 small business concerns if Res. 228, a resolution recognizing the On page 87, strike line 7 and all that fol- such small business concerns can offer the teams and players of the Negro Base- lows through page 91, line 4. On page 91, strike line 23 and all that fol- items sought by the contracting officer on ball Leagues for their achievements, competitive terms, with respect to price, dedication, sacrifices, and contribu- lows through page 92, line 5, and insert the following: quality, and delivery schedule, with the tions to baseball and the Nation. Section 351(3)(A)(ii) of the Small Business goods or services available in the market. S. RES. 231 Investment Act of 1958 (15 U.S.C. 689(3)(A)(ii)) ‘‘(B) If only 1 small business concern can satisfy the requirement, the contracting offi- At the request of Mr. FEINGOLD, the is amended— (1) in subclause (I), by striking ‘‘50 percent cer shall include such small business concern names of the Senator from Indiana in their evaluation.’’. (Mr. LUGAR) and the Senator from or more’’ and all that follows and inserting ‘‘the median family income for such tract (c) REPORT REQUIREMENT.— Delaware (Mr. BIDEN) were added as co- does not exceed 80 percent of the greater of (1) IN GENERAL.—Not less than once every sponsors of S. Res. 231, a resolution the statewide median family income or met- 180 days, the Comptroller General shall sub- commending the Government and peo- ropolitan area median family income; or’’; mit a report on the level of participation in ple of Kenya. and multiple award contracts, including the Fed- eral Supply Schedule to— f (2) in subclause (II), by striking ‘‘household income’’ each place it appears and inserting (A) the Small Business Administration; STATEMENTS ON INTRODUCED ‘‘family income’’. (B) the Committee on Small Business and BILLS AND JOINT RESOLUTIONS On pages 109 through 110, redesignate para- Entrepreneurship of the Senate; and graphs (6) through (13) as paragraphs (7) (C) the Committee on Small Business of By Mr. BROWNBACK (for himself through (14), respectively. the House of Representatives. and Mr. NICKLES): On page 109, between lines 2 and 3, insert (2) CONTENTS.—Each report submitted S. 1667. A bill to exempt small trailer the following: under paragraph (1) shall contain, for the 6- manufacturers from enhanced early ‘‘(6) DISADVANTAGED NATIVE AMERICAN EN- month reporting period— warning reporting requirements under TREPRENEUR.—The term ‘disadvantaged Na- (A) the total number of multiple award the Transportation Recall Enhance- tive American entrepreneur’ means a dis- contracts; (B) the total number of small business con- ment, Accountability, and Documenta- advantaged entrepreneur who is also a mem- ber of an Indian Tribe.’’ cerns that received multiple award con- tion (TREAD) Act; to the Committee On page 111, line 21, strike ‘‘and’’ and all tracts; on Commerce, Science, and Transpor- that follows through ‘‘(4)’’ on line 22, and in- (C) the total number of orders; tation. sert the following: (D) the total value of orders;

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00031 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.026 S26PT1 S12058 CONGRESSIONAL RECORD — SENATE September 26, 2003 (E) the number of orders received by small Strike the fourth clause of the preamble. The following named officer for appoint- business concerns; In the seventh clause of the preamble, ment in the United States Navy to the grade (F) the value of orders received by small strike ‘‘free fluctuation’’ and insert ‘‘mar- indicated under title 10, U.S.C., section 624: business concerns; ket-based valuation’’. To be rear admiral (lower half) (G) the number of small business concerns f Capt. Richard E. Cellon that received orders; and The following named officer for appoint- (H) such other information that the Comp- EXECUTIVE SESSION ment in the United States Naval Reserve to troller General considers relevant. the grade indicated under title 10, U.S.C., On page 193, strike line 14 and all that fol- lows through page 194, line 7, and insert the EXECUTIVE CALENDAR section 12203: To be rear admiral (lower half) following: Mr. FRIST. Mr. President, I ask (2) in subparagraph (F), by striking the pe- unanimous consent that the Senate im- Capt. Ben F. Gaumer riod at the end and inserting ‘‘; and’’; and The following named officer for appoint- ‘‘(G) certification that the offeror or bidder mediately proceed to executive session ment in the United States Navy to the grade will acquire articles, equipment, supplies, to consider en bloc the following nomi- indicated while assigned to a position of im- services, or materials, or obtain the perform- nations on today’s Executive Calendar: portance and responsibility under title 10, ance of construction work from small busi- Nos. 364 through 378 and all the nomi- U.S.C., section 601: ness concerns in the amount and quality nations on the Secretary’s desk. To be vice admiral used in preparing the bid or proposal, unless I further ask unanimous consent that Rear Adm. Henry G. Ulrich, III such small business concerns are no longer the nominations be confirmed, the mo- The following named officer for appoint- in business or can no longer meet the qual- tions to reconsider be laid upon the ment as Chief of Naval Reserve, United ity, quantity, or delivery date.’’. States Navy, and appointment to the grade (b) PENALTIES FOR FALSE CERTIFICATIONS.— table, the President be immediately Section 16(f) of the Small Business Act (15 notified of the Senate’s action, and the indicated while assigned to a position of im- U.S.C. 645(f)) is amended by striking ‘‘of this Senate then return to legislative ses- portance and responsibility under title 10, Act’’ and inserting ‘‘or the reporting require- sion. U.S.C., sections 601 and 5143: ments of section 8(d)(11)’’. The PRESIDING OFFICER. Without To be vice admiral On page 195, strike lines 4 through 19 and objection, it is so ordered. Rear Adm. John G. Cotton insert the following: The nominations considered and con- The following named officer for appoint- (1) by redesignating paragraph (11) as para- firmed en bloc are as follows: ment in the United States Navy to the grade graph (14); and indicated while assigned to a position of im- (2) by inserting after paragraph (10) the fol- DEPARTMENT OF DEFENSE portance and responsibility under title 10, lowing: Gordon England, of Texas, to be Secretary U.S.C., section 601: ‘‘(11) CERTIFICATION.—A report submitted of the Navy. To be vice admiral by the prime contractor pursuant to para- AIR FORCE graph (6)(E) to determine the attainment of Vice Adm. Timothy J. Keating The following named officer for appoint- a subcontract utilization goal under any sub- The following named officer for appoint- ment in the United States Air force to the contracting plan entered into with a Federal ment in the United States Navy to the grade grade indicated while assigned to a position agency under this subsection shall contain indicated under title 10, U.S.C., section 624: of importance and responsibility under title the name and signature of the president or To be rear admiral (lower half) 10, U.S.C., section 601: chief executive officer of the contractor, cer- Capt. Robert F. Burt tifying that the subcontracting data pro- To be lieutenant general MARINE CORPS vided in the report are accurate and com- Lt. Gen. Lance L. Smith The following named officer for appoint- plete. The following named officer for appoint- ment in the United States Marine Corps to ‘‘(12) CENTRALIZED DATABASE.—The results ment in the United States Air Force to the the grade indicated while assigned to a posi- of an evaluation under paragraph (10)(C) grade indicated while assigned to a position tion of importance and responsibility under shall be included in a national centralized of importance and responsibility under title title 10, U.S.C., section 601: governmentwide database. 10, U.S.C., section 601: ‘‘(13) PAYMENTS PENDING REPORTS.—Each To be lieutenant general Federal agency having contracting authority To be lieutenant general Maj. Gen. Jan C. Huly shall ensure that the terms of each contract Lt. Gen. William R. Looney, III for goods and services includes a provision NOMINATIONS PLACED ON THE SECRETARY’S ARMY allowing the contracting officer of an agency DESK to withhold an appropriate amount of pay- The following named officer for appoint- AIR FORCE ment in the Reserve of the Army to the ment with respect to a contract (depending PN363 Air Force nominations (44) begin- on the size of the contract) until the date of grades indicated under title 10, U.S.C., sec- tion 12203: ning MARK T. ALLISON, and ending FRED- receipt of complete, accurate, and timely ERICK M. WOLFE, which nominations were subcontracting reports in accordance with To be brigadier general received by the Senate and appeared in the paragraph (11).’’. Colonel Dennis P. Geoghan Congressional Record of February 25, 2003 On page 196, lines 17 and 18, strike ‘‘per- The following named officer for appoint- PN871 Air Force nominations (2) beginning formance, or lack of performance of the sub- ment in the United States Army to the grade GEOFFREY H. HILLS, and ending JOHN B. contractor.’’ and insert ‘‘circumstances sur- indicated while assigned to a position of im- STEELE, which nominations were received rounding the failure to make the timely pay- portance and responsibility under title 10, by the Senate and appeared in the Congres- ment described in subparagraph (A).’’. U.S.C., section 601: sional Record of September 2, 2003 On page 199, line 3, strike ‘‘(b)’’ and insert PN905 Air Force nominations (3) beginning the following: To be lieutenant general (b) HUBZONE STATUS TIMELINE AND COM- Maj. Gen. Claude V. Christianson STEPHEN W. HUMPHREY, and ending MENCEMENT.— The following named officer for appoint- RANDY J. YOVANOVICH, which nomina- (1) IN GENERAL.—A base closure area shall ment in the United States Army to the grade tions were received by the Senate and ap- be treated as a HUBZone for a period of 5 indicated while assigned to a position of im- peared in the Congressional Record of Sep- years beginning on the date of final closure. portance and responsibility under title 10, tember 4, 2003 A military base that was closed before the U.S.C., section 601: PN875 Air Force nominations (5) beginning SCOTT G. BOOK, and ending SARAH K. date of enactment of this Act shall not be To be lieutenant general SLAVENS, which nominations were received considered a base closure area for purposes of Lt. Gen. William E. Ward this section. by the Senate and appeared in the Congres- NAVY (2) EFFECTIVE DATE.—This section and the sional Record of September 2, 2003 amendments made by this section shall take The following named officer for appoint- PN874 Air Force nominations (2) beginning effect on the date of enactment of this Act. ment in the United States Naval Reserve to TERI L. POULTON-CONSOLDANE, and end- (c) the grade indicated under title 10, U.S.C., ing SHELDON G. WHITE, which nomina- section 12203: tions were received by the Senate and ap- SA 1789. Mr. FRIST (for Mr. GRAHAM To be rear admiral peared in the Congressional Record of Sep- of South Carolina) proposed an amend- tember 2, 2003 Rear Adm. (lh) Peter L. Andrus PN873 Air Force nomination of Brian P. ment to the resolution S. Res. 219, to The following named officer for appoint- Olson, which was received by the Senate and encourage the People’s Republic of ment in the United States Naval Reserve to appeared in the Congressional Record of Sep- the grade indicated under title 10, U.S.C., China to establish a market-based tember 2, 2003 section 12203: valuation of the yuan and to fulfill its PN872 Air Force nominations (2) beginning commitments under international To be rear admiral CRAIG H. MORRIS, and ending SHERICE D. trade agreements; as follows: Rear Adm. (lh) James M. McGarrah YOUNG, which nominations were received by

VerDate Sep 11 2014 09:42 Jul 25, 2019 Jkt 000000 PO 00000 Frm 00032 Fmt 0637 Sfmt 0634 C:\ERIC\CONGRESSIONAL RECORD SSN FILES_2\S26SE3.REC S26SE3 ejoyner on DSK30MW082PROD with CONG-REC-ONLINE September 26, 2003 CONGRESSIONAL RECORD — SENATE S12059 the Senate and appeared in the Congres- ate and appeared in the Congressional WASHBURN, which nominations were re- sional Record of September 2, 2003 Record of September 2, 2003 ceived by the Senate and appeared in the PN946 Air Force nomination of Gerilyn A. PN881 Marine Corps nomination of Jon C. Congressional Record of September 3, 2003 Posner, which was received by the Senate Rhodes, which was received by the Senate PN898 Navy nominations (30) beginning and appeared in the Congressional Record of and appeared in the Congressional Record of TRACIE L ANDRUSIAK, and ending ROB- September 17, 2003 September 2, 2003 ERT A WOLF, which nominations were re- ARMY PN913 Marine Corps nomination of Colin D. ceived by the Senate and appeared in the Smith, which was received by the Senate and PN948 Army nomination of Timothy C. Congressional Record of September 3, 2003 appeared in the Congressional Record of Sep- Kelly, which was received by the Senate and PN899 Navy nominations (16) beginning tember 4, 2003 appeared in the Congressional Record of Sep- TIMOTHY A ANDERSON, and ending DOUG- tember 17, 2003 NAVY LAS T WAHL, which nominations were re- PN949 Army nominations (2) beginning PN950 Navy nomination of Robert E. ceived by the Senate and appeared in the PAUL D. HARRELL, and ending WILLIAM Stone, which was received by the Senate and Congressional Record of September 3, 2003 S. LEE, which nominations were received by appeared in the Congressional Record of Sep- PN900 Navy nominations (51) beginning the Senate and appeared in the Congres- tember 17, 2003 SOWON S AHN, and ending SCOTT D sional Record of September 17, 2003 PN851 Navy nominations (26) beginning YOUNG, which nominations were received by PN947 Army nomination of Gregory S. STEPHEN M. SAIA, and ending DAVID A. the Senate and appeared in the Congres- Johnson, which was received by the Senate TUBLEY, which nominations were received sional Record of September 3, 2003 and appeared in the Congressional Record of by the Senate and appeared in the Congres- PN901 Navy nominations (201) beginning September 17, 2003 sional Record of July 30, 2003 LEON S ABRAMS, and ending CARL PN921 Army nomination of Andrew D. PN859 Navy nominations (25) beginning ZEIGLER, which nominations were received Stewart, which was received by the Senate LEE A. AXTELL, and ending DENNIS W. by the Senate and appeared in the Congres- and appeared in the Congressional Record of YOUNG, which nominations were received by sional Record of September 3, 2003 the Senate and appeared in the Congres- September 8, 2003 PN902 Navy nominations (864) beginning sional Record of July 30, 2003 PN912 Army nomination of John B. RAFAEL A ACEVEDO, and ending TODD A PN858 Navy nominations (37) beginning Munozatkinson, which was received by the ZIRKLE, which nominations were received LEANNE K. AABY, and ending MICHAEL J. Senate and appeared in the Congressional by the Senate and appeared in the Congres- ZUCCHERO, which nominations were re- Record of September 4, 2003 sional Record of September 3, 2003 PN876 Army nomination of Kevin J. Chap- ceived by the Senate and appeared in the PN922 Navy nomination of Paul C. Bown, man, which was received by the Senate and Congressional Record of July 30, 2003 which was received by the Senate and ap- appeared in the Congressional Record of Sep- PN857 Navy nominations (64) beginning peared in the Congressional Record of Sep- tember 2, 2003 LINDA M. ACOSTA, and ending JOAN L. tember 8, 2003 PN850 Army nominations (10) beginning WRIGHT, which nominations were received MICHAEL J. BULLOCK, and ending PAUL by the Senate and appeared in the Congres- PN923 Navy nomination of Paul H. Evers, A. TRAPANI, which nominations were re- sional Record of July 30, 2003 which was received by the Senate and ap- ceived by the Senate and appeared in the PN856 Navy nominations (18) beginning peared in the Congressional Record of Sep- Congressional Record of July 30, 2003 RICHARD E. AGUILA, and ending SCOTT D. tember 8, 2003 PN878 Army nomination of Charles A. THOMAS, which nominations were received PN951 Navy nominations (3) beginning Jarnot, which was received by the Senate by the Senate and appeared in the Congres- WILLIAM K. BANE, and ending ANDY J. and appeared in the Congressional Record of sional Record of July 30, 2003 LANCASTER, which nominations were re- September 2, 2003 PN855 Navy nominations (117) beginning ceived by the Senate and appeared in the PN877 Army nomination of Mary M. MICHAEL T. AKIN, and ending PETER G. Congressional Record of September 17, 2003 McCord, which was received by the Senate WOODSON, which nominations were received PN952 Navy nominations (31) beginning and appeared in the Congressional Record of by the Senate and appeared in the Congres- BRADLEY A APPLEMAN, and ending September 2, 2003 sional Record of July 30, 2003 FLORENCIO J YUZON, which nominations PN866 Army nominations (175) beginning PN854 Navy nominations (56) beginning were received by the Senate and appeared in SCOTT E. ALEXANDER, and ending WIL- JAMES J. ANDERSON, and ending JOHN F. the Congressional Record of September 17, LIAM H. WOODS, which nominations were ZOLLO, which nominations were received by 2003 received by the Senate and appeared in the the Senate and appeared in the Congres- PN953 Navy nominations (37) beginning Congressional Record of August 1, 2003 sional Record of July 30, 2003 ERSKINE L ALVIS, and ending RANDY E PN865 Army nominations (109) beginning PN853 Navy nominations (16) beginning WILLIAMS, which nominations were re- BRYAN K. ADAMS, and ending JOSEPH M. VIDA M. ANTOLINJENKINS, and ending ceived by the Senate and appeared in the YOSWA, which nominations were received DOMINICK G. YACONO, JR., which nomina- Congressional Record of September 17, 2003 tions were received by the Senate and ap- by the Senate and appeared in the Congres- PN954 Navy nominations (44) beginning MI- peared in the Congressional Record of July sional Record of August 1, 2003 CHAEL S AGABEGI, and ending REID J 30, 2003 PN864 Army nominations (142) beginning WINKLER, which nominations were received PN852 Navy nominations (38) beginning RICHARD K. ADDO, and ending VERONICA by the Senate and appeared in the Congres- ROLAND E. ARELLANO, and ending S. ZSIDO, which nominations were received sional Record of September 17, 2003 MARVA L. WHEELER, which nominations by the Senate and appeared in the Congres- PN955 Navy nominations (57) beginning sional Record of August 1, 2003 were received by the Senate and appeared in the Congressional Record of July 30, 2003 JOHN R ANDERSON, and ending NICOLAS PN863 Army nominations (950) beginning D I YAMODIS, which nominations were re- MADELFIA A. ABB, and ending X0007, which PN868 Navy nominations (2) beginning BRENT T. CHANNELL, and ending MAT- ceived by the Senate and appeared in the nominations were received by the Senate and Congressional Record of September 17, 2003 appeared in the Congressional Record of Au- THEW W. EDWARDS, which nominations were received by the Senate and appeared in PN956 Navy nominations (73) beginning gust 1, 2003 ALAN L ADAMS, and ending GEORGES E PN744 Army nominations (39) beginning the Congressional Record of August 1, 2003 YOUNES, which nominations were received WILLIAM T. BARBEE, JR., and ending KEN- PN867 Navy nominations (9) beginning by the Senate and appeared in the Congres- NETH W. YATES, which nominations were EMMA J. M. BROWN, and ending MARCIA sional Record of September 17, 2003 received by the Senate and appeared in the L. ZIEMBA, which nominations were re- PN957 Navy nominations (135) beginning Congressional Record of June 16, 2003 ceived by the Senate and appeared in the PN929 Army nominations (1630) beginning Congressional Record of August 1, 2003 JAMES D ABBOTT, and ending ROBERT W TYRONE C.* ABERO, and ending X3713, PN894 Navy nominations (11) beginning ZURSCHMIT, which nominations were re- which nominations were received by the Sen- MARC E BOYD, and ending WENDY L SNY- ceived by the Senate and appeared in the ate and appeared in the Congressional DER, which nominations were received by Congressional Record of September 17, 2003 Record of September 10, 2003 the Senate and appeared in the Congres- PN958 Navy nominations (319) beginning PN879 Army nomination of Joseph T. sional Record of September 3, 2003 TIM K ADAMS, and ending TIMOTHY P PN895 Navy nominations (17) beginning Ramsey, which was received by the Senate ZINKUS, which nominations were received OLIVIA L. BETHEA, and ending THERESA and appeared in the Congressional Record of by the Senate and appeared in the Congres- A TALBERT, which nominations were re- September 2, 2003 sional Record of September 17, 2003 PN849 Army nominations (54) beginning ceived by the Senate and appeared in the STEPHEN W. AUSTIN, and ending NATHAN Congressional Record of September 3, 2003 PN896 Navy nominations (41) beginning f L. ZIMMERMAN, which nominations were JASON B BABCOCK, and ending TIMOTHY J received by the Senate and appeared in the ZINCK, which nominations were received by Congressional Record of July 30, 2003 LEGISLATIVE SESSION the Senate and appeared in the Congres- MARINE CORPS sional Record of September 3, 2003 The PRESIDING OFFICER. Under PN880 Marine Corps nomination of Bryan PN897 Navy nominations (15) beginning the previous order, the Senate will re- D. McKinney, which was received by the Sen- REID B APPLEQUIST, and ending BRET A sume legislative session.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00033 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.050 S26PT1 S12060 CONGRESSIONAL RECORD — SENATE September 26, 2003 HONORING THE LIFE OF HERB (2) expresses its deepest condolences to the Subtitle E—504 Loan Program BROOKS family of Herb Brooks; and Sec. 241. Extension of user fees. (3) directs the Secretary of the Senate to Mr. FRIST. I ask unanimous consent Sec. 242. Amortized loan loss reserve fund. transmit an enrolled copy of this resolution Sec. 243. Alternative loss reserve for certain that the Judiciary Committee be dis- to the family of Herb Brooks. premier certified lenders. charged from further consideration of f Sec. 244. Debenture size. S. Res. 235 and the Senate proceed to Sec. 245. Job creation or retention stand- its consideration. SMALL BUSINESS ADMINISTRA- ards. The PRESIDING OFFICER. Without TION 50TH ANNIVERSARY REAU- Sec. 246. Simplified applications. objection, it is so ordered. The clerk THORIZATION ACT OF 2003 Sec. 247. Child care lending pilot program. will report the resolution by title. Mr. FRIST. I ask unanimous consent Sec. 248. Definition of rural area. The assistant legislative clerk read that the Senate proceed to the imme- Subtitle F—Surety Bond Program as follows: diate consideration of Calendar 248, S. Sec. 251. Clarification of maximum surety A resolution (S. Res. 235) honoring the life 1375. bond guarantee. of the late Herb Brooks and expressing the The PRESIDING OFFICER. The Sec. 252. Authorization of Preferred Surety deepest condolences of the Senate to his clerk will report the bill by title. Bond Guarantee Program. family on his death. The assistant legislative clerk read Subtitle G—Miscellaneous There being no objection, the Senate as follows: Sec. 261. Coordination of SBA loans. proceeded to consider the resolution. A bill (S. 1375) to provide for the reauthor- Sec. 262. Leasing options for 7(a) and 504 bor- Mr. FRIST. I ask unanimous consent ization of programs administered by the rowers. that the resolution and preamble be Small Business Administration, and for Sec. 263. Calculation of financing limitation other purposes. for small business investment agreed to en bloc, the motion to recon- companies. sider be laid upon the table, and any There being no objection, the Senate Sec. 264. Establishing alternative size stand- statements related thereto be printed proceeded to consider the bill which ard. in the RECORD, with no intervening ac- had been reported from the Committee Sec. 265. Pilot program for guarantees on tion. on Small Business and Entrepreneur- pools of non-SBA loans. The PRESIDING OFFICER. Without ship, with amendments, as follows: Subtitle H—New Markets Venture Capital objection, it is so ordered. [Strike the parts shown in black brackets Sec. 271. Time frame for raising private cap- The resolution (S. Res. 235) was and insert the part shown in italic.] ital. agreed to. S. 1375 Sec. 272. Definition of low-income geo- The preamble was agreed to. Be it enacted by the Senate and House of Rep- graphic area. The resolution, with its preamble, resentatives of the United States of America in Subtitle I—Small Business Investment reads as follows: Congress assembled, Company Program S. RES. 235 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. Sec. 281. Investment of excess funds. Whereas the Senate has learned with great (a) SHORT TITLE.—This Act may be cited as Sec. 282. Maximum prioritized payment sadness of the death of Herb Brooks; the ‘‘Small Business Administration 50th rate. Whereas Herb Brooks, born in Saint Paul, Anniversary Reauthorization Act of 2003’’. Sec. 283. Improved distribution require- Minnesota, greatly distinguished himself by (b) TABLE OF CONTENTS.—The table of con- ments. his long commitment to the game of hockey, tents for this Act is as follows: Subtitle J—Small Business Intermediary the players whom he coached, the State of Sec. 1. Short title; table of contents. Lending Pilot Program Sec. 2. Effective date. Minnesota, and the United States of Amer- Sec. 291. Short title. ica; TITLE I—GENERAL PROVISIONS Sec. 292. Findings. Whereas Herb Brooks was a member of the Subtitle A—Administration Accountability Sec. 293. Small Business Intermediary Lending 1964 and 1968 United States Olympic Hockey Sec. 101. Document retention and investiga- Pilot Program. Teams; tions. TITLE III—ENTREPRENEURIAL Whereas Herb Brooks coached the 1980 Sec. 102. Management of the Small Business DEVELOPMENT PROGRAMS United States Olympic Hockey Team, also Administration. known as the ‘‘Miracle on Ice’’, to a sensa- Subtitle A—Office of Entrepreneurial Subtitle B—Authorizations tional victory against the favored Soviet Development Union team, providing the United States Sec. 111. Program authorization levels. Sec. 301. Service Corps of Retired Execu- with an unforgettable moment that high- Sec. 112. Additional reauthorizations. tives. lighted American determination, resilience, TITLE II—FINANCIAL ASSISTANCE Sec. 302. Small Business Development Cen- and spirit; Subtitle A—7(a) Loan Guarantee Program ter Program. Whereas the United States Olympic Team Sec. 201. National Preferred Lenders Pilot Sec. 303. PRIME reauthorization and transfer continued victoriously on and won the Gold Program. to the Small Business Act. Medal at the 1980 Olympic Games; Sec. 202. Extension of program participation Subtitle B—Women’s Small Business Whereas Herb Brooks coached 3 University fees. Ownership Programs of Minnesota hockey teams to NCAA Na- Sec. 203. Loans sold in secondary market. Sec. 311. Office of Women’s Business Owner- tional Championships in 1974, 1976, and 1979; Sec. 204. Clarification of eligibility for vet- ship. Whereas Herb Brooks subsequently erans. Sec. 312. Women’s Business Center Program. coached the Minnesota North Stars, the New Sec. 205. Enhancement of low documenta- Sec. 313. National Women’s Business Coun- York Rangers, the New Jersey Devils, and tion loan program. cil. the Pittsburgh Penguins; Sec. 206. Increased loan amounts for export- Sec. 314. Interagency Committee on Wom- Whereas Herb Brooks spearheaded the de- ers. en’s Business Enterprise. velopment of the Division I hockey program Subtitle B—Microloan Program Sec. 315. Preserving the independence of the at Saint Cloud State University by serving Sec. 211. Microloan program improvements. National Women’s Business Coun- as the first coach of the team, obtaining the Subtitle C—Lender Oversight cil. funding for a world-class ice arena, and re- cruiting top-level players to the new pro- Sec. 221. Examination and review fees. Subtitle C—Office of Native American gram; Sec. 222. Enforcement authority for Small Affairs Whereas in 1990, Herb Brooks was inducted Business Lending Companies Sec. 321. Short title. into the United States Hockey Hall of Fame and non-federally regulated Sec. 322. Native American Small Business and in 1999 was inducted into the Inter- SBA lenders. Development Program. national Hockey Hall of Fame; Sec. 223. Definitions for Small Business Sec. 323. Pilot programs. Lending Companies and non- Whereas Herb Brooks was a devoted hus- Subtitle D—Office of Veterans Business federally regulated SBA lend- band to his wife, Patti, and a loving father to Development his 2 children, Dan and Kelly; and ers. Sec. 331. Advisory Committee on Veterans Whereas his life was remarkable for its Subtitle D—Disaster Assistance Loan Business Affairs. constant pursuit of excellence: Now, there- Program Sec. 332. Outreach grants for veterans. fore, be it Sec. 231. Conforming amendment for dis- Sec. 333. Authorization of appropriations. Resolved, That the Senate— aster assistance loan program. (1) pays tribute to the outstanding career, Sec. 232. Disaster relief for small business TITLE IV—SMALL BUSINESS character, and dedicated work of the great concerns damaged by drought. PROCUREMENT OPPORTUNITIES American Herb Brooks; Sec. 233. Disaster mitigation pilot program. Sec. 401. Contract consolidation.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00034 Fmt 0637 Sfmt 0655 E:\CR\FM\G26SE6.064 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12061 Sec. 402. Agency accountability. records available to the requesting com- ‘‘(i) $70,000,000 in technical assistance Sec. 403. Small business participation in mittee or its duly authorized representative grants, as provided in section 7(m); and prime contracting. within 5 business days of the request, and if ‘‘(ii) $100,000,000 in direct loans, as provided Sec. 404. Small business participation in a document or record cannot be made avail- in section 7(m). subcontracting. able within such timeframe, the Adminis- ‘‘(B) For the programs authorized by this Sec. 405. Evaluating subcontract participa- trator or the Inspector General, as applica- Act, the Administration is authorized to tion in awarding contracts. ble, shall provide the requesting committee make $21,550,000,000 in deferred participation Sec. 406. Direct payments to subcontractors. with a written explanation stating the rea- loans and other financings. Of such sum, the Sec. 407. Women-owned small business in- son that each document or record requested Administration is authorized to make— dustry study. has not been provided and a date certain for ‘‘(i) $16,000,000,000 in general business loans, Sec. 408. øA¿HUBZone authorizations. its production.’’. as provided in section 7(a); Sec. 409. Definition of øHUBzone¿ HUBZone; SEC. 102. MANAGEMENT OF THE SMALL BUSI- ‘‘(ii) $5,000,000,000 in certified development treatment of certain former NESS ADMINISTRATION. company financings, as provided in section military installation lands as Section 4 of the Small Business Act (15 7(a)(13) of this Act and section 504 of the øHUBzones¿ HUBZones. U.S.C. 633) is amended— Small Business Investment Act of 1958; Sec. 410. Definition of øHUBzone¿ HUBZone (1) by striking ‘‘SEC. 4.’’ and inserting the ‘‘(iii) $500,000,000 in loans, as provided in small business concern. following: section 7(a)(21); and Sec. 411. Acquisition regulations. ‘‘SEC. 4. MANAGEMENT OF THE SMALL BUSINESS ‘‘(iv) $50,000,000 in loans, as provided in sec- TITLE V—MISCELLANEOUS ADMINISTRATION.’’; tion 7(m). (2) in subsection (a), by striking ‘‘(a)’’ and ‘‘(C) For the programs authorized by title Sec. 501. Minority Small Business and Cap- III of the Small Business Investment Act of ital Ownership Development inserting the following: ‘‘(a) ESTABLISHMENT.—’’; 1958, the Administration is authorized to Program. make— ø ¿ (3) in subsection (b)— Sec. 502. Extension of program authority ‘‘(i) $4,000,000,000 in purchases of partici- for technology assistance pro- (A) by striking ‘‘(b)(1)’’ and inserting the following: pating securities; and grams. ‘‘(ii) $3,000,000,000 in guarantees of deben- ø ¿ ‘‘(b) AUTHORITY OF ADMINISTRATOR.— Sec. 503. R BusinessLINC report to Con- tures. gress. ‘‘(1) IN GENERAL.— ‘‘(A) APPOINTMENT.—’’; ‘‘(D) For the programs authorized by part SEC. 2. EFFECTIVE DATE. (B) in paragraph (1)— B of title IV of the Small Business Invest- (a) IN GENERAL.—This Act and the amend- (i) by striking ‘‘The Administrator shall ment Act of 1958, the Administration is au- ments made by this Act shall take effect on not engage’’ and inserting the following: thorized to enter into guarantees not to ex- October 1, 2003. ‘‘(B) SOLE EMPLOYMENT.—The Adminis- ceed $6,000,000,000, of which not more than 50 (b) RULEMAKING AUTHORITY.— trator shall not engage’’; percent may be in bonds approved pursuant (1) PROPOSED REGULATIONS.—Except as oth- (ii) by striking ‘‘In carrying out’’ and in- to section 411(a)(3) of that Act. erwise specifically provided in this Act, not serting the following: ‘‘(E) The Administration is authorized to later than 180 days after the date of enact- make grants or enter into cooperative agree- ‘‘(C) NONDISCRIMINATION; SPECIAL CONSIDER- ment of this Act, the Administrator of the ments for a total amount of $7,000,000 for the ATION FOR VETERANS.—In carrying out’’; and Small Business Administration (referred to (iii) by striking ‘‘The President’’ and in- Service Corps of Retired Executives program in this Act as the ‘‘Administrator’’ and the serting the following: authorized by section 8(b)(1). ‘‘Administration’’, respectively) shall pub- ‘‘(2) ADDITIONAL AUTHORIZATIONS.— ‘‘(D) APPOINTMENT OF DEPUTY ADMINIS- lish proposed regulations to carry out the ‘‘(A) There are authorized to be appro- TRATOR; ASSOCIATE ADMINISTRATORS.—The priated to the Administration for fiscal year provisions of this Act and the amendments President’’; and 2004 such sums as may be necessary to carry made by this Act. (C) in paragraph (2), by striking ‘‘the Ad- (2) FINAL REGULATIONS.—Except as other- out the provisions of this Act not elsewhere ministrator also’’ and inserting ‘‘RESPON- wise specifically provided in this Act, not provided for, including administrative ex- SIBILITIES OF ADMINISTRATOR.—The Adminis- penses and necessary loan capital for dis- later than 300 days after the date of enact- trator’’; and aster loans pursuant to section 7(b), and to ment of this Act, the Administrator shall (4) by adding at the end the following: carry out title IV of the Small Business In- issue final regulations to carry out the pro- ‘‘(g) OFFICE OF LENDER OVERSIGHT.—The vestment Act of 1958, including salaries and visions of this Act and the amendments Director of the Office of Lender Oversight expenses of the Administration. made by this Act. shall— ‘‘(B) Notwithstanding any other provision TITLE I—GENERAL PROVISIONS ‘‘(1) formulate, execute, and promote poli- of this paragraph, for fiscal year 2004— cies and procedures of the Administration Subtitle A—Administration Accountability ‘‘(i) no funds are authorized to be used as that provide adequate and effective over- SEC. 101. DOCUMENT RETENTION AND INVES- loan capital for the loan program authorized sight and review of lenders participating in, TIGATIONS. by section 7(a)(21) except by transfer from or applying to participate in, the loan and Section 10(e) of the Small Business Act (15 another Federal department or agency to the loan guaranty programs for small business U.S.C. 639(e)) is amended by striking the Administration, unless the program level au- concerns under this Act and the Small Busi- matter preceding paragraph (2) and inserting thorized for general business loans under ness Investment Act of 1958 (15 U.S.C. 661 et the following: paragraph (1)(B)(i) is fully funded; and seq.); and ‘‘(e) DOCUMENT RETENTION; INVESTIGA- ‘‘(ii) the Administration may not approve ‘‘(2) report directly to the Chief Operating TIONS.— loans on its own behalf or on behalf of any Officer of the Administration.’’. ‘‘(1) DOCUMENT RETENTION.—The øAdminis- other Federal department or agency, by con- tration¿ Administrator and the Inspector Gen- Subtitle B—Authorizations tract or otherwise, under terms and condi- eral of the Administration shall— SEC. 111. PROGRAM AUTHORIZATION LEVELS. tions other than those specifically author- ‘‘(A) retain all documents and records, in- Section 20 of the Small Business Act (15 ized under this Act or the Small Business In- cluding correspondence, records of inquiry, U.S.C. 631 note) is amended— vestment Act of 1958, except that it may ap- memoranda (including those relating to all (1) in subsection (a)(1), by striking ‘‘certifi- prove loans under section 7(a)(21) of this Act investigations conducted by or for the Ad- cation’’ each place that term appears and in- in gross amounts of not more than $2,000,000. ministration), reports, studies, analyses, serting ‘‘accreditation’’; ‘‘(f) FISCAL YEAR 2005.— contracts, agreements, opinions, computer (2) by striking subsections (c) through (h) ‘‘(1) PROGRAM LEVELS.—The following pro- entries, e-mail messages, forms, manuals, and inserting the following: gram levels are authorized for fiscal year briefing materials, press releases, and books ‘‘(c) DISASTER MITIGATION PILOT PRO- 2005: for a period of not less than 2 years from the GRAM.—The following program levels are au- ‘‘(A) For the programs authorized by this date such documents are created; thorized for loans under section 7(b)(1)(C): Act, the Administration is authorized to ‘‘(B) keep the items described in subpara- ‘‘(1) $15,000,000 for fiscal year 2003. make— graph (A) available at all times for inspec- ‘‘(2) $15,000,000 for fiscal year 2004. ‘‘(i) $75,000,000 in technical assistance tion and examination by the Committee on ‘‘(3) $15,000,000 for fiscal year 2005. grants, as provided in section 7(m); and Small Business and Entrepreneurship of the ‘‘(4) $15,000,000 for fiscal year 2006.’’; ‘‘(ii) $105,000,000 in direct loans, as provided Senate and the Committee on Small Busi- (3) by redesignating subsection (i) as sub- in 7(m). ness of the House of Representatives, or section (d); and ‘‘(B) For the programs authorized by this their duly authorized representatives; and (4) by adding at the end the following: Act, the Administration is authorized to ‘‘(C) upon the written request of the Com- ‘‘(e) FISCAL YEAR 2004.— make $22,300,000,000 in deferred participation mittee on Small Business and Entrepreneur- ‘‘(1) PROGRAM LEVELS.—The following pro- loans and other financings. Of such sum, the ship of the Senate or the Committee on gram levels are authorized for fiscal year Administration is authorized to make— Small Business of the House of Representa- 2004: ‘‘(i) $16,500,000,000 in general business loans, tives pursuant to subparagraph (B), the Ad- ‘‘(A) For the programs authorized by this as provided in section 7(a); ministrator or the Inspector General, as ap- Act, the Administration is authorized to ‘‘(ii) $5,250,000,000 in certified development plicable, shall make such documents or make— company financings, as provided in section

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00035 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 S12062 CONGRESSIONAL RECORD — SENATE September 26, 2003 7(a)(13) of this Act and section 504 of the ‘‘(ii) $3,500,000,000 in guarantees of deben- TITLE II—FINANCIAL ASSISTANCE Small Business Investment Act of 1958; tures. Subtitle A—7(a) Loan Guarantee Program ‘‘(iii) $500,000,000 in loans, as provided in ‘‘(D) For the programs authorized by part section 7(a)(21); and B of title IV of the Small Business Invest- SEC. 201. NATIONAL PREFERRED LENDERS PILOT ‘‘(iv) $50,000,000 in loans, as provided in sec- ment Act of 1958, the Administration is au- PROGRAM. tion 7(m). thorized to enter into guarantees not to ex- Section 7(a)(2) of the Small Business Act ‘‘(C) For the programs authorized by title ceed $6,000,000,000, of which not more than 50 (15 U.S.C. 636(a)(2)(C)) is amended by adding III of the Small Business Investment Act of percent may be in bonds approved pursuant at the end the following: 1958, the Administration is authorized to to section 411(a)(3) of that Act. ‘‘(E) NATIONAL PREFERRED LENDERS PILOT make— ‘‘(E) The Administration is authorized to PROGRAM.— ‘‘(i) $4,250,000,000 in purchases of partici- make grants or enter into cooperative agree- ‘‘(i) ESTABLISHMENT.—There is established pating securities; and ments for a total amount of $7,000,000 for the the National Preferred Lenders Pilot Pro- ‘‘(ii) $3,250,000,000 in guarantees of deben- Service Corps of Retired Executives program gram, a 3-year pilot program in which a par- tures. authorized by section 8(b)(1). ticipant in the Preferred Lenders Program ‘‘(D) For the programs authorized by part ‘‘(2) ADDITIONAL AUTHORIZATIONS.— may operate as a preferred lender in any B of title IV of the Small Business Invest- ‘‘(A) There are authorized to be appro- State if such lender meets the criteria estab- ment Act of 1958, the Administration is au- priated to the Administration for fiscal year lished by the Administration. thorized to enter into guarantees not to ex- 2006 such sums as may be necessary to carry ‘‘(ii) ELIGIBILITY CRITERIA.—For purposes of ceed $6,000,000,000, of which not more than 50 out the provisions of this Act not elsewhere clause (i), criteria established by the Admin- percent may be in bonds approved pursuant provided for, including administrative ex- istration shall include— to section 411(a)(3) of that Act. penses and necessary loan capital for dis- ‘‘(I) demonstrated proficiency in the Pre- ‘‘(E) The Administration is authorized to aster loans pursuant to section 7(b), and to ferred Lenders Program for not less than 3 make grants or enter into cooperative agree- carry out title IV of the Small Business In- years; ments for a total amount of $7,000,000 for the vestment Act of 1958, including salaries and ‘‘(II) annual loan approvals of a minimum Service Corps of Retired Executives program expenses of the Administration. number of 7(a) Preferred Lenders Program authorized by section 8(b)(1). ‘‘(B) Notwithstanding any other provision loans, excluding SBA Express loans, as deter- ‘‘(2) ADDITIONAL AUTHORIZATIONS.— of this paragraph, for fiscal year 2006— mined by the Administration; ‘‘(A) There are authorized to be appro- ‘‘(i) no funds are authorized to be used as ‘‘(III) operation by the lender in not less priated to the Administration for fiscal year loan capital for the loan program authorized than 5 States or 10 Small Business Adminis- 2005 such sums as may be necessary to carry by section 7(a)(21) except by transfer from tration districts; out the provisions of this Act not elsewhere another Federal department or agency to the ‘‘(IV) satisfactory centralized approval, provided for, including administrative ex- Administration, unless the program level au- loan servicing, and loan liquidation func- penses and necessary loan capital for dis- thorized for general business loans under tions and processes; and aster loans pursuant to section 7(b), and to paragraph (1)(B)(i) is fully funded; and ‘‘(V) consideration of any comments and carry out title IV of the Small Business In- ‘‘(ii) the Administration may not approve recommendations that may be received from vestment Act of 1958, including salaries and loans on its own behalf or on behalf of any any District Director or Regional Adminis- expenses of the Administration. other Federal department or agency, by con- trator relating to the performance of the ap- ‘‘(B) Notwithstanding any other provision tract or otherwise, under terms and condi- plicant. of this paragraph, for fiscal year 2005— tions other than those specifically author- ‘‘(iii) TERMS AND CONDITIONS.—Applicants ‘‘(i) no funds are authorized to be used as ized under this Act or the Small Business In- shall be approved under the following terms loan capital for the loan program authorized vestment Act of 1958, except that it may ap- and conditions: by section 7(a)(21) except by transfer from prove loans under section 7(a)(21) of this Act ‘‘(I) TERM.—Each participant approved another Federal department or agency to the in gross amounts of not more than under this subparagraph shall be eligible to Administration, unless the program level au- $2,000,000.’’. make loans for up to 1 year under the pro- thorized for general business loans under SEC. 112. ADDITIONAL REAUTHORIZATIONS. gram established under this subparagraph. paragraph (1)(B)(i) is fully funded; and ‘‘(II) RENEWAL.—At the expiration of the ‘‘(ii) the Administration may not approve (a) DRUG-FREE WORKPLACE PROGRAM AS- term described in subclause (I), the author- loans on its own behalf or on behalf of any SISTANCE.—Section 21(c)(3)(T) of the Small ity of a participant to make loans under this other Federal department or agency, by con- Business Act (15 U.S.C. 648(c)(3)(T)) is amend- subparagraph may be renewed based on a re- tract or otherwise, under terms and condi- ed by striking ‘‘October 1, 2003’’ and insert- view of performance during the initial term. tions other than those specifically author- ing ‘‘October 1, 2006’’. ‘‘(III) EFFECT OF FAILURE.—Failure to meet ized under this Act or the Small Business In- (b) PAUL D. COVERDELL DRUG-FREE WORK- the criteria under this subparagraph shall vestment Act of 1958, except that it may ap- PLACE PROGRAM.—Section 27(g)(1) of the not effect the eligibility of a participant to prove loans under section 7(a)(21) of this Act Small Business Act (15 U.S.C. 654(g)(1)) is continue as a preferred lender in States or in gross amounts of not more than $2,000,000. amended by striking ‘‘2001 through 2003’’ and districts in which it is in good standing.’’. ‘‘(g) FISCAL YEAR 2006.— inserting ‘‘2004 through 2006’’. SEC. 202. EXTENSION OF PROGRAM PARTICIPA- ‘‘(1) PROGRAM LEVELS.—The following pro- (c) SMALL BUSINESS DEVELOPMENT CEN- TION FEES. gram levels are authorized for fiscal year TERS.—Section 21(a)(4)(C) of the Small Busi- Section 7(a) of the Small Business Act (15 2006: ness Act (15 U.S.C. 648(a)(4)(C)) is amended— U.S.C. 636(a)) is amended— ‘‘(A) For the programs authorized by this (1) by amending clause (vii) to read as fol- (1) in paragraph (12) by striking ‘‘(b)’’ and Act, the Administration is authorized to lows: inserting the following: make— ‘‘(vii) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(B)’’; ‘‘(i) $80,000,000 in technical assistance There are authorized to be appropriated to (2) in paragraph (18)— grants, as provided in section 7(m); and carry out this subparagraph— (A) in subparagraph (A)— ‘‘(ii) $110,000,000 in direct loans, as provided ‘‘(I) $125,000,000 for fiscal year 2004; (i) in clause (i), by striking ‘‘2 percent’’ and in 7(m). ‘‘(II) $130,000,000 for fiscal year 2005; and inserting ‘‘1 percent’’; and ‘‘(B) For the programs authorized by this ‘‘(III) $135,000,000 for fiscal year 2006.’’; (ii) in clause (ii), by striking ‘‘3 percent’’ Act, the Administration is authorized to (2) by redesignating clause (viii) as clause and inserting ‘‘2.5 percent’’; and make $23,050,000,000 in deferred participation (ix); and (B) by striking subparagraph (C); and loans and other financings. Of such sum, the (3) by inserting after clause (vii) the fol- (3) in paragraph (23)(A), by striking ‘‘0.5 Administration is authorized to make— lowing: percent’’ and all that follows through ‘‘equal ‘‘(i) $17,000,000,000 in general business ‘‘(viii) LIMITATION.—From the funds appro- to’’. loans, as provided in section 7(a); priated pursuant to clause (vii), the Adminis- ‘‘(ii) $5,500,000,000 in certified development tration shall reserve not less than $1,000,000 SEC. 203. LOANS SOLD IN SECONDARY MARKET. company financings, as provided in section in each fiscal year to develop portable assist- Section 5(g) of the Small Business Act (15 7(a)(13) of this Act and section 504 of the ance for startup and sustainability non- U.S.C. 634(g)) is amended by adding at the Small Business Investment Act of 1958; matching grant programs to be conducted by end the following: ‘‘(iii) $500,000,000 in loans, as provided in eligible small business development centers ‘‘(6) Trust certificates issued pursuant to section 7(a)(21); and in communities that are economically chal- this subsection may be comprised of a pool of ‘‘(iv) $50,000,000 in loans, as provided in sec- lenged as a result of a business or govern- loans, guaranteed by the Administration, tion 7(m). ment facility downsizing or closing, which with varying interest rates. The interest ‘‘(C) For the programs authorized by title has resulted in the loss of jobs or small busi- rate paid by such certificates shall be equal III of the Small Business Investment Act of ness instability. A non-matching grant under to the weighted average of the interest rates 1958, the Administration is authorized to this clause shall not exceed $100,000, and of the loans in the pool. The Administration make— shall be used for small business development shall prescribe the maximum amount of var- ‘‘(i) $4,500,000,000 in purchases of partici- center personnel expenses and related small iation in the loan characteristics in order to pating securities; and business programs and services.’’. enhance the marketability of the pool.’’.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00036 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12063

SEC. 204. CLARIFICATION OF ELIGIBILITY FOR (e) REPORT ON TRANSFERRED AMOUNTS.— Small Business Lending Companies, in ac- VETERANS. Section 7(m)(9)(B) of the Small Business Act cordance with the purposes of this Act. Section 7(a)(8) of the Small Business Act (15 U.S.C. 636(m)(9)(B)) is amended— ‘‘(2) NON-FEDERALLY REGULATED SBA LEND- (15 U.S.C. 636(a)(8)) is amended to read as fol- (1) by striking ‘‘The Administration’’ and ERS.—The Administration is authorized to— lows: inserting the following: ‘‘(A) supervise the safety and soundness of ‘‘(8) The Administration may make loans ‘‘(i) IN GENERAL.—The Administration’’; non-federally regulated SBA lenders; under this subsection to— (2) by striking the period after ‘‘financ- ‘‘(B) regulate, examine, and enforce laws ‘‘(A) small business concerns owned and ing’’; and relating to lending by non-federally regu- controlled by veterans (as defined in section (3) by adding at the end the following: lated SBA lenders under section 7(a); and 101(2) of title 38, United States Code); ‘‘(ii) REPORT.—The Administration shall ‘‘(C) prescribe regulations governing the ‘‘(B) small business concerns owned and report, in its annual budget request and per- operations, oversight, and enforcement of controlled by disabled veterans (as defined in formance plan to Congress, on the perform- non-federally regulated SBA lenders, in ac- section 4211(3) of title 38, United States ance by the Administration of the require- cordance with the purposes of this Act. Code); and ments of clause (i).’’. ‘‘(c) CAPITAL DIRECTIVES.—The Administra- ‘‘(C) small business concerns owned and (f) ACCURATE SUBSIDY MODEL.—Section controlled by members of Reserve compo- 7(m) of the Small Business Act (15 U.S.C. tion may— nents of the Armed Forces (as defined in sec- 636(m)) is amended by adding at the end the ‘‘(1) deem the failure of a Small Business tion 101(c)(6) of title 10, United States following: Lending Company to maintain capital at or Code).’’. ‘‘(14) IMPROVED SUBSIDY MODEL.—The Ad- above the minimum capital level established ministrator shall develop a subsidy model for by the Administration as an unsafe and un- SEC. 205. ENHANCEMENT OF LOW DOCUMENTA- sound practice; and TION LOAN PROGRAM. the microloan program under this sub- ‘‘(2) in addition to, or in lieu of, any other Section 7(a)(25)(C) of the Small Business section, to be used in the fiscal year 2005 action authorized by law, issue a directive to Act (15 U.S.C. 636(a)(25)(C)) is amended by budget, that is more accurate than the sub- a Small Business Lending Company that striking ‘‘$100,000’’ and inserting ‘‘$250,000’’. sidy model in effect on the day before the date of enactment of this paragraph.’’. fails to return or maintain capital at or SEC. 206. INCREASED LOAN AMOUNTS FOR EX- (g) INCREASED FLEXIBILITY FOR PROVIDING above its required level, as established by PORTERS. TECHNICAL ASSISTANCE TO POTENTIAL BOR- the Administration. Section 7(a) of the Small Business Act (15 ROWERS.—Section 7(m)(4)(E)(i) of the Small U.S.C. 636(a)) is amended— ‘‘(d) FORFEITURE OF AUTHORITY FOR NON- Business Act (15 U.S.C. 636(m)(4)(E)(i) is amend- (1) in paragraph (3)— COMPLIANCE.— ed by striking ‘‘25 percent’’ and inserting ‘‘30 (A) in subparagraph (A), by inserting be- ‘‘(1) IN GENERAL.—Subject to the provisions percent’’. fore the semicolon at the end the following: of subsection (g), if any Small Business ‘‘and paragraph (14)’’; and Subtitle C—Lender Oversight Lending Company violates any of the provi- (B) in subparagraph (B), by striking SEC. 221. EXAMINATION AND REVIEW FEES. sions of this Act, or any related regulation, ‘‘$1,250,000’’ and inserting ‘‘$1,300,000’’; and Section 5(b) of the Small Business Act (15 such company shall forfeit all of the rights, (2) in paragraph (14), by adding at the end U.S.C. 634(b)) is amended— privileges, and franchises under this Act. the following: (1) in the matter preceding paragraph (1), ‘‘(2) ADJUDICATION.—A company under ‘‘(D) The total amount of financings under by striking ‘‘(b) In the performance’’ and in- paragraph (1) shall not forfeit its rights, this paragraph that are outstanding and serting the following: privileges, and franchises under this Act, un- committed (by participation or otherwise) to ‘‘(b) AUTHORITY OF ADMINISTRATOR.—In the less a court of the United States, with juris- the borrower from the business loan and in- performance’’; diction over the judicial district in which the vestment fund established under this Act (2) in paragraph (12), by striking ‘‘and’’ at principal place of business of such company may not exceed $1,300,000 and the gross loan the end; is located, determines, in a suit brought by, amount under this paragraph may not ex- (3) in paragraph (13), by striking the period or on behalf of, the Administrator, that such ceed $2,600,000.’’. at the end and inserting ‘‘; and’’; and company violated this Act, or regulations (4) by adding at the end the following: promulgated pursuant to this Act. Subtitle B—Microloan Program ‘‘(14) require lenders participating in the SEC. 211. MICROLOAN PROGRAM IMPROVE- program authorized by section 7(a), includ- ‘‘(e) REVOCATION OR SUSPENSION OF AU- MENTS. ing Small Business Lending Companies, to THORITY.— (a) INTERMEDIARY ELIGIBILITY REQUIRE- pay reasonable examination and review fees, ‘‘(1) IN GENERAL.—Subject to the provisions MENTS.—Section 7(m)(2) of the Small Busi- which shall be— of subsection (g), the Administration may re- ness Act (15 U.S.C. 636(m)(2)) is amended— ‘‘(A) deposited in the account for salaries voke or suspend the authority of a partici- (1) in subparagraph (A), by striking ‘‘in and expenses of the Administration; and pating lender to make, service, or liquidate paragraph (10); and’’ and inserting ‘‘of the ‘‘(B) made available only for the costs of business loans under section 7(a) if the par- term ‘intermediary’ under paragraph (11);’’; examinations, reviews, and other lender ticipating lender— and oversight activities concerning lenders par- ‘‘(A) knowingly makes false statements in (2) in subparagraph (B)— ticipating in the program authorized by sec- any written statement required under this (A) by striking ‘‘(B) has at least’’ and in- tion 7(a).’’. Act or any regulation issued under this Act; serting the following: SEC. 222. ENFORCEMENT AUTHORITY FOR SMALL ‘‘(B) fails to state, in any written state- ‘‘(B) has— BUSINESS LENDING COMPANIES ment required under this Act or any regula- ‘‘(i) at least’’; and AND NON-FEDERALLY REGULATED tion issued under this Act, a material fact (B) by striking the period at the end and SBA LENDERS. necessary in order to make the statement inserting the following: ‘‘; or The Small Business Act (15 U.S.C. 631 et not misleading in the light of the cir- ‘‘(ii) a full-time employee who has not less seq.) is amended— cumstances under which the statement was than 3 years experience making microloans (1) by redesignating section 36 as section made; to startup, newly established, or growing 37; and ‘‘(C) willfully or repeatedly violates— small business concerns; and (2) by inserting after section 35 the fol- ‘‘(i) any provision of this Act; ‘‘(C) has at least 1 year experience pro- lowing new section: ‘‘(ii) any rule or regulation issued under viding, as an integral part of its microloan ‘‘SEC. 36. ENFORCEMENT AUTHORITY FOR SMALL this Act; or program, intensive marketing, management, BUSINESS LENDING COMPANIES AND NON-FED- ‘‘(iii) any condition imposed by the Admin- and technical assistance to its borrowers.’’. ERALLY REGULATED SBA LENDERS istration with any application, request, or (b) CONFORMING CHANGE IN AVERAGE ‘‘(a) DEFINED TERM.—In this section the agreement; or SMALLER LOAN SIZE.—Section 7(m)(3)(F)(iii) term ‘management official’ means an officer, ‘‘(D) violates any cease and desist order of the Small Business Act (15 U.S.C. director, general partner, manager, em- issued by the Administration under this sec- 636(m)(3)(F)(iii)) is amended by striking ployee, agent, or other participant in the tion. ‘‘$7,500’’ and inserting ‘‘$10,000’’. management or conduct of the affairs of a ‘‘(2) LENGTH OF SUSPENSION.—The suspen- (c) LIMITATION ON THIRD PARTY TECHNICAL Small Business Lending Company or non- sion under paragraph (1) shall remain in full ASSISTANCE.—Section 7(m)(4)(E)(ii) of the federally regulated SBA lender under section force and effect until the Administration Small Business Act (15 U.S.C. 7(a). issues a written notice of termination. 636(m)(4)(E)(ii)) is amended— ‘‘(b) AUTHORIZATION.— ‘‘(3) NOTIFICATION.—If the lending author- (1) by striking ‘‘TECHNICAL ASSISTANCE’’ ‘‘(1) SMALL BUSINESS LENDING COMPANIES.— ity of a lender is revoked under paragraph and inserting ‘‘THIRD PARTY TECHNICAL AS- The Administration is authorized to— (1), the lender shall send notification, not SISTANCE’’; and ‘‘(A) supervise the safety and soundness of later than 30 days after such revocation, to (2) by striking ‘‘25 percent’’ and inserting Small Business Lending Companies; all existing borrowers that such authority ‘‘30 percent’’. ‘‘(B) set capital standards for, regulate, ex- has been revoked and that a new servicer has (d) LOAN TERMS.—Section 7(m)(1)(B)(i) of amine, and enforce laws relating to Small been appointed to service their loans. If the the Small Business Act (15 U.S.C. Business Lending Companies; and lender fails to provide such notification be- 636(m)(1)(B)(i)) is amended by striking ‘‘(C) prescribe regulations governing the fore the deadline, the aAdministration shall ‘‘short-term’’. operations, oversight, and enforcement of provide such notification to borrowers.

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‘‘(4) DELEGATION.—The Administration ‘‘(iii) the effective date of the order. ‘‘(B) NOTICE.—Upon the receipt of the ap- may delegate the authority to suspend a par- ‘‘(C) EFFECTIVE DATE.— plication filed under subparagraph (A), the ticipating lender’s authority to make loans ‘‘(i) CEASE AND DESIST ORDER.—A cease and court shall notify the participating lender or under section 7(a), but shall not delegate the desist order issued under this paragraph other person of such enforcement action. authority to revoke a participating lender’s shall become effective on the date specified ‘‘(C) PROCEDURE.—The evidence to be con- authority to make such loans. therein. sidered, the procedure to be followed, and the ‘‘(f) CEASE AND DESIST ORDERS.—If a par- ‘‘(ii) REVOCATION OR SUSPENSION.—An order jurisdiction of the court shall be the same as ticipating lender or management official has revoking or suspending the authority of a is provided in paragraph (5) for applications violated, or is about to violate any provision participating lender under section 7(a) shall to set aside or modify orders. of this Act, or any related regulation, the be final and conclusive 30 days after the date ‘‘(h) REMOVAL OR SUSPENSION OF MANAGE- Administration, subject to the provisions of of issuance of such order unless the partici- MENT OFFICIALS.— subsection (g), may— pating lender files an appeal under paragraph ‘‘(1) REMOVAL OF MANAGEMENT OFFICIALS.— ‘‘(1) order the participating lender or man- (5). ‘‘(A) NOTICE OF REMOVAL.—The Adminis- agement official to— ‘‘(5) APPEAL.— ‘‘(A) cease and desist from such violation; trator may serve upon any management offi- ‘‘(A) APPEAL BY RIGHT.—Not later than 30 cial a written notice of its intention to re- and days after an order is issued under paragraph move that management official if, in the ‘‘(B) take, or refrain from, such action as (4), a participating lender may appeal such opinion of the Administrator such manage- the Administration deems necessary to en- order by filing a petition requesting that the ment official— sure compliance with the Act and related Administration’s order be set aside or modi- ‘‘(i) has willfully and knowingly com- regulations; and fied with the clerk of the United States dis- mitted any substantial violation of— ‘‘(2) suspend the authority of such partici- trict court for the judicial district in which ‘‘(I) this Act; pating lender pending full compliance with such participating lender has its principal ‘‘(II) any regulation issued under this Act; all orders issued under paragraph (1). place of business. ‘‘(III) a cease-and-desist order which has ‘‘(g) PROCESS FOR REVOCATION OR SUSPEN- ‘‘(B) LEAVE OF COURT.—After the expiration become final; or SION OF AUTHORITY OR CEASE AND DESIST OR- of the period described in subparagraph (A), DERS.— a participating lender may file a petition of ‘‘(IV) any agreement by the management ‘‘(1) NOTICE.—Before revoking or sus- appeal only by leave of court and upon a official or the participating lender; or pending the authority of a participating showing of reasonable grounds for failure to ‘‘(ii) has willfully and knowingly com- lender pursuant to subsection (e) or issuing a timely file such petition. mitted or engaged in any act, omission, or practice which constitutes a substantial cease and desist order pursuant to subsection ‘‘(C) DELIVERY OF PETITION.—Upon receiv- (f), the Administration shall— ing a petition under this paragraph, the breach of a fiduciary duty of that person as ‘‘(A) provide notice to the participating clerk of the court shall immediately deliver a management official if the violation or lender that such action is contemplated; and a copy of the petition to the Administration, breach of fiduciary duty involves personal ‘‘(B) provide the participating lender with which shall certify and file in the court a dishonesty on the part of such management an opportunity to show cause why such ac- transcript of the record upon which the order official. tion should not be taken. complained of was entered. ‘‘(B) CONTENTS OF NOTICE.—A notice pro- ‘‘(2) CONTENTS.—A notice under paragraph ‘‘(D) AMENDMENT OF PETITION.—If the Ad- vided under subparagraph (A) shall contain— (1) shall contain— ministration amends or sets aside its order, ‘‘(i) a statement of the facts constituting ‘‘(A) a statement of the matters of fact and in whole or in part, before the record is filed the grounds for the removal of the manage- law asserted by the Administration; under subparagraph (C), the petitioner may ment official; and ‘‘(B) a description of the legal authority amend the petition within such time as the ‘‘(ii) the time and place at which a hearing and jurisdiction under which a hearing is to court may determine, on notice to the Ad- will be held to determine if the management be held; and ministration. official should be removed from office. ‘‘(C) the time and place of the hearing that ‘‘(E) EFFECT OF PETITION.—The filing of a ‘‘(C) HEARINGS.— will be held before the Administration. petition for review shall not affect the oper- ‘‘(i) TIMING.—A hearing described in sub- ‘‘(3) HEARING.— ation of the order of the Administration, but paragraph (B) shall take place not earlier ‘‘(A) IN GENERAL.—A hearing under this the district court may restrain or suspend, than 30 days nor later than 60 days after the subsection shall take place before the Office in whole or in part, the operation of the date on which notice is provided under sub- of Hearings and Appeals of the Administra- order pending the final hearing and deter- paragraph (A), unless an earlier or later date tion. mination of the petition. is set by the Administrator at the request ‘‘(B) SUBPOENA.—The Administration may ‘‘(F) AUTHORITY OF COURT.— of— require by subpoena— ‘‘(i) IN GENERAL.—Except as provided under ‘‘(I) the management official, for good ‘‘(i) the attendance and testimony of wit- clause (ii), the district court may affirm, cause shown; or nesses; and modify, or set aside any order of the Admin- ‘‘(II) the Attorney General of the United ‘‘(ii) the production of all books, papers, e- istration issued under this subsection. States. mails, faxes, and documents relating to the ‘‘(ii) LIMITATION.—The district court shall ‘‘(ii) CONSENT.—If the management official hearing under this paragraph. not consider an objection to an order of the fails to appear, in person or by a duly au- ‘‘(C) ENFORCEMENT OF SUBPOENA.—If a Administration unless such objection was thorized representative, at a hearing under party disobeys a subpoena issued under sub- presented to the Administration or there this paragraph, that management official paragraph (B), the Administration, or any were reasonable grounds for failure to do so. shall be deemed to have consented to the party to a proceeding before the Administra- ‘‘(G) ADDITIONAL EVIDENCE.— issuance of an order of removal under sub- tion, may invoke the aid of any court of the ‘‘(i) IN GENERAL.—If the district court de- paragraph (A). United States to require— termines that the just and proper disposition ‘‘(D) ISSUANCE OF ORDER OF REMOVAL.— ‘‘(i) the attendance and testimony of wit- of the case requires the taking of additional ‘‘(i) IN GENERAL.—The Administrator may nesses; and evidence, the court may take additional evi- issue an order of removal from office if— ‘‘(ii) the production of books, papers, e- dence and findings of fact, or may order the ‘‘(I) consent is deemed under subparagraph mails, faxes, and documents. Administration to reopen the hearing for the (C)(ii); or ‘‘(D) WITNESS FEES.—Witnesses summoned taking of such evidence, in such manner and ‘‘(II) the Administrator finds, upon the before the Administration shall be paid, by upon such terms and conditions as the court record of the hearing described in this sub- the party at whose instance they were determines to be proper. section, that any of the grounds specified in called, the same fees and mileage that are ‘‘(ii) MODIFICATION OF FINDINGS.—The Ad- the notice of removal has been established. paid witnesses in the courts of the United ministration may modify its findings as to ‘‘(ii) EFFECTIVENESS.—An order under States. the facts, or make new findings, by reason of clause (i) shall— ‘‘(4) ISSUANCE OF ORDER.— the additional evidence so taken, and it shall ‘‘(I) become effective on the expiration of ‘‘(A) IN GENERAL.—If the Administration, file its modified or new findings and the the date which is 30 days after the date that after a hearing, or a waiver thereof, deter- amendments, if any, of its order, with the notice is provided to the participating lender mines on the record that an order revoking record of such additional evidence. and the management official concerned (ex- or suspending the authority of a partici- ‘‘(6) ENFORCEMENT OF ORDER.— cept in the case of an order issued upon con- pating lender under section 7(a) or a cease ‘‘(A) IN GENERAL.—If any participating sent as described in øclause¿ subparagraph and desist order should be issued, the Admin- lender or other person against which an (C)(ii), which shall become effective at the istration shall promptly issue such order to order is issued under this section fails to time specified in such order); and the participating lender and any other per- obey the order, the Administration may file ‘‘(II) remain effective and enforceable, ex- son involved. an application with the United States dis- cept to the extent it is stayed, modified, ter- ‘‘(B) CONTENTS.—The order issued under trict court within the judicial district where minated, or set aside by action of the Admin- subparagraph (A) shall contain— the participating lender has its principal istrator or a reviewing court, in accordance ‘‘(i) a statement of the findings of the Ad- place of business, for the enforcement of the with this section. ministration; order by filing a transcript of the record ‘‘(2) AUTHORITY TO SUSPEND OR PROHIBIT ‘‘(ii) the reasons therefore; and upon which the disobeyed order was entered. PARTICIPATION.—

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‘‘(A) IN GENERAL.—The Administrator fice, or to temporarily prohibit the manage- late any provision of this Act, any rule or may— ment official from participation in the man- regulation under this Act, or any order ‘‘(i) if necessary to protect the Small Busi- agement or conduct of the affairs of any par- issued under this Act, the Administrator ness Lending Company or interests of the ticipating lender. may apply to the proper district court of the Administration, suspend from office any ‘‘(4) PROCEDURAL PROVISIONS; JUDICIAL RE- United States, or a United States court of management official described in paragraph VIEW.— any place subject to the jurisdiction of the (1), or temporarily prohibit such official ‘‘(A) HEARING VENUE.—Any hearing under United States, for an order to— from further participating in the manage- this subsection shall be— ‘‘(A) enjoin such acts or practices; or ment or conduct of the affairs of the Small ‘‘(i) held in the Federal judicial district or ‘‘(B) enforce compliance with such provi- Business Lending Company; and in the territory in which the principal office sion, rule, regulation, or order. ‘‘(ii) if necessary to protect the interests of of the participating lender is located, unless ‘‘(2) JURISDICTION.—A court under para- the Administration, suspend from office any the party afforded the hearing consents to graph (1) shall have jurisdiction over any ac- management official described in paragraph another place; and tion under paragraph (1). (1) or prohibit from further participation a ‘‘(ii) conducted in accordance with the pro- ‘‘(3) ISSUANCE.—Upon a showing by the Ad- non-federally regulated SBA lender or any visions of chapter 5 of title 5, United States ministrator that a participating lender or management official described in paragraph Code. other person has engaged, or is about to en- (1) in any activities related to the making, ‘‘(B) ISSUANCE OF ORDERS.—After a hearing gage, in any act or practice described in servicing, review, approval, or liquidation of under this subsection, and not later than 90 paragraph (1), the court shall issue, without any loan made under section 7(a). days after the Administrator has notified the bond— ‘‘(B) EFFECTIVENESS.—A suspension or pro- parties that the case has been submitted for ‘‘(A) a permanent or temporary injunction; hibition under subparagraph (A)— final decision, the Administrator shall— ‘‘(B) a restraining order; or ‘‘(i) shall become effective upon service of ‘‘(i) render a decision in the matter, which ‘‘(C) any other appropriate order. notice under paragraph (1); and shall include findings of fact upon which its ‘‘(j) APPOINTMENT OF RECEIVERS.—In any ‘‘(ii) unless stayed by a court in pro- decision is predicated; and injunction proceeding under subsection (i), ceedings under subparagraph (C), shall re- ‘‘(ii) issue and serve upon each party to the the district court may— main in effect— proceeding an order or orders consistent ‘‘(1) seize the assets of 1 or more Small ‘‘(I) pending the completion of the admin- with the provisions of this section. Business Lending Companies; and istrative proceedings pursuant to a notice ‘‘(C) AUTHORITY TO MODIFY ORDERS.—The ‘‘(2) appoint the Administration, or an- under paragraph (1); and Administrator may modify, terminate, or set other receiver, to hold or administer the as- ‘‘(II) until the Administrator dismisses the aside any order issued under this section— sets seized under paragraph (1) under the di- charges specified in the notice, or, if an order ‘‘(i) at any time, upon such notice, and in rection of the court. of removal or prohibition is issued against such manner as the Administrator may pre- ‘‘(k) POSSESSION OF ASSETS.— the management official, until the effective scribe, until a petition for review is timely ‘‘(1) SMALL BUSINESS LENDING COMPANIES.— date of any such order. filed with a United States district court, in If a Small Business Lending Company is in- ‘‘(C) JUDICIAL REVIEW.—Not later than 10 accordance with subparagraph (D)(ii) and a solvent, out of compliance with capital re- days after any management official has been record of the proceeding has been filed in ac- quirements under this section, or otherwise suspended from office or prohibited from par- cordance with subparagraph (D)(iii); and operating in an unsafe or unsound condition, ticipation in the management or conduct of ‘‘(ii) after the filing of the record under the Administration may take possession of— the affairs of a participating lender, the subparagraph (D)(iii), with permission of the ‘‘(A) the portfolio of loans guaranteed by management official may apply for a stay of court. the Administration and sell such loans to a the suspension or prohibition, pending the ‘‘(D) JUDICIAL REVIEW.— third party through a receiver appointed completion of the administrative pro- ‘‘(i) IN GENERAL.—Judicial review of an under subsection (j)(2); and ceedings under this subsection, to— order issued under this section shall be lim- ‘‘(B) servicing activities of loans that are ‘‘(i) the United States district court for the ited to the provisions of this subsection. guaranteed by the Administration and sell judicial district in which the home office of ‘‘(ii) PETITION FOR JUDICIAL REVIEW.—Any such servicing rights to a third party the participating lender is located; or party to a hearing under this section may through a receiver appointed under sub- ‘‘(ii) the United States District Court for obtain a review of any order issued pursuant section (j)(2). the District of Columbia. to subparagraph (B) (other than an order ‘‘(2) NON-FEDERALLY REGULATED SBA LEND- ‘‘(3) AUTHORITY TO SUSPEND ON CRIMINAL issued with the consent of the management ERS.—If a non-federally regulated SBA lend- CHARGES.— official concerned or an order issued under er is insolvent or otherwise operating in an ‘‘(A) IN GENERAL.—If a management official subsection (d)), by filing, not later than 30 unsafe and unsound condition, the Adminis- is charged, in any information, indictment, days after the date of service of such order, tration may take possession of— or complaint authorized by a United States in the United States district court for the ju- ‘‘(A) the portfolio of loans guaranteed by attorney or a State prosecutor, with the dicial district in which the principal office of the Administration and sell such loans to a commission of a felony involving dishonesty the licensee is located or in the United third party; and or breach of trust, or has been convicted of States District Court for the District of Co- ‘‘(B) servicing activities of loans that are any felony, the Administrator may suspend lumbia, a written petition requested that the guaranteed by the Administration and sell that management official from office or pro- order be modified, terminated, or set aside. such servicing rights to a third party. hibit that management official from further ‘‘(iii) NOTICE TO ADMINISTRATION.—The ‘‘(l) PENALTIES AND FORFEITURES.— participation in the management or conduct clerk of the court receiving a petition under ‘‘(1) IN GENERAL.—Except as provided under of the affairs of the participating lender. øsubparagraph¿ clause (ii) shall transmit a paragraph (3), a Small Business Lending ‘‘(B) EFFECTIVENESS.—A suspension or pro- copy of the petition to the Administrator, Company or a non-federally regulated SBA hibition under paragraph (A) shall remain in who shall submit to the court the record of lender that violates any regulation or writ- effect until the subject information, indict- the proceeding, in accordance with section ten directive issued by the Administrator re- ment, or complaint is finally disposed of, or 2112 of title 28, United States Code. garding the filing of any regular or special until terminated by the Administrator. ‘‘(iv) JURISDICTION.— report shall pay to the United States a civil ‘‘(C) AUTHORITY UPON CONVICTION.— ‘‘(I) EXCLUSIVE.—Upon the filing of the penalty of not more than $5,000 for every day ‘‘(i) IN GENERAL.—If a judgment of convic- record under clause (iii), the district court after the due date in which the lender fails tion with respect to an offense described in described in clause (ii) shall have exclusive to file such report, unless such failure is due paragraph (A) is entered against a manage- jurisdiction to affirm, modify, terminate, or to reasonable cause and not willful neglect. ment official and is no longer subject to ap- set aside, in whole or in part, the order of the ‘‘(2) RECOVERY OF CIVIL PENALTY.—The civil pellate review, the Administrator may issue Administrator, except as provided under penalty provided for in this section shall ac- an order removing that management official paragraph (2)(B)(ii)(II). crue to the United States and may be recov- from office. ‘‘(II) REVIEW.—The review of any pro- ered in a civil action brought by the Admin- ‘‘(ii) NOTICE.—A copy of the order issued ceeding under subclause (I) shall be in ac- istration. under clause (i) shall be delivered to the cordance with chapter 7 of title 5, United ‘‘(3) EXEMPTION.—The Administrator may, management official and the participating States Code. by regulation, order, or upon the application lender for which such official was employed. ‘‘(v) JUDICIAL REVIEW NOT A STAY.—The of an interested party, at any time before a ‘‘(iii) EFFECTIVE DATE.—The order of re- commencement of proceedings for judicial report is due under paragraph (1) and after moval under clause (i) shall take effect upon review under this paragraph shall not, unless notice and opportunity for hearing, exempt, the delivery of a copy of the order to the par- specifically ordered by the district court, op- in whole or in part, any Small Business ticipating lender. erate as a stay of any order issued by the Ad- Lending Company from the provisions of ‘‘(D) AUTHORITY UPON DISMISSAL OR OTHER ministrator under this section. paragraph (1), upon such terms and condi- DISPOSITION.—A finding of not guilty or other ‘‘(i) INJUNCTIONS.— tions and for such period of time as the Ad- disposition of charges described in subpara- ‘‘(1) APPLICATION.—If, in the judgment of ministrator determines to be appropriate, if graph (A) shall not preclude the Adminis- the Administrator, a participating lender or the Administrator finds that such action is trator from initiating proceedings to suspend any other person has engaged, or is about to consistent with the public interest or the or remove the management official from of- engage, in any acts or practices which vio- protection of the Administration.

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‘‘(4) ALTERNATIVE REQUIREMENTS.—If an ex- (c) PROMPT RESPONSE TO DISASTER RE- ‘‘(iii) CERTIFICATION.—Before the end of emption is granted under paragraph (3), the QUESTS.—Section 7(b)(2)(D) of the Small any calendar quarter for which an election is Administrator may, for the purposes of this Business Act (15 U.S.C. 636(b)(2)(D)) is in effect under subparagraph (A), the head of section, make any alternative requirements amended by striking ‘‘Upon receipt of such the PCL shall submit to the Administrator a appropriate to the situation.’’. certification, the Administration may’’ and certification that the loss reserve of the PCL SEC. 223. DEFINITIONS FOR SMALL BUSINESS inserting ‘‘Not later than 30 days after the is sufficient to meet such PCL’s obligation LENDING COMPANIES AND NON-FED- date of receipt of such certification by a to protect the Federal Government from risk ERALLY REGULATED SBA LENDERS. Governor of a State, the Administration of loss. Such certification shall be in such Section 3 of the Small Business Act (15 shall respond in writing to that Governor on form and submitted in such manner as the U.S.C. 632) is amended— its determination and the reasons therefore, Administrator may require and shall be (1) in subsection (l), by striking ‘‘Act— and may’’. signed by the head of such PCL and the audi- ‘‘(1) the term’’ and inserting ‘‘Act, the (d) RULEMAKING.—Not later than 45 days tor making the determination under clause term’’; and after the date of enactment of this section, (ii)(II). (2) by adding at the end the following: the Administrator shall promulgate final ‘‘(C) DISBURSEMENTS.— ‘‘(r) SMALL BUSINESS LENDING COMPANY.— rules to carry out this section and the ‘‘(i) ORDINARY RULE INAPPLICABLE.—Para- In this Act, the term ‘Small Business Lend- amendments made by this section. graph (6) shall not apply with respect to any ing Company’ means a non-depository finan- SEC. 233. DISASTER MITIGATION PILOT PRO- qualified high loss reserve PCL for any cal- cial institution that is licensed, supervised, GRAM. endar quarter for which an election is in ef- examined, and regulated by the Administra- Section 7(b)(1)(C) of the Small Business fect under subparagraph (A). tion to only make loans under section 7. Act (15 U.S.C. 636(b)(1)(C)) is amended by ‘‘(ii) EXCESS FUNDS.—At the end of each ‘‘(s) NON-FEDERALLY REGULATED SBA striking ‘‘2000 through 2004’’ and inserting calendar quarter for which an election is in LENDER.—In this Act, the term ‘non-feder- ‘‘2003 through 2006’’. effect under subparagraph (A), the Adminis- ally regulated SBA lender’ means a financial tration shall allow the qualified high loss re- Subtitle E—504 Loan Program institution, other than a Small Business serve PCL to withdraw from its loss reserve Lending Company, that makes loans under SEC. 241. EXTENSION OF USER FEES. the excess of— section 7 and is not regulated by— Section 503(f) of the Small Business Invest- ‘‘(I) the amount of the loss reserve, over ‘‘(1) the Farm Credit Administration; ment Act of 1958 (15 U.S.C. 697(f)) is amended ‘‘(II) the greater of $100,000 or the amount ‘‘(2) the Federal Financial Institution Ex- by striking ‘‘October 1, 2003’’ and inserting which is determined under subparagraph amination Council; ‘‘October 1, 2006’’. (B)(ii) to be sufficient to meet the PCL’s ob- ‘‘(3) the Board of Governors of the Federal SEC. 242. AMORTIZED LOAN LOSS RESERVE ligation to protect the Federal Government Reserve System; FUND. from risk of loss. ‘‘(4) the Office of the Comptroller of the Paragraph (6) of section 508(c) of the Small ‘‘(D) RECONTRIBUTION.—If the requirements Currency; Business Investment Act of 1958 (15 U.S.C. of this paragraph apply to a qualified high ‘‘(5) the Federal Deposit Insurance Cor- 697e(c)) is amended— loss reserve PCL for any calendar quarter poration; (1) by striking ‘‘The Administration’’ and and cease to apply to such PCL for any sub- ‘‘(6) the Office of Thrift Supervision; or inserting the following: sequent calendar quarter, such PCL shall ‘‘(7) the National Credit Union Administra- ‘‘(A) IN GENERAL.—The Administration’’; make a contribution to its loss reserve in tion.’’. and such amount as the Administrator may de- Subtitle D—Disaster Assistance Loan (2) by adding at the end the following new termine provided that such amount does not Program subparagraph: exceed the amount which would result in the ‘‘(B) TEMPORARY REDUCTION BASED ON OUT- SEC. 231. CONFORMING AMENDMENT FOR DIS- total amount in the loss reserve being equal ASTER ASSISTANCE LOAN PROGRAM. STANDING BALANCE.—Notwithstanding sub- to the amount which would have been in Section 7(c)(6) of the Small Business Act paragraph (A), the Administration shall such loss reserve had this paragraph never (15 U.S.C. 636(c)(6)) is amended— allow the certified development company to applied to such PCL. The Administrator may (1) by striking ‘‘$500,000’’ each place it ap- withdraw from the loss reserve such amounts require that such payment be made as a sin- pears and inserting ‘‘$1,500,000’’; and as are in excess of 1 percent of the aggregate gle payment or as a series of payments. (2) by inserting ‘‘commencing on or after outstanding balances of debentures to which ‘‘(E) RISK MANAGEMENT.—If a qualified high April 1, 1993,’’ before ‘‘unless an applicant’’. such loss reserve relates. The preceding sen- loss reserve PCL fails to meet the require- SEC. 232. DISASTER RELIEF FOR SMALL BUSI- tence shall not apply with respect to any de- ment of subparagraph (F)(iii) during any pe- NESS CONCERNS DAMAGED BY benture before 100 percent of the contribu- riod for which an election is in effect under DROUGHT. tion described in paragraph (4) with respect subparagraph (A) and such failure continues (a) DROUGHT DISASTER AUTHORITY.— to such debenture has been made.’’. for 180 days, the requirements of paragraphs (1) DEFINITION OF DISASTER.—Section 3(k) SEC. 243. ALTERNATIVE LOSS RESERVE FOR CER- (2), (4), and (6) shall apply to such PCL as of of the Small Business Act (15 U.S.C. 632(k)) is TAIN PREMIER CERTIFIED LEND- the end of such 180-day period and such PCL amended— ERS. shall make the contribution to its loss re- (A) by inserting ‘‘(1)’’ after ‘‘(k)’’; and (a) IN GENERAL.—Subsection (c) of section serve described in subparagraph (D). The Ad- (B) by adding at the end the following: 508 of the Small Business Investment Act of ministrator may waive the requirements of ‘‘(2) For purposes of section 7(b)(2), the 1958 (15 U.S.C. 697e) is amended by adding at this subparagraph. term ‘disaster’ includes— the end the following: ‘‘(F) QUALIFIED HIGH LOSS RESERVE PCL.— ‘‘(A) drought; and ‘‘(7) ALTERNATIVE LOSS RESERVE.— The term ‘qualified high loss reserve PCL’ ‘‘(B) below average water levels in the ‘‘(A) ELECTION.—With respect to any eligi- means, with respect to any calendar year, Great Lakes, or on any body of water in the ble calendar quarter, any qualified high loss any premier certified lender designated by United States that supports commerce by reserve PCL may elect to have the require- the Administrator as a qualified high loss re- small business concerns.’’. ments of this paragraph apply in lieu of the serve PCL for such year. The Administrator (2) DROUGHT DISASTER RELIEF AUTHORITY.— requirements of paragraphs (2) and (4) for shall not designate a company under the pre- Section 7(b)(2) of the Small Business Act (15 such quarter. ceding sentence unless the Administrator de- U.S.C. 636(b)(2)) is amended— ‘‘(B) CONTRIBUTIONS.— termines that— (A) by inserting ‘‘(including drought), with ‘‘(i) ORDINARY RULES INAPPLICABLE.—Ex- ‘‘(i) the amount of the loss reserve of the respect to both farm-related and nonfarm-re- cept as provided under clause (ii) and para- company is not less than $100,000; lated small business concerns,’’ before ‘‘if graph (5), a qualified high loss reserve PCL ‘‘(ii) the company has established and is the Administration’’; and that makes the election described in sub- utilizing an appropriate and effective process (B) in subparagraph (B), by striking ‘‘the paragraph (A) with respect to a calendar for analyzing the risk of loss associated with Consolidated Farmers Home Administration quarter shall not be required to make con- its portfolio of PCLP loans and for grading Act of 1961 (7 U.S.C. 1961)’’ and inserting the tributions to its loss reserve during such each PCLP loan made by the company on the following: ‘‘section 321 of the Consolidated quarter. basis of the risk of loss associated with such Farm and Rural Development Act (7 U.S.C. ‘‘(ii) BASED ON LOSS.—A qualified high loss loan; and 1961), in which case, assistance under this reserve PCL that makes the election de- ‘‘(iii) the company meets or exceeds 4 or paragraph may be provided to farm-related scribed in subparagraph (A) with respect to more of the specified risk management and nonfarm-related small business con- any calendar quarter shall, before the last benchmarks as of the most recent assess- cerns, subject to the other applicable re- day of such quarter, make such contribu- ment by the Administration or the Adminis- quirements of this paragraph’’. tions to its loss reserve as are necessary to tration has issued a waiver with respect to (b) LIMITATION ON LOANS.—From funds oth- ensure that the amount of the loss reserve of the requirement of this clause. erwise appropriated pursuant to section 20 the PCL is— ‘‘(G) SPECIFIED RISK MANAGEMENT BENCH- for loans under section 7(b) of the Small ‘‘(I) not less than $100,000; and MARKS.—For purposes of this paragraph, the Business Act (15 U.S.C. 636(b)), not more than ‘‘(II) sufficient, as determined by a quali- term ‘specified risk management bench- $9,000,000 may be used during fiscal year 2004 fied independent auditor, for the PCL to marks’ means the following rates, as deter- to provide drought disaster loans to non- meet its obligations to protect the Federal mined by the Administrator: farm-related small business concerns. Government from risk of loss. ‘‘(i) Currency rate.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00040 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12067 ‘‘(ii) Delinquency rate. protect the Federal Government from the ments for that particular project if the out- ‘‘(iii) Default rate. risk of loss associated with loans guaranteed standing portfolio of the development com- ‘‘(iv) Liquidation rate. under such Program. pany meets or exceeds the job creation or re- ‘‘(v) Loss rate. (2) TRANSMISSION OF REPORT.—The report tention criteria under subsection (d)(1).’’. ‘‘(H) QUALIFIED INDEPENDENT AUDITOR.—For described in paragraph (1) shall be trans- purposes of this paragraph, the term ‘quali- mitted to the Committee on Small Business SEC. 246. SIMPLIFIED APPLICATIONS. fied independent auditor’ means any licensed of the House of Representatives and the (a) LOANS OF $400,000 OR LESS.— auditor who— Committee on Small Business and Entrepre- (1) IN GENERAL.—Not later than 180 days ‘‘(i) is compensated by the qualified high neurship of the Senate not later than 180 after the date of enactment of this Act, the loss reserve PCL; days after the date of the enactment of this Administrator shall develop a shorter, more ‘‘(ii) is independent of such PCL; and Act. concise, and simplified application form for ‘‘(iii) has been approved by the Adminis- (3) LIMITATION.—The amount of the con- loan guarantees involving not more than trator during the preceding year. tract described in paragraph (1) shall not ex- $400,000 authorized under section 504 of the ‘‘(I) PCLP LOAN.—For purposes of this ceed $75,000. Small Business Investment Act of 1958 (15 paragraph, the term ‘PCLP loan’ means any SEC. 244. DEBENTURE SIZE. U.S.C. 697a). loan guaranteed under this section. Section 502(2) of the Small Business Invest- (2) AVAILABILITY TO CERTIFIED DEVELOP- ‘‘(J) ELIGIBLE CALENDAR QUARTER.—For ment Act of 1958 (15 U.S.C. 696) is amended to MENT COMPANIES.—The form developed under purposes of this paragraph, the term ‘eligible read as follows: paragraph (1) shall be made available to cer- calendar quarter’ means— ø(1) by striking ‘‘The Administration tified development companies not later than ‘‘(i) the first calendar quarter that begins may,’’ and inserting the following: 180 days after the date of enactment of this after the end of the 90-day period beginning ‘‘(a) IN GENERAL.—The Administration Act. with the date of the enactment of this para- may,’’; (b) ALL OTHER LOANS.— graph; and (2) by striking ‘‘: Provided, however, That (1) IN GENERAL.—Not later than 270 days ø ¿ the foregoing powers’’ and inserting the fol- ‘‘(ii) the 7 11 succeeding calendar quar- after the date of enactment of this Act, the lowing: ters. Administrator shall develop a shorter, more ‘‘(b) CONDITIONS.—The authority under sub- ‘‘(K) CALENDAR QUARTER.—For purposes of concise, and simplified application form for this paragraph, the term ‘calendar quarter’ section (a)’’; and (3) in subsection (b) (as designated by para- all loan guarantees authorized under section means— 504 of the Small Business Investment Act of ‘‘(i) the period which begins on January 1 graph (2)), by amending paragraph (2) to read as follows:¿ 1958 (15 U.S.C. 697a), including those de- and ends on March 31 of each year; scribed in subsection (a). ‘‘(ii) the period which begins on April 1 and ‘‘(2) MAXIMUM AMOUNT.—Loans made by the (2) AVAILABILITY TO CERTIFIED DEVELOP- ends on June 30 of each year; Administration under this section shall be MENT COMPANIES.—The form developed under ‘‘(iii) the period which begins on July 1 and limited to— ‘‘(A) $1,500,000 for each small business con- paragraph (1) shall be made available to cer- ends on September 30 of each year; and tified development companies not later than ‘‘(iv) the period which begins on October 1 cern if the loan proceeds will not be directed toward a goal or project described in sub- 270 days after the date of enactment of this and ends on December 31 of each year. Act. ‘‘(L) REGULATIONS.—Not later than 45 days paragraph (B) or (C); after the date of the enactment of this para- ‘‘(B) $2,000,000 for each small business con- SEC. 247. CHILD CARE LENDING PILOT PRO- graph, the Administrator shall publish in the cern if the loan proceeds will be directed to- GRAM. ward 1 or more of the public policy goals de- Federal Register and transmit to Congress (a) LOANS AUTHORIZED.—Section 502 of the scribed under section 501(d)(3); and regulations to carry out this paragraph. Small Business Investment Act of 1958 (15 ø‘‘(C) $2,000,000 for each small business con- Such regulations shall include provisions re- U.S.C. 696) is amended— cern if the loan proceeds will be directed to- lating to— (1) in the matter preceding paragraph (1)— ward manufacturing projects.’’.¿ ‘‘(i) the approval of auditors under sub- (A) by striking ‘‘The Administration’’ and ‘‘(C) $4,000,000 for each small business concern paragraph (H); and inserting the following: ‘‘(ii) the designation of qualified high loss if the loan proceeds will be directed toward reserve PCLs under subparagraph (F), includ- manufacturing projects.’’. ‘‘(a) AUTHORIZATION.—The Administra- ing the determination of whether a process SEC. 245. JOB CREATION OR RETENTION STAND- tion’’; for analyzing risk of loss is appropriate and ARDS. (B) by striking ‘‘and such loans’’ and in- effective for purposes of subparagraph Section 501 of the Small Business Invest- serting ‘‘. Such loans’’; (F)(ii).’’. ment Act of 1958 (15 U.S.C. 695) is amended by (C) by striking ‘‘: Provided, however, That (b) INCREASED REIMBURSEMENT FOR LOSSES striking the undesignated paragraph at the the foregoing powers shall be subject to the RELATED TO DEBENTURES ISSUED DURING end and inserting the following: following restrictions and limitations:’’ and ELECTION PERIOD.—Subparagraph (C) of sec- ‘‘(e) JOB CREATION OR RETENTION.— inserting a period; and tion 508(b)(2) of the Small Business Invest- ø‘‘(1) IN GENERAL.—A project being funded (D) by adding at the end the following: by the debenture is deemed to satisfy the job ment Act of 1958 (15 U.S.C. 697e(b)(2)) is ‘‘(b) RESTRICTIONS AND LIMITATIONS.—The creation or retention requirement under sub- amended by inserting ‘‘(15 percent in the authority under subsection (a) shall be sub- case of any such loss attributable to a deben- section (d)(1) if the project creates or retains ject to the following restrictions and limita- ture issued by the company during any pe- 1 job opportunity for every $50,000 guaran- riod for which an election is in effect under teed by the Administration.¿ tions:’’; and subsection (c)(7) for such company)’’ before ‘‘(1) IN GENERAL.—A project being funded by (2) in paragraph (1)— ‘‘; and’’. the debenture is deemed to satisfy the job cre- (A) by inserting after ‘‘USE OF PRO- (c) CONFORMING AMENDMENTS.— ation or retention requirement under subsection CEEDS.—’’ the following: (1) Subparagraph (D) of section 508(b)(2) of (d)(1) if the project creates or retains— ‘‘(A) IN GENERAL.—’’; and the Small Business Investment Act of 1958 ‘‘(A) 1 job opportunity for every $50,000 guar- (B) by adding at the end the following: (15 U.S.C. 697e(b)(2)) is amended by striking anteed by the Administration; or ‘‘(B) LOANS TO SMALL, NONPROFIT CHILD ‘‘subsection (c)(2)’’ and inserting ‘‘subsection ‘‘(B) in the case of a manufacturing project, 1 CARE BUSINESSES.— (c)’’. job opportunity for every $100,000 guaranteed by ‘‘(i) IN GENERAL.—Notwithstanding sub- (2) Paragraph (5) of section 508(c) of the the Administration. section (a)(1), the proceeds of any loan de- Small Business Investment Act of 1958 (15 ‘‘(2) TEMPORARY JOB CREATION WAIVER.— scribed in subsection (a) may be used by the U.S.C. 697e(c)) is amended by striking ‘‘10 ‘‘(A) IN GENERAL.—If a development com- certified development company to assist percent’’. pany fails to meet the job creation and re- small, nonprofit child care businesses, pro- (d) STUDY AND REPORT.— tention requirements under this section, the vided that— (1) IN GENERAL.—The Administrator shall company may apply for a temporary waiver ‘‘(I) the loan will be used for a sound busi- enter into a contract with a Federal agency from the Administration. Not later than 30 ness purpose that has been approved by the experienced in community development days after the request for such waiver, the Administration; lending and financial regulation or with a Administration shall respond to the request ‘‘(II) each such business receiving financial member of the Federal Financial Institu- and may temporarily waive the requirement assistance meets all of the same eligibility tions Examinations Council to study and if the development company shows reason- requirements applicable to for-profit busi- prepare a report regarding— able cause for its failure to meet the job cre- nesses under this title, except for status as a (A) the extent to which statutory require- ation and retention requirements under this for-profit business; ments have caused over capitalization in the section and demonstrates how it intends to ‘‘(III) 1 or more individuals has personally loss reserves maintained by certified devel- attain such requirements in the future. guaranteed the loan; opment companies participating in the Pre- ‘‘(B) AGGREGATION OF GOALS AND OBJEC- ‘‘(IV) the small, non-profit child care busi- mier Certified Lenders Program established TIVES.—If a project meets the economic de- ness has clear and singular title to the col- under section 508 of the Small Business In- velopment objectives or public policy goals lateral for the loan; and vestment Act of 1958 (15 U.S.C. 697e); and under paragraphs (2) and (3) of subsection (d), ‘‘(V) the small, non-profit child care busi- (B) alternatives for establishing and main- the project does not need to meet the indi- ness has sufficient cash flow from its oper- taining loss reserves that are sufficient to vidual job creation or retention require- ations to meet its obligations on the loan

VerDate jul 14 2003 02:09 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00041 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 S12068 CONGRESSIONAL RECORD — SENATE September 26, 2003 and its normal and reasonable operating ex- ber of child care small businesses, cat- the borrower under section 7(a) would exceed penses. egorized by status as a for-profit or non-prof- $1,000,000 (or if the gross loan amount would ‘‘(ii) LIMITATION ON VOLUME.—Not more it business, that— exceed $2,000,000), except as provided in sub- than 7 percent of the total number of loans (I) applied for loans under the program paragraph (B), plus an amount not to exceed guaranteed in any fiscal year under this title (and whether it was a new or expanding child the maximum amount of a development may be awarded under the pilot program. care provider); company financing under title V of the ‘‘(iii) DEFINED TERM.—For purposes of this (II) were approved for loans under the pro- Small Business Investment Act of 1958 (15 subparagraph, the term ‘small, non-profit gram; and U.S.C. 695 et seq.), and the Administration child care business’ means an establishment (III) received loan disbursements under the shall report to Congress in its annual budget that— program (and whether they are a new or ex- request and performance plan on the number ‘‘(I) is organized in accordance with section panding child care provider); and of small business concerns that have 501(c)(3) of the Internal Revenue Code of 1986; (v) with respect to the businesses described financings under both section 7(a) and under ‘‘(II) is primarily engaged in providing under clause (iv)(III)— title V of the Small Business Investment Act child care for infants, toddlers, pre-school, or (I) the number of such businesses in each of 1958, and the total amount and general pre-kindergarten children (or any combina- State, insular area, and District of Colum- performance of such financings.;’’. tion thereof), may provide care for older bia, as of the year of enactment of this Act; SEC. 262. LEASING OPTIONS FOR 7(a) AND 504 children when they are not in school, and (II) the total amount loaned to such busi- BORROWERS. may offer pre-kindergarten educational pro- nesses under the program; (a) 7(a) LOANS.—Section 7(a)(28) of the grams; (III) the total number of loans to such Small Business Act (15 U.S.C. 636(a)(28)) is ‘‘(III) including its affiliates, has tangible businesses under the program; amended to read as follows: net worth that does not exceed $7,000,000, and (IV) the average loan amount and term; ‘‘(28) LEASING.—In addition to such other has average net income (excluding any car- (V) the currency rate, delinquencies, de- lease arrangements as may be authorized by ryover losses) for the preceding 2 completed faults, and losses of the loans; the Administration, a borrower under this fiscal years that does not exceed $2,500,000; (VI) the number and percent of children section may lease, permanently or for a and served who receive subsidized assistance; and short term, to 1 or more tenants, not more ‘‘(IV) is licensed as a child care provider by (VII) the number and percent of children than 40 percent of any property purchased or the District of Columbia, the insular area, or served who are low income. constructed as part of a project financed the State in which it is located.’’. (C) ACCESS TO INFORMATION.— under this section if the borrower perma- ‘‘(iv) SUNSET PROVISION.—This subpara- (i) IN GENERAL.—The Administration shall nently occupies and uses not less than 60 per- graph shall remain in effect until September collect and maintain such information as cent of the total business space of the prop- 30, 2006, and shall apply to all loans author- may be necessary to carry out this para- erty.’’. ized under this subparagraph that are ap- graph from certified development centers (b) 504 LOANS.—Subsection (b)(5) of section plied for, approved, or disbursed during the and child care providers, and such centers 502 of the Small Business Investment Act of period beginning on the date of enactment of and providers shall comply with a request for 1958 (15 U.S.C. 696), as redesignated by this the Small Business Administration 50th An- information from the Administration for Act, is amended to read as follows: niversary Reauthorization Act of 2003 and that purpose. ending on September 30, 2006.’’. ‘‘(5) LEASING.—In addition to such other (ii) PROVISION OF INFORMATION TO GAO.— (b) REPORTS.— lease arrangements as may be authorized by The Administration shall provide informa- (1) SMALL BUSINESS ADMINISTRATION.— the Administration, a borrower under this tion collected under this subparagraph to the (A) IN GENERAL.—Not later than 6 months title may lease, permanently or for a short after the date of enactment of this Act, and Comptroller General of the United States for term, to 1 or more tenants, not more than 40 every 6 months thereafter until September purposes of the report required by this para- percent of any property purchased or con- 30, 2006, the Administrator shall submit a re- graph. structed as part of a project financed under port on the implementation of the program (c) RULEMAKING AUTHORITY.—Not later this title if the borrower permanently occu- under subsection (a) to— than 120 days after the date of enactment of pies and uses not less than 60 percent of the (i) the Committee on Small Business and this Act, the Administrator shall issue final total business space of the property.’’. Entrepreneurship of the Senate; and rules to carry out the loan program author- SEC. 263. CALCULATION OF FINANCING LIMITA- (ii) the Committee on Small Business of ized by section 502(b)(1)(B) of the Small Busi- TION FOR SMALL BUSINESS INVEST- the House of Representatives. ness Investment Act of 1958, as added by this MENT COMPANIES. (B) CONTENTS.—The report under subpara- Act. Section 306 of the Small Business Invest- graph (A) shall contain— SEC. 248. DEFINITION OF RURAL AREA. ment Act of 1958 (15 U.S.C. 686) is amended by (i) the date on which the program is imple- Section 501 of the Small Business Invest- inserting after subsection (a) the following: mented; ment Act of 1958 (15 U.S.C. 695) is amended by ‘‘(b) In calculating the 20 percent limita- (ii) the date on which the rules are issued adding at the end the following: tion under subsection (a) or any guarantee pursuant to subsection (c); and ‘‘(f) DEFINITION OF RURAL AREA.—For pur- required of a small business investment com- (iii) the number and dollar amount of loans poses of this title, the term ‘rural area’ pany by the Administration, only 50 percent under the program applied for, approved, and means any area other than— of the value of any loans issued under either disbursed during the previous 6 months— ‘‘(1) a city or town with a population of not section 7(a) of the Small Business Act or ‘‘(I) with respect to nonprofit child care less than 50,000 inhabitants; or title V of this Act, which are received by the business; and ‘‘(2) the urbanized area adjacent to a city enterprise in which the small business in- ‘‘(II) with respect to for profit child care or town under subparagraph (A).’’. vestment company has issued commitments, business. Subtitle F—Surety Bond Program shall be taken into consideration, but for ENERAL ACCOUNTING OFFICE any 1 such enterprise, a small business in- (2) G .— SEC. 251. CLARIFICATION OF MAXIMUM SURETY (A) IN GENERAL.—Not later than March 31, BOND GUARANTEE. vestment company may not simultaneously take advantage of this discounted calcula- 2006, the Comptroller General of the United (a) IN GENERAL.—Section 411(a)(1) of the tion for loans under both section 7(a) of the States shall submit a report on the child Small Business Investment Act of 1958 (15 Small Business Act (15 U.S.C. 636(a)) and care small business loans authorized by sec- U.S.C. 694b(a)(1)) is amended by striking title V of this Act.’’. tion 502(b)(1)(B) of the Small Business In- ‘‘contract up to’’ and inserting ‘‘total work vestment Act of 1958, as added by this Act, order or contract amount at the time of bond SEC. 264. ESTABLISHING ALTERNATIVE SIZE to— execution that does not exceed’’. STANDARD. (i) the Committee on Small Business and Section 3(a)(3) of the Small Business Act SEC. 252. AUTHORIZATION OF PREFERRED SUR- Entrepreneurship of the Senate; and ETY BOND GUARANTEE PROGRAM. (15 U.S.C. 632(a)(3) is amended— (ii) the Committee on Small Business of Section 411(a) of the Small Business In- (1) by striking ‘‘When establishing’’ and in- the House of Representatives. vestment Act of 1958 (15 U.S.C. 694b(a)) is serting the following: ‘‘ESTABLISHMENT OF (B) CONTENTS.—The report under subpara- amended by adding at the end the following: SIZE STANDARDS.— ø ¿ graph (A) shall contain information gathered ‘‘This paragraph shall remain in effect ‘‘( 1 A) IN GENERAL.—When establishing’’; during the first 2 years of the loan program, through September 30, 2006.’’. and including— (2) by adding at the end the following: (i) an evaluation of the timeliness of the Subtitle G—Miscellaneous ‘‘(ø2¿B) ALTERNATIVE SIZE STANDARD.—The implementation of the loan program; SEC. 261. COORDINATION OF SBA LOANS. Administrator shall establish an alternative (ii) a description of the effectiveness and Section 7(a)(3) of the Small Business Act size standard pursuant to paragraph (2), ease with which certified development com- (15 U.S.C. 636(a)(3)) is amended— which— panies, lenders, and small businesses have (1) by inserting ‘‘TOTAL AMOUNT OF ‘‘(øA¿i) shall be applicable to loan appli- participated in the loan program; LOANS.—’’ before ‘‘No loan’’; and cants under section 7(a) of this Act or title V (iii) a description and assessment of how (2) by amending subparagraph (A) to read of the Small Business Investment Act of 1958 the loan program was marketed; as follows: (15 U.S.C. 695 et seq.); and (iv) by location (State, insular area, and ‘‘(A) if the total amount outstanding and ‘‘(øB¿ii) shall utilize the maximum net District of Columbia) and in total, the num- committed (by participation or otherwise) to worth and maximum net income of the pro-

VerDate jul 14 2003 02:32 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00042 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12069

spective borrower as an alternative to the ‘‘(2) ANALYSIS AND REPORT.—Not later than SEC. 282. MAXIMUM PRIORITIZED PAYMENT use of industry standards.’’. December 30, 2005, the Comptroller General RATE. SEC. 265. PILOT PROGRAM FOR GUARANTEES ON shall— Section 303(g) of the Small Business In- POOLS OF NON-SBA LOANS. ‘‘(A) conduct an analysis of the pilot pro- vestment Act of 1958 (15 U.S.C. 683(g)) is Title IV of the Small Business Investment gram under this section; and amended— Act of 1958 (15 U.S.C. 692 et seq.) is amended ‘‘(B) submit a report to Congress that con- (1) in the matter preceding paragraph (1), by adding at the end the following: tains a summary of the analysis conducted ø(A)¿ by striking ‘‘In order’’ and inserting ‘‘GUARANTEES OF PARTICIPATING SECURI- ‘‘PART C—CREDIT ENHANCEMENT GUARANTEES under subparagraph (A) and a description of any effects, not attributable to other causes, TIES.—In order’’; and ‘‘SEC. 420. (a) The Administration is au- of the pilot program on the lending programs ø(B) by striking ‘‘For purposes of this sec- thorized, upon such terms and conditions as under section 7(a) of the Small Business Act tion,’’ and all that follows through ‘‘the ex- it may prescribe, in order to encourage lend- (15 U.S.C. 636(a)) and title V of this Act. tent of earnings.’’; and¿ ers to increase the availability of small busi- ‘‘(3) IMPLEMENTATION.— (2) in paragraph (2), by striking ‘‘1.38 per- ness financing by improving such lenders’ ac- ‘‘(A) REPORT.—After completing oper- cent’’ and inserting ‘‘1.7 percent’’. cess to reasonable sources of funding, to pro- ational guidelines to carry out the pilot pro- SEC. 283. IMPROVED DISTRIBUTION REQUIRE- vide a credit enhancement guarantee, or gram under this section, the Administration MENTS. commitment to guarantee, of the timely shall submit a report, which describes the Section 303(g)(9) of the Small Business In- payment of a portion of the principal and in- method in which the pilot program will be vestment Act of 1958 (15 U.S.C. 683(g)(9)) is terest on securities issued and managed by implemented, to— amended to read as follows: not less than 2 and not more than 5 qualified ‘‘(i) the Committee on Small Business and ‘‘(9) After making any distribution pursu- entities authorized and approved by the Ad- Entrepreneurship of the Senate; and ant to paragraph (8), a company with partici- ministration. ‘‘(ii) the Committee on Small Business of pating securities outstanding may distribute ‘‘(b)(1) The Administration may provide its the House of Representatives. the balance of income to its investors if— credit enhancement guarantees in respect of ‘‘(B) TIMING.—The Administration shall ‘‘(A) there are no accumulated and unpaid securities that represent interests in, or not implement the pilot program under this prioritized payments; other obligations issued by, a trust, pool, or section until the date that is 50 days after ‘‘(B) any amounts received by the Adminis- other entity whose assets (other than the the report has been submitted under sub- tration under this paragraph and paragraph Administration’s credit enhancement guar- paragraph (A). (8) are first applied as prepayment of the antee and credit enhancements provided by principal amount of the outstanding partici- other parties) consist of loans made to small ‘‘(f) SUNSET PROVISION.—This section shall remain in effect until September 30, 2006.’’. pating securities or debentures of the com- business concerns. pany at the time of such distribution and ‘‘(2) All loans under paragraph (1) shall be Subtitle H—New Markets Venture Capital then applied to the profit participation originated, purchased, or assembled and SEC. 271. TIME FRAME FOR RAISING PRIVATE under paragraph (11); and managed consistent with requirements pre- CAPITAL. ‘‘(C) any distributions under this para- scribed by the Administration in connection Section 354(d) of the Small Business In- graph are made to private investors and to with this credit enhancement guarantee pro- vestment Act of 1958 (15 U.S.C. 689c(d)) is the Administration in the ratio of private gram. amended— capital to leverage as of the date imme- ‘‘(3) The Administration shall prescribe re- (1) by redesignating paragraphs (1) and (2) as diately preceding the distribution until the quirements to be observed by the issuers and paragraphs (2) and (3), respectively; and outstanding participating securities or de- managers of the securities covered by credit (2) by striking ‘‘The Administrator shall’’ bentures of the company have been paid in enhancement guarantees to ensure the safe- and all that follows through ‘‘following re- full, after which any remaining distributions ty and soundness of the credit enhancement quirements:’’ and inserting the following: under this paragraph are made to private in- guarantee program. vestors and to the Administration in the ‘‘(4) The Administration may authorize af- ‘‘(1) IN GENERAL.—The Administrator shall give each conditionally approved company 2 ratio provided for the distribution of profits filiates of lenders designated as Preferred under paragraph (11).’’. Lenders (as defined in the Small Business years to satisfy the requirements under this Subtitle J—Small Business Intermediary Act) to become issuers and managers of secu- subsection. If a conditionally approved com- Lending Pilot Program rities covered by credit enhancement guar- pany meets these requirements before the antees if not more than 50 percent of the vot- end of such 2-year period, the Administrator SEC. 291. SHORT TITLE. ing and economic ownership interests of any shall proceed to final approval according to This subtitle may be cited as the ‘‘Small Busi- ø ¿ ø ¿ such issuer or manager are owned, directly the following requirement : under sub- ness Intermediary Lending Pilot Program Act of or indirectly, by any single Preferred Lender section (e).’’. 2003’’. or any person directly or indirectly control- SEC. 272. DEFINITION OF LOW-INCOME GEO- SEC. 292. FINDINGS. ling such Preferred Lender. GRAPHIC AREA. Congress finds the following: ‘‘(c) The full faith and credit of the United Section 351(3)(A)(ii)ø(II)¿(I) of the Small (1) Small and emerging businesses, particu- States is pledged to the payment of all Business Investment Act of 1958 (15 U.S.C. larly startups and businesses that lack suffi- amounts the Administration may be re- 689(3)(A)(ii)ø(II)¿(I)) is amended by striking cient or conventional collateral, continue to face quired to pay as a result of credit enhance- ‘‘øhousehold income¿ 50 percent or more’’ and barriers accessing mid-sized loans in amounts ment guarantees under this section. all that follows and inserting ‘‘øfamily¿ the between $35,000 and $200,000, with affordable ‘‘(d)(1) The Administration may issue an median household income for such tract does terms and conditions. (2) Consolidation in the banking industry has amount of credit enhancement guarantees in not exceed 80 percent of the greater of the resulted in a decrease in the number of small, lo- any fiscal year not exceeding the amount of statewide median øfamily¿ household income cally controlled banks with not more than the business loan and development company or metropolitan area median øfamily¿ house- $100,000,000 in assets and has changed the meth- debenture guarantee authority available to hold income.’’. od by which banks make small business credit the Administration for such year under this Subtitle I—Small Business Investment decisions with— Act and the Small Business Act. Company Program (A) credit scoring techniques replacing rela- ‘‘(2) The Administration shall set the per- tionship-based lending, which often works to centage and priority of each credit enhance- SEC. 281. INVESTMENT OF EXCESS FUNDS. the disadvantage of small or startup businesses ment guarantee on issued securities so that Section 308(b) of the Small Business In- that do not conform with a bank’s standardized the amount of the Administration’s antici- vestment Act of 1958 (15 U.S.C. 687(b)) is credit formulas; and amended by striking the last sentence and pated net loss (if any) as a result of such (B) less flexible terms and conditions, which inserting the following: ‘‘Such companies guarantee is fully reserved in a credit sub- are often necessary for small and emerging busi- with outstanding financings are authorized sidy account funded in whole or in part by nesses. fees collected by the Administration. to invest funds not reasonably needed for (3) In the environment described in para- ‘‘(3) The Administration shall charge and their operations in— graphs (1) and (2), non-profit intermediary lend- collect a fee from the issuer based on the Ad- ‘‘(1) direct obligations of, or obligations ers, including community development corpora- ministration’s guaranteed amount of issued guaranteed as to principal and interest by, tions, providing financial resources that serve to securities, but the amount of such fee may the United States; supplement the small business lending and in- ø ¿ not exceed the estimated credit subsidy cost ‘‘(2) in savings account or certificates of vestments of a bank by— of the Administration’s credit enhancement deposit maturing within 1 year øthat are (A) providing riskier, up front, or subordi- guarantee. issued¿ after issuance by any institution, nated capital; ‘‘(e) REPORTING AND ANALYSIS.— whose accounts are øF¿federally insured, or (B) offering flexible terms and underwriting ‘‘(1) REPORTING.—During the development in savings accounts of such institution; or procedures; and and implementation of the pilot program, ‘‘(3) in such other investment securities, (C) providing technical assistance to busi- the Administrator shall provide a report on mutual funds, or instruments that solely nesses in order to reduce the transaction costs the status of the pilot program under this consist of, invest in, or are supported by the and risk exposure of banks. section to Congress in each annual budget instruments described in paragraphs (1) and (4) Several Federal programs, including the request and performance plan. (2).’’. Microloan Program under section 7(m) of the

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Small Business Act (15 U.S.C. 636(m)) and the ‘‘(5) LOANS TO INTERMEDIARIES.— ‘‘(iv) the repayment history of each inter- Intermediary Relending Program of the Depart- ‘‘(A) APPLICATION.—Each intermediary desir- mediary; ment of Agriculture, have demonstrated the ef- ing a loan under this subsection shall submit an ‘‘(v) a description of the loan portfolio of each fectiveness of working through non-profit inter- application to the Administration, which de- intermediary, including the extent to which it mediaries to address the needs of small business scribes— provides mid-size loans to small business con- concerns that are unable to access capital ‘‘(i) the type of small business concerns to be cerns in rural and economically depressed areas; through conventional sources. assisted; ‘‘(vi) an estimate of the number of low-income (5) More than 1,000 non-profit intermediary ‘‘(ii) the size and range of loans to be made; individuals who have been employed as a direct lenders in the United States are— ‘‘(iii) the geographic area to be served and its result of the Program; and (A) successfully providing financial and tech- economic, poverty, and unemployment charac- ‘‘(vii) any recommendations for legislative nical assistance to small and emerging busi- teristics; changes that would improve the operation of the nesses; ‘‘(iv) the status of small business concerns in Program.’’. (B) working with banks and other lenders to the area to be served and an analysis of the (b) RULEMAKING AUTHORITY.—Not later than leverage additional capital for their business availability of credit; and 180 days after the date of enactment of this Act, borrowers; and ‘‘(v) the qualifications of the applicant to the Administrator shall issue regulations to (C) creating employment opportunities for low carry out the purpose of this subsection. carry out the amendment made by subsection income individuals through their lending and ‘‘(B) LOAN LIMITS.—Notwithstanding sub- (a). business development activities. section (a)(3), no loan may be made under this (c) AUTHORIZATION OF APPROPRIATIONS.— subsection if the total amount outstanding and SEC. 293. SMALL BUSINESS INTERMEDIARY LEND- (1) IN GENERAL.—There are authorized to be ING PILOT PROGRAM. committed to an intermediary from the business appropriated such sums as may be necessary for loan and investment fund established by this (a) IN GENERAL.—Section 7(l) of the Small each of the fiscal years 2004 through 2006 to pro- Business Act (15 U.S.C. 636(l)) is amended to Act would, as a result of such loan, exceed vide $20,000,000 in loans under section 7(l) of the read as follows: $1,000,000 during the participation of the inter- Small Business Act, as amended by subsection ‘‘(l) SMALL BUSINESS INTERMEDIARY LENDING mediary in the Program. (a). ‘‘(C) LOAN DURATION.—Loans made by the PROGRAM.— (2) AVAILABILITY.—Any amounts appropriated Administration under this subsection shall be ‘‘(1) DEFINITIONS.—For purposes of this sub- pursuant to paragraph (1) shall remain avail- section— for a maximum term of 20 years. able until expended. ‘‘(D) APPLICABLE INTEREST RATES.—Loans ‘‘(A) the term ‘intermediary’ means an entity TITLE III—ENTREPRENEURIAL that seeks to borrow, or has borrowed, funds made by the Administration to an intermediary under the Program shall bear an annual inter- DEVELOPMENT PROGRAMS from the Administration to make mid-size loans Subtitle A—Office of Entrepreneurial to small business concerns under this subsection est rate equal to 1.00 percent. ‘‘(E) FEES; COLLATERAL.—The Administration Development that is a private, nonprofit entity, including— ‘‘(i) a private, nonprofit community develop- may not charge any fees or require collateral SEC. 301. SERVICE CORPS OF RETIRED EXECU- TIVES. ment corporation; with respect to any loan made to an inter- ‘‘(ii) a consortium of private, nonprofit orga- mediary under this subsection. (a) IN GENERAL.—Section 8(b)(1)(B) of the ‘‘(F) LEVERAGE.—Any loan to a small business nizations or nonprofit community development Small Business Act (15 U.S.C. 637(b)(1)(B)) is concern shall not exceed 75 percent of the total corporations; amended— ‘‘(iii) a quasi-governmental economic develop- cost of the project, with the remaining funds (1) by striking ‘‘this Act; and to’’, and in- ment entity (such as a planning and develop- being leveraged from other sources, including— serting ‘‘this Act. To’’; ‘‘(i) banks or credit unions; ment district), other than a State, county, or (2) by striking ‘‘may maintain at its head- ‘‘(ii) community development financial insti- municipal government; and quarters’’ and all that follows through ‘‘That tutions; and any’’ and inserting ‘‘shall maintain at its ‘‘(v) an agency of or nonprofit entity estab- ‘‘(iii) other sources with funds available to the lished by a Native American Tribal Government; headquarters and pay the salaries, benefits, intermediary lender. and expenses of a volunteer and professional and ‘‘(G) DELAYED PAYMENTS.—The Administra- ‘‘(B) the term ‘mid-size loan’ means a fixed staff to manage and oversee the program. tion shall not require the repayment of principal Any’’; and rate loan of not less than $35,000 and not more or interest on a loan made to an intermediary than $200,000, made by an intermediary to a (3) by striking the period at the end and in- under this section during the first 2 years of the serting the following: ‘‘and the management startup, newly established, or growing small loan. business concern. of the contributions received.’’. ‘‘(6) PROGRAM FUNDING FOR MID-SIZE LOANS.— (b) REGULATIONS.—The Administration ‘‘(2) ESTABLISHMENT.—There is established a ‘‘(A) NUMBER OF PARTICIPANTS.—Under the 3-year small business intermediary lending pilot shall, not later than 180 days after the date Program, the Administration may provide loans, of enactment of this Act, promulgate regula- program (referred to in this section as the ‘‘Pro- on a competitive basis, to not more than 20 gram’’), under which the Administration may tions to carry out the amendments made by intermediaries. subsection (a). make direct loans to eligible intermediaries, for ‘‘(B) EQUITABLE DISTRIBUTION OF INTER- (c) EXTENSION OF COSPONSORSHIP AUTHOR- the purpose of making fixed interest rate mid- MEDIARIES.—The Administration shall select ITY.—Section 401(a)(2) of the Small Business size loans to startup, newly established, and and provide funding under the Program to such growing small business concerns. Administration Reauthorization and Amend- intermediaries as will ensure geographic diver- ments Act of 1994 (15 U.S.C. 637 note, 108 ‘‘(3) PURPOSES.—The purposes of the small sity and representation of urban and rural com- business intermediary lender pilot program are— Stat. 4190) is amended by striking ‘‘Sep- munities. tember 30, 2003’’ and inserting ‘‘September ‘‘(A) to assist small business concerns in those ‘‘(7) REPORT TO CONGRESS.— 30, 2006’’. areas suffering from a lack of credit due to poor ‘‘(A) INITIAL REPORT.—Not later than 30 economic conditions; months after the date of enactment of the Small SEC. 302. SMALL BUSINESS DEVELOPMENT CEN- ‘‘(B) to create employment opportunities for Business Administration 50th Anniversary Re- TER PROGRAM. low-income individuals; authorization Act of 2003, the Administration (a) TERM CHANGE.—Section 21(k) of the ‘‘(C) to establish a mid-size loan program to be shall submit a report containing an evaluation Small Business Act (15 U.S.C. 648(k)) is administered by the Small Business Administra- of the effectiveness of the Program to— amended— tion to make loans to eligible intermediaries to ‘‘(i) the Committee on Small Business and En- (1) by striking ‘‘CERTIFICATION’’ each place enable such intermediaries to provide small- trepreneurship of the Senate; and it appears and inserting ‘‘ACCREDITATION’’; scale loans, particularly loans in amounts aver- ‘‘(ii) the Committee on Small Business of the and aging not more than $150,000, to startup, newly House of Representatives. (2) by striking ‘‘certification’’ each place it established, or growing small business concerns ‘‘(B) ANNUAL REPORT.—Not later than 12 appears and inserting ‘‘accreditation’’. for working capital or the acquisition of mate- months after the date of enactment of the Small (b) PRIVACY REQUIREMENTS.—Section 21(a) rials, supplies, or equipment; Business Administration 50th Anniversary Re- of the Small Business Act is amended by ‘‘(D) to test the effectiveness of non-profit authorization Act of 2003, and each year there- adding at the end the following: intermediaries— after, the Administration shall submit an an- ‘‘(7) PRIVACY REQUIREMENTS.— ‘‘(i) as a delivery system for a mid-size loan nual report containing an evaluation of the ef- ‘‘(A) IN GENERAL.—A small business devel- program; and fectiveness of the Program to the Committees de- opment center, consortium of small business ‘‘(ii) in addressing the credit needs of small scribed in subparagraph (A). development centers, or contractor or agent businesses and leveraging other sources of cred- ‘‘(C) CONTENTS.—The reports submitted under of a small business development center may it; and subparagraphs (A) and (B) shall include— not disclose the name, address, or telephone ‘‘(E) to determine the advisability and feasi- ‘‘(i) the numbers and locations of the inter- number of any individual or small business bility of implementing a mid-size loan program mediaries receiving funds to provide mid-size concern receiving assistance under this sec- nationwide. loans; tion without the consent of such individual ‘‘(4) ELIGIBILITY FOR PARTICIPATION.—An ‘‘(ii) the amounts of each loan to an inter- or small business concern, unless— intermediary shall be eligible to receive loans if mediary; ‘‘(i) the Administrator is ordered to make the intermediary has at least 1 year of experi- ‘‘(iii) the numbers and amounts of mid-size such a disclosure by a court in any civil or ence making loans to startup, newly established, loans made by intermediaries to small business criminal enforcement action initiated by a or growing small business concerns. concerns; Federal or State agency; or

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00044 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.039 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12071 ‘‘(ii) the Administrator considers such a prise development organization or program’ vide grants using that assistance to qualified disclosure to be necessary for the purpose of means a nonprofit entity, or a program adminis- small and emerging microenterprise organiza- conducting a financial audit of a small busi- tered by such an entity, including community tions and programs, subject to such rules and ness development center, but a disclosure development corporations or other nonprofit de- regulations as the Administrator determines to under this clause shall be limited to the in- velopment organizations and social service orga- be appropriate. formation necessary for such audit. nizations, that provides services to disadvan- ‘‘(B) LIMIT ON ADMINISTRATIVE EXPENSES.— ‘‘(B) ADMINISTRATION USE OF INFORMA- taged entrepreneurs. Not more than 7.5 percent of assistance received TION.—This section shall not— ‘‘(12) TRAINING AND TECHNICAL ASSISTANCE.— by a qualified organization under this section ‘‘(i) restrict Administration access to pro- The term ‘training and technical assistance’ may be used for administrative expenses in con- gram activity data; or means services and support provided to dis- nection with the making of subgrants under ‘‘(ii) prevent the Administration from advantaged entrepreneurs, such as assistance subparagraph (A). using client information (other than the in- for the purpose of enhancing business planning, ‘‘(4) DIVERSITY.—In making grants under this formation described in subparagraph (A)) to marketing, management, financial management section, the Administrator shall ensure that conduct client surveys. skills, and assistance for the purpose of access- grant recipients include both large and small ‘‘(C) REGULATIONS.—The Administrator ing financial services. microenterprise organizations, serving urban, shall issue regulations to establish standards ‘‘(13) VERY LOW-INCOME PERSON.—The term rural, and Indian tribal communities serving di- for requiring disclosures during a financial ‘very low-income person’ means having an in- verse populations. audit under subparagraph (A)(ii).’’. come, adjusted for family size, of not more than ‘‘(5) PROHIBITION ON PREFERENTIAL CONSIDER- (c) CONFORMING AMENDMENT.—Section 150 percent of the poverty line (as defined in ATION OF CERTAIN SBA PROGRAM PARTICIPANTS.— 20(a)(1) of the Small Business Act (15 U.S.C. 631 section 673(2) of the Community Services Block In making grants under this section, the Admin- note) is amended by striking ‘‘certification’’ Grant Act (42 U.S.C. 9902(2)), including any re- istrator shall ensure that any application made each place it appears and inserting ‘‘accredita- vision required by that section). by a qualified organization that is a participant tion’’. ‘‘(b) ESTABLISHMENT OF PROGRAM.—The Ad- in the program established under section 7(m) of SEC. 303. PRIME REAUTHORIZATION AND TRANS- ministrator shall establish a microenterprise the Small Business Act does not receive pref- FER TO THE SMALL BUSINESS ACT. technical assistance and capacity building grant erential consideration over applications from (a) PROGRAM REAUTHORIZATION.—Subtitle C program to provide assistance from the Adminis- other qualified organizations that are not par- of title I of the Riegle Community Development tration in the form of grants to qualified organi- ticipants in such program. and Regulatory Improvement Act of 1994 (15 zations in accordance with this section. ‘‘(f) MATCHING REQUIREMENTS.— U.S.C. 6901 note) is amended to read as follows: ‘‘(c) USES OF ASSISTANCE.—A qualified organi- ‘‘(1) IN GENERAL.—Financial assistance under zation shall use grants made under this sec- this section shall be matched with funds from ‘‘SEC. 37. PROGRAM FOR INVESTMENT IN MICRO- sources other than the Federal Government on ENTREPRENEURS. tion— the basis of not less than 50 percent of each dol- ‘‘(a) DEFINITIONS.—For purposes of this sec- ‘‘(1) to provide training and technical assist- tion, the following definitions shall apply: ance to disadvantaged entrepreneurs; lar provided by the Administration. ‘‘(2) SOURCES OF MATCHING FUNDS.—Fees, ‘‘(1) ADMINISTRATION.—The term ‘Administra- ‘‘(2) to provide training and capacity building grants, gifts, funds from loan sources, and in- tion’ means the Small Business Administration. services to microenterprise development organi- kind resources of a grant recipient from public ‘‘(2) ADMINISTRATOR.—The term ‘Adminis- zations and programs and groups of such orga- or private sources may be used to comply with trator’ means the Administrator of the Small nizations to assist such organizations and pro- the matching requirement in paragraph (1). Business Administration. grams in developing microenterprise training ‘‘(3) EXCEPTION.— ‘‘(3) CAPACITY BUILDING SERVICES.—The term and services; ‘‘(A) IN GENERAL.—In the case of an applicant ‘‘(3) to aid in researching and developing the ‘capacity building services’ means services pro- for assistance under this section with severe best practices in the field of microenterprise and vided to an organization that is, or that is in constraints on available sources of matching technical assistance programs for disadvantaged the process of becoming, a microenterprise devel- funds, the Administrator may reduce or elimi- entrepreneurs; and opment organization or program, for the pur- nate the matching requirements of paragraph pose of enhancing its ability to provide training ‘‘(4) for such other activities as the Adminis- trator determines are consistent with the pur- (1). and services to disadvantaged entrepreneurs. ‘‘(B) LIMITATION.—Not more than 10 percent poses of this section. ‘‘(4) COLLABORATIVE.—The term ‘collabo- of the total funds made available from the Ad- ‘‘(d) QUALIFIED ORGANIZATIONS.—For pur- rative’ means 2 or more nonprofit entities that ministration in any fiscal year to carry out this agree to act jointly as a qualified organization poses of eligibility for assistance under this sec- tion, a qualified organization shall be— section may be excepted from the matching re- under this section. quirements of paragraph (1), as authorized by ‘‘(5) DISADVANTAGED ENTREPRENEUR.—The ‘‘(1) a nonprofit microenterprise development organization or program (or a group or collabo- subparagraph (A) of this paragraph. term ‘disadvantaged entrepreneur’ means a ‘‘(g) APPLICATIONS FOR ASSISTANCE.—An ap- rative thereof) that has a demonstrated record microentrepreneur that— plication for assistance under this section shall of delivering microenterprise services to dis- ‘‘(A) is a low-income person; be submitted in such form and in accordance advantaged entrepreneurs; ‘‘(B) is a very low-income person; or with such procedures as the Administrator shall ‘‘(C) lacks adequate access to capital or other ‘‘(2) an intermediary; ‘‘(3) a microenterprise development organiza- establish. resources essential for business success, or is ‘‘(h) RECORDKEEPING AND REPORTING.— tion or program that is accountable to a local economically disadvantaged, as determined by ‘‘(1) IN GENERAL.—Each organization that re- community, working in conjunction with a State the Administrator. ceives assistance from the Administration in ac- or local government or Indian tribe; or ‘‘(6) INDIAN TRIBE.—The term ‘Indian tribe’ cordance with this section shall— has the same meaning as in section 4(a) of the ‘‘(4) an Indian tribe acting on its own, if the ‘‘(A) submit to the Administration not less Indian Self-Determination and Education As- Indian tribe can certify that no private organi- than once in every 18-month period, financial sistance Act. zation or program referred to in this subsection statements audited by an independent certified ‘‘(7) INTERMEDIARY.—The term ‘intermediary’ exists within its jurisdiction. public accountant; means a private, nonprofit entity that seeks to ‘‘(e) ALLOCATION OF ASSISTANCE; SUB- ‘‘(B) submit an annual report to the Adminis- serve microenterprise development organizations GRANTS.— tration on its activities; and and programs, as authorized under subsection ‘‘(1) ALLOCATION OF ASSISTANCE.— ‘‘(C) keep such records as may be necessary to (d). ‘‘(A) IN GENERAL.—The Administrator shall disclose the manner in which any assistance ‘‘(8) LOW-INCOME PERSON.—The term ‘low-in- allocate assistance from the Administration under this section is used. come person’ means having an income, adjusted under this section to ensure that— ‘‘(2) ACCESS.—The Administration shall have for family size, of not more than— ‘‘(i) activities described in subsection (c)(1) are access upon request, for the purposes of deter- ‘‘(A) for metropolitan areas, 80 percent of the funded using not less than 75 percent of mining compliance with this section, to any area median income; and amounts made available for such assistance; records of any organization that receives assist- ‘‘(B) for nonmetropolitan areas, the greater and ance from the Administration in accordance of— ‘‘(ii) activities described in subsection (c)(2) with this section. ‘‘(i) 80 percent of the area median income; or are funded using not less than 15 percent of ‘‘(3) DATA COLLECTION.—Each organization ‘‘(ii) 80 percent of the statewide nonmetropoli- amounts made available for such assistance. that receives assistance from the Administration tan area median income. ‘‘(B) LIMIT ON INDIVIDUAL ASSISTANCE.—No in accordance with this section shall collect in- ‘‘(9) MICROENTREPRENEUR.—The term ‘micro- single person may receive more than 10 percent formation relating to, as applicable— entrepreneur’ means the owner or developer of a of the total funds appropriated under this sec- ‘‘(A) the number of individuals counseled or microenterprise. tion in a single fiscal year. trained; ‘‘(10) MICROENTERPRISE.—The term ‘micro- ‘‘(2) TARGETED ASSISTANCE.—The Adminis- ‘‘(B) the number of hours of counseling pro- enterprise’ means a sole proprietorship, partner- trator shall ensure that not less than 50 percent vided; ship, or corporation that— of the grants made under this section are used ‘‘(C) the number of startup small business ‘‘(A) has fewer than 5 employees; and to benefit very low-income persons, including concerns formed; ‘‘(B) generally lacks access to conventional those residing on Indian reservations. ‘‘(D) the number of small business concerns loans, equity, or other banking services. ‘‘(3) SUBGRANTS AUTHORIZED.— expanded; ‘‘(11) MICROENTERPRISE DEVELOPMENT ORGA- ‘‘(A) IN GENERAL.—A qualified organization ‘‘(E) the number of low-income individuals NIZATION OR PROGRAM.—The term ‘microenter- receiving assistance under this section may pro- counseled or trained; and

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‘‘(F) the number of very low-income individ- the programmatic and financial oversight ‘‘(4) MATCHING REQUIREMENT.— uals counseled or trained. process by— ‘‘(A) WOMEN’S BUSINESS CENTER GRANTS.— ‘‘(i) AUTHORIZATION.—There are authorized to ‘‘(A) providing notice to the public of each As a condition of receiving financial assist- be appropriated to the Administrator, to carry women’s business center grant announce- ance under this section, the grant recipient out the provisions of this section, to remain ment for an initial and renewal grant, not shall agree to obtain, after its application available until expended— later than 6 months before awarding such has been approved and notice of award has ‘‘(1) $15,000,000 for fiscal year 2004; grant; been issued, cash contributions from non- ‘‘(2) $15,000,000 for fiscal year 2005; and ‘‘(B) providing notice to grant applicants Federal sources as follows: ‘‘(3) $15,000,000 for fiscal year 2006.’’. and recipients of program evaluation cri- ‘‘(i) In the first and second years, 1 non- (b) TRANSFER PROVISIONS.— teria, not later than 12 months before any Federal dollar for each 2 Federal dollars pro- (1) SMALL BUSINESS ACT AMENDMENTS.—The such evaluation; vided under the 4-year grant. Small Business Act (15 U.S.C. 631 et seq.) is ‘‘(C) reducing paperwork and reporting re- ‘‘(ii) In the third and fourth years, 1 non- amended by redesignating section 37, as added quirements for grant applicants and recipi- Federal dollar for each Federal dollar pro- by this Act, as section 38. ents; vided under the 4-year grant. (2) TRANSFER.—Section 37 of the Riegle Com- ‘‘(D) standardizing the oversight and re- ‘‘(iii) In each renewal period, 1 non-Federal munity Development and Regulatory Improve- view process of the Administration; and dollar for each Federal dollar provided under ment Act of 1994 (15 U.S.C. 6901 note), as so des- ‘‘(E) providing to each women’s business the 3-year grant. ignated by subsection (a) of this section, is center, not later than 30 days after the com- ‘‘(B) FORM OF NON-FEDERAL CONTRIBU- transferred to, and inserted after, section 36 of pletion of a site visit at that center, a copy TIONS.—Not more than 1⁄2 of the non-Federal the Small Business Act, as added by this Act. of site visit reports and evaluation reports sector matching assistance may be in the (c) REFERENCES.—All references in Federal prepared by district office technical rep- form of in-kind contributions that are budg- law to the ‘‘Program for Investment in Micro- resentatives or Administration officials.’’. et line items only, including office equip- entrepreneurs Act of 1999’’ or the ‘‘PRIME Act’’ SEC. 312. WOMEN’S BUSINESS CENTER PROGRAM. ment and office space. shall be deemed to be references to section 37 of (a) WOMEN’S BUSINESS CENTER GRANTS PRO- ‘‘(C) FAILURE TO OBTAIN NON-FEDERAL FUND- the Small Business Act, as added by this sec- GRAM.—Section 29 of the Small Business Act ING.— tion. (15 U.S.C. 656) is amended— ‘‘(i) ADVANCE DISBURSEMENTS.—If any grant (d) RULE OF CONSTRUCTION.—Nothing in this (1) in subsection (a)— recipient fails to obtain the required non- section or the amendments made by this section (A) by redesignating paragraphs (2), (3), Federal contribution during any project shall affect any grant or assistance provided and (4), as paragraphs (3), (4), and (5), respec- year, it shall not be eligible for advance dis- under the Program for Investment in Micro- tively; and bursements pursuant to subparagraph (D) entrepreneurs Act of 1999, before the date of en- (B) by inserting after paragraph (1) the fol- during the remainder of that project year. actment of this Act, and any such grant or as- lowing: ‘‘(ii) ABILITY TO OBTAIN NON-FEDERAL FUND- sistance shall be subject to the Program for In- ‘‘(2) the term ‘association of women’s busi- ING.—Before approving assistance to a grant vestment in Microentrepreneurs Act of 1999, as ness centers’ means an organization that recipient that has failed to obtain the re- in effect on the day before the date of enactment represents not less than 30 percent of the quired non-Federal contribution for any of this Act. women’s business centers that are partici- other projects under this Act, the Adminis- Subtitle B—Women’s Small Business pating in a program under this section and tration shall require the grant recipient to Ownership Programs whose primary purpose is to represent wom- certify that it will be able to obtain the req- SEC. 311. OFFICE OF WOMEN’S BUSINESS OWNER- en’s business centers;’’; and uisite non-Federal funding and enter a writ- SHIP. (2) by striking subsections (b) through (f) ten finding setting forth the reasons for Section 29(g) of the Small Business Act (15 and inserting the following: making such determination. U.S.C. 656(g)) is amended— ‘‘(b) GRANTS AUTHORIZED.— ‘‘(D) FORM OF FEDERAL CONTRIBUTIONS.— (1) in paragraph (2)— ‘‘(1) IN GENERAL.—The Administration may The financial assistance authorized pursuant (A) in subparagraph (B)(i), by striking ‘‘in award initial and renewal grants of not more to this section may be made by grant or co- the areas’’ and all that follows through the than $150,000 per year, which shall be known operative agreement and may contain such end of subclause (I), and inserting the fol- as ‘women’s business center grants’, to pri- provision, as necessary, to provide for pay- lowing: ‘‘to address issues concerning oper- vate nonprofit organizations to conduct ments in lump sum or installments, and in ations, manufacturing, technology, finance, projects for the benefit of small business advance or by way of reimbursement. The retail and product sales, international trade, concerns owned and controlled by women. At Administration may disburse up to 25 per- and other disciplines required for— the end of the initial 4-year grant period, and cent of each year’s Federal share awarded to ‘‘(I) starting, operating, and growing a every 3 years thereafter, the grant recipient a grant recipient after notice of the award small business concern;’’; and may apply to renew the grant in accordance has been issued and before the non-Federal (B) in subparagraph (C), by inserting ‘‘, the with this subsection and subsection (e)(2). In sector matching funds are obtained. National Women’s Business Council, and any the event that the Administration has insuf- ‘‘(5) APPLICATION FOR AN INITIAL GRANT.— association of women’s business centers, as ficient funds to provide grants of $150,000, for Each organization desiring an initial grant defined in subsection (a)’’ before the period each eligible women’s business center, avail- under this subsection, shall submit to the at the end; and able funds shall be allocated evenly to eligi- Administration an application that con- (2) by adding at the end the following: ble centers, unless any center requests a tains— ‘‘(3) PROGRAMS AND SERVICES FOR WOMEN- lower amount than the allocable amount. ‘‘(A) a certification that the applicant— OWNED SMALL BUSINESSES.—The Assistant ‘‘(2) COOPERATIVE AGREEMENT AUTHORITY.— ‘‘(i) is a private nonprofit organization; Administrator, in consultation with the Na- ‘‘(A) IN GENERAL.—The Administration ‘‘(ii) has designated an executive director tional Women’s Business Council, the Inter- may enter into Federal cooperative agree- or program manager, who may be com- agency Committee on Women’s Business En- ments with grant recipients under this sub- pensated from grant funds or other sources, terprise, and 1 or more associations of wom- section to perform the services described to manage the center; and en’s business centers, shall develop programs under paragraph (3) only to the extent and in ‘‘(iii) as a condition of receiving a grant and services for women-owned businesses (as the amount provided by appropriated funds. under this subsection, agrees— defined in section 408 of the Women’s Busi- ‘‘(B) TERMINATION.— ‘‘(I) to receive a site visit as part of the ness Ownership Act of 1988 (15 U.S.C. 631 ‘‘(i) IN GENERAL.—If any grant recipient final selection process; note)) in business areas, which may include— under this subsection does not fulfill its ‘‘(II) to undergo an annual programmatic ‘‘(A) manufacturing; grant obligations, after advanced notifica- and financial examination; and ‘‘(B) technology; tion, during the period of the grant, the Ad- ‘‘(III) to the maximum extent practicable, ‘‘(C) professional services; ministration may terminate the grant. to remedy any problems identified pursuant ‘‘(D) retail and product sales; ‘‘(ii) EXCEPTION.—Notwithstanding a grant to the site visit or examination under sub- ‘‘(E) travel and tourism; recipient’s violation of a grant obligation clauses (I) and (II); ‘‘(F) international trade; and under this section, the Administration may ‘‘(B) information demonstrating that the ‘‘(G) Federal Government contract busi- continue to fund the grant if the grant re- applicant has the ability and resources to ness development. cipient is making a good faith effort to com- meet the needs of the market to be served by ‘‘(4) TRAINING.—The Administration shall ply with such obligation. the women’s business center site for which provide annual programmatic and financial ‘‘(3) USE OF FUNDS.—Grants awarded under an initial grant is sought, including the abil- oversight training for women’s business own- paragraph (1) may be used to provide train- ity to comply with the matching require- ership representatives and district office ing and counseling in the areas of— ment under paragraph (4); technical representatives of the Administra- ‘‘(A) pre-business, business startup, and ‘‘(C) information relating to assistance to tion to enable these representatives to carry business operations; be provided by the women’s business center out their responsibilities under this section. ‘‘(B) financial planning assistance; site for which an initial grant is sought in ‘‘(5) GRANT PROGRAM IMPROVEMENT.—The ‘‘(C) procurement assistance; the area in which the site is located; Administration shall improve the women’s ‘‘(D) management assistance; and ‘‘(D) information demonstrating the effec- business center grant proposal process and ‘‘(E) marketing assistance. tive experience of the applicant in—

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00046 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.040 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12073 ‘‘(i) conducting financial, management, to the site visit or examination under sub- site that is awarded an initial or renewal and marketing assistance programs, as de- clauses (I) and (II); grant shall collect information relating to— scribed under paragraph (3), which are de- ‘‘(B) information demonstrating that the ‘‘(A) the number of individuals counseled signed to teach or upgrade the business applicant has the ability and resources to or trained; skills of women who are business owners or meet the needs of the market to be served by ‘‘(B) the number of hours of counseling potential business owners; the women’s business center site for which a provided; ‘‘(ii) providing training and services to a renewal grant is sought, including the abil- ‘‘(C) the number of workshops conducted; representative number of women who are ity to comply with the matching require- ‘‘(D) the number of startup small business both socially and economically disadvan- ment under paragraph (4); concerns formed; and taged; and ‘‘(C) information relating to assistance to ‘‘(E) the number of jobs created or main- ‘‘(iii) using resource partners of the Ad- be provided by the women’s business center tained at assisted small business concerns. ministration and other entities, such as uni- site for which a renewal grant is sought in ‘‘(10) PRIVACY REQUIREMENTS.— versities; the area in which the site is located; ‘‘(A) IN GENERAL.—A women’s business cen- ‘‘(E) a 4-year plan that projects the ability ‘‘(D) information demonstrating the utili- ter may not disclose the name, address, or of the women’s business center site for which zation of resource partners of the Adminis- telephone number of any individual or small an initial grant is sought— tration and other entities; business concern receiving assistance under ‘‘(i) to serve women business owners or po- ‘‘(E) a 3-year plan that projects the ability this section without the consent of such in- tential owners in the future by improving of the women’s business center site for which dividual or small business concern unless— training and counseling activities; and a renewal grant is sought— ‘‘(i) the Administrator is ordered to make ‘‘(ii) to provide training and services to a ‘‘(i) to serve women business owners or po- such a disclosure by a court in any civil or representative number of women who are tential owners in the future by improving criminal enforcement action initiated by a both socially and economically disadvan- training and counseling activities; and Federal or State agency; or taged; and ‘‘(ii) to provide training and services to a ‘‘(ii) the Administrator considers such a ‘‘(F) any additional information that the representative number of women who are disclosure to be necessary for the purpose of Administration may reasonably require. both socially and economically disadvan- conducting a financial audit of a small busi- ‘‘(6) REVIEW AND APPROVAL OF APPLICATIONS taged; and ness development center, but a disclosure FOR AN INITIAL GRANT.— ‘‘(F) any additional information that the under this clause shall be limited to the in- ‘‘(A) IN GENERAL.—The Administration Administration may reasonably require. formation necessary for such audit. shall— ‘‘(B) ADMINISTRATION USE OF INFORMA- ‘‘(i) review each application submitted ‘‘(8) REVIEW AND APPROVAL OF APPLICATIONS FOR A RENEWAL GRANT.— TION.—This section shall not— under paragraph (5) based on the information ‘‘(i) restrict Administration access to pro- provided in such paragraph and the criteria ‘‘(A) IN GENERAL.—The Administration shall— gram activity data; or set forth under subparagraph (B); and ‘‘(ii) prevent the Administration from ‘‘(ii) as part of the final selection process, ‘‘(i) review each application submitted under paragraph (7) based on the information using client information (other than the in- conduct a site visit at each women’s business formation described in subparagraph (A)) to center for which an initial grant is sought. provided in such paragraph and the criteria conduct client surveys. ‘‘(B) SELECTION CRITERIA.— set forth under subparagraph (B); and ‘‘(C) REGULATIONS.—The Administrator ‘‘(i) IN GENERAL.—The Administration shall ‘‘(ii) as part of the final selection process, shall issue regulations to establish standards evaluate applicants in accordance with pre- conduct a site visit at each women’s business for requiring disclosures during a financial determined selection criteria that shall be center for which a renewal grant is sought. audit under subparagraph (A)(ii). stated in terms of relative importance. Such ‘‘(B) SELECTION CRITERIA.—The Administra- ‘‘(11) TRANSITION RULES.— criteria and their relative importance shall tion shall evaluate applicants in accordance ‘‘(A) IN GENERAL.—Notwithstanding any be made publicly available and stated in with predetermined selection criteria that other provision of law, a grant or coopera- each solicitation for applications made by shall be stated in terms of relative impor- tive agreement that was awarded as an eligi- the Administration. tance. Such criteria and their relative im- ble sustainability grant, from amounts ap- ‘‘(ii) REQUIRED CRITERIA.—The selection portance shall be made publicly available criteria for an initial grant under clause (i) and stated in each solicitation for applica- propriated for fiscal year 2003, to operate a shall include— tions made by the Administration. women’s business center, shall remain in full ‘‘(I) the experience of the applicant in con- ‘‘(C) CONDITIONS FOR CONTINUED FUNDING.— force and effect under the terms, and for the ducting programs or ongoing efforts designed In determining whether to renew a grant or duration, of such agreement, subject to the to teach or upgrade the business skills of cooperative agreement with a women’s busi- grant limitation in paragraph (1). women business owners or potential owners; ness center, the Administration— ‘‘(B) EXTENSION.—If the sustainability ‘‘(II) the ability of the applicant to com- ‘‘(i) shall consider the results of the most grant under subparagraph (A) is scheduled to mence a project within a minimum amount recent evaluation of the center, and, to a expire not later than June 30, 2005, a 1-year of time; lesser extent, previous evaluations; and extension shall be granted without any ‘‘(III) the ability of the applicant to pro- ‘‘(ii) may withhold such renewal, if the Ad- interruption of funding, subject to the grant vide training and services to a representative ministration determines that the center has limitation in paragraph (1). number of women who are both socially and failed to provide the information required to ‘‘(C) EFFECT ON CERTAIN EXISTING PROJECTS economically disadvantaged; and be provided under this subsection, or the in- AND RENEWAL AUTHORITY.—A project being ‘‘(IV) the location for the women’s business formation provided by the center is inad- conducted by a women’s business center center site proposed by the applicant. equate. under this subsection on the day before the ‘‘(C) RECORD RETENTION.—The Administra- ‘‘(D) CONTINUING GRANT AND COOPERATIVE date of enactment of the Small Business Ad- tion shall maintain a copy of each applica- AGREEMENT AUTHORITY.— ministration 50th Anniversary Reauthoriza- tion submitted under this paragraph for not ‘‘(i) IN GENERAL.—The authority of the Ad- tion Act of 2003— less than 7 years. ministrator to enter into grants or coopera- ‘‘(i) as a 5-year project, shall remain in full ‘‘(7) APPLICATION FOR A RENEWAL GRANT.— tive agreements under this subsection shall force and effect under the terms and for the Each organization desiring a renewal grant be in effect for each fiscal year only to the duration of that agreement; and under this subsection, shall submit to the extent and in the amounts as are provided in ‘‘(ii) shall be eligible to apply for a 3-year Administration, not later than 3 months be- advance in appropriations Acts. renewal grant funded at a level equal to not fore the expiration of an existing grant ‘‘(ii) RENEWAL.—After the Administrator more than $150,000 per year. under this subsection, an application that has entered into a grant or cooperative ‘‘(c) ASSOCIATIONS OF WOMEN’S BUSINESS contains— agreement with any women’s business center CENTERS.— ‘‘(A) a certification that the applicant— under this subsection, it shall not suspend, ‘‘(1) RECOGNITION.—The Administration ‘‘(i) is a private nonprofit organization; terminate, or fail to renew or extend any shall recognize the existence and activities ‘‘(ii) has designated an executive director such grant or cooperative agreement unless of any association of women’s business cen- or program manager to manage the center; the Administrator provides the center with ters established to address matters of com- and written notification setting forth the rea- mon concern. ‘‘(iii) as a condition of receiving a grant sons therefore and affords the center an op- ‘‘(2) CONSULTATION.—The Administration under this subsection, agrees— portunity for a hearing, appeal, or other ad- shall consult with each association of wom- ‘‘(I) to receive a site visit as part of the ministrative proceeding under chapter 5 of en’s business centers (as defined in sub- final selection process; title 5, United States Code. section (a)) to develop— ‘‘(II) to submit, for the preceding 2 years, ‘‘(E) RECORD RETENTION.—The Administra- ‘‘(A) a training program for the staff of the annual programmatic and financial examina- tion shall maintain a copy of each applica- women’s business centers and the Adminis- tion reports or certified copies of the appli- tion submitted under this paragraph for not tration; and cant’s compliance supplemental audits under less than 7 years. ‘‘(B) recommendations to improve the poli- OMB Circular A–133; and ‘‘(9) DATA COLLECTION.—Consistent with cies and procedures for governing the general ‘‘(III) to the maximum extent practicable, the annual report to Congress under sub- operations and administration of the Wom- to remedy any problems identified pursuant section (g), each women’s business center en’s Business Center Program, including

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grant program improvements under sub- (d) CLEARINGHOUSE FOR HISTORICAL DOCU- SEC. 315. PRESERVING THE INDEPENDENCE OF section (g)(5).’’. MENTS.—Section 409 of the Women’s Business THE NATIONAL WOMEN’S BUSINESS (b) CONFORMING AMENDMENTS.—Section 29 Ownership Act of 1988 (15 U.S.C. 631 note7109) COUNCIL. of the Small Business Act (15 U.S.C. 656) is is amended by adding at the end the fol- (a) SHORT TITLE.—This section may be cited amended— lowing: as the ‘‘National Women’s Business Council (1) by redesignating subsections (g), (h), (i), ‘‘(c) CLEARINGHOUSE FOR HISTORICAL DOCU- Independence Preservation Act of 2003’’. (j), and (k) as subsections (d), (e), (f), (g), and MENTS.—The Council shall serve as a clear- (b) FINDINGS.—Congress finds the following: (h), respectively; inghouse for information on small businesses (1) The National Women’s Business Council (2) in subsection (e)(2), as redesignated by owned and controlled by women, including provides an independent source of advice and paragraph (1) of this subsection, by striking research conducted by other organizations policy recommendations regarding women’s ‘‘to award a contract (as a sustainability and individuals relating to ownership by business development and the needs of women grant) under subsection (l) or’’; women of small businesses in the United entrepreneurs in the United States to— (3) in subsection (g)(1), as redesignated by States.’’. (A) the President; paragraph (1) of this subsection, by striking (e) AUTHORIZATION OF APPROPRIATIONS.— (B) Congress; ‘‘The Administration’’ and inserting ‘‘Not Section 410(a) of the Women’s Business Own- (C) the Interagency Committee on Women’s later than November 1st of each year, the ership Act of 1988 (15 U.S.C. ø631 note¿7110(a)) Business Enterprise; and Administration’’; is amended by striking ‘‘2001 through 2003, of (D) the Administrator of the Small Business (4) in subsection (h), as redesignated by which $550,000’’ and inserting ‘‘2004 through Administration. paragraph (1) of this subsection— 2006, of which at least 30 percent’’. (2) The members of the National Women’s (A) by amending paragraph (1) to read as SEC. 314. INTERAGENCY COMMITTEE ON WOM- Business Council are small business owners, rep- follows: EN’S BUSINESS ENTERPRISE. resentatives of business organizations, and rep- ‘‘(1) IN GENERAL.—There are authorized to (a) CHAIRPERSON.—Section 403(b) of the resentatives of women’s business centers. be appropriated to carry out the provisions Women’s Business Ownership Act of 1988 (15 (3) The chair and ranking member of the Com- of this section, to remain available until ex- U.S.C. ø631 note¿7103(b)) is amended— mittee on Small Business and Entrepreneurship pended— (1) by striking ‘‘Not later’’ and inserting of the Senate and the Committee on Small Busi- ‘‘(A) $15,000,000 for fiscal year 2004, of which the following: ness of the House of Representatives make rec- $500,000 may be used to provide supplemental ‘‘(1) IN GENERAL.—Not later’’; and ommendations to the Administrator to fill 8 of sustainability grants to women’s business (2) by adding at the end the following: the positions on the National Women’s Business centers, except that no such center may re- ‘‘(2) VACANCY.—In the event that a chair- Council. Four of the positions are reserved for ceive more than a total of $125,000 in grant person is not appointed under paragraph (1), small business owners who are affiliated with funding for the grant period beginning on the Deputy Administrator of the Small Busi- the political party of the President and 4 of the July 1, 2003 and ending on June 30, 2004; ness Administration shall serve as acting positions are reserved for small business owners ‘‘(B) $16,000,000 for fiscal year 2005; and chairperson of the Interagency Committee who are not affiliated with the political party of ‘‘(C) $17,500,000 for fiscal year 2006.’’; until a chairperson is appointed under para- the President. This method of appointment en- (B) by amending paragraph (2) to read as graph (1).’’. sures that the National Women’s Business follows: (b) POLICY ADVISORY GROUP.—Section 401 Council will provide Congress with nonpartisan, ‘‘(2) USE OF AMOUNTS.—Amounts made of the Women’s Business Ownership Act of balanced, and independent advice. available under this subsection may only be 1988 (15 U.S.C. ø631 note¿7101) is amended— (4) In order to maintain the independence of used for grant awards and may not be used (1) by striking ‘‘There’’ and inserting the the National Women’s Business Council and to for costs incurred by the Administration in following: ensure that the Council continues to provide connection with the management and admin- ‘‘(a) IN GENERAL.—There’’; and Congress with advice on a nonpartisan basis, it istration of the program under this sec- (2) by adding at the end the following: is essential that the Council maintain the bipar- tion.’’; and ‘‘(b) POLICY ADVISORY GROUP.— tisan balance established under section 407 of (C) by striking paragraph (4); and ‘‘(1) ESTABLISHMENT.—There is established the Women’s Business Ownership Act of 1988 (15 (5) by striking subsection (l). a Policy Advisory Group to assist the chair- U.S.C. 7107). SEC. 313. NATIONAL WOMEN’S BUSINESS COUN- person in developing policies and programs (c) MAINTENANCE OF PARTISAN BALANCE.— CIL. under this Act. Section 407(f) of the Women’s Business Owner- (a) COSPONSORSHIP AUTHORITY.—Section 406 ‘‘(2) MEMBERSHIP.—The Policy Advisory ship Act of 1988 (15 U.S.C. 7107(f)) is amended— of the Women’s Business Ownership Act of Group shall be composed of 7 policy making (1) by striking ‘‘A vacancy’’ and inserting the ø ¿ 1988 (15 U.S.C. 631 note 7106) is amended by officials, of whom— following: adding at the end the following: ‘‘(A) 1 shall be a representative of the ‘‘(1) IN GENERAL.—A vacancy’’; and ‘‘(f) COSPONSORSHIP AUTHORITY.—The Coun- Small Business Administration; (2) by adding at the end the following: cil is authorized to enter into agreements as ‘‘(B) 1 shall be a representative of the De- ‘‘(2) PARTISAN BALANCE.—When filling vacan- cosponsors with public and private entities, partment of Commerce; cies under paragraph (1), the Administrator in the same manner as is provided in section ‘‘(C) 1 shall be a representative of the De- shall, to the extent practicable, ensure that 8(b)(1)(A) of the Small Business Act (15 partment of Labor; there are an equal number of members on the U.S.C. 637(b)(1)(A)), to carry out its duties ‘‘(D) 1 shall be a representative of the De- Council from each of the 2 major political par- under this section.’’. partment of Defense; (b) MEMBERSHIP.—Section 407(f) of the ties. Women’s Business Ownership Act of 1988 (15 ‘‘(E) 1 shall be a representative of the De- ‘‘(3) ACCOUNTABILITY.—If a vacancy is not U.S.C. ø631 note¿7107(f)) is amended by add- partment of the Treasury; and filled within the 30-day period required under ing at the end the following: ‘‘(F) 2 shall be representatives of the Na- paragraph (1) or if there exists an imbalance of ‘‘(3) REPRESENTATION OF MEMBER ORGANIZA- tional Women’s Business Council.’’. party-affiliated members on the Council for a (c) ESTABLISHMENT OF SUBCOMMITTEES.— TIONS.—Notwithstanding subsection (b), a period exceeding 30 days, the Administrator national women’s business organization or Section 401 of the Women’s Business Owner- shall submit a report, not later than 10 days ø ¿ small business that is represented on the ship Act of 1988 (15 U.S.C. 631 note 7101), as after the respective 30-day deadline, to the Com- Council may, in consultation with the chair- amended by subsection (b), is further amend- mittee on Small Business and Entrepreneurship person of the Council, replace its representa- ed by adding at the end the following: of the Senate and the Committee on Small Busi- tive member on the Council at any time dur- ‘‘(c) SUBCOMMITTEES.— ness of the House of Representatives, that ex- ing the service term to which that member ‘‘(1) ESTABLISHMENT.—There are estab- plains why the respective deadline was not met was appointed.’’. lished— and provides an estimated date on which any (c) ESTABLISHMENT OF COMMITTEES.— ‘‘(A) the Subcommittee on Manufacturing, vacancies will be filled.’’. Technology, and Professional Services; øThe¿Title IV of the Women’s Business Own- Subtitle C—Office of Native American Affairs ership Act of 1988 (15 U.S.C. ø631 note¿7101 et ‘‘(B) the Subcommittee on Travel, Tour- SEC. 321. SHORT TITLE. seq.) is amended by inserting after section ism, Product and Retail Sales, and Inter- ø407¿410, the following new section: national Trade; and This subtitle may be cited as the ‘‘Native American Small Business Development ‘‘SEC. ø408¿411. COMMITTEES. ‘‘(C) the Subcommittee on Federal Pro- Act’’. ‘‘(a) ESTABLISHMENT.—There are estab- curement and Contracting. lished within the Council— ‘‘(2) DUTIES.—The Subcommittees estab- SEC. 322. NATIVE AMERICAN SMALL BUSINESS ‘‘(1) the Committee on Manufacturing, lished under paragraph (1) shall perform such DEVELOPMENT PROGRAM. Technology, and Professional Services; duties as the chairperson shall direct. The Small Business Act (15 U.S.C. 631 et ‘‘(2) the Committee on Travel, Tourism, ‘‘(3) MEETINGS.—The Interagency Com- seq.) is amended— Product and Retail Sales, and International mittee shall meet not less frequently than 3 (1) by redesignating section 36 as section Trade; and times each year to— 37; and ‘‘(3) the Committee on Federal Procure- ‘‘(A) plan activities for the new fiscal year; (2) by inserting after section 35 the fol- ment and Contracting. ‘‘(B) track year-to-date agency contracting lowing: ‘‘(b) DUTIES.—The Committees established goals; and ‘‘SEC. 36. NATIVE AMERICAN SMALL BUSINESS under subsection (a) shall perform such du- ‘‘(C) evaluate the progress during the fiscal DEVELOPMENT PROGRAM. ties as the chairperson shall direct.’’. year and prepare an annual report.’’. ‘‘(a) DEFINITIONS.—In this section—

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‘‘(1) the term ‘Alaska Native’ has the same ‘‘(C) EMPLOYMENT STATUS.—The Assistant ‘‘(III) developing pricing strategies; meaning as the term ‘Native’ in section 3(b) Administrator shall be a Senior Executive ‘‘(IV) locating contract opportunities; of the Alaska Native Claims Settlement Act Service position under section 3132(a)(2) of ‘‘(V) negotiating contracts; and (43 U.S.C. 1602(b)); title 5, United States Code, and shall serve as ‘‘(VI) utilizing varying public relations and ‘‘(2) the term ‘Alaska Native corporation’ a noncareer appointee, as defined in section advertising techniques. has the same meaning as the term ‘Native 3132(a)(7) of title 5, United States Code. ‘‘(B) BUSINESS DEVELOPMENT ASSISTANCE Corporation’ in section 3(m) of the Alaska ‘‘(D) RESPONSIBILITIES AND DUTIES.—The RECIPIENTS.—The business development as- Native Claims Settlement Act (43 U.S.C. Assistant Administrator shall— sistance under subparagraph (A) shall be of- 1602(m)); ‘‘(i) administer and manage the Native fered to prospective and current owners of ‘‘(3) the term ‘Assistant Administrator’ American Small Business Development pro- small business concerns that are owned by— means the Assistant Administrator of the gram established under this section; ‘‘(i) American Indians or tribal govern- Office of Native American Affairs established ‘‘(ii) recommend the annual administrative ments, and located on or near tribal lands; and program budgets for the Office of Native under subsection (b); ‘‘(ii) Alaska Natives or Alaska Native cor- American Affairs; ‘‘(4) the terms ‘center’ and ‘Native Amer- porations; or ‘‘(iii) consult with Native American busi- ican business center’ mean a center estab- ‘‘(iii) Native Hawaiians or Native Hawaiian ness centers in carrying out the program es- lished under subsection (c); organizations. ‘‘(5) the term ‘Native American business tablished under this section; ‘‘(3) FORM OF FEDERAL FINANCIAL ASSIST- development center’ means an entity pro- ‘‘(iv) recommend appropriate funding lev- ANCE.— viding business development assistance to els; ‘‘(A) DOCUMENTATION.— federally recognized tribes and Native Amer- ‘‘(v) review the annual budgets submitted by each applicant for the Native American ‘‘(i) IN GENERAL.—The financial assistance icans under a grant from the Minority Busi- to Native American business centers author- ness Development Agency of the Department Small Business Development program; ized under this subsection may be made by of Commerce; ‘‘(vi) select applicants to participate in the grant, contract, or cooperative agreement. ‘‘(6) the term ‘Native American small busi- program under this section; ‘‘(ii) EXCEPTION.—Financial assistance ness concern’ means a small business con- ‘‘(vii) implement this section; and under this subsection to Alaska Native cor- cern that is owned and controlled by— ‘‘(viii) maintain a clearinghouse to provide porations or Native Hawaiian organizations ‘‘(A) a member of an Indian tribe or tribal for the dissemination and exchange of infor- may only be made by grant. government; mation between Native American business ‘‘(B) PAYMENTS.— ‘‘(B) an Alaska Native or Alaska Native centers. ‘‘(i) TIMING.—Payments made under this corporation; or ‘‘(E) CONSULTATION REQUIREMENTS.—In car- subsection may be disbursed in an annual ‘‘(C) a Native Hawaiian or Native Hawaiian rying out the responsibilities and duties de- lump sum or in periodic installments, at the organization; scribed in this paragraph, the Assistant Ad- ‘‘(7) the term ‘Native Hawaiian’ has the ministrator shall confer with and seek the request of the recipient. same meaning as in section 625 of the Older advice of— ‘‘(ii) ADVANCE.—The Administration may Americans Act of 1965 (42 U.S.C. 3057k); ‘‘(i) Administration officials working in disburse not more than 25 percent of the an- areas served by Native American business ‘‘(8) the term ‘Native Hawaiian organiza- nual amount of Federal financial assistance centers and Native American business devel- tion’ has the same meaning as in section awarded to a Native American small busi- opment centers; 8(a)(15) of this Act; ness center after notice of the award has ‘‘(ii) the Bureau of Indian Affairs of the De- ‘‘(9) the term ‘tribal college’ has the same been issued. partment of the Interior; meaning as the term ‘tribally controlled col- ‘‘(iii) NO MATCHING REQUIREMENT.—The Ad- ‘‘(iii) tribal governments; lege or university’ has in section 2(a)(4) of ministration shall not require a grant recipi- ‘‘(iv) tribal colleges; the Tribally Controlled Community College ent to match grant funding received under ‘‘(v) Alaska Native corporations; and Assistance Act of 1978 (25 U.S.C. 1801(a)(4)); this subsection with non-Federal resources ‘‘(vi) Native Hawaiian organizations. as a condition of receiving the grant. ‘‘(10) the term ‘tribal government’ has the ATIVE MERICAN MALL USINESS E ‘‘(c) N A S B D - ‘‘(4) CONTRACT AND COOPERATIVE AGREE- same meaning as the term ‘Indian tribe’ has VELOPMENT PROGRAM.— in section 7501(a)(9) of title 31, United States MENT AUTHORITY.—A Native American busi- ‘‘(1) AUTHORIZATION.— ness center may enter into a contract or co- Code; and ‘‘(A) IN GENERAL.—The Administration, operative agreement with a Federal depart- ‘‘(11) the term ‘tribal lands’ means all through the Office of Native American Af- ment or agency to provide specific assistance lands within the exterior boundaries of any fairs, shall provide financial assistance to to Native American and other under-served Indian reservation. tribal governments, tribal colleges, Native small business concerns located on or near ‘‘(b) OFFICE OF NATIVE AMERICAN AF- Hawaiian organizations, and Alaska Native tribal lands, to the extent that such contract FAIRS.— corporations to create Native American busi- or cooperative agreement is consistent with ‘‘(1) ESTABLISHMENT.—There is established ness centers in accordance with this section. the terms of any assistance received by the within the Administration the Office of Na- ‘‘(B) USE OF FUNDS.—The financial and re- tive American Affairs, which, under the di- source assistance provided under this sub- Native American business center from the rection of the Assistant Administrator, shall section shall be used to overcome obstacles Administration. implement the Administration’s programs impeding the creation, development, and ex- ‘‘(5) APPLICATION PROCESS.— for the development of business enterprises pansion of small business concerns, in ac- ‘‘(A) SUBMISSION OF A 5-YEAR PLAN.—Each by Native Americans. cordance with this section, by— applicant for assistance under paragraph (1) ‘‘(2) PURPOSE.—The purpose of the Office of ‘‘(i) reservation-based American Indians; shall submit a 5-year plan to the Administra- Native American Affairs is to assist Native ‘‘(ii) Alaska Natives; and tion on proposed assistance and training ac- American entrepreneurs to— ‘‘(iii) Native Hawaiians. tivities. ‘‘(A) start, operate, and grow small busi- ‘‘(2) 5-YEAR PROJECTS.— ‘‘(B) CRITERIA.— ness concerns; ‘‘(A) IN GENERAL.—Each Native American ‘‘(i) IN GENERAL.—The Administration shall ‘‘(B) develop management and technical business center that receives assistance evaluate and rank applicants in accordance skills; under paragraph (1)(A) shall conduct 5-year with predetermined selection criteria that ‘‘(C) seek Federal procurement opportuni- projects that offer culturally tailored busi- shall be stated in terms of relative impor- ties; ness development assistance in the form of— tance. ‘‘(D) increase employment opportunities ‘‘(i) financial education, including training ‘‘(ii) PUBLIC NOTICE.—The criteria required for Native Americans through the start and and counseling in— by this paragraph and their relative impor- expansion of small business concerns; and ‘‘(I) applying for and securing business tance shall be made publicly available, with- ‘‘(E) increase the access of Native Ameri- credit and investment capital; in a reasonable time, and stated in each so- cans to capital markets. ‘‘(II) preparing and presenting financial licitation for applications made by the Ad- ‘‘(3) ASSISTANT ADMINISTRATOR.— statements; and ministration. ‘‘(A) APPOINTMENT.—The Administrator ‘‘(III) managing cash flow and other finan- ‘‘(iii) CONSIDERATIONS.—The criteria re- shall appoint a qualified individual to serve cial operations of a business concern; quired by this paragraph shall include— as Assistant Administrator of the Office of ‘‘(ii) management education, including ‘‘(I) the experience of the applicant in con- Native American Affairs in accordance with training and counseling in planning, orga- ducting programs or ongoing efforts designed this paragraph. nizing, staffing, directing, and controlling to impart or upgrade the business skills of ‘‘(B) QUALIFICATIONS.—The Assistant Ad- each major activity and function of a small current or potential owners of Native Amer- ministrator appointed under subparagraph business concern; and ican small business concerns; (A) shall have— ‘‘(iii) marketing education, including ‘‘(II) the ability of the applicant to com- ‘‘(i) knowledge of the Native American cul- training and counseling in— mence a project within a minimum amount ture; and ‘‘(I) identifying and segmenting domestic of time; ‘‘(ii) experience providing culturally tai- and international market opportunities; ‘‘(III) the ability of the applicant to pro- lored small business development assistance ‘‘(II) preparing and executing marketing vide quality training and services to a sig- to Native Americans. plans; nificant number of Native Americans;

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‘‘(IV) previous assistance from the Small ‘‘(III) the number of existing businesses (D) GRANT DURATION.—Each grant under Business Administration to provide services seeking to expand employment; this subsection shall be awarded for not less in Native American communities; and ‘‘(IV) jobs created or maintained, on an an- than a 2-year period and not more than a 4- ‘‘(V) the proposed location for the Native nual basis, by Native American small busi- year period. American business center site, with priority ness concerns assisted by the center since re- (2) CONDITIONS FOR PARTICIPATION.—Each given based on the proximity of the center to ceiving funding under this Act; entity desiring a grant under this subsection the population being served and to achieve a ‘‘(V) to the maximum extent practicable, shall submit an application to the Adminis- broad geographic dispersion of the centers. the capital investment and loan financing tration that contains— ‘‘(6) PROGRAM EXAMINATION.— utilized by emerging and expanding busi- (A) a certification that the applicant— ‘‘(A) IN GENERAL.—Each Native American nesses that were assisted by a Native Amer- (i) is a small business development center business center established pursuant to this ican business center; and or a private, nonprofit organization under subsection shall annually provide the Ad- ‘‘(VI) the most recent examination, as re- paragraph (1)(B)(i); ministration with an itemized cost break- quired under subparagraph (B), and the sub- (ii) employs an executive director or pro- down of actual expenditures incurred during sequent determination made by the Adminis- gram manager to manage the facility; and the preceding year. tration under that subparagraph. (iii) agrees— ‘‘(7) ANNUAL REPORT.—Each entity receiv- ‘‘(B) ADMINISTRATION ACTION.—Based on in- (I) to a site visit as part of the final selec- formation received under subparagraph (A), ing financial assistance under this sub- tion process; the Administration shall— section shall annually report to the Adminis- (II) to an annual programmatic and finan- tration on the services provided with such fi- ‘‘(i) develop and implement an annual pro- cial examination; and nancial assistance, including— grammatic and financial examination of (III) to the maximum extent practicable, ‘‘(A) the number of individuals assisted, each Native American business center as- to remedy any problems identified pursuant categorized by ethnicity; sisted pursuant to this subsection; and to that site visit or examination; ‘‘(B) the number of hours spent providing ‘‘(ii) analyze the results of each examina- (B) information demonstrating that the ap- counseling and training for those individ- tion conducted under clause (i) to determine plicant has the ability and resources to meet uals; the programmatic and financial viability of the needs, including cultural needs, of the ‘‘(C) the number of startup small business each Native American business center. concerns created or maintained; Native Americans to be served by the grant; ‘‘(C) CONDITIONS FOR CONTINUED FUNDING.— ‘‘(D) the gross receipts of assisted small (C) information relating to proposed assist- In determining whether to renew a grant, business concerns; ance that the grant will provide, including— contract, or cooperative agreement with a ‘‘(E) the number of jobs created or main- (i) the number of individuals to be assisted; Native American business center, the Ad- tained at assisted small business concerns; and ministration— and (ii) the number of hours of counseling, ‘‘(i) shall consider the results of the most ‘‘(F) the number of Native American jobs training, and workshops to be provided; recent examination of the center under sub- created or maintained at assisted small busi- (D) information demonstrating the effec- paragraph (B), and, to a lesser extent, pre- ness concerns. tive experience of the applicant in— vious examinations; and ‘‘(8) RECORD RETENTION.— (i) conducting financial, management, and ‘‘(ii) may withhold such renewal, if the Ad- ‘‘(A) APPLICATIONS.—The Administration marketing assistance programs designed to ministration determines that— shall maintain a copy of each application impart or upgrade the business skills of cur- ‘‘(I) the center has failed to provide ade- submitted under this subsection for not less rent or prospective Native American busi- quate information required to be provided than 7 years. ness owners; under subparagraph (A), or the information ‘‘(B) ANNUAL REPORTS.—The Administra- (ii) providing training and services to a provided by the center is inadequate; or tion shall maintain copies of the information representative number of Native Americans; ‘‘(II) the center has failed to provide ade- collected under paragraph (6)(A) indefinitely. (iii) using resource partners of the Admin- quate information required to be provided by ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.— istration and other entities, including uni- the center for purposes of the report of the There are authorized to be appropriated versities, tribal governments, or tribal col- Administration under subparagraph (E). $5,000,000 for each of the fiscal years 2004 leges; and ‘‘(D) CONTINUING CONTRACT AND COOPERA- through 2008, to carry out the Native Amer- (iv) the prudent management of finances TIVE AGREEMENT AUTHORITY.— ican Small Business Development Program, and staffing; ‘‘(i) IN GENERAL.—The authority of the Ad- authorized under subsection (c).’’. (E) the location where the applicant will ministrator to enter into contracts or coop- SEC. 323. PILOT PROGRAMS. provide training and services to Native erative agreements in accordance with this (a) DEFINITIONS.—In this section, the fol- Americans; and subsection shall be in effect for each fiscal lowing definitions shall apply: (F) a multiyear plan, corresponding to the year only to the extent and in the amounts (1) INCORPORATION BY REFERENCE.—The length of the grant, that describes— as are provided in advance in appropriations terms defined in section 36(a) of the Small (i) the number of Native Americans and Acts. Business Act (as added by this Act) have the Native American small business concerns to ‘‘(ii) RENEWAL.—After the Administrator same meanings as in that section 36(a) when be served by the grant; has entered into a contract or cooperative used in this section. (ii) in the continental United States, the agreement with any Native American busi- (2) JOINT PROJECT.—The term ‘‘joint number of Native Americans to be served by ness center under this subsection, it shall project’’ means the combined resources and the grant; and not suspend, terminate, or fail to renew or expertise of 2 or more distinct entities at a (iii) the training and services to be pro- extend any such contract or cooperative physical location dedicated to assisting the vided to a representative number of Native agreement unless the Administrator provides Native American community. Americans. the center with written notification setting (b) NATIVE AMERICAN DEVELOPMENT GRANT (3) REVIEW OF APPLICATIONS.—The Adminis- forth the reasons therefore and affords the PILOT PROGRAM.— tration shall— center an opportunity for a hearing, appeal, (1) AUTHORIZATION.— (A) evaluate and rank applicants under or other administrative proceeding under (A) IN GENERAL.—There is established a 4- paragraph (2) in accordance with predeter- chapter 5 of title 5, United States Code. year pilot program under which the Adminis- mined selection criteria that is stated in ‘‘(E) MANAGEMENT REPORT.— tration is authorized to award Native Amer- terms of relative importance; ‘‘(i) IN GENERAL.—The Administration shall ican development grants to provide cul- (B) include such criteria in each solicita- prepare and submit to the Committee on turally tailored business development train- tion under this subsection and make such in- Small Business and Entrepreneurship of the ing and related services to Native Americans formation available to the public; and Senate and the Committee on Small Busi- and Native American small business con- (C) approve or disapprove each completed ness of the House of Representatives an an- cerns. application submitted under this subsection nual report on the effectiveness of all (B) ELIGIBLE ORGANIZATIONS.—The grants not more than 60 days after submission. projects conducted by Native American busi- authorized under subparagraph (A) may be (4) ANNUAL REPORT.—Each recipient of a ness centers under this subsection and any awarded to— Native American development grant under pilot programs administered by the Office of (i) any small business development center; this subsection shall annually report to the Native American Affairs. or Administration on the impact of the grant ‘‘(ii) CONTENTS.—Each report submitted (ii) any private, nonprofit organization funding, including— under clause (i) shall include, with respect to that— (A) the number of individuals assisted, cat- each Native American business center re- (I) has members of an Indian tribe com- egorized by ethnicity; ceiving financial assistance under this sub- prising a majority of its board of directors; (B) the number of hours spent providing section— (II) is a Native Hawaiian organization; or counseling and training for those individ- ‘‘(I) the number of individuals receiving as- (III) is an Alaska Native corporation. uals; sistance from the Native American business (C) AMOUNTS.—The Administration shall (C) the number of startup small business center; not award a grant under this subsection in concerns created or maintained with assist- ‘‘(II) the number of startup business con- an amount which exceeds $100,000 for each ance from a Native American business cen- cerns created; year of the project. ter;

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00050 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.040 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12077 (D) the gross receipts of assisted small above, designed to impart or upgrade the SEC. 333. AUTHORIZATION OF APPROPRIATIONS. business concerns; business skills of current or prospective Na- Section 32 of the Small Business Act (15 (E) the number of jobs created or main- tive American business owners; and U.S.C. 657b) is amended by adding at the end tained at assisted small business concerns; (ii) the prudent management of finances the following: and and staffing; and ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.— (F) the number of Native American jobs (F) a plan for the length of the grant, that There are authorized to be appropriated for created or maintained at assisted small busi- describes— carrying out the provisions of this section— ness concerns. (i) the number of Native Americans and ‘‘(1) $1,000,000 for fiscal year 2004; (5) RECORD RETENTION.— Native American small business concerns to ‘‘(2) $1,500,000 for fiscal year 2005; and (A) APPLICATIONS.—The Administration be served by the grant; and ‘‘(3) $2,000,000 for fiscal year 2006.’’. shall maintain a copy of each application (ii) the training and services to be pro- TITLE IV—SMALL BUSINESS submitted under this subsection for not less vided. PROCUREMENT OPPORTUNITIES than 7 years. (3) REVIEW OF APPLICATIONS.—The Adminis- SEC. 401. CONTRACT CONSOLIDATION. (B) ANNUAL REPORTS.—The Administration tration shall— (a) DEFINITIONS.—Section 3(o) of the Small shall maintain copies of the information col- (A) evaluate and rank applicants under Business Act (15 U.S.C. 632(o)) is amended to lected under paragraph (4) indefinitely. paragraph (2) in accordance with predeter- (c) AMERICAN INDIAN TRIBAL ASSISTANCE read as follows: mined selection criteria that is stated in ‘‘(o) DEFINITIONS RELATING TO CONSOLIDA- CENTER GRANT PILOT PROGRAM.— terms of relative importance; TION OF CONTRACT REQUIREMENTS.—In this (1) AUTHORIZATION.— (B) include such criteria in each solicita- Act— (A) IN GENERAL.—There is established a 4- tion under this subsection and make such in- year pilot program, under which the Admin- ‘‘(1) the terms ‘consolidation of contract formation available to the public; and requirements’ and ‘consolidation’, with re- istration shall award not less than 3 Amer- (C) approve or disapprove each application ican Indian Tribal Assistance Center grants spect to contract requirements of a military submitted under this subsection not more department, Defense Agency, Department of to establish joint projects to provide cul- than 60 days after submission. turally tailored business development assist- Defense Field Activity, or any other Federal (4) ANNUAL REPORT.—Each recipient of an department or agency having contracting ance to prospective and current owners of American Indian tribal assistance center small business concerns located on or near authority mean a use of a solicitation to ob- grant under this subsection shall annually tain offers for a single contract or a multiple tribal lands. report to the Administration on the impact (B) ELIGIBLE ORGANIZATIONS.— award contract to satisfy 2 or more require- of the grant funding received during the re- (i) CLASS 1.—Not fewer than 1 grant shall ments of that department, agency, or activ- porting year, and the cumulative impact of be awarded to a joint project performed by a ity for goods or services that— the grant funding received since the initi- Native American business center, a Native ‘‘(A) have previously been provided to or ation of the grant, including— American business development center, and performed for that department, agency, or (A) the number of individuals assisted, cat- a small business development center. activity under 2 or more separate contracts egorized by ethnicity; (ii) CLASS 2.—Not fewer than 2 grants shall that are smaller in cost than the total cost (B) the number of hours of counseling and be awarded to joint projects performed by a of the contract for which the offers are solic- training provided and workshops conducted; Native American business center and a Na- ited; or tive American business development center. (C) the number of startup business con- ‘‘(B) are of a type capable of being provided cerns created or maintained with assistance (C) AMOUNTS.—The Administration shall or performed by a small business concern for not award a grant under this subsection in from a Native American business center; that department, agency, or activity under 2 an amount which exceeds $200,000 for each (D) the gross receipts of assisted small or more separate contracts that are smaller year of the project. business concerns; in cost than the total cost of the contract for (E) the number of jobs created or main- (D) GRANT DURATION.—Each grant under which the offers are solicited; this subsection shall be awarded for a 3-year tained at assisted small business concerns; ‘‘(2) the term ‘multiple award contract’ period. and means— (2) CONDITIONS FOR PARTICIPATION.—Each (F) the number of Native American jobs ‘‘(A) a contract that is entered into by the entity desiring a grant under this subsection created or maintained at assisted small busi- Administrator of General Services under the shall submit to the Administration a joint ness concerns. multiple award schedule program referred to application that contains— (5) RECORD RETENTION.— in section 2302(2)(C) of title 10, United States (A) a certification that each participant of (A) APPLICATIONS.—The Administration Code; the joint application— shall maintain a copy of each application ‘‘(B) a multiple award task order contract (i) is either a Native American business submitted under this subsection for not less or delivery order contract that is entered center, a Native American business develop- than 7 years. into under the authority of sections 2304a ment center, or a small business develop- (B) ANNUAL REPORTS.—The Administration through 2304d of title 10, United States Code, ment center; shall maintain copies of the information col- or sections 303H through 303K of the Federal (ii) employs an executive director or pro- lected under paragraph (4) indefinitely. Property and Administrative Services Act of gram manager to manage the center; and (d) AUTHORIZATION OF APPROPRIATIONS.— 1949 (41 U.S.C. 253h through 253k); and (iii) as a condition of receiving the Amer- There are authorized to be appropriated— ‘‘(C) any other indeterminate delivery, in- ican Indian Tribal Assistance Center grant, (1) $1,000,000 for each of the fiscal years 2004 determinate quantity contract that is en- agrees— through 2007, to carry out the Native Amer- tered into by the head of a Federal agency (I) to an annual programmatic and finan- ican Development Grant Pilot Program, au- with 2 or more sources pursuant to the same cial examination; and thorized under subsection (b); and solicitation; and (II) to the maximum extent practicable, to (2) $1,000,000 for each of the fiscal years 2004 ‘‘(3) the term ‘senior procurement execu- remedy any problems identified pursuant to through 2007, to carry out the American In- tive’ means— that examination; dian Tribal Assistance Center Grant Pilot ‘‘(A) with respect to a military depart- (B) information demonstrating an historic Program, authorized under subsection (c). ment, the official designated under section commitment to providing assistance to Na- Subtitle D—Office of Veterans Business 16(3) of the Office of Federal Procurement tive Americans— Development Policy Act (41 U.S.C. 414(3)) as the senior (i) residing on or near tribal lands; or procurement executive for the military de- (ii) operating a small business concern on SEC. 331. ADVISORY COMMITTEE ON VETERANS partment; or near tribal lands; BUSINESS AFFAIRS. ‘‘(B) with respect to a Defense Agency or a (C) information demonstrating that each (a) RETENTION OF DUTIES.—Section 33(h) of Department of Defense Field Activity, the participant of the joint application has the the Small Business Act (15 U.S.C. 657c(h)) is official so designated for the Department of ability and resources to meet the needs, in- amended by striking ‘‘October 1, 2004’’ and Defense; and cluding the cultural needs of the Native inserting ‘‘October 1, 2006’’. ‘‘(C) with respect to a Federal department Americans to be served by the grant; (b) EXTENSION OF AUTHORITY.—Section or agency other than those referred to in (D) information relating to proposed as- 203(h) of the Veterans Entrepreneurship and subparagraphs (A) and (B), the official so sistance that the grant will provide, includ- Small Business Development Act of 1999 (15 designated by that department or agency.’’. ing— U.S.C. 657b note) is amended by striking (b) PROCUREMENT STRATEGIES.—Section (i) the number of individuals to be assisted; ‘‘September 30, 2004’’ and inserting ‘‘Sep- 15(e) of the Small Business Act (15 U.S.C. and tember 30, 2006’’. 644(e)) is amended— (ii) the number of hours of counseling, (1) in paragraph (2)— training, and workshops to be provided; SEC. 332. OUTREACH GRANTS FOR VETERANS. (A) by striking ‘‘.— (E) information demonstrating the effec- Section 8(b)(17) of the Small Business Act ‘‘(A) IN GENERAL’’; and tive experience of each participant of the (15 U.S.C. 637(b)(17)) is amended by inserting (B) by striking subparagraphs (B) and (C); joint application in— before the period at the end the following: ‘‘, and (i) conducting financial, management, and veterans, and members of a reserve compo- (2) by striking paragraph (3) and inserting marketing assistance programs, as described nent of the Armed Forces’’. the following:

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‘‘(3) LIMITATION ON USE OF ACQUISITION (c) REPORT REQUIREMENTS.—Section proceed without being subject to the additional STRATEGIES INVOLVING CONSOLIDATION.— 15(p)(4)(B) of the Small Business Act (15 benefit analyses required by the amendments ‘‘(A) CERTAIN DEFENSE CONTRACT REQUIRE- U.S.C. 644(p)(4)(B)) is amended— made by this section. MENTS.—An official of a military depart- (1) in clause (i), by striking ‘‘and’’ at the (2) CONSIDERATIONS.—The study conducted ment, defense agency, or Department of De- end; under paragraph (1) shall include consideration fense Field Activity shall not execute an ac- (2) in clause (ii), by striking the period at of thresholds based on— quisition strategy that includes a consolida- the end and inserting the following: ‘‘; and’’; (A) the dollar value of the overall prime con- tion of contract requirements of the military and tract at issue (including the average dollar department, agency, or activity with a total (3) by adding at the end the following: value of a prime contract in each industry cat- value in excess of $5,000,000, unless the senior ‘‘(iii) a description of best practices for egory); procurement executive first— maximizing small business prime and sub- (B) the portion of such prime contract ‘‘(i) conducts market research; contracting opportunities.’’. amounts that could potentially include small ‘‘(ii) identifies any alternative contracting (d) PROCUREMENT CENTER REPRESENTA- business participation as subcontractors; approaches that would involve a lesser de- TIVES.—Section 15(l) of the Small Business (C) the availability of small business concerns gree of consolidation of contract require- Act (15 U.S.C. 644(l)) is amended— in each industry that have the capabilities and ments; and (1) by striking ‘‘(l)(1)’’ and inserting ‘‘(2)’’; resources to fulfill prime contract requirements; ‘‘(iii) determines that the consolidation is (2) by redesignating paragraphs (2) through and necessary and justified. (7) as paragraphs (3) through (8), respec- (D) such other criteria that the Comptroller ‘‘(B) CERTAIN CIVILIAN AGENCY CONTRACT tively; determines relevant. REQUIREMENTS.—The head of a Federal agen- (3) by inserting before paragraph (2), as so (3) REPORT.—Not later than June 30, 2004, the cy not described in subparagraph (A) that redesignated, the following: Comptroller General shall submit a report to has contracting authority shall not execute ‘‘(l)(1) The Administration shall assign not Congress and the Administration on the results an acquisition strategy that includes a con- fewer than 1 procurement center representa- of the study conducted under this subsection, solidation of contract requirements of the tive at each major procurement center, in together with any recommendations with legis- agency with a total value in excess of addition to no less than 1 for each State.’’; lative or regulatory action. $2,000,000, unless the senior procurement ex- (4) in paragraph (2), as redesignated, by SEC. 402. AGENCY ACCOUNTABILITY. ecutive of the agency first— striking ‘‘to the representative referred to in (a) AGENCY RESPONSIBILITIES.—Section ‘‘(i) conducts market research; subsection (k)(6)’’ and inserting ‘‘to the tra- 15(g)(2) of the Small Business Act (15 U.S.C. ‘‘(ii) identifies any alternative contracting ditional procurement center representative 644(g)(2)) is amended— approaches that would involve a lesser de- and the commercial market representative, (1) by inserting ‘‘(A)’’ after ‘‘(2)’’; gree of consolidation of contract require- with each such position filled by a different (2) by striking ‘‘shall, after consultation’’ ments; and individual, and each such representative hav- and inserting the following: ‘‘shall— ‘‘(iii) determines that the consolidation is ing separate and distinct duties and respon- ‘‘(i) after consultation’’; necessary and justified. sibilities.’’; and (3) by striking ‘‘agency. Goals established’’ ‘‘(C) ADDITIONAL REQUIREMENTS FOR HIGHER (5) by striking ‘‘paragraph (2)’’ each place and inserting the following: ‘‘agency; VALUE CONSOLIDATED CONTRACTS.—In addi- that term appears and inserting ‘‘paragraph ‘‘(ii) identify a percentage of the procure- tion to meeting the requirements under sub- (3)’’. ment budget of the agency to be awarded to paragraph (A) or (B), a procurement strategy (e) ADDITIONAL TO TECHNICAL ADVISERS.— small business concerns, in consultation by a civilian agency that includes a consoli- Section 15(k)ø(8)¿ of the Small Business Act with the Office of Small and Disadvantaged dated contract valued at more than (15 U.S.C. 644(k)ø(8)¿) is amended— Business Utilization of the agency, which in- $5,000,000, or by a defense agency that in- (1) in paragraph (5), by striking ‘‘bundled formation shall be included in the strategic cludes a consolidated contract valued at contract’’ and inserting ‘‘consolidated con- plan required under section 306 of title 5, more than $7,000,000 shall include— tract’’; and United States Code, and the annual budget ‘‘(i) an assessment of the specific impedi- (2) in paragraph (8), by striking ‘‘represent- submission to Congress by that agency, and, ments to participation by small business ative—’’ and inserting ‘‘representative at upon request, in any testimony provided by concerns as prime contractors that will re- each major procurement center under sub- that agency before the Congress in connec- sult from the consolidation; section (l)(1)—’’. tion with the budget process; and ‘‘(ii) actions designed to maximize small (f) CONFORMING AMENDMENTS.—Section ‘‘(iii) report, as part of its annual perform- business participation as prime contractors, 15(p) of the Small Business Act (15 U.S.C. ance plan, required under section 1115 of title including provisions that encourage small 644(p)) is amended— 31, United States Code, the extent to which business teaming for the consolidated re- (1) in the subsection heading, by striking the agency achieved the goals referred to in quirement; ‘‘BUNDLED CONTRACTS’’ and inserting ‘‘CON- clause (ii), and appropriate justification for ‘‘(iii) actions designed to maximize small SOLIDATED CONTRACTS’’; any failure to do so. business participation as subcontractors (in- (2) in paragraph (1), in the paragraph head- ‘‘(B) Goals established’’; cluding suppliers) at any tier under the con- ing, by striking ‘‘BUNDLED CONTRACT’’ and in- (4) by striking ‘‘Whenever’’ and inserting tract or contracts that may be awarded to serting ‘‘CONSOLIDATED CONTRACT’’; the following: meet the requirements; and (3) in paragraph (4), in the paragraph head- ‘‘(C) Whenever’’; ‘‘(iv) the identification of the alternative ing, by striking ‘‘CONTRACT BUNDLING’’ and (5) by striking ‘‘For the purpose of’’ and in- strategies that would reduce or minimize the inserting ‘‘CONTRACT CONSOLIDATION’’; serting the following: scope of the consolidation and the rationale (4) by striking ‘‘bundled contracts’’ each ‘‘(D) For the purpose of’’; for not choosing those alternatives. place that term appears and inserting ‘‘con- (6) in the last sentence— ‘‘(D) NECESSARY AND JUSTIFIED.—A senior solidated contracts’’; (A) by striking ‘‘(A) contracts’’ and insert- procurement executive may determine that (5) by striking ‘‘bundled contract’’ each ing ‘‘(i) contracts’’; and an acquisition strategy involving a consoli- place that term appears and inserting ‘‘con- (B) by striking ‘‘(B) contracts’’ and insert- dation of contract requirements is necessary solidated contract’’; ing ‘‘(ii) contracts’’; and and justified for purposes of subparagraph (6) by striking ‘‘bundling of contract re- (7) by adding at the end the following: (A), (B), or (C), if the benefits of the acquisi- quirements’’ each place that term appears ‘‘(E)(i) Each procurement employee de- tion strategy substantially exceed the bene- and inserting ‘‘consolidation of contract re- scribed in clause (iii)— fits of each of the possible alternative con- quirements’’; ø‘‘(I) shall have as an annual performance tracting approaches identified under clause (7) in paragraph (4)(B)(ii), by striking ‘‘pre- evaluation factor, where appropriate, the (ii) of any of those subparagraphs, as applica- viously bundled’’ and inserting ‘‘previously success of that procurement employee in ble. However, savings in administrative or consolidated’’; small business utilization, in accordance personnel costs alone do not constitute, for (8) in paragraph (4)(B)(ii)(I), by striking with the goals established under this sub- such purpose, a sufficient justification for a ‘‘were bundled’’ and inserting ‘‘were consoli- section; and¿ consolidation of contract requirements in a dated’’; ø‘‘(II)¿(I) shall communicate to their sub- procurement, unless the total amount of the (9) in paragraph (4)(B)(ii)(II)(bb), by strik- ordinates the importance of achieving small cost savings is expected to be substantial in ing ‘‘bundling the contract requirements’’ business goals.; and relation to the total cost of the procure- and inserting ‘‘the consolidation of contract ‘‘(II) shall have as an annual performance ment. requirements’’; and evaluation factor, where appropriate, the suc- ‘‘(E) BENEFITS.—Benefits considered for (10) in paragraph (4)(B)(ii)(II)(cc), by strik- cess of that procurement employee in small busi- purposes of this paragraph may include cost ing ‘‘bundled status’’ and inserting ‘‘consoli- ness utilization, in accordance with the goals and, regardless of whether quantifiable in dated status’’. established under this subsection. dollar amounts— (g) GAO STUDY AND REPORT.— ‘‘(ii) An appropriate percentage of any per- ‘‘(i) quality; (1) FEASIBILITY STUDY REQUIRED.—The Comp- formance-related bonus awarded to a pro- ‘‘(ii) acquisition cycle; troller General of the United States shall con- curement employee described in clause (iii) ‘‘(iii) terms and conditions; and duct a study of the feasibility of setting thresh- shall be withheld, where appropriate, for fail- ‘‘(iv) any other benefit directly related to olds, based on industry category, for permitting ure to achieve the goals established under national security or homeland defense.’’. the consolidation of contract requirements to this subsection.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00052 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.040 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12079

‘‘(iii) A procurement employee described in used in preparing the bid or proposal, unless ‘‘(D) DEFINED TERM.—As used in this para- this clause is a senior procurement execu- such small business concerns are no longer in graph, the term ‘civilian agency prime con- tive, senior program manager, or small and business or can no longer meet the quality, tractor’ means a prime contractor that of- disadvantaged business utilization manager quantity, or delivery date.’’. fers any combination of services or manufac- of a Federal agency having contracting au- (b) PENALTIES FOR FALSE CERTIFICATIONS.— tured goods to Federal agencies other than thority.’’. Section 16(f) of the Small Business Act (14 the Department of Defense or agencies with (b) SMALL AND DISADVANTAGED BUSINESS U.S.C. 645(f)) is amended by inserting ‘‘or responsibility for homeland security or na- UTILIZATION.—Section 15(k)(3) of the Small 8(d)(6)(G))’’ before ‘‘of this Act’’. tional security.’’. Business Act (15 U.S.C. 644(k)(3)) is amended SEC. 405. EVALUATING SUBCONTRACT PARTICI- (b) SUNSET.—The amendment made by this to read as follows: PATION IN AWARDING CONTRACTS. section shall remain in effect during the pe- ‘‘(3) be responsible only to, and report di- (a) SIGNIFICANT FACTORS.—Section riod beginning on the date of enactment of rectly to, the head of such agency, except 8(d)(4)(G) of the Small Business Act (15 this Act and ending on September 30, 2006. that the Director of Small and Disadvan- U.S.C. 637(d)(4)(G)) is amended by striking ‘‘a SEC. 407. WOMEN-OWNED SMALL BUSINESS IN- taged Business Utilization for the Depart- bundled’’ and inserting ‘‘any’’. DUSTRY STUDY. Section 8(m)(4) of the Small Business Act ment of Defense shall be responsible only to, (b) EVALUATION REPORTS.—Section 8(d)(10) and report directly to, the Undersecretary of of the Small Business Act (15 U.S.C. (15 U.S.C. 637(m)(4)) is amended to read as Defense for Acquisition, Technology, and Lo- 637(d)(10)) is amended— follows: gistics,’’. (1) by striking ‘‘is authorized to’’ and in- ‘‘(4) GAO IDENTIFICATION OF INDUSTRIES.— (c) REPORTS ON SMALL BUSINESS UTILIZA- serting ‘‘shall’’; ‘‘(A) STUDY.—The Comptroller General of TION.—Section 10(d) of the Small Business (2) in subparagraph (B), by striking ‘‘and’’ the United States shall conduct a study to Act (15 U.S.C. 639(d)) is amended— at the end; identify industries in which small business (1) by inserting ‘‘and each agency that is a (3) in subparagraph (C), by striking the pe- concerns owned and controlled by women are member of the President’s Management riod at the end and inserting ‘‘; and’’; and underrepresented with respect to Federal Council (or any successor thereto)’’ after (4) by adding at the end the following: procurement contracting. ‘‘Department of Defense’’ the first place that ‘‘(D) report the results of each evaluation ‘‘(B) REPORT TO CONGRESS.—Not later than term appears; and under subparagraph (C) to the appropriate December 31, 2003, the Comptroller General (2) by inserting ‘‘or that agency’’ after contracting officers.’’. shall submit a report to Congress on the re- sults of the study conducted under subpara- ‘‘Department of Defense’’ the second place (c) CENTRALIZED DATABASE; PAYMENTS graph (A), together with any recommenda- that term appears. PENDING REPORTS.—Section 8(d) of the Small (d) TECHNICAL CORRECTION.— Business Act (15 U.S.C. 637(d)) is amended— tions for legislative action. (1) IN GENERAL.—Section 502(b) of the Vet- (1) by redesignating paragraph (11) as para- ‘‘(C) ASSISTANCE FROM OTHER AGENCIES.— erans Entrepreneurship and Small Business graph (13); and The Comptroller General may request of any Development Act of 1999 (Public Law 106–50, (2) by inserting after paragraph (10) the fol- Federal agency, and such agency shall pro- 113 Stat. 248) is amended by striking ‘‘Sec- lowing: vide, such information as the Comptroller General determines necessary in carrying tion 15’’ and inserting ‘‘Section 15(g)(2)’’. ‘‘(11) CENTRALIZED DATABASE.—The results (2) EFFECT.—The amendment made by of an evaluation under paragraph (10)(C) out this paragraph, to the extent otherwise paragraph (1) shall be deemed to have the shall be included in a national centralized permitted by law.’’. same effective date as section 502(b) of the governmentwide database. SEC. 408. HUBZONE AUTHORIZATIONS. Section 31(d) of the Small Business Act (15 Veterans Entrepreneurship and Small Busi- ‘‘(12) PAYMENTS PENDING REPORTS.—Each ness Development Act of 1999. Federal agency having contracting authority U.S.C. 657a(d)) is amended— (1) by striking ‘‘2001’’ and inserting ‘‘2004’’; SEC. 403. SMALL BUSINESS PARTICIPATION IN shall ensure that the terms of each contract PRIME CONTRACTING. for goods and services includes a provision and (2) by striking ‘‘2003’’ and inserting ‘‘2006’’. (a) PARTICIPATION IN MULTIPLE AWARD CON- allowing the contracting officer of an agency TRACTS.—Section 15(g) of the Small Business to withhold an appropriate amount of pay- SEC. 409. DEFINITION OF HUBZONE; TREATMENT Act (15 U.S.C. 644(g)) is amended by adding at ment with respect to a contract (depending OF CERTAIN FORMER MILITARY IN- STALLATION LANDS AS HUBZONES. the end the following: on the size of the contract) until the date of (a) BASE CLOSURE AREAS.—Section 3(p)(1) ‘‘(3) The governmentwide goal for partici- receipt of complete, accurate, and timely of the Small Business Act (15 U.S.C. 632(p)(1)) pation by small business concerns in any subcontracting reports in accordance with is amended— multiple award contract shall be established paragraph (6)(G).’’. (1) in subparagraph (C), by striking ‘‘or’’ at at not less than 23 percent of the total dollar (d) REFERRAL OF MATERIAL BREACH TO IN- the end; value of all awards under that contract.’’. SPECTORS GENERAL.—Section 8(d)(8) of the (2) in subparagraph (D), by striking the pe- (b) RESERVED CONTRACTS.—Section 15(j) of Small Business Act (15 U.S.C. 637(d)(8)) is riod at the end and inserting ‘‘; or’’; and the Small Business Act (15 U.S.C. 644(j)) is amended by adding at the end the following: (3) by adding at the end the following: amended— ‘‘A material breach described in this para- ‘‘(E) base closure areas.’’. (1) in paragraph (1), by inserting ‘‘, includ- graph shall be referred for investigation to (b) DEFINITION.—Section 3(p)(4) of the ing any order of 1 or more Federal Supply the Inspector General (or the equivalent) of Small Business Act (15 U.S.C. 632(p)(4)) is Schedule items,’’ after ‘‘goods and services’’; the affected agency.’’. amended by adding at the end the following: and SEC. 406. DIRECT PAYMENTS TO SUBCONTRAC- ‘‘(D) BASE CLOSURE AREA.—The term ‘base (2) by adding at the end the following: TORS. closure area’ means lands within the exter- ‘‘(4) Any adjustment to the simplified ac- (a) IN GENERAL.—Section 8(d) of the Small nal boundaries of a military installation quisition threshold (as defined in section Business Act (15 U.S.C. 637(d)), as amended that were closed through a privatization 4(11) of the Office of Federal Procurement by section 405, is further amended by adding process under the authority of— Policy Act (41 U.S.C. 403(11))), shall be imme- at the end the following: ‘‘(i) the Defense Base Closure and Realign- diately matched by an identical adjustment ‘‘(14) TIMELY PAYMENT TO SMALL BUSINESS ment Act of 1990 (part A of title XXIX of Di- to the small business reserve for purposes of SUBCONTRACTORS.— vision B of Public Law 101–510; 10 U.S.C. 2687 this subsection.’’. ‘‘(A) IN GENERAL.—Subject to subparagraph note); SEC. 404. SMALL BUSINESS PARTICIPATION IN (B), the failure of a civilian agency prime ‘‘(ii) title II of the Defense Authorization SUBCONTRACTING. contractor, as defined in subparagraph (D), Amendments and Base Closure and Realign- (a) CERTIFICATIONS REQUIRED.—Section to make a timely payment, as determined by ment Act (Public Law 100–526; 10 U.S.C. 2687 8(d)(6) of the Small Business Act (15 U.S.C. the contract with the subcontractor, to a note); 637(d)(6)) is amended— subcontractor that is a small business con- ‘‘(iii) section 2687 of title 10, United States (1) in subparagraph (E), by striking ‘‘and’’ cern shall be a material breach of the con- Code; or at the end; tract with the Federal agency. ‘‘(iv) any other provision of law author- (2) in subparagraph (F), by striking the pe- ‘‘(B) CONSIDERATION OF PERFORMANCE.—Be- izing or directing the Secretary of Defense or riod at the end and inserting a semicolon; fore making a determination under subpara- the Secretary of a military department to and graph (A), the contracting officer shall con- dispose of real property at the military in- (3) by adding at the end the following: sider all reasonable issues regarding the per- stallation for purposes relating to base clo- ‘‘(G) the name and signature of the indi- formance, or lack of performance, of the sub- sures of redevelopment, while retaining the vidual that is the president, chief executive contractor. authority to enter into a leaseback of all or officer, or head of the entity, certifying that ‘‘(C) WITHHOLDING OF PAYMENTS.—Not later a portion of the property for military use.’’. subcontracting data provided are accurate than 30 days after the date on which a mate- SEC. 410. DEFINITION OF HUBZONE SMALL BUSI- and complete; and rial breach under subparagraph (A) is deter- NESS CONCERN. ‘‘(H) certification that the offeror or bidder mined by the contracting officer, the Federal Section 3(p) of the Small Business Act (15 will acquire articles, equipment, supplies, agency may withhold any amounts due and U.S.C. 632(p)) is amended— services, or materials, or obtain the perform- owing the subcontractor from payments due (1) by redesignating paragraphs (4) through ance of construction work from small busi- to the prime contractor and pay such (7) as paragraphs (5) through (8), respec- ness concerns in the amount and quality amounts directly to the subcontractor. tively; and

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00053 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.040 S26PT1 S12080 CONGRESSIONAL RECORD — SENATE September 26, 2003 (2) by inserting after paragraph (3) the fol- ‘‘(A) IN GENERAL.—The Associate Adminis- small businesses can borrow subject to lowing: trator of Business Development shall collect the SBA’s guarantee, so that the SBA’s ‘‘(4) RULE OF CONSTRUCTION RELATING TO data on the BusinessLINC program and sub- loan sizes realistically reflect what it OWNERSHIP.—For purposes of paragraph mit an annual report by April 30 of each year costs to start and operate a small busi- (3)(A), the term ‘person’ includes any small on the effectiveness of the program to the business investment company, specialized Committee on Small Business and Entrepre- ness in today’s economy. Moreover, the small business investment company, New neurship of the Senate and the Committee bill addresses access to capital by help- Markets Venture Capital company (as those on Small Business of the House. ing SBA’s lending partners—for in- terms are defined in sections 103 and 351, re- ‘‘(B) CONTENTS.—The report submitted stance, through the new National Pre- spectively, of the Small Business Investment under subparagraph (A) shall include— ferred Lenders Pilot Program. Act of 1958 (15 U.S.C. 662, 689), or other simi- ‘‘(i) the number of programs administered In the area of entrepreneurial devel- lar investment company, as determined by in each State; opment, we set out to ensure that the the Administrator, if any such company ‘‘(ii) the corresponding grant awards and SBA’s programs continue to provide comprises not more than 15 percent of the the date of each award; the products and services essential to ownership of the subject small business con- ‘‘(iii) the dollar amount of the contracts in cern.’’. effect in each State as a result of the small businesses. Recognizing the tre- SEC. 411. ACQUISITION REGULATIONS. BusinessLINC program; and mendous accomplishments by women Not later than 180 days after the date of ‘‘(iv) the number of teaming arrangements entrepreneurs, I have included the enactment of this Act, the or partnerships created as a result of the Women’s Small Business Improvement øG¿governmentwide procurement regula- BusinessLINC program.’’. Act of 2003, which I introduced earlier tions issued under sections 6(a) and 25(c) of Ms. SNOWE. Mr. President, I rise this year, to integrate and better lever- the Office of Federal Procurement Policy today to seek unanimous consent for age the spectrum of women’s business Act (41 U.S.C. 405(a) and 421(c)) and the pro- the passage of the Small Business Ad- programs that the SBA provides for curement regulations described in section ministration 50th Anniversary Reau- women entrepreneurs. 25(c)(2) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c)(2)) that are thorization Act of 2003, S. 1375, a bill to A cornerstone of these improvements issued by the Department of Defense shall be reauthorize the U.S. Small Business involves making the Women’s Business amended as necessary to carry out this title Administration, SBA and its programs Center Program a permanent program and the amendments made by this title. for the next 3 years, together with a that will offer opportunities for the TITLE V—MISCELLANEOUS managers’ amendment. creation of new centers and renewal SEC. 501. MINORITY SMALL BUSINESS AND CAP- As the chair of the Committee on grants for existing centers on a com- ITAL OWNERSHIP DEVELOPMENT Small Business and Entrepreneurship, I petitive basis. By replacing the pilot PROGRAM. am pleased to report that this legisla- Sustainability Program, which expires (a) NAME CHANGE.—Sections 4(b), 7(j), and tion passed the Committee on July 10, at the end of the current fiscal year, 8(a) of the Small Business Act (15 U.S.C. 2003, by a unanimous vote. It is the with a fair and balanced grant pro- 633(b), 636(j), and 637(a)) are amended by striking ‘‘Minority Small Business and Cap- product of significant contributions by gram, the bill will correct the funding ital Ownership Development’’ each place it the members of my committee, and I constraints that have plagued the pro- appears and inserting ‘‘Business Develop- am grateful for the efforts of the com- gram in 2003. ment’’. mittee’s ranking member, Senator In addition, the SBA’s entrepre- (b) CONFORMING AMENDMENTS.—The Small KERRY, to make this a truly bipartisan neurial development partners—the Business Act (15 U.S.C. 631 et seq.) is amend- bill. Small Business Development Centers ed— The challenge for today’s SBA is and the Service Corps of Retired Ex- (1) in section 2(d)(2)(B)(ii), by striking enormous. Each year, there are 3 to 4 ecutives—continue to provide quality ‘‘small business and capital ownership devel- opment program’’ and inserting ‘‘small busi- million new business start-ups—1 in 25 training and free counseling through ness development program’’; adult Americans is taking steps to almost 2,000 locations. As a result, in (2) in section 7(j)(10), by striking ‘‘small start a business. And, small businesses addition to minor technical changes in business and capital ownership development account for approximately two-thirds these programs, the bill reauthorizes program’’ and inserting ‘‘small business de- of the net new jobs in our country. these critical programs for the next velopment program’’; We began the reauthorization process three years. (3) in section 7(j)(12)(A), by striking ‘‘Cap- this year with a series of hearings, Finally, one of the most serious prob- ital Ownership Development Program’’ and roundtables, and discussions to develop lems facing small businesses is their inserting ‘‘Business Development Program’’; a bill that would improve the SBA pro- inability to participate fully in Federal and (4) in section 8(a)(21)(B)(v)(I), by striking grams that provide counseling and contracts, on either a prime or sub- ‘‘Capital Ownership Development Program’’ training for entrepreneurs—and to im- contract basis. In the last 10 years, and inserting ‘‘Business Development Pro- prove the SBA’s financial assistance contract bundling has forced more than gram. and Government procurement pro- 50 percent of small businesses out of (c) ANNUAL REPORT.—Section 8(a)(20)(A) of grams that enable small businesses to the Federal marketplace. The bill ad- the Small Business Act (15 U.S.C. prosper and expand. While the particu- dresses the practice of Federal contract 637(a)(20)(A)) is amended by striking ‘‘semi- lars of this bill are extensive, let me bundling by changing the definition of annually report to their assigned Business highlight a few of its key areas. ‘‘contract bundling’’ to limit its use so Opportunity Specialist’’ and inserting ‘‘an- nually submit, to their assigned Business Op- In terms of financing programs for that small businesses have better ac- portunity Specialist, a report, which shall small businesses, I have focused exten- cess to Federal contracts and a fair op- include’’. sively on improving the credit and ven- portunity to compete for them. SEC. 502. EXTENSION OF [PROGRAM] AUTHORITY ture capital resources that the SBA Furthermore, the bill implements the FOR TECHNOLOGY ASSISTANCE PRO- provides for small businesses. These Procurement Program for Women- GRAM. programs are the centerpiece of the owned Small Business Concerns, which (a) RURAL OUTREACH.—Section 9(s)(2) of the SBA’s efforts to help entrepreneurs get will give contracting officers the tools Small Business Act (15 U.S.C. 638(s)(2)) is amended by striking ‘‘2005’’ and inserting started and assist small businesses to necessary to help women-owned small ‘‘2006’’. prosper. In fact, in just the past 3 years businesses compete in the Federal mar- (b) FAST PROGRAM.—Section 34 of the alone, the SBA’s lending programs ketplace more effectively. The bill also Small Business Act (15 U.S.C. 657d) is amend- made it possible for small businesses to contains improvements to the ed— create or retain more than 1.3 million HUBZone program, including the des- (1) in subsection (h), by striking ‘‘2005’’ jobs. ignation of a closed military base as a each place it appears and inserting ‘‘2006’’; Nevertheless, access to capital con- HUBZone for 5 years to reduce the seri- and tinues to rank as a primary concern for ous consequences that military base (2) by striking ‘‘September 30, 2005’’ and in- small business owners. So, we are pro- serting ‘‘September 30, 2006’’. closings pose for our local commu- posing to continue the growth of the fi- SEC. 503. BUSINESSLINC REPORT TO CONGRESS. nities. Section 8(n) of the Small Business Act (15 nancing programs through reasonable With this bill, I am offering a man- U.S.C. 637(n)) is amended by adding at the increases in the authorization levels of agers’ amendment, which is co-spon- end the following: the 7(a), 504 and Microloan programs. sored by Senator KERRY, to address ‘‘(4) ANNUAL REPORT.— The bill also increases the amount that several issues that have risen since the

VerDate jul 14 2003 02:14 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00054 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.040 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12081 committee’s markup of the bill. In than later trying to create such a mar- credit card loans, and car loans, which working with several of my colleagues, ket in one step when economic pres- have active secondary markets. This on and off of the Small Business Com- sures called for an immediate response. program would allow lenders, including mittee, I believe the changes encom- The SBA is not alone in its support community banks, to benefit from the passed in this amendment address cer- for a program to securitize small busi- increased liquidity of small business tain concerns and strengthen par- ness loans. The Board of Governors of loans and to utilize capital that is oth- ticular aspects of the bill so that it the Federal Reserve System, in its Sep- erwise locked into existing loans, and provides the greatest benefit to small tember 2002 Report to the Congress on therefore provide better terms on loans businesses and entrepreneurs in this the Availability of Credit to Small to small businesses, as well as to make country. Let me highlight several of Businesses, stated that the more small business loans. these changes. securitization of small business loans This proposal, as embodied in Section First, the amendment removes sec- could ‘‘substantially influence the 265, is not a departure from the SBA’s tion 265, which would have authorized availability of credit’’ to small busi- current practice of guaranteeing loans the SBA to develop and implement an nesses. The Federal Reserve noted that and regulating the securitization of innovative 3-year pilot program in one primary benefit of a secondary those loans. The SBA already regulates which the SBA would provide a partial market would be that small business the securitization of both guaranteed guarantee on pools of securitized small borrowers could enjoy lower financing portions of loans provided to small business loans that are not otherwise costs. In addition to the Federal Re- businesses and non-guaranteed por- guaranteed by the SBA. serve report, other studies have shown tions of the same loans. These loans When the President’s Fiscal Year 2004 that small businesses could benefit are made both by Federally-regulated budget request was transmitted to the from an efficient secondary market for lenders and by lenders that are not Congress this past February, it stated small business loans. Federally regulated. In Fiscal Year that the SBA was exploring a possible The Federal Reserve report noted 2002, the SBA regulated the new approach to expand the opportuni- that a primary obstacle to a wide- securitization of $3.4 billion in Govern- ties of small businesses to access cap- spread secondary market for small ment-guaranteed small business loans ital markets by facilitating the business loans was the lack of stand- made under Section 7(a) of the Small securitization of conventional small ardized information to evaluate small Business Act. When the guaranteed business loans that were not already business loans for re-sale. As noted, the portions of the 7(a) loans are guaranteed by the SBA. Increasing ac- SBA has exercised foresight by secur- securitized separately from the non- cess to capital is a high priority of ing the contract with Dun & Bradstreet guaranteed portions, the SBA is guar- small businesses, and has been one of and Fair, Isaacs to attack this prob- anteeing 100 percent of the loan pools. the Committee’s priorities throughout lem. With the information provided by The new proposal presents a much its history. We are always seeking in- this new credit-scoring model, the more measured SBA involvement than novative ways to increase access to securitization of non-SBA small busi- is involved with the SBA’s current fi- capital for small businesses, while at ness loans will be far more feasible. nancing programs. Under the pilot pro- the same time measuring the cost and The committee has received support gram, financial firms approved by the risk of loss that the Federal Govern- for the pilot program from representa- SBA would pool loans not individually ment must incur to facilitate such fi- tives of thousands of small businesses guaranteed by the SBA. These pooling nancing. Accordingly, I recognized the that believe the program could im- entities would then issue securities of- potential benefits of this proposal for prove access to capital, and could im- fering returns based upon the returns small businesses across the Nation. prove the terms of loans received, for from the loans in the pool. The securi- At our roundtable on April 30, 2003, many small businesses, particularly ties would be rated by a rating agency the committee examined the loan-pool- those without significant real estate and sold to investors. ing proposal in greater detail. The SBA property to use as collateral. Signifi- The pooling entity would also offer a reported that it had been exploring this cant support for the program has been partial ‘‘first-loss’’ guarantee to inves- type of program for some time, and expressed particularly by small busi- tors on the securities’ returns. If the thought the idea had considerable nesses that are owned by minorities or loans had insufficient returns to pay merit. The agency, however, was uncer- by women. For these small businesses, the expected returns on the securities, tain if it had the authority to develop which often have less real estate col- the pooling entity’s guarantee would and implement such a program, absent lateral, on average, than other small be the first guarantee called into per- legislative authorization. After the businesses, the pilot program holds formance to pay investors. The SBA roundtable, we consulted with the SBA great potential for creating capital re- would issue partial, not complete, ‘‘sec- and with participants in the small sources to meet their financing needs. ond loss’’ guarantees on the return business financing industry to deter- Financial firms currently involved in from the securities, but not on indi- mine the program’s appropriate ele- the pooling and securitization of SBA vidual loans within the pool. The agen- ments. 7(a) and 504 loans have also expressed cy’s guarantees would thus be available In addition to the support the SBA their support for the program, and only after the first-loss guarantees of- expressed for the proposal in its budget have stated their belief that it will in- fered by the pool issuers are exhausted. request, at the committee’s round- crease small businesses’ access to effec- In addition, the SBA will only need to table, and in subsequent discussions tive capital. provide guarantees at a much lower with committee staff, the SBA took With this input from the SBA, small percentage level than is currently the other steps to help make the proposal a businesses, and financial firms in hand, case for the SBA’s guarantees on indi- success. For example, the agency en- and having considered many studies re- vidual loans. Finally, and perhaps most tered into a contract with Dun & Brad- garding small business credit and the importantly, the cost of the SBA guar- street and with Fair, Isaacs, Co., to effectiveness of secondary markets, we antees will be fully funded by fees paid create a credit-scoring model for small included Section 265 in S. 1375, which by the loan poolers, so no Federal ap- businesses, similar to individual con- was approved unanimously by the com- propriations will be necessary. sumer credit scores, to help small busi- mittee. Section 265 authorized, but did The proposed program also requires nesses gauge their credit quality. The not require, the SBA to develop the three separate types of reports. The scoring model will assist the pooling pilot program if the SBA determined SBA must provide to the committee proposal by providing uniformity of that it could be practically imple- and to the Committee on Small Busi- pricing, thus reducing a primary obsta- mented. ness of the House of Representatives a cle to the securitization of non-SBA The rationale for this proposal is to report detailing the pooling program small business loans. The SBA also increase effective liquidity for small before it is implemented, and wait 50 helped build support for the proposal businesses by improving the quality days after submitting the report before by publicizing the need to take the and amount of loans available to them. implementing the program. In addi- foundational steps to build a secondary The pooling structure is based on simi- tion, the SBA must file with the Con- market for small business loans, rather lar arrangements for home mortgages, gress, in the SBA’s Budget Request and

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00055 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.045 S26PT1 S12082 CONGRESSIONAL RECORD — SENATE September 26, 2003 Performance Plan, an annual report This change will eliminate confusion question the need for action if small about the program’s performance. Fi- that has resulted from the use of dif- businesses are successfully competing nally, the GAO is required to study the ferent definitions for two related pro- for and winning schedule orders each program, if implemented, and report on grams. More importantly, by signifi- day. Finally, they assert that sched- the program’s performance, including cantly broadening the definition of uled contracts are a faster, easier, any effects the program may have on those areas in which investment is per- more flexible way for agencies to meet the 504 or 7(a) programs, before cal- mitted under the New Markets Venture their needs and any change that re- endar year 2006. Capital program, this change will in- duces that ease should be challenged. Working with Senator PRYOR and crease the flexibility that New Markets In my view, if small businesses enjoy with other colleagues, both on and off Venture Capital companies have in a majority share of schedule con- the committee, we endeavored to pro- choosing small businesses in which to tracts—which they do—should not vide greater specificity in the instruc- invest. As a result, we should see their participation in these contracts tions the provision gives the SBA re- stronger New Markets Venture Capital reflect their representation on the sup- garding the pilot program, so as to en- companies and more small businesses ply schedule? Currently, small busi- sure that the pooling proposal provides being served through this venture cap- nesses represent more than 70 percent the greatest benefit to small businesses ital program. of the companies listed on the Federal in need of capital while limiting risk to The third part of the managers’ Supply Schedule, yet these small busi- the Federal Government. I believe amendment modifies several provisions nesses are receiving just under 30 per- those modifications would have greatly in the bill relating to government con- cent of the awards under the schedule. improved the pilot program and in- tracting opportunities for small busi- The intent of multiple-award con- creased its potential to provide in- nesses. In 1994, Congress enacted the tacting was not to have a majority of creased access to capital on terms that Federal Acquisition Streamlining Act, orders awarded on a sole-source basis. are beneficial to small businesses. FASA, to streamline Federal procure- Rather, it was designed to be a stream- Access to credit for small businesses ment processes. FASA included an lined acquisition process to achieve is often a challenge, and the committee amendment to the Small Business Act competition without increasing the has consistently believed that encour- that created an exclusive reservation government’s risk. Including small aging more lending to small businesses for small businesses consisting of con- business helps to ensure the Federal that have a likelihood to succeed, tracts valued at more than $2,500 but Government is getting the best prod- grow, and create new jobs is a sound not more than $100,000. And, while it ucts and services at the best prices. national policy. The pilot program Nevertheless, in order to ensure the had the chance to classify purchases takes advantage of the successful ex- timely passage of this important reau- under multiple-award schedule con- ample of the prior securizations of SBA thorization legislation, I have agreed tracts, including Federal Supply small business loans, and of changes in to modify the bill’s provision that Schedule, within this reserve at that the investment community, to facili- would have allowed small business set- time, the Congress expressly excluded tate lending in the small business com- asides of awards on multiple-award munity for years to come. these sales from small business set- contracts, to require, instead, that con- However, while I continue to recog- aside rules. Accordingly, rules on small tracting officers review the offers of at nize the merits of this measure and be- business set-asides do not apply to Fed- least two small businesses when com- lieve that it should be included in this eral Supply Schedule purchases, and, pleting orders on multiple-award con- bill, the administration has now taken instead, contracting officers are re- tacts. While I had hoped to provide a contrary position. In the interest of quired to give a ‘‘preference’’ to small stronger provisions for small busi- expediting the passage of S. 1375 before businesses. nesses seeking to contract with the Although reports now indicate that the SBA’s current authorizing legisla- Federal Government, I believe this tion expires, I am reluctantly removing the level of small business participa- compromise will still lead to greater this provision to focus on those ele- tion on schedule contracts is growing procurement opportunities for small ments of the bill that must be enacted. and is relatively higher than the share enterprises. While I am disappointed to have to small businesses receive on non-sched- This modification anticipates that a remove this section, it is clear that ule contracts, small businesses con- contracting officer will give serious this bill must move forward as quickly tinue to report to the committee that consideration to small businesses seek- as possible. I want to be clear, however, they invest time and money to nego- ing to provide goods and services to the that I continue to appreciate the bene- tiate a schedule contract successfully Federal Government. As an example, fits of this pilot program, and will in- with the General Services Administra- when placing orders for supplies with troduce this provision as a separate bill tion or an executive agent managing a contractors on the General Services in the near future. With the support Government-wide Acquisition Con- Administration’s Federal Supply this proposal already has, I am con- tract, and then they never receive the Schedule, contracting officers should fident we can implement this innova- benefit of an order placed against that consider the information available on tive program, and I look forward to the contract. Small businesses further re- the GSA Advantage on-line shopping benefits it can provide for small busi- port that the Government relies on a service or other catalogs and price lists nesses as we try to assist small busi- limited and preferred list of larger of at least two small business multiple- nesses to prosper, create more jobs, and firms to meet its requirements for award-schedule contractors that pro- pull the economy out of its current dol- goods and services. vide the supplies that are being pur- drums. Small businesses deserve to have a chased. The amendment also modifies the fair opportunity to compete for those Placing orders for services, however, provisions of the bill relating to the orders. The Small Business Adminis- may be more complex at times. In New Markets Venture Capital Program tration 50th Anniversary Reauthoriza- these instances, contracting officers and the definition of ‘‘low-income geo- tion Act would protect small busi- purchasing from Government-wide ac- graphic area,’’ in which New Markets nesses and ensure that they continue quisition contacts, multi-agency con- Venture Capital companies are to in- to have access to, and the opportunity tracts, or the Federal Supply Schedule vest most of their funds. In order to co- to compete for, multiple-award and should include at least two small busi- ordinate the definition of ‘‘low-income schedule purchases. Specifically, the nesses when they solicit offers. These geographic area’’ used in the SBA’s bill restricts competition of schedule actions will ensure that small business New Markets Venture Capital Program orders valued between $2,500 and multiple-award contractors have a fair and that used for the New Markets Tax $100,000 for small businesses. opportunity to be considered for or- Credit under the tax code, the man- I know that some of my colleagues ders. agers’ amendment specifies that the believe that by setting aside schedule To ensure the necessary steps are Small Business Act’s definition will be orders under $100,000, thousands of taken to establish clear guidance and based on median family income, rather small firms that supply and sell that agencies follow these established than median household income as through contracts held by large firms procedures to implement this com- under current law. may significantly be harmed. They also promise, my committee will closely

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00056 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.047 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12083 monitor competition and small busi- reports provided to the government is cy will result in 3.3 million jobs over ness participation on multiple-award accurate and complete. the next 5 years, with the SBA and its contracts. Specifically, the amendment In addition, under current language programs predicted to support over 1 mandates the U.S. General Accounting in the bill, a contracting officer must million jobs over that same period Office, GAO, to report bi-annually to first consider ‘‘all reasonable issues re- through prime contracts and sub- the Committees on Small Business on garding the subcontractor’s perform- contracts. the number of actions and dollars ance, or lack of performance, before This bill is based on the deliberative, awarded to small business under mul- making a determination that the prime methodical, and systematic approach tiple-award contracts and help to contractor failed in its responsibility that this committee has taken to re- achieve the level of competition in to timely pay a small business subcon- view the spectrum of SBA programs, Federal contracting that Congress en- tractor.’’ Some of my colleagues, how- building on those that are working and visioned. In addition, the existing pro- ever, have raised concerns that this fixing those that are not. How can we visions in the bill require the GAO to language limits the contracting offi- do anything less for the economic en- conduct periodic reviews of small busi- cer’s discretion to issues regarding gine of our economy—small business— ness participation in multiple-award only the performance of the subcon- which holds the greatest hope for this contracts, which will help Congress to tractor, and that other issues that country’s recovery from the current ensure these provisions are imple- might legitimately cause non-pay- economic doldrums? mented appropriately. ment, such as disputes over off-sets, I urge my colleagues to support this Responding to additional concerns could not be considered. That was important legislation. raised by my colleagues, the managers’ never the intent of the bill reported by (At the request of Mr. DASCHLE, the amendment withdraws language that the committee. following statement was ordered to be references the authority of agencies to In light of these concerns, the man- printed in the RECORD.) withhold a portion of a performance-re- agers’ amendment modifies the lan- ∑ Mr. KERRY. Mr. President, today, as lated bonus awarded to procurement guage to ensure that a contracting offi- ranking democrat on the Committee on officials for failure to achieve small cer can consider ‘‘all reasonable issues Small Business and Entrepreneurship, I business goals. regarding the circumstances sur- join the committee’s chair, Senator The committee believes measures rounding the failure to make timely OLYMPIA SNOWE, in bringing to the that hold agency officials accountable payment to a small business subcon- floor for final Senate consideration, a for their performance will drive re- tractor’’ before making a determina- 3-year reauthorization bill for the sults. Therefore, language in the bill, tion to make a direct payment to the Small Business Administration’s pro- as reported, would have held agency subcontractor under a pilot program to grams. procurement officials accountable for test direct payments to small business These programs help small businesses small business goals. It directed agen- contractors. with access to capital, business advice cies to include in the annual perform- The committee also recognizes the and training and Federal procurement ance evaluation for agency procure- economic ramifications that military opportunities. But before I speak more ment officials a factor that measures base closures can have on our local specifically about the provisions of the the success of that official in small communities and economies. We be- bill, I would like to thank Chair SNOWE business utilization. lieve the SBA’s Historically Underuti- for working hand-in-hand with me on It further required agencies to factor lized Business Zone, HUBZone, pro- this, my third reauthorization of the the performance of procurement offi- gram can harness the strength and the Small Business Administration since cials in achieving these small business creativity of the small business sector becoming ranking member in 1997. Hav- goals into any monetary rewards under by providing these firms with incen- ing worked close on two previous reau- consideration. In order to avoid delay- tives to relocate to areas suffering thorizations, and as a member of the ing the entire bill for this provision, I from the effects of a military base clo- Small Business and Entrepreneurship have reluctantly agreed to withdraw sure. Therefore, we included language Committee for over 18 years, I can tell this latter provision. Nevertheless, my in the bill to designate base closure you that the SBA reauthorization proc- committee will continue to monitor areas as HUBZones, and the managers’ ess takes diligence and a strong atten- the extent to which agencies are meet- amendment clarifies that such designa- tion to detail. I want to commend Sen- ing their small business goals and look tion will apply to military bases closed ator SNOWE for taking the initiative to for every opportunity to hold failing after the date of enactment for a period draft legislation that makes such im- agencies accountable to our small busi- of 5 years in order to attract small portant and necessary changes to the ness constituency. businesses to areas affected by base SBA during this reauthorization proc- With respect to subcontracting op- closure where there are customers and ess and for showing great leadership in portunities, once a contract that con- a skilled workforce. The committee be- her first 9 months as chair of the Com- tains a small business subcontracting lieves that new business and new jobs mittee on Small Business and Entre- plan has been awarded by a Federal created through HUBZone small busi- preneurship. agency, the prime contractor is re- nesses means new life for areas affected Our bill will strengthen the SBA and quired to submit reports periodically by base closure. dramatically improve the agency’s to the Government that include infor- Lastly, our colleague from New Mex- ability to deliver services to small mation on the prime contractor’s ico, Senator BINGAMAN, has requested businesses in every State. It is based achievement of its subcontracting an adjustment to the Program for In- on a sound committee record. In addi- goals and the dollars awarded to small vestment in Microentrepreneurs, tion to holding two hearings and three business subcontractors. While the U.S. PRIME, which the bill reauthorizes for roundtables to specifically address the General Accounting Office indicates 3 years. To accommodate this request, SBA’s programs and related reauthor- that most contractors that the GAO re- the managers’ amendment authorizes ization issues, our committee met and viewed make good faith efforts to com- $2 million under the PRIME program spoke with numerous constituents, ply with their subcontracting plans, to be spent to provide grants to inter- program directors and small business small businesses report to my com- mediaries to assist disadvantaged Na- advocates. It is through this cor- mittee that not only do prime contrac- tive American entrepreneurs. This respondence, research and input that tors fail to comply with subcontracting modification enhances the bill’s provi- our committee has been able to prepare plans, but they also fail to submit com- sions that encourage Native American- a comprehensive piece of legislation plete and accurate subcontracting re- owned businesses and new Native that should serve the Small Business ports. Therefore, this managers’ American entrepreneurs. Administration and the entire small- amendment contains a technical cor- Mr. President, I will close by noting business community well past even the rection to clarify that the company that this is one of the most expansive next reauthorization period. president or the head of the entity SBA reauthorization bills in the 50- Over the past 3 years, as chairman must certify that data contained in year history of the agency. The SBA and ranking member of this com- subcontracting compliance evaluation estimates that reauthorizing the agen- mittee, I have seen this administration

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00057 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.048 S26PT1 S12084 CONGRESSIONAL RECORD — SENATE September 26, 2003 reduce Government funding and trans- or they can not get a loan at all. For well as that of the SBA itself, is not fer that money to the wealthy with tax the past few years as the economy has simply to maintain these programs but cut after tax cut, resulting in a signifi- fizzled, the Federal Reserve has re- to monitor the demand and adjust the cant loss of revenue for essential ini- ported that banks have cut back on programs accordingly to meet the tiatives aimed at fostering small busi- lending to small businesses, making it needs of small businesses. According to nesses and the job creation and eco- harder and more expensive to get SBA’s testimony before the committee nomic activity they bring about. While loans. And who has been there to pick on April 30, 2003, the agency estimates many of like to note that small busi- up the slack? The Small Business Ad- demand only by looking backwards— nesses are the engine of economic ministration and its lending partners. what has happened in the past year. growth and should be bolstered by our Lending is up 37 percent in the SBA’s However, there are other important Government, this administration has largest lending program for working factors to consider: changes in loan given small businesses more words capital. Lending is up 22 percent in the volume, trends in the economy, and than action. SBA’s loan program for small busi- initiatives and program changes that The need for small business pro- nesses that are growing and need will affect loan volume. For example, grams—for access to capital, for train- money to buy equipment and buildings. the agency often enters into memo- ing and counseling, for assistance in Lending is up in the SBA’s microloan randa of understanding with trade and gaining access to the Federal market- program, which serves those with the ethnic associations in order to help place—runs counter cyclically to the least access to capital through the pri- their members who own small busi- economy. When the economy is slump- vate sector. And the SBA’s venture nesses, and recently the SBA opened ing, as it now is, small businesses and capital programs play a significant its lending programs to all credit entrepreneurs need the SBA even more. role in this country’s investment in unions, which number 10,000. Both of Our committee has heard from the our fastest-growing small businesses, these changes are intended to raise small-business community that de- accounting for more than 50 percent of awareness of the SBA’s services, which mand for training and assistance and all U.S. venture investments. Last year ultimately will affect demand. In a access to capital is up, yet this admin- these loans and investments pumped press release from the SBA regarding credit unions, the agency stated that istration has proposed freezing funding about $20 billion into the economy, le- delivery of SBA loans through credit for virtually all SBA programs for 6 veraged millions more from the private unions, ‘‘Represents a possible increase years. Their proposal includes no ad- sector, fed the local tax base as the of nearly 30 percent in the overall num- justment for inflation or demand, de- Federal Government cut back, and cre- ber of institutions where entrepreneurs spite the SBA’s own numbers that show ated or retained more than 400,000 jobs. can seek capital for their businesses.’’ demand is up for its programs. The As the committee reviewed the SBA’s That possibility, if it becomes a re- SBA’s largest lending programs would programs for reauthorization, these ality, will almost certainly increase facts figured largely into establishing have run out of money this year had demand for 7(a) loans. Therefore, it the SBA not taken the drastic step of the program levels. I thank our chair, should be factored into the SBA’s esti- capping the size of loans. Both the Senator SNOWE, for working with me to mate of programs demand for fiscal problem of imminent shutdown and the set the levels for the SBA’s lending and year 2004 and beyond, and aligned in its SBA’s solution of a cap would have venture capital programs at increasing annual appropriations requests and leg- been bad for struggling small busi- levels for the next 3 years. I am par- islative proposals. nesses. But for additional funding of ticularly pleased with the increased Aside from setting the level for each more than $3 billion made available by funding levels for the microloan pro- small business financial assistance pro- Congress, the SBA’s solution would gram. gram, our SBA reauthorization makes have disrupted many small businesses’ I disagree with the administration’s important program changes and starts access to otherwise unattainable cap- proposals over the past few years to some important, new initiatives. In the ital. Again, the problem and its solu- cut back its investment in microloans SBA’s microloan program, we have tion could have been avoided had the and training assistance to micro-entre- adopted many of the provisions we administration properly funded this preneurs. And I disagree with the ad- passed last year as part of S. 174, which important program. ministration’s contention that these Senator SNOWE and I introduced and It is in carrying out our legislative borrowers are being served through the the committee and the full Senate and oversight responsibilities that 7(a) loan program. The small borrower voted to pass by unanimous consent. I Chair SNOWE and I raised a number of in the microloan program is different thank the Association for Enterprise concerns regarding the SBA’s reauthor- than the small borrower being served Opportunity, AEO, as well as the par- ization proposal and the overall man- through the 7(a) loan program. Both ticipants of the reauthorization round- agement and direction of many of the lending vehicles are important, but table on April 30, 2003—Mary Mathews agency’s programs through hearings they are different, and one is not a sub- of Minnesota’s Northeast Entrepreneur and roundtables and in letters and stitute for the other. Fund, Zach Gast of AEO in Wash- phone calls to the administration. And And who are these borrowers being ington, D.C., Alan Corbet of Missouri’s after hearing from the community and served through the microloan program? Go Connection, and Blake Brown of working with small business experts in Thirty percent are African American. Maine’s Coastal Enterprises—for rep- the field, Senator SNOWE and I came to Eleven percent are Hispanic. Thirty- resenting the microloan industry so the conclusion that many of the pro- seven percent are women. And any- convincingly and educating the com- posals put forth by the Small Business where from 30 to 40 percent go to small mittee on the inextricable correlation Administration would not help the businesses in rural areas. Banks turn between technical assistance, lending agency’s programs, but rather would these borrowers away, and yet the ad- and successful businesses that can ultimately hinder them. ministration proposed cutting the repay their loans. I thank them for il- This administration and small busi- microloan program by 36 percent in its lustrating so vividly how they serve nesses across this Nation will find, most recent budget—fiscal year 2004. borrowers that would not otherwise however, that our prescription for The SBA needs to fully fund these pro- have access to capital—because their small businesses in a flailing economy grams and put more resources into the loans are not profitable enough to ap- is quite different. Our reauthorization office that manages the program. Four peal to traditional lenders, and because legislation embraces the initiatives people are not enough to manage 1,400 the efficiencies of credit scoring work that have worked for years, redirects loans and 180 grants. against these small borrowers, even those that have struggled, and sets the Not only is the program level for those with repayment ability. The SBA and our small business sector up microloans troublesome, but also the SBA’s microloans represent their only for continued success. level for the agency’s largest small credit option to help them achieve eco- Although banks have plenty of cash business lending program, the 7(a) pro- nomic independence and become bank- to lend, many small businesses still gram. In the report that accompanies able in the future. have a problem getting access to cred- S. 1375, the committee notes that our Picking up where we left off last it. Either the terms are unreasonable, duty as members of this committee, as year, and even the year before when we

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00058 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.059 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12085 made important changes to the loans to small businesses for working peace with the rising cost of commer- microloan program, S. 1375 will make capital with long terms of up to 25 cial real estate and equipment. We it possible for lenders to offer small years, we made permanent the reduc- have raised the job requirement stand- business ‘‘short-term’’ loans. This will tion in the fees borrowers and lenders ard up from $35,000 to $50,000. This is benefit small businesses, the lenders pay. We are testing a proposal that al- reasonable given the increase in the and the SBA because it will eliminate lows the most proficient 7(a) lenders in Consumer Price Index since the last repeated paperwork and administrative good standing to lend in every State. time the job requirement was changed oversight from those small businesses, Lenders have complained that applying in 1990. We have directed the SBA to such as carpenters, who need revolving for lending autonomy in each of the 70 simplify the application and docu- loans to finance the jobs as they come district offices and branches is admin- mentation process of applying for and in, rather than taking multiple little istratively burdensome, both for them closing 504 loans, long a goal of this fixed-term loans. Rather than tying and for the agency staff, and that some Committee and made a priority based eligibility to the expertise of the enti- district offices have taken advantage on the compelling testimony of some of ty, we have made it possible for new of the power to approve or disapprove our witnesses during the reauthoriza- entities to qualify as the SBA micro- lenders when they apply for this spe- tion process. We have also created two lending intermediaries if they have cial lending status. alternatives for 504 lenders to use when staff with this unique lending and tech- Let me be clear—while I want to establishing a loan loss reserve to nical assistance expertise. We have avoid unnecessary paperwork and cover potential losses. made a conforming change regarding eliminate reported abuses, I do not I am particularly pleased that we the average smaller size of microloans, want the lenders to take this as a sig- have included S. 822, the Child Care increasing it from $7,500 to $10,000, to nal to quit working with the district Lending Pilot Act in the reauthoriza- make it consistent with similar directors and district staff. It is impor- tion bill. It allows small, non-profit changes enacted in December 2000. tant to have a local connection and for childcare businesses access to 504 Unlike the provisions we considered the SBA and the lenders to work to- loans. I thank Senator SNOWE and my in 2000 and again last year with S. 174, gether to maximize service to the colleagues for agreeing to try this for 3 years, similar to what we have done this bill does not go as far to eliminate small businesses. We need to maximize with the microloan program. And I the restrictions on lenders contracting resources to reach not only as many thank the trade association of 504 lend- out the technical assistance or assist- small businesses as possible, but also ers, the National Association of Cer- ance before a loan is made. Instead, we those populations that most need ac- tified Development Companies, and raise from 25 percent to 30 percent the cess to affordable capital. It would be other 504 lenders for their endorsement amount of TA funds an intermediary unreasonable to continue holding dis- of, and input on, the pilot. can contract with an outside expert trict directors accountable for lending The more research I have done, the and the amount of grants a lender can goals in their areas without building in more I have come to realize how vi- use to counsel prospective borrowers. a mechanism to encourage interaction. tally important it is that we give non- The latter change does not go as far as There are concerns that allowing lend- profit day care providers the same op- I would like, but represents a com- ers to make loans on a nationwide portunities as for-profits to expand promise. Although there is a percep- basis and bypass the local SBA staff to their businesses. Non-profit day care tion that pre-loan assistance means work only with SBA staff in Wash- centers are often the only childcare that TA money is used on microentre- ington, DC, could undermine the local suppliers available in needy areas, preneurs who never get loans, in actu- infrastructure and the SBA’s ability to from the most urban to be most rural. ality the small-business owner in many meet the individual needs of local I have taken note of states like Oregon, cases needs help getting the loan more small businesses. For this purpose I where 79 percent of day care providers than assistance running the business have included a provision that directs are non-profit, Michigan, where that after he or she gets the loan. Also, un- the SBA to consider the recommenda- number jumps to 86 percent, Iowa with like the last two microloan bills, in- tions and comments of any district di- 77 percent, my own State of Massachu- stead of including a provision author- rectors and regional administrators setts with 90 percent, Ohio with 62 per- izing the SBA to fund peer-to-peer when reviewing a lender for national cent, and the list goes on and on. I’ve mentoring among microloan lenders lending authority. learned that in State after State fami- and TA providers, the microlenders To increase the value of 7(a) loans lies are waiting for affordable day care; asked the committee to increase the sold in the secondary market, the com- from more than 1,000 families on the oversight of an existing statutory pro- mittee has included a provision to waiting list in both Nevada and Maine vision that requires the SBA to con- allow the SBA to pool and sell the to more than 30,000 on the list in Texas. tract out 7 percent of its loan dollars guaranteed portion of loans with varied These parents are waiting for quality for training of intermediaries. rates. Currently, the SBA has the au- day care they can afford, and making Now the SBA will have to report an- thority to only sell those loans with available affordable loans to all li- nually on this specific provision to identical rates. Proponents argue that censed child care providers may in- highlight what they have done to com- this will create efficiencies in the mar- crease access to care and cut down ply with the law. Last, S. 1375 requires ket and strengthen the program by those waiting lists. the SBA to develop an improved sub- bringing it into line with what the pri- I understand there is concern about sidy rate model to determine the cost vate sector has been doing for years. the precedent of the SBA lending to of microloans because the one they At Senator SNOWE’s request, in order non-profits. Right now it is done in have used since the program’s incep- to reach more under-served small busi- only limited circumstances— tion does not reflect the performance nesses, we have enhanced the Low-Doc microloans, physical disaster loans and of the program. For example, last year, program, allowing lenders to use the economic injury disaster loans in the in Fiscal Year 2003, the administra- simplified application from for loans areas affected by the terrorist attacks tion’s budget doubled the subsidy rate, up to $250,000 from $100,000, making it of 9/11. And I agree it should not be ex- which is the Government’s cost of the the same as the SBA Express program. panded to all industries. However, this program, from 6.78 percent to 13.05 per- We have also expanded the incentives is a very unique industry whose criti- cent, even though the program had not for lenders to provide financing to ex- cally important services in many experienced any loss of Federal funds port small businesses, and proposed let- States are delivered mostly through since the first loan was made in 1992. ting 7(a) borrowers use a simplified size non-profits, and the only way to in- This broken method of calculating the standard when determining if an appli- crease facilities to provide the child cost of these loans is a waste of tax- cant is a small business. care is to reach both for-profit and payer money because Congress has to To improve the 504 loan program, non-profit child care providers. Fur- appropriate unnecessary funds to run which makes long-term loans of up to ther, non-profits are usually the pro- the program. 20 years to small, growing businesses viders that care for the neediest kids. I In the 7(a) loan program, the SBA’s to buy equipment and buildings, we have added provisions to the pilot pro- largest loan program, which provides have raised the debenture size to keep gram to ensure that the underwriting

VerDate jul 14 2003 02:14 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00059 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.061 S26PT1 S12086 CONGRESSIONAL RECORD — SENATE September 26, 2003 standards are just as tough, if not more and agriculture. However, farmers and centives with financial soundness so, as those applied to for-profit cen- ranchers are not the only small busi- issues and allowed small businesses to ters. The loans must be personally ness owners whose livelihoods are at receive more SBIC financing than cur- guaranteed, the collateral must be risk when drought hits their commu- rently permissible if they also have a owned outright by the child care pro- nities. The impact can be just as dev- 504 or 7(a) loan. We have improved the vider, and it must be able to make its astating to the owners of rafting busi- arrangement for distributing payments loan payments and cover normal oper- nesses, marinas, and bait and tackle from successful SBICs so that the SBA ating expenses from the revenue gen- shops. Sadly, at present these small and the investors are treated more fair- erated from its clients. With these pro- businesses cannot get help through the ly and the taxpayer has more protec- tections, the loans to non-profits SBA’s disaster loan program because of tion for realizing repayment on the in- should perform just as well as those something taxpayers hate about gov- vestments. We have put in place con- made to for-profits, and if there is a ernment—bureaucracy. forming amendments to make the New problem, the loans should be The SBA denies these businesses ac- Markets Venture Capital program collateralized sufficiently to cover the cess to disaster loans because its law- work with the New Markets Tax Cred- losses. yers say drought is not a sudden event it, as Congress intended. And we have The bill defines a small, non-profit and therefore it is not a disaster by clarified that New Markets Venture child care businesses as an entity orga- definition. Despite numerous requests, Capital companies have 2 years to raise nized as a 501(c)(3), but not just any or- written and verbal, for a copy of this their matching capital, as Congress in- ganization. It must be a licensed child legal opinion, the SBA delayed compli- tended. The committee has been trou- care provider; it must meet the size ance for 6 months. The delay jeopard- bled by the agency’s interpretation of standard for a small business; and it ized enactment of emergency legisla- the NMVC statute, which SBA viewed must provide care to infants, toddlers tion during the 107th Congress, leaving as permitting the agency to choose and pre-kindergarten and care to older small business drought victims without how much time it could give condi- children after school. This makes as- assistance. Contrary to the agency’s tionally approved NMVCs to raise the sistance available to eligible entities position that drought is not a disaster, private-sector matching money. The that offer Head Start services. At Sen- as of July 16, 2002, the day this legisla- SBA’s chosen time frames were unrea- ator SNOWE’s request, the pilot is lim- tion was introduced last year, the SBA sonable and not what Congress in- ited to seven percent of the number of had drought disaster declarations in ef- tended. loans guaranteed by the 504 program fect in 36 States. That number had I very much regret that the man- overall, which is less than the 10 per- grown to 48 by the beginning of this agers’ amendment that we are consid- cent allowed for pilots under SBA’s 7(a) year, demonstrating that the problem ering today does not include a change guaranteed business loan program. I had gotten worse and even more small to the New Markets Venture Capital feel that the agreed upon cap should businesses were in need. Program which would better align al- allow for sufficient lending under the As I have said time and again, the lowable investments with repayment pilot to adequately test whether lend- SBA already has the authority to help obligations. Right now the repayment ing to non-profit childcare providers is all small businesses hurt by drought in and profit participation schedules are effective in increasing access to afford- declared disaster areas, but the agency out of sync. Experts argue that this sit- able childcare, and whether it protects will not do it. For years the agency has uation could force NMVCs to liquidate the general 504 program, which is vital been applying the law unfairly, helping promising small businesses in order to to the financing of small businesses in some and not others, and it is out of raise repayment money. It would be this country. compliance with the law. The Small unfortunate if this were to occur, par- Before I move on to discuss another Business Drought Relief Act of 2003 ticularly for the employees of small important provision in the bill, I want would force the SBA to comply with businesses in these high-unemployment to thank all the members of the Advi- existing law, restoring fairness to an areas who will be hard-pressed in this sory Committee on Child Care and unfair system, and would get help to economy to find another job with sus- Small Business in Massachusetts who small business drought victims that tainable wages and benefits. I do not not only identified the need for this need it. I thank former Governor Jim have an SBA NMVC in my State, but policy change but also developed many Hodges of South Carolina, and his there are about 20 States with NMVCs innovative ideas to coordinate Federal staffer Lane Hudson, for bringing this which would have benefited from this and State business services and child to the committee’s attention. They proposed change—Maine, New Hamp- welfare services to expand the avail- served the needy small businesses of shire, Vermont, Kentucky, Maryland, ability of quality, affordable child care their State extremely well, and I am West Virginia, Ohio, Delaware, New and strengthen the businesses of child sorry that politics kept this common Jersey, Pennsylvania, Arizona, and care of child care providers. sense and much needed provision from Washington, DC. I am sorry that we The bill also includes a comprehen- being enacted. I thank the other 15 could not reach a compromise and I sive study by the GAO to track and Governors who fought for their con- hope for the sake of existing NMVCs monitor the impact of this program stituents, too. And I thank Senator and the small businesses they assist both on child care industry and the 504 BOND for working with me on this when that the experts are not right. program. Last, I want to remind my he was the ranking member of the I thank the many experts who have colleagues that the 504 program is Committee on Small Business & Entre- advised this committee over the years funded entirely through fees and does preneurship, and Senator SNOWE and on developing and implementing the not require appropriations. Further, her staff for all their help and support. new markets venture capital program. when the Congressional Budget Office While we might have had a lot of rain My colleagues on the committee and I reviewed the reauthorization act and recently in the northeast, there are are grateful for their help. It is a great estimated its cost and the impact the areas like Lake Mead in Arizona and service to the taxpayers and businesses provisions would have on the programs, Nevada where it is so dry that the and the communities that will benefit CBO assessed no cost increase to the water level is down and small busi- from this innovative investment. In no 504 program, its subsidy rate, or the nesses are losing business and having particular order, I thank Dr. Julia agency by enacting the child care lend- to make expensive changes, such as ex- Rubin who helped us when she was at ing pilot provision. tending docks to reach the water in Harvard, at Brown and now at Rutgers Also included in this bill is S. 318, the order to stay in business. University. I thank Saunders Miller, Small Business Drought Relief Act. In this bill are also provisions to now himself a small business owner of This simply reinforces in legislation strengthen the SBA’s venture capital Peaq Funds in Manhattan, who was a something that the SBA should already programs—the Small Business Invest- principal developer of this program and be doing. You see, the SBA doesn’t ment Company Debenture and Partici- may other venture capital initiatives treat all drought victims the same. The pating Securities programs, and the for the many years he worked at the agency only helps those small busi- New Markets Venture Capital Pro- SBA. I thank Don Christensen, the nesses whose income is tied to farming gram. We have balanced investment in- former head of the SBA’s investment

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00060 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.063 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12087 division, where he served this nation tenure as a member, chair, and lead has 15 members. The chair is appointed and president Clinton extremely well. Democrat of the Senate Committee on by the President and must be a promi- And to the many developmental ven- Small Business and Entrepreneurship, I nent business woman. Six members are ture capitalists who routinely impart have worked to increase and improve representatives of women’s business or- their expertise and wisdom to this the opportunities for enterprising en- ganizations, including representatives committee, such as Elyse Cherry of the trepreneurial women in a variety of of women’s business center sites, and Boston Community Venture Fund and ways, leading to greater earning power, the remaining eight are members ap- Ray Moncrief of Kentucky Highlands. financial independence and asset accu- pointed by the SBA administrator Responding to findings by the Gen- mulation—and I am glad that Senator based upon recommendations of the eral Accounting Office and the SBA’s SNOWE is joining me in this endeavor. chair and ranking members of the Sen- Office of Inspector General, this legis- As Chair SNOWE expressed when she ate Small Business and Entrepreneur- lation includes many measures to introduced the Women’s Small Busi- ship Committee and the House Small strengthen the SBA’s oversight of lend- ness Programs Improvement Act—and Business Committee. Of these eight ers. And we have reauthorized and when Senator SNOWE and I passed the ‘‘party-affiliated’’ members, four come clarified the law for surety bond guar- Women’s Business Center’s Preserva- from the same political party as the antees to help small businesses get tion Act—protecting the extremely ef- President and four members who are Government contracts. fective and well-established Women’s not from the President’s party; all of While no one would deny the impor- Business Center network was a high them must be small business owners. tance that access to capital plays in priority in this reauthorization. For The bipartisan balance in the NWBC’s the success of small businesses, as SBA that reason, we make permanent the membership helps to ensure that any Administrator Hector Barreto and past Women’s Business Center Sustain- policy recommendations will reflect SBA administrators have acknowl- ability Pilot Program by creating 3- the needs of women in business and not edged time and again, debt is not al- year ‘‘renewal’’ grants for those cen- the political agenda of one political ways the answer. In the SBA’s FY 2004 ters with sustainability grants and 4- party over another. budget request, there is reference to in- year ‘‘initial’’ grants for new centers; Vacancies on the NWBC are supposed formation from the Ewing Marion increase the program’s authorization to be filled no later than 30 days after Kauffman Foundation and Dun & Brad- levels; and direct the Office of Women’s the position becomes open; however, in street that indicates ‘‘80 percent of new Business Ownership, OWBO, to make the past 2 years, the SBA has failed to businesses discontinue operation with- all Women’s Business Center grants at meet this 30-day statutory deadline. The NWBC Chair was vacant from May in 5 years because of lack of ‘knowl- $150K and to consult with the associa- 29, 2001, to May 21, 2002, a period of 11 edge’ of key business skills.’’ Despite tions of Women’s Business Centers months and 22 days. Of the party-affili- the recognized importance of such as- when making improvements to the pro- ated slots reserved for the President’s sistance, the SBA’s funding request for gram. Other changes to the Women’s party, one was vacant for 3 months, Business Center Program include fiscal year 2004 and its legislative pro- two were vacant for a period of 7 posal to implement that request would streamlining the data collection and months; and one was vacant for 21 freeze funding levels for virtually all the grant application and selection cri- months. Two of the seats reserved for agency programs, without even ac- teria, protecting the privacy of Wom- members who are not from the Presi- counting for inflation, for a 6-year pe- en’s Business Center, WBC, clients, and dent’s party were vacant for nearly 2 riod. If enacted, that would severely providing for a smooth transition from years, one seat was vacant for 7 hamstring this nation’s small busi- sustainability to the newly established months, and the fourth seat remains nesses and their ability to effectively WBC program. vacant. At one point during the past 2 compete and prosper in the national Our legislation will not only secure years the NWBC had a severe partisan economy. For this reason, Senator the future of the Women’s Business imbalance. There were three Repub- SNOWE and I took a comprehensive ap- Center Program, but it will connect all lican members on the NWBC and no proach to supporting and improving SBA-related women’s initiatives with a Democratic members. The committee the SBA’s entrepreneurial development unified mission, similar guidance and is concerned that these vacancies un- programs, while rejecting proposals put training. These changes were coupled dermine the effectiveness of the NWBC, forth that would undermine their suc- with minor, yet significant, changes to and that the lack of bipartisan balance cess. the National Women’s Business Coun- will subject any policy positions taken Cuts to or inadequate funding of the cil, NWBC, and the Interagency Com- by the NWBC to criticism as being mo- SBA’s entrepreneurial development mittee on Women’s Business Enter- tivated by partisan interests. programs are often attributed to vague prise. Senator SNOWE and I included Senator LANDRIEU’s amendment, and unfounded claims of duplication. provisions to give the NWBC cospon- which was approved unanimously by Such claims mistake a common mis- sorship authority, to allow more flexi- the committee, requires that vacancies sion of training and counseling for du- bility in the way the council uses in the party-affiliated slots will be plication, ignoring the reality that funds, and to direct the council to filled to maintain a bipartisan balance small businesses vary greatly, are serve as a clearinghouse for historical on the NWBC. The provision also en- often at very different stages of devel- data. Each of these things will enable sures accountability by requiring the opment, and have many different the council to become a better resource administration to report to Congress needs. Just as it would be ineffective to for the administration, Congress and on vacancies that remain unfilled for only have one type of loan or venture the entire small-business community. more than 30 days. The committee ex- capital financing structure for the 25 Since its inception, the NWBC has pro- pects the report to cite the reasons for million small businesses in this coun- vided Congress, the Small Business Ad- the vacancies, what is causing any try, it would be futile to water down ministration, and the Interagency delays in filling the positions, whether specialized management and training Committee on Women’s Business En- nominees were available for consider- programs to impose a one-size-fits-all terprise with independent advice and ation, at what stage in the vetting approach. policy recommendations on issues fac- process nominees are, whether there I want to commend Chair SNOWE for ing women in business. are any objections to the nominees and giving women entrepreneurs such a In recognition of the council’s impor- what those objections are, an estimate prominent place in the reauthorization tance to policy making and women in for when the vacancies will be filled, process. Rarely do women entre- business, Senator LANDRIEU offered and and any other relevant information re- preneurs get the recognition and atten- the committee adopted an amendment lating to the vacancies. tion they deserve for their contribu- identical to her National Women’s To bolster the representation of tions to our economy: Eighteen million Business Council Independence Preser- women business owners in the Federal Americans would be without jobs today vation Act of 2003, which seeks to Government, our bill re-establishes the if it were not for these entrepreneurs maintain the bipartisan balance on the Interagency Committee on Women’s who had the courage and the vision to NWBC. The structure of the NWBC Business Enterprise, directs the Dep- strike out on their own. During my helps to maintain its independence. It uty Administrator of the SBA to serve

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00061 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.066 S26PT1 S12088 CONGRESSIONAL RECORD — SENATE September 26, 2003 as acting chairperson of the Inter- worth of professional business advice. dress the needs of the Native American agency Committee until a chairperson It is safe to say that in this down econ- entrepreneurial community. The provi- is appointed, establishes a Policy Advi- omy, SCORE is one investment that sion follows the existing Small Busi- sory Group to assist the Committee’s will be paying dividends for years to ness Administration’s approach and chairperson in developing policies and come. terminology for implementing the programs under this act and creates I thank Senator SNOWE for working PRIME Act to enhance the possibility three subcommittees similar to those with me to include, as introduced, the of economic development through en- created under the National Women’s Native American Small Business De- trepreneurship in Native American Business Council. velopment Act, which I reintroduced communities. The Bingaman provision This bill also supports and protects earlier this year together with Senator will strengthen the three-pronged ap- the Small Business Development Cen- JOHNSON and Senator SMITH to address proach the Senator JOHNSON and I de- ter network, which has served millions the SBA’s growing lack of commitment signed in the Native American Small of small-business owners since its in- to the Native American community. Business Development Act to find a so- ception more than 20 years ago. It According to a report released by the lution to the longterm economic handi- should also be noted that in 2001, U.S. Census Bureau, the ‘‘three year cap existing in Native American com- SBDCs helped small businesses create average poverty rate for American In- munities nationwide. There are a num- or retain over 80,000 jobs, generate $3.9 dians and Alaska Natives from 1998– ber of microenterprise organizations in billion in sales and obtain $2.7 billion 2000 was 25.9 percent; higher than for states across the country that are will- in financing. For every dollar spent on any other race groups.’’ With an unem- ing and prepared to take on the addi- an SBDC, $2.09 in tax revenue was re- ployment rate well above the national tional challenge of assisting disadvan- turned to the Federal Government. average and household income at just taged Native American entrepreneurs, Numbers aside, the nationwide net- three-quarters of the national average, and there are a number of Native work of SBDCs provides important Native American communities need a American communities that are eager counseling services to small-business commitment from the Federal Govern- to take a different path to economic owners that are unable to afford pri- ment that we will help them, particu- development. However, there are cur- vate consulting, many of whom are larly during these difficult economic rently a limited amount of funds to women and minority clients. The SBDC times. To reaffirm this commitment, allow that to happen. I commend Sen- program has grown to serve 1.25 mil- the Johnson-Kerry-Smith bill provides ator BINGAMAN for his attention to this lion small-business owners and entre- Native Americans the resources they matter, for his continued support of preneurs each year, and there are near- need to take advantage of the opportu- my small business legislation, and for ly 1,000 centers serving every State in nities of entrepreneurship. his foresight and vision for Native the Nation. The Native American Small Business Americans in New Mexico and across While this bill rejects the potentially Development Act, as included in our the country. The Native American detrimental changes proposed by the reauthorization bill, will ensure that communities across our nation will be SBA to the SBDC network, it does ad- the SBA’s programs to assist Native better off with the assistance that this dress concerns expressed by the centers American communities cannot be dis- provision makes possible. Were it not and small businesses. Our bill increases solved by making the SBA’s Office of for the persistence of Senator BINGA- authorization levels to keep up with in- Native American Affairs, ONAA, and MAN, this provision would not be part creased demand and a provision to pro- its assistant administrator permanent. of SBA’s tools to help Native American tect the privacy of the program’s cli- Our legislation would also create a entrepreneurs. I also want to thank ents and a provision to help the SBDCs statutory grant program, known as the Senator SNOWE for working with Sen- that have been adversely affected by Native American Development grant ator BINGAMAN and me to include this poor economic conditions or govern- program, to assist Native Americans. provision in the managers’ amendment. ment downsizing. Also included is a It would also establish two pilot pro- To address the growing business de- portability provision proposed by Sen- grams to try new means of assisting velopment needs of veterans, Senator ator SNOWE to provide supplemental as- Native American communities and re- SNOWE and I reauthorized the Advisory sistance to State SBDC networks that quire Native American communities to Committee on Veterans Affairs, ex- have been adversely affected by a mili- be consulted regarding the future of panded veterans outreach grants from tary base or industrial site closure the SBA programs designed to assist solely serving disabled veterans, to which has lead to a loss of jobs and se- them. In short, this legislation will en- serving all veterans, reservists and vere economic harm. If implemented sure that our Native American commu- service-disabled veterans. Further, we correctly, portability has the potential nities receive the adequate assistance increase the funding for the Office of to help States, reeling in the aftermath they need to help start and grow small Veterans Business Development to en- of a sudden economic change, to pro- businesses. able that office to better deal with the vide the necessary small business as- Senator BINGAMAN and I have worked demand by veterans for outreach and sistance to quell the economic injury closely to develop a provision for inclu- development services. to a particular area. sion in a joint managers’ amendment Included in a joint Snowe-Kerry Also, included in the entrepreneurial to the reported bill, which will expand amendment, which was unanimously development section of our bill is a the Program for Investment in Micro- approved at the Committee markup, is provision to increase to $7 million an- entrepreneurs, PRIME, with a separate a reauthorization of PRIME at $15 mil- nually the authorization level for the $2 million authorization to provide di- lion. SBA Administrator Hector Service Corps of Retired Executives, rect, in-depth technical assistance and Barreto has stated, ‘‘The PRIME pro- SCORE, which has 10,500 volunteers, counseling to disadvantaged Native gram was created to help the smallest and technical change to allow SCORE American small business owners. The of small businesses. These are entre- to keep its modest staff of 14 employ- provision will complement the Native preneurs at the most basic stage of ees. For more than 38 years, SCORE American Business Centers created in starting a business and who typically has been one of the SBA’s greatest and the Native American Small Business require the greatest amount of com- most efficient successes. In 2002, Development Act by following the mitted service and guidance. In order SCORE volunteers held over 300,000 PRIME model, which provides tech- to succeed, they require training and counseling sessions and put in nearly nical assistance through microenter- technical assistance that must be ac- 1.4 million volunteer hours. To keep up prise entities that have extensive expe- cessible.’’ with an our nonstop national economy, rience helping the least experienced en- PRIME is a powerful investment that SCORE has dramatically advanced the trepreneurs in low-income commu- provides critical assistance to strug- outreach of its online services to reach nities. The rationale for amending the gling, distressed communities. It’s en- clients 24 hours a day, seven days a PRIME Act, rather than creating a sep- gineered to help low-income and very week. Last year, for $5 million, SCORE arate program, is that PRIME is cur- low-income families, defined as those volunteers provided small business rently operational and simply needs at 150 percent of the poverty line or owners an estimated $170.8 million additional funding so it can better ad- below. A very low-income family of

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00062 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.068 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12089 four earns about $23,000 a year. The This language is a prime example of The bill would also create a reporting International Labor Organizations esti- the effectiveness of bipartisanship, dili- requirement for the BusinessLINC pro- mates that the return on investment in gence and compromise. This approach gram, which has been showing promise microenterprise development through incorporates language from an amend- in creating real teaming opportunities resources like PRIME ranges from $2.06 ment to the Department of Defense re- for small businesses in the private sec- to $2.72 for every dollar invested. authorization offered by Senator COL- tor. Although the administration rec- Microenterprise contributes to our na- LINS and Senator TALENT, language ommended elimination of the program, tional economy through public tax rev- from my contract bundling bill, S. 633 the reports this committee received re- enues, private income increases, and and the President’s initiative on con- garding the overwhelming success of reduced dependence on public assist- tract bundling. the existing nine programs made it ance, such as welfare. Small Business The first provision creates a two- clear that the SBA did not have suffi- Development Centers define a ‘‘client’’ tiered threshold in order to prevent un- cient information about BusinessLINC as someone who has received two hours necessary contract consolidation. Ci- to make an informed decision on its ef- of training. On average, however, vilian agencies will be required to meet fectiveness. The committee’s bill would PRIME organizations spend 10 hours specific standards if they attempt to ensure that the SBA offers the proper with low-income and very low-income consolidate contracts above $2 million level of oversight and would foster the entrepreneurs. and $5 million. The Department of De- continued success of the program. I fense is required to meet similar re- Many often confuse PRIME assist- would like to thank Senator SNOWE for quirements for contracts above $5 mil- ance with the microloan technical as- working with me to find a compromise lion and $7 million. The bill also fur- sistance. Unlike the microloan pro- to preserve this successful program. gram’s technical assistance, which is ther expands the definition of contract bundling to include contract consolida- At the Committee’s roundtable on directly tied to helping microentre- non-credit programs and the hearing preneurs obtain access to capital tion, closing a loophole in the defini- tion that has been widely used and det- on contract bundling, the small busi- through microlenders, the PRIME pro- ness community reiterated the need for gram is designed to help microentre- rimentally affecting small businesses. The second provision increases in the accountability for small business con- preneurs who may not be credit-worthy number of procurement center rep- tracting at the agency level. I applaud or don’t need or want loans, but do resentatives, PCRs. These representa- Senator SNOWE on her efforts to ensure need intensive technical assistance. tives advocate on behalf of small busi- that Federal agencies be held account- Currently, there are fewer than 80 or- nesses in cases directly affecting con- able for fully utilizing small businesses ganizations with PRIME grants, yet tracting, such as the bundling or con- and to allow a greater amount of Con- the need for PRIME assistance is now solidation of contracts. Unfortunately, gressional oversight of the implemen- greater than ever. While access to cred- the number of PCRs has been reduced tation of agency procurement strate- it is vital for many microentre- from over 200 at its peak in the late gies. Provisions within this bill will en- preneurs, for low-income individuals, 1980s to the current level of just 47. In sure that the heads of Federal agencies there is a severe gap between being addition to reducing the number of tra- identify a specific portion of their credit-worthy and receiving the tech- ditional PCRs, the administration has budget request that will be awarded to nical assistance needed to be successful also eliminated the Breakout PCRs, small businesses in their strategic plan in business. The PRIME program ad- specially trained advocates that ana- and their annual budget submission to dresses this gap. for these reason, Sen- lyze highly technical large contracts Congress. The bill also gives senior pro- ator SNOWE and I reauthorized the pro- and ‘‘unbundle’’ contracts and break curement executives and senior pro- gram for three years. Our bill also out portions that are appropriate for gram managers additional authority to moves PRIME’s statutory language to small businesses. Their responsibilities educate their staff regarding the im- the Small Business Act and includes a have been rolled into that of tradi- portance of meeting the government- data collection provision. tional PCRs, even though the number wide goals for small business utiliza- We continue to receive reports of the of PCRs continued to decline. Often, tion and allows for greater account- detrimental effects of the Administra- the role of commercial marketing rep- ability in annual performance evalua- tion’s policy of reduced staffing and re- resentatives, CMRs, was also incor- tions. I would like to thank the mem- sources for essential programs aimed porated into the responsibilities of tra- bers of the Senate committee on Gov- at allowing small businesses to thrive. ditional PCRs. CMRs are responsible ernment Affairs for working with Sen- Week after week, the Federal Times re- for identifying opportunities and devel- ator SNOWE and me on these provisions ports on the decline in contracts being oping marketing strategies for small to ensure that agency officials have the allocated to small businesses, small businesses to appeal to large prime authority, as well as the flexibility, to businesses losing ground in the Federal contractors. The SBA’s attempt to efficiently and effectively meet the marketplace, and most recently, on the streamline their offices and replace goals we have placed before them. awarding of more big contracts with trained individuals with electronic sys- In addition to increasing opportuni- less oversight from Federal agencies. tems has resulted in the disenfran- ties for prime contracts, this bill ad- With agencies awarding larger, more chisement of small businesses and hin- dresses another serious problem: Small complex and more costly contracts dered the SBA’s ability to maintain a businesses have been severely ham- with fewer staff performing oversight, proper level of oversight over Federal pered by dishonest practices by some this nation’s small businesses and its contracting. tax payers are the ones shouldering the In the bill, we have increased the businesses that have prime contracts burden when small business goals con- number of procurement center rep- with the Federal Government and have tinue to be unmet. In addition to help- resentatives to ensure that every State received preference over other prime ing small businesses obtain access to and every major procurement center is contractors due to their superior small procurement opportunities, these goals allocated a PCR. Meanwhile, we have business subcontracting plans. Senator are meant to help the government ben- also ensured that these PCRs are not SNOWE and I have worked closely to ad- efit from the cost-savings and innova- burdened with responsibilities that dress the concerns of small businesses tions small business contractors can were previously the duties of breakout regarding delays in payment, false re- often provide. PCRs and commercial marketing rep- porting and the use of ‘‘bait and Significant improvements to the on- resentatives. These two improvements switch’’ tactics by prime contractors. going problem of contact bundling, also will dramatically increase the efficacy The bill holds prime contractors re- called contract consolidation, are in- and efficiency of all three positions and sponsible for the validity of subcon- cluded in this bill. One provision in- allow proper review of the approxi- tracting data, requiring the CEO to cluded in this legislation that will mately 40 percent of Federal contracts, certify to the accuracy of the subcon- make a significant impact on small nearly, $90 billion, that are currently tracting report under penalty of law. It businesses’ ability to compete is the not being reviewed by PCRs. This also expands the penalties for fal- method we have adopted to address the should increase small business’s access sifying data included in subcontracting ongoing problem of contract bundling. to Federal contract opportunities. reports to match the $500,000 or 10

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00063 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.070 S26PT1 S12090 CONGRESSIONAL RECORD — SENATE September 26, 2003 years in prison for businesses that fal- ties, through Federal contracting op- Business Zone Contracting Program, or sify their status as a small and dis- portunities, and employing the workers as it is commonly referred to, the advantaged business. If one inten- in that area. Additional options for as- HUBZone program. This small-business tionally falsifies data as a part of a sistance for these areas are available program was one of my personal prior- subcontracting report to a Federal through the SBA if these areas do not ities as former chairman of the Senate agency, he is defrauding the United receive continued economic stability Small Business Committee. It was es- States government and will be pun- following the expiration of the 5-year tablished in 1997 with the intent to cre- ished to the full extent of the law. HUBZone status. ate jobs in severely economically dis- During the committee’s reauthoriza- I want to thank Chair SNOWE and her tressed communities, both rural and tion roundtables, we heard numerous able staff for all of their cooperation urban. In addition, the HUBZone pro- accounts of subcontractors receiving over the past several months. I would gram provides a Federal contracting late payments or partial payments like to thank the members of the Sen- preference as an incentive for small from their prime contractors. Small ate Committees on Armed Services and businesses to locate in these low-in- firms do not have the luxury of waiting Government Reform for working close- come areas. The jobs created by the for their payments when they have in- ly with me and my staff to ensure that HUBZone program bring money to vested time and money to provide their this bill meets the needs of the Federal those blighted areas and create a de- products and services to the prime con- Government’s diverse procurement of- mand for more goods and services, tractor. To address this concern, the fices as they work to ensure that the which leads to the creation of more bill directs the SBA to create a three- government receives the essential small businesses and increased com- year pilot program, which tests the goods and services it requires. I also merce in the area. Little by little, the feasibility of direct payment to sub- want to express my gratitude to all the community’s economic base is reborn. contractors from the Federal agencies members of the committee for their Today, there are over 8,378 small that are receiving the contracts and or diligent efforts to improve this legisla- businesses that are HUBZone certified, services. tion and urge them and my other Sen- and the Government has procured ap- In 2000, Congress passed legislation to ate colleagues to support the Small proximately $1.7 billion in HUBZone implement a limited competition, set- Business Administration 50th Anniver- contracting this year. The SBA reports aside program for women-owned busi- sary Reauthorization Act of 2003.∑ that in FY 2001, each dollar spent on nesses, intended to assist agencies to Mr. BOND. Mr. President, I rise the program yielded a return of $288 in increase contracting to these firms and today in recognition of S. 1375, the contract awards and as a result, the help to meet the five percent govern- Small Business Administration 50th program helped to create 12,782 jobs in ment-wide goal. The original bill Anniversary Reauthorization Act of the United States, approximately 8,974 amended the Small Business Act in 2003. This bill revitalizes existing SBA of which were located in distressed section 8(m)(4) to require the SBA Ad- programs and brings to life new pilot areas. ministrator to complete a study to programs, all of which promote the de- Based on FY 2001 procurement statis- identify industries in which women- mands and growth of the small busi- tics, HUBZone firms increased employ- owned businesses are under-represented ness community. I commend the chair, ment 33 percent to 50 percent as a re- and report to Congress. The original Senator SNOWE, for passing this bill sult of contract awards. Nearly 50 per- study has been completed, but has been through the Small Business Committee cent of HUBZone firms increased cap- delayed by a subsequent study of the with unanimous support. ital expenditures as a result of receiv- original study’s ‘‘methodology,’’ caus- Upon final passage of this bill, we ing contracts in FY 2001. As our econ- ing the program to be delayed indefi- will take a giant step toward improv- omy struggles during these difficult nitely rather than be implemented in ing and refining the SBA and its pro- times, this vital program will continue 2002, as it should have been. This bill grams. With the new provisions that to bring jobs to our Nation’s inner cit- expedites the implementation of the al- enhance agency record-keeping and re- ies, poor rural counties, and Indian res- ready overdue program by reassigning align program operations under a more ervations. the responsibility of the study from the appropriate department, it is clear that I urge Congress to support the SBA to the GAO and giving the Comp- agency accountability and oversight HUBZone program in its current form troller a deadline of December 31, 2003, will be strengthened. In addition, small along with the new amendments pro- to report his findings to Congress. businesses will benefit from improve- vided in the Senate’s version of the During this time of economic down- ments in the leading programs, greater SBA Reauthorization Act of 2003. Any turn, we must ensure that long-term access to capital, new innovations in additional changes not supported by strategies of reorganization and re- the entrepreneurial programs, expan- the full Senate Committee on Small structuring do not have immediate sion of procurement programs, and im- Business could seriously undermine the negative impacts on our communities. proved training and assistance provi- original intent of the program. One example of this is the economic sions. Thank you for the opportunity to impact on surrounding areas when a According to the SBA’s Office of Ad- speak today on behalf of the small military base is closed. The loss of con- vocacy, small businesses represent business community. I encourage my tracts to small businesses, jobs and re- more than 99.7 percent of all employ- colleagues to support Senator SNOWE sources can cripple a community’s ers, employ more than half of all pri- and S. 1375, the Small Business Admin- economy. To reduce the impact on vate sector employees, and generate 60 istration 50th Anniversary Reauthor- these regions, this bill utilizes a con- to 80 percent of net new jobs annually. ization Act of 2003. tracting program, called the HUBZone Given these statistics and the difficult Mr. LEVIN. Mr. President, the Small program, intended to target under- financial times we face in today’s econ- Business Administration 50th Anniver- served areas and maintain the profit- omy, I urge Congress to continue to sary Reauthorization Act of 2003 re- ability of the firms located within nurture the needs of the small business flects a bipartisan effort that passed these areas. This bill will allow mili- community. We must show enthusi- the Senate Small Business and Entre- tary installations that are closed after astic support for this bill, which I am preneurship Committee unanimously. passage of this legislation to receive confident will provide the SBA with This bill reauthorizes many Small HUBZone status. Senator SNOWE and I greater tools to keep pace with the Business Administration, SBA, pro- have included a further provision with- ever-changing global economy and to grams for 3 years as well as authorizes in the managers’ amendment of S. 1375, serve the small business community in a number of pilot programs. which would limit this special classi- a more effective and efficient manner. The reauthorization bill is a great fication for 5 years after the closure of To act otherwise could jeopardize this improvement over the President’s pro- the base. The intent of the immediate Nation’s much needed job growth and posal which would have frozen SBA qualification of these areas is to allow innovation. programs at fiscal year 2003 funding for a smoother transition of the base to Before I yield the floor, I refer to an levels for 6 years. By reauthorizing the commercial use by encouraging small important small business program ti- SBA over a shorter 3-year period, as businesses to relocate to those facili- tled the Historically Underutilized Congress has done traditionally, our

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00064 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.072 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12091 bill allows Congress to exercise closer ness Administration 50th Anniversary ensure that SBA remains responsive in oversight than would have been the Reauthorization Act of 2003. There are the bad times—as well as the good. We case under a 6-year bill. Our bill is re- millions of good reasons why we need were able to expand the definition of a sponsive to our Nation’s small busi- to pass this important bill today and disaster to include drought and below nesses and entrepreneurs, many of they are reflected in the millions of average water levels in bodies of water whom have no alternative credit source small businesses around the country that support small businesses. That and allowing the SBA to make more that benefit from the support the change was clearly needed because the loans to small entrepreneurs. These en- Small Business Administration pro- impact of a drought or low water level trepreneurs provide the job creation vides small businesses in Wyoming and on agriculture is clear to all of us. and business expansion that can result around the country. Although we do What might not be so clear is how from the small business loans. not have time for me to list those mil- these water problems also affect tour- I am pleased the Senate SBA reau- lions of reasons I can sum them up in ism and recreational businesses. It thorization bill contains an amend- just three words—jobs, jobs, jobs. wasn’t clear before, so these businesses ment I authored to establish the Small It’s an expression we have heard often fell through the cracks of Federal Business Intermediary Lending Pilot many, many times but it is the truth— assistance. With the passage of this Program to address the needs of ex- small businesses really are the back- bill, however, that crack will be filled panding small business. The pilot lend- bone of our economy. They provide ca- in and small businesses will no longer ing program is aimed at businesses reers for the established generation of suffer from these problems with no that need loans that are larger than workers who need jobs to raise their help or relief in sight. those available under the SBA families and they provide jobs to the Native Americans will also benefit microloan program but a variety of younger generation of workers—teens from this bill and find help for the ter- reasons—including lack of sufficient or and young adults of my State and rible challenges poverty and unemploy- conventional collateral—are unable to many others who are looking for em- ment impose on the Native American secure the credit they need at the ployment to help them pay the ex- communities in my State and across terms they need through conventional penses of school and help them learn the Nation. Promoting the creation lenders, even with the assistance of the the lessons of responsibility, commit- and development of small businesses in 7(a) program. these areas will bring much needed as- The pilot lending program is designed ment and teamwork. As a former small business owner sistance to those Native Americans to work through local non-profit lend- who need a chance to help themselves. ing intermediaries. This proposal au- myself, I have seen firsthand how a I believe this approach will work be- thorizes the SBA to make 1 percent, 20- paycheck impacts lives and teaches in- year loans on a competitive basis to up valuable life lessons and career skills. cause each tribe will actively support to 20 non-profit lending intermediaries A job is more than a responsibility— it to ensure the program is a success. These and many other changes to the around the country. These loans would it’s a precious gift that can change SBA will ensure that it remains a bea- be used to capitalize a revolving loan your life and help you understand what con of support and hope for small busi- fund through which the intermediary it means to be a contributing member nesses that are carefully navigating would make loans of between $35,000 of society. and $200,000 to small businesses. Unlike In my home state of Wyoming, 96.5 the rough and rocky shores of competi- the SBA microloan program there percent of our businesses are small tion and the thousands of details that would be no technical assistance grant businesses and that translates into a can slow or destroy a small business at provided to the intermediary. All ad- lot of jobs and a lot of families with any stage of its development. As I have already mentioned, our ministrative costs or technical support food on the table and a roof over their small businesses are the backbone of provided to business borrowers would heads thanks to the SBA and the pro- be covered by the interest rate spread grams it provides the people of our our economy. The Small Business Ad- between the lending intermediary’s 1 country. ministration is the lifeblood of our percent loan from the SBA and the That is why I was so pleased to be a small businesses. The support and en- loans made to the business borrowers. part of the important work on the couragement of each helps make the While the SBA is committed to en- Small Business Administration 50th other more efficient, more productive suring that 7(a) lenders make smaller Anniversary Reauthorization Act of and more successful. loans, this pilot is designed to reach a 2003. This is truly a historic occasion Our small businesses and the Small sector of small businesses that 7(a) as we celebrate the SBA’s successes of Business Administration have a unique lenders cannot and will not reach due the past 50 years and set its course for and important relationship. They need to the perceived higher risk of these the years to come. each other to grow and prosper and businesses. Many of our States, includ- We’ve all heard the expression—give best of all—as they do—they help the ing Michigan, Maine and Idaho, are for- a man a fish and you will have fed him Nation to do the same. tunate to have a health network of for today. Teach a man to fish and you Mr. PRYOR. Mr. President, today the community based, non-profit inter- will have provided him with the tools Senate will consider a bill that is very mediary lenders that are experienced he will need to feed himself for the rest important to small business owners and successful in meeting the needs of of his life. and their employees. I am referring to these businesses. This pilot program The SBA operates on a similar prin- S. 1375, the Small Business Administra- will give them additional tools to help ciple. It does not give a business fund- tion 50th Anniversary Reauthorization them create badly needed jobs among ing for a day’s operation. Instead, it Act. The purpose of this bill is to reau- small businesses. provides the tools, training and sup- thorize the many needed initiatives at Finally, I am pleased that the reau- port necessary to ensure that a busi- the SBA—from long-term loans and thorization bill contains the bill pro- ness begins to operate on firm, solid venture capital to help with accessing viding disaster relief for small busi- footing and has a reasonable chance for Government contracts—that have nesses damaged by drought. This in- success. helped create successful businesses cludes a provision I authored which Then, when the doors open up and the that are now household names to many would make eligible small businesses customers come in, the SBA continues Americans. To name just a few, hurt by low water levels on the Great to serve as a reference and a source of Callaway Golf, Ben & Jerry’s, Winne- Lakes. I am also glad to see it includes support to ensure that a small business bago, Apple Computer and FedEx. In the childcare lending pilot program to has a place to turn to for advice, en- Arkansas, last year, more than 305 allow affordable and low interest SBA couragement and help if things take an businesses got loans through the SBA, 504 loans for non-profit child care cen- unexpected turn for the worse. and with them created jobs and con- ter. It is my hope that this program Expect the unexpected—that’s not tributed to the local tax base. will spur the establishment and expan- just good advice—it’s the focus of the We on the committee have worked sion of child care providers. SBA’s updated disaster authority in hard to review the services available to Mr. ENZI. Mr. President, I rise today this bill. This section is one of the small businesses through the SBA and to speak in support of the Small Busi- changes we were able to make to help its lending and counseling partners. As

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00065 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.037 S26PT1 S12092 CONGRESSIONAL RECORD — SENATE September 26, 2003 a result, this bill builds upon what will pass unanimously. The Committee culture has interpreted legislation re- works right at the SBA and improves held informative and useful hearings garding the treatment of HUBZone upon areas that need to be updated. and roundtable discussions to learn price preferences for food aid pur- The changes are sensible and fiscally from small business owners and leaders chases. The current system provides responsible. We also included an inno- about the value of the Small Business HUBZone firms with a price preference vative provision to address workforce Administration’s programs. We also on the first 40 percent of a given tender issues. heard from SBA Administrator Hector of food aid. A tender is essentially a I offer my thanks and appreciation to Barreto, about the Bush administra- contract for aid that spells out how Senator SNOWE and Senator KERRY for tion’s reauthorization proposal for im- much of a particular commodity—corn, giving me the opportunity to address proving the agency’s ability to respond wheat, vegetable oil—would be pro- my concerns regarding some of the pro- to the many challenges facing small vided under the contract. The remain- visions in the SBA reauthorization bill. businesses and the increasing number ing 60 percent of the contract volume is One of my initial concerns was that we of start-ups. In the end she put to- not subject to the preference, so continued to actively support the gether an excellent bill that I sup- HUBZones companies compete with all SBA’s 7(a) guaranteed business loan ported when it passed the committee other firms, large and small, in full and and 504 certified business development unanimously. I expect the Senate to do open competition for this portion of company loans programs. the same. the contract. Access to capital is one of the most Ms. SNOWE. I thank the Senator for The Department of Agriculture has critical issues facing new and small her generous comments, and I appre- misinterpreted the statute and unfairly businesses alike, particularly for mi- ciate her work on the Committee. She limited the participation of HUBZone norities and entrepreneurs in inner- added an excellent amendment to the firms to only 40 percent of any food aid city and rural areas who lack sufficient bill to ensure that the National Wom- contract. This effectively locked them collateral or credit to get loans from en’s Business Council maintains a bi- out of 60 percent of every tender con- banks, even when they have a good partisan balance. I thank her for sup- tract offered. The Department has idea and repayment ability. I believe, porting this bill. since corrected its interpretation and and am hopeful, that the SBA Reau- Ms. LANDRIEU. The issue I wanted is allowing the program to perform as thorization Act will go far in satisfying to bring to your attention relates to it was intended by Congress when these this demand for capital to those who HUBZone provisions in the House provisions were added to the HUBZone have traditionally been shut out. Addi- version of the SBA reauthorization. program in 2000. tionally, I have endeavored to ensure HUBZones are distressed urban and I am glad that the Department of Ag- that the SBA 7(a) and 504 programs rural areas characterized by chronic riculture has changed its interpreta- continue unharmed. I encourage the high unemployment and/or low house- tion. Louisiana has 10 HUBZone firms SBA to work with the small business hold income. Mr. President, there are that are exporters and may be able to community—the trade associations for 152 HUBZone companies creating jobs participate in the food aid program and 7(a) and 504 lenders and borrowers, the and empowering communities through- compete now that the proper interpre- National Association of Government out my State. Under the program, tation is in effect. Officials with the Guaranteed Lenders and the National small businesses that locate in a Port of Lake Charles in Lake Charles, Association of Development Compa- HUBZone, and hire workers who live in LA came to me and expressed their nies, to ensure they are not harmed. the HUBZone, are eligible to receive concern with the Department’s initial Small businesses employ millions of price preferences in bidding on govern- interpretation because they operate in people and provide the fuel for our Na- ment contracts. These price pref- a HUBZone and want to attract more tion’s economic growth. Although most erences encourage small businesses to businesses to the port. This interpreta- economists aver that the recession has locate in our distressed communities tion limited the amount of contracts ended, employment figures continue to and help offset the additional costs HUBZone firms were eligible to bid on. lag behind other economic data at a they face as a result of being out of the The correct interpretation allows them rate that continues to cause me great regular stream of commerce. Price to bring new businesses to the Lake concern—21 months of straight job preferences also help to even the play- Charles area and help them to reinvigo- losses means we should be using every ing field between HUBZone eligible and rate an area that is working to regain tool we have to create jobs. With the non-HUBZone firms in competing for its footing in the current economic cli- assistance of Senator SNOWE, the SBA contracts. I support the HUBZone pro- mate and provide critical jobs for the Reauthorization Act should help to gram. It is providing an economic families who live there. spur job creation and increase access to boost through job creation and capital I know there are some who feel that much needed capital for our Nation’s investment to areas of poverty and un- under the current interpretation small businesses. employment that really need it. HUBZone firms may have an unfair ad- I ask my colleagues to support this Ms. SNOWE. I am also a strong sup- vantage. I welcome the opportunity to bill because we need to enact this legis- porter of the HUBZone program. Today work with the chair and the other lation before many of SBA’s programs there are more than 8,300 HUBZone members of the committee to inves- expire on September 30. small businesses that helped to create tigate this further. Perhaps the com- Ms. LANDRIEU. Mr. President, be- more than 30,000 jobs in the last 2 mittee could hold a hearing to learn fore the Senate prepares to consider years. In our reauthorization bill, the more about this issue. and pass S. 1375, the Small Business committee has made some minor Ms. SNOWE. I thank the Senator for Administration 50th Anniversary Reau- changes to strengthen the program. bringing this to my attention. I am thorization Act of 2003, I would like to One of these changes would ensure that happy to work with the Senator on this bring an important issue to the Sen- communities affected by military base issue. I thank the Senator from Lou- ate’s attention that I hope will be ad- closures would receive temporary isiana for her support of this legisla- dressed in conference with the House. HUBZone eligibility, preventing a sig- tion. It relates to the HUBZone program, nificant economic downturn. The bill Mr. BAYH. Mr. President, today, the specifically the price preferences for also allows HUBZone companies to re- Senate will unanimously pass the food aid contracts. I would like to dis- ceive up to 15 percent investment from Small Business Reauthorization Act. cuss this matter with my colleague, outside organizations, allowing them This is a critically important piece of the Chair of the Small Business and to raise capital, expand their business legislation for the future of small busi- Entrepreneurship Committee, so that and create even more jobs. ness in America, and in turn, for our we have a clear record of our position Ms. LANDRIEU. I am pleased that Nation’s economy. Small businesses on the issue prior to final passage of the Senate has decided to leave the are the engines of economic growth, the SBA Reauthorization legislation. HUBZone program intact with these and they play a vital role in expanding Let me begin by first congratulating limited, but sound modifications. An our economy. This is something I be- her for bringing this bill through Com- issue has been brought to my attention lieve in so strongly that for 2 weeks in mittee and to the Senate floor where it involving how the Department of Agri- August, I traveled across the State of

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00066 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.033 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12093 Indiana to meet with small business These programs also provide specific, create jobs for workers at home. I com- owners and to host a series of small critical support to businesses that are mend the Senate for passing this bill business summits. The purpose of these owned and operated by women, minori- and hope that the Senate and the summits was to link people looking to ties, and veterans, groups that some- House will reconcile their differences start or expand their small businesses times face greater difficulty in obtain- quickly so that this critical legislation with every available Federal resource ing capital. can go to the President’s desk for his that could help them fulfill their Best of all, the 504 loan program pro- signature. dream. vides all of these opportunities for eco- ON-DEMAND AIR SERVICE During my visits in Indiana, I saw nomic growth at no cost to the tax- Mr. WYDEN. Mr. President, I want to first hand the differences small busi- payer. The 504 program is subsidy-free, take a moment to highlight a par- nesses can make in their communities. financed purely by user fees that bor- ticular issue that my staff has been John Roembke, of Ossian, IN, used a rowers pay to finance the risk inherent talking to the Small Business Adminis- Small Business Administration loan to in the program. The cost to the tax- tration, SBA about. This relates to an start his manufacturing and design payers is zero. Oregon company named SkyTaxi, company nearly 30 years ago. He began Even with these advantages, there which has an innovative and ambitious as the sole employee for his company, are still greater needs for capital in In- business plan for providing on-demand but today he employs more than 60 diana, particularly in the manufac- air service to small communities. As Hoosiers. Each Hoosier employed at turing sector, which employs 580,000 my colleague from Maine knows better Roembke Manufacturing represents a Hoosiers, a higher percentage of indus- than most, small and rural commu- family that has greater job security trial workers than any other State. nities are often gravely underserved by and new economic opportunities The manufacturing sector is in crisis. commercial airlines. These are places thanks to John’s success and help from Since July 2000, manufacturing has lost where transportation links are a make- the SBA. 2.6 million jobs—the largest decline or-break issue for local economic op- Our Nation’s unemployment rate now during the post-World War II era. Re- portunity. But, as a recent General Ac- stands at 6.1 percent, and in my State, cent job losses in manufacturing jobs counting Office report concluded last there are pockets of even higher unem- represents nearly 90 percent of total January, the trend is not positive. The ployment. What these areas need, and U.S. job losses. Manufacturing output current turmoil in the airline industry what our economy needs, is more job has shown virtually no growth since hits small communities hard, because creation, and it is a well-known fact December 2001. those are the first places airlines trim that three out of every four new jobs Manufacturing is, and will continue or eliminate service when they are are created by our growing and innova- to be, critical to our country’s overall looking to cut costs. And most efforts tive small businesses. Usually, the only economic growth, and for that reason, to promote air service to small com- hurdle standing between a company I want to help our small manufacturers munities have met with limited long- and its desire to expand and hire new that are struggling to compete with term success. workers is capital. Without it, our the low wages and high technology Ms. SNOWE. I agree with the Senator businesses starve because they cannot equipment used by our international that attracting new air service and re- obtain space, equipment, tooling, and competitors. In order to addresses this taining current service to small com- employees. With it, creative businesses need, I offered an amendment during munities is a critical economic issue. I can secure all of these assets, expand the mark-up of this bill that was gra- am also familiar with the GAO report productivity, increase sales, add new ciously accepted by the Committee to which he refers, since Senator jobs, and improve the quality of life in Chair. The provision directly address WYDEN and I were two of the three Sen- their communities. the needs of America’s small manufac- ate requesters of that report, together The legislation we pass today will turers, providing them with the addi- with our colleague on the Aviation build on this kind of success, by cre- tional capital they need to stay com- Subcommittee, Senator ROCKEFELLER. ating jobs, improving access to capital, petitive in both the United States and Mr. WYDEN. The Senator may recall, and strengthening crucial disaster as- world markets. then, that the GAO report briefly dis- sistance programs. Through the efforts The provision would increase the 504 cusses SkyTaxi as a potential alter- of Chairman SNOWE, Ranking Member maximum loan guaranty for small native way to provide air service to KERRY, and my other fellow members manufacturers to $4 million and alter small communities. The report ob- of the Small Business Committee, the the job creation capital requirements serves that SkyTaxi offers a business Senate has taken an important step to- for small manufacturers, allowing model that is still relatively new, but ward reauthorizing the Small Business small manufacturers to create one new that could help meet some of the needs Administration and its important job for each $100,000 in 504 loan guaran- of small communities. small business assistance programs for tees. As a result of this legislation, Ms. SNOWE. I share the Senator’s the next three years. companies will be able to obtain new view that it is critical to explore, sup- Today, I look forward to supporting equipment, become more competitive port and promote alternative ap- this bill that reauthorizes the most ef- and, most importantly, hire new work- proaches for meeting the transpor- fective capital access programs that ers. Indiana’s Certified Development tation needs of small and rural commu- exist today in our Federal government: Companies estimate that the bill could nities. This includes ensuring that Fed- the 504 and 7(a) loan guaranty pro- create between 200 and 400 additional eral agencies take the appropriate ac- grams. These two programs will pro- jobs each year. tion to provide financial assistance to vide more than $20 billion in both long The change to the 504 loan program small business franchisees interested in and short term funding to America’s will allow our manufacturers to ac- helping communities improve trans- small businesses each and every year of quire more state-of-the-art equipment portation services. this reauthorization. In just the last and technology to become more pro- Mr. WYDEN. SkyTaxi intends to op- three years, these SBA loan programs ductive, and lower their operating erate through a franchise system, in have created more than 500,000 new costs. If small manufacturers are al- which individual small businesses jobs nationwide. Over the past three lowed to invest in state-of-the-art tech- would purchase small aircraft and op- years in Indiana, the 504 program alone nology, and remain competitive with erate local SkyTaxi franchises. But has provided $125 million in capital to foreign competitors, this will put more purchasing an aircraft takes a substan- small businesses and created 5,000 new hardworking Hoosiers back to work. tial amount of capital, and many po- jobs. The employees who fill the new Further, these jobs will provide higher tential franchise owners—such as laid- positions and the entrepreneurs who wages and benefits than we see avail- off commercial pilots who now wish to have expanded their businesses return able in many communities today, start their own businesses—find that millions of dollars in payroll, sales, in- thereby improving our quality of life. financing for aviation-related busi- come, and real estate taxes to the Fed- This legislation will provide the fuel nesses is currently very difficult to ob- eral, State, and local governments in that our manufacturers need to remain tain. SkyTaxi therefore expects and every county and State each year. competitive in world market and to hopes that potential franchise owners

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00067 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.054 S26PT1 S12094 CONGRESSIONAL RECORD — SENATE September 26, 2003 would be able to turn to the SBA and The amendment (No. 1788) was agreed ‘‘(2)(A) In the case of orders under multiple its lending partners for small business to, as follows: award contracts, including Federal Supply Schedule contracts and multi-agency con- loans, in order to get up and running. (Purpose: To make technical corrections to tracts, that are subject to the small business The problem now arises because, in the bill, and for other purposes) order to satisfy FAA safety require- reserve, contracting officers shall consider On page 87, strike line 7 and all that fol- not less than 2 small business concerns if ments and obtain FAA certification, lows through page 91, line 4. such small business concerns can offer the SkyTaxi needs to retain certain au- On page 91, strike line 23 and all that fol- items sought by the contracting officer on thority over safety matters, including lows through page 92, line 5, and insert the competitive terms, with respect to price, ensuring the competence of flight crew following: quality, and delivery schedule, with the and the quality of aircraft mainte- Section 351(3)(A)(ii) of the Small Business goods or services available in the market. Investment Act of 1958 (15 U.S.C. 689(3)(A)(ii)) nance. ‘‘(B) If only 1 small business concern can is amended— satisfy the requirement, the contracting offi- It has set up its franchise agreement (1) in subclause (I), by striking ‘‘50 percent accordingly. Unfortunately, the SBA cer shall include such small business concern or more’’ and all that follows and inserting in their evaluation.’’. has so far taken the position that, due ‘‘the median family income for such tract (c) REPORT REQUIREMENT.— to the authority vested in SkyTaxi in does not exceed 80 percent of the greater of (1) IN GENERAL.—Not less than once every the franchise agreement, the SBA the statewide median family income or met- 180 days, the Comptroller General shall sub- would view each of the individual fran- ropolitan area median family income; or’’; mit a report on the level of participation in chise owners as ‘‘affiliated’’ with Sky- and multiple award contracts, including the Fed- Tax and each other—and thus ineli- (2) in subclause (II), by striking ‘‘household eral Supply Schedule to— gible to apply for individual SBA guar- income’’ each place it appears and inserting (A) the Small Business Administration; ‘‘family income’’. antee loans. (B) the Committee on Small Business and On pages 109 through 110, redesignate para- Entrepreneurship of the Senate; and My staff has been in contact with the graphs (6) through (13) as paragraphs (7) SBA about this, and I am hopeful that (C) the Committee on Small Business of through (14), respectively. the House of Representatives. this eligibility problem can be solved. On page 109, between lines 2 and 3, insert (2) CONTENTS.—Each report submitted For example, it may be possible to the following: under paragraph (1) shall contain, for the 6- work with FAA to clarify the limits of ‘‘(6) DISADVANTAGED NATIVE AMERICAN EN- month reporting period— SkyTaxi’s safety-related authority TREPRENEUR.—The term ‘disadvantaged Na- (A) the total number of multiple award over franchisees, and to rework the tive American entrepreneur’ means a dis- contracts; franchise agreement to preserve SBA advantaged entrepreneur who is also a mem- (B) the total number of small business con- ber of an Indian Tribe.’’ cerns that received multiple award con- loan eligibility. But for that to happen, On page 111, line 21, strike ‘‘and’’ and all it’s going to take a commitment from tracts; that follows through ‘‘(4)’’ on line 22, and in- (C) the total number of orders; the SBA to work on a cooperative basis sert the following: (D) the total value of orders; to try to find a solution. If the SBA ‘‘(4) to provide training and technical as- (E) the number of orders received by small will roll up its sleeves and work cre- sistance to disadvantaged Native American business concerns; atively with my office and with entrepreneurs and prospective entrepreneurs; (F) the value of orders received by small SkyTaxi, then I think the problem can and business concerns; be solved to everyone’s satisfaction. ‘‘(5)’’ (G) the number of small business concerns On page 117, strike lines 9 through 14 and And in the end, the real beneficiaries that received orders; and insert the following: (H) such other information that the Comp- could be rural communities. ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.— Ms. SNOWE. As chair of the Small troller General considers relevant. ‘‘(1) IN GENERAL.—There are authorized to On page 193, strike line 14 and all that fol- Business Committee, I am concerned be appropriated to the Administrator lows through page 194, line 7, and insert the by any interpretation of the Small $15,000,000 for each of the fiscal years 2004 following: Business Act that unnecessarily inhib- through 2006 to carry out the provisions of (2) in subparagraph (F), by striking the pe- its access to SBA programs and serv- this section, which shall remain available riod at the end and inserting ‘‘; and’’; and ices by eligible small businesses. This until expended. ‘‘(G) certification that the offeror or bidder interpretation not only affects the ‘‘(2) TRAINING FOR NATIVE AMERICAN ENTRE- will acquire articles, equipment, supplies, PRENEURS.—In addition to the amount au- ability of small businesses to receive services, or materials, or obtain the perform- thorized under subsection (i)(1), there are au- ance of construction work from small busi- financial assistance under the 7(a) loan thorized to be appropriated to the Adminis- program but also to bid on Federal con- ness concerns in the amount and quality trator $2,000,000 for each of the fiscal years used in preparing the bid or proposal, unless tracts set aside for small businesses. As 2004 through 2006 to carry out the provisions such small business concerns are no longer the economy struggles to recover, it is of subsection (c)(4), which shall remain in business or can no longer meet the qual- critical that we get back to business— available until expended.’’ ity, quantity, or delivery date.’’. an investment in small business is an On page 190, strike line 21 and all that fol- (b) PENALTIES FOR FALSE CERTIFICATIONS.— investment in jobs. lows through ‘‘(iii)’’ on page 191, line 1, and Section 16(f) of the Small Business Act (15 As we work with our colleagues on insert the following: U.S.C. 645(f)) is amended by striking ‘‘of this ‘‘(ii)’’. Act’’ and inserting ‘‘or the reporting require- the House Small Business Committee On page 192, strike line 11 and all that fol- to reauthorize the SBA’s programs and ments of section 8(d)(11)’’. lows through page 193, line 6, and insert the On page 195, strike lines 4 through 19 and services, we will carefully consider pro- following: insert the following: visions to address this issue and work SEC. 403. SMALL BUSINESS PARTICIPATION IN (1) by redesignating paragraph (11) as para- with the SBA to find an agreeable solu- PRIME CONTRACTING. graph (14); and tion. (a) RESERVED CONTRACTS.—Section 15(j) of (2) by inserting after paragraph (10) the fol- Mr. WYDEN. I thank the Senator for the Small Business Act (15 U.S.C. 644(j)) is lowing: her assistance with this issue, and for amended by adding at the end the following: ‘‘(11) CERTIFICATION.—A report submitted her consistent and careful attention to ‘‘(4) Any adjustment to the simplified ac- by the prime contractor pursuant to para- small business issues and rural trans- quisition threshold (as defined in section graph (6)(E) to determine the attainment of 4(11) of the Office of Federal Procurement a subcontract utilization goal under any sub- portation issues alike. Policy Act (41 U.S.C. 403(11))), shall be imme- Mr. FRIST. I ask unanimous consent contracting plan entered into with a Federal diately matched by an identical adjustment agency under this subsection shall contain that the committee-reported amend- to the small business reserve for purposes of the name and signature of the president or ments be agreed to, the managers’ this subsection.’’. chief executive officer of the contractor, cer- amendment at the desk be agreed to, (b) PARTICIPATION IN MULTIPLE AWARD CON- tifying that the subcontracting data pro- the bill, as amended, be read a third TRACTS.—Section 15(j) of the Small Business vided in the report are accurate and com- time and passed, the motion to recon- Act (15 U.S.C. 644(j)) is amended— plete. sider be laid upon the table, and any (1) in paragraph (2), by striking ‘‘(2) In car- ‘‘(12) CENTRALIZED DATABASE.—The results rying out paragraph (1)’’ and inserting ‘‘(3) statements relating to the bill be of an evaluation under paragraph (10)(C) In carrying out paragraphs (1) and (2)’’; shall be included in a national centralized printed in the RECORD. (2) in paragraph (3), by striking ‘‘(3) Noth- governmentwide database. The PRESIDING OFFICER. Without ing in paragraph (1)’’ and inserting ‘‘(4) ‘‘(13) PAYMENTS PENDING REPORTS.—Each objection, it is so ordered. Nothing in this subsection’’; and Federal agency having contracting authority The committee amendments were (3) by adding after paragraph (1) the fol- shall ensure that the terms of each contract agreed to. lowing: for goods and services includes a provision

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00068 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.056 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12095 allowing the contracting officer of an agency S. RES. 219 tantly, and because of the need to com- to withhold an appropriate amount of pay- Whereas the currency of the People’s Re- plete action on the extension imme- ment with respect to a contract (depending public of China, the yuan or renminbi, has diately to ensure the many TEA–21 on the size of the contract) until the date of been tightly pegged to the United States dol- programs do not come to a halt, do I receipt of complete, accurate, and timely lar at the same fixed level since 1994; subcontracting reports in accordance with accept the terms of the extension as Whereas the undervaluation of China’s cur- approved by the House for the safety paragraph (11).’’. rency makes exports from China less expen- On page 196, lines 17 and 18, strike ‘‘per- sive for foreigners and makes foreign prod- programs administered by the Federal formance, or lack of performance of the sub- ucts more expensive for Chinese consumers, Motor Carrier Safety Administration, contractor.’’ and insert ‘‘circumstances sur- an effective subsidization of China’s exports FMCSA. rounding the failure to make the timely pay- and a virtual tariff on foreign imports; The House-passed short-term exten- ment described in subparagraph (A).’’. Whereas the Government of the People’s sion authorizes $56 million less, on an On page 199, line 3, strike ‘‘(b)’’ and insert Republic of China has significantly inter- annualized basis, for motor carrier the following: vened in its foreign exchange markets in safety than the program’s fiscal year (b) HUBZONE STATUS TIMELINE AND COM- order to hold the value of the yuan within its MENCEMENT.— 2003 appropriated level. I am very con- tight and artificial trading band, resulting in cerned that the level of funding in the (1) IN GENERAL.—A base closure area shall enormous growth in China’s dollar reserves, be treated as a HUBZone for a period of 5 estimated to be over $345,000,000,000 as of extension is insufficient to make years beginning on the date of final closure. June 2003; progress toward the national goal of re- A military base that was closed before the Whereas the practice of ‘‘currency manipu- ducing the rate of truck-related crash- date of enactment of this Act shall not be lation’’ to gain a trade or competitive advan- es by 30 percent by 2008. The extension considered a base closure area for purposes of tage is a violation of the spirit and letter of does not provide sufficient funding for this section. the World Trade Organization and Inter- FMCSA to fully implement existing, (2) EFFECTIVE DATE.—This section and the national Monetary Fund agreements, of amendments made by this section shall take authorized programs in the short term, which the People’s Republic of China is now including the ‘‘new entrants’’ program, effect on the date of enactment of this Act. party; (c) Whereas the undervaluation of China’s cur- hazmat permitting, additional carrier The bill (S. 1375), as amended, was rency has had and continues to have a nega- compliance reviews, and completion of considered read the third time and tive impact on the United States manufac- long overdue rulemaking proceedings. passed, as follows: turing sector, contributing to significant job Further, the bill provides no funds to (The bill will be printed in a future losses and business closures; continue construction of inspection fa- edition of the RECORD.) Whereas the undervaluation of China’s cur- cilities at the border. The funding level rency also has had and continues to have a f is significantly below the President’s negative impact on the economies of its funding request for fiscal year 2004; the neighbor nations, the European Community, ENCOURAGING THE PEOPLE’S RE- Senate Commerce Committee’s TEA–21 PUBLIC OF CHINA TO ESTABLISH Mexico, and Latin America; Whereas the free fluctuation of currencies reauthorization legislation; and the A MARKET-BASED VALUATION funding levels approved by the Senate OF THE YUAN is a key component to the health of global trade, and the stability of the world econ- and House Appropriations Committees. Mr. FRIST. Mr. President, I ask omy; and And, it is entirely inconsistent with unanimous consent that the Finance Whereas China’s central bank governor has the significant funding increases pro- Committee be discharged from further stated that the value of the yuan will even- vided over the short-term for highway action on S. Res. 219, and the Senate tually be determined by market forces rath- construction and maintenance. proceed to its immediate consider- er than pegged firmly to the dollar: Now, FMCSA was created after TEA–21 be- therefore, be it ation. Resolved, That the Senate of the United came law to address the increasing The PRESIDING OFFICER. Without States— number of truck-related accidents on objection, it is so ordered. (1) supports the Secretary of the Treas- our nation’s roads and highways. The The clerk will report the resolution ury’s work with regard to the Secretary’s duties assigned to the agency through by title. discussions with the Government of the Peo- the Motor Carrier Safety Assistance The assistant legislative clerk read ple’s Republic of China leading to a market- Act, MCSIA, and other legislation have as follows: based valuation of the yuan; and resulted in funding levels significantly (2) encourages the People’s Republic of The resolution (S. Res. 219) to encourage above the administrative takedown au- China to continue to act on its commitments the People’s Republic of China to establish a to the trade rules and principles of the inter- thorized by TEA–21. The extension, market-based valuation of the yuan and to national community of which it is now a however, fails to recognize this and, on fulfill its commitments under international member. the grounds that the bill must comply trade agreements. f with the budget resolution, funding for There being no objection, the Senate motor carrier safety is being curtailed, proceeded to consider the resolution. SURFACE TRANSPORTATION while highway construction and transit Mr. FRIST. Mr. President, I ask EXTENSION ACT OF 2003 funding is being increased. unanimous consent that the resolution Mr. FRIST. Mr. President, I ask I want to put my colleagues on no- be agreed to, the amendment to the unanimous consent that the Senate im- tice that either when the full Senate preamble be agreed to, the preamble, mediately proceed to the consideration moves its 6-year reauthorization bill, as amended, be agreed to, the motion of H.R. 3087, which is at the desk. or is faced with a further extension of to reconsider be laid upon the table and The PRESIDING OFFICER. The TEA–21 next February, I will insist that any statements regarding this clerk will report the bill by title. that the motor carrier safety programs matter be printed in the RECORD. The assistant legislative clerk read are authorized at an appropriate level The PRESIDING OFFICER. Without as follows: of funding. I believe my views are objection, it is so ordered. A bill (H.R. 3087) to provide an extension of shared by Senator HOLLINGS, who The resolution (S. Res. 219) was highway, highway safety, motor carrier safe- joined me in sponsoring legislation, S. agreed to. ty, transit, and other programs funded out of 1646, that would have funded the safety The amendment (No. 1789) to the pre- the Highway Trust Fund pending enactment programs for 5 months at a level con- amble was agreed to, as follows: of a law reauthorizing the Transportation sistent with the Commerce Commit- AMENDMENT NO. 1789 Equity Act for the 21st Century. tee’s reauthorization proposal. (Purpose: To make clarifying amendments) There being no objection, the Senate I take pride in the fact that the Sen- Strike the fourth clause of the preamble. proceeded to consider the bill. ate Commerce Committee completed In the seventh clause of the preamble, Mr. MCCAIN. Mr. President, today, work last June on its 6-year reauthor- strike ‘‘free fluctuation’’ and insert ‘‘mar- the Senate will approve a 5-month ex- ization of the TEA–21 safety programs ket-based valuation’’. tension of the highway programs au- under its jurisdiction. Our bipartisan The preamble, as amended, was thorized by the Transportation Equity bill is designed to meet the level of agreed to. Act for the 21st Century, TEA–21, based commitment to safety needed to The resolution, with its preamble, on an agreement between the Senate achieve aggressive goals for reducing reads as follows: and House leadership. Only reluc- accidents and fatalities on the nation’s

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00069 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.053 S26PT1 S12096 CONGRESSIONAL RECORD — SENATE September 26, 2003 roadways. Safety deserves at least the needed investment will result in the anced Budget and Emergency Deficit same attention and priority as high- continued deterioration of our existing Control Act of 1985 and purport to ex- way construction and again, I will ob- infrastructure. tend the life of the transportation cat- ject to any future related measure that Moreover, investment in our trans- egories. Subsection (d) deems certain does not ensure the motor carrier safe- portation infrastructure has economic spending adjustments to be ‘‘zero’’ for ty programs are fully funded for the benefits as well. According to the U.S. FY 2004. Finally subsection (e) ex- full 2004 fiscal year. Chamber of Commerce, each $1 billion presses a ‘‘sense of Congress’’ with re- Mr. SARBANES. Mr. President, I join invested in transportation infrastruc- spect to the adjustments for revenue with my colleagues in supporting the ture creates 47,500 jobs. At a time when aligned budget authority (aka RABA). pending legislation. This 5-month ex- our economy is struggling, investing in While some may argue that these tension of the Transportation Equity transportation is one of the smartest ‘‘budgetary provisions’’ are of little Act for the 21st Century, TEA–21, pre- actions that Government can take. In- consequence given the expiration of the serves the basic structure of our Fed- creased investment creates jobs today statutory spending caps which had eral surface transportation programs, and leads to economic growth tomor- been set out in section 251, I feel it is which have proven to be extremely row. still important to comment upon them. beneficial for our citizens’ mobility For this reason, I am disappointed I am concerned that their inclusion in and our national economy over the last that the administration has not yet this bill may signal to some that we 6 years. come forward with the resources we have prejudged the important fiscal I want to focus for a moment on the will need to develop a full, 6 year reau- policy debate that must take place Federal transit program, in which I thorization bill. The administration’s when the long-term reauthorization have a particular interest as the rank- reauthorization proposal, known as comes before the Senate. Let me assure ing member of the Senate Banking SAFETEA, provides only a minimal in- my colleagues, that in agreeing to this Committee. The Banking Committee crease for the Federal highway pro- necessary stop-gap measure today, I and its Housing and Transportation gram, and in fact would cut that pro- am in no way conceding the future Subcommittee, both last Congress and gram in fiscal year 2004 from its fiscal budgetary treatment of transportation this Congress, have held a series of year 2003 level. For transit, SAFETEA spending. hearings on the contributions of the These issues have a long history. not only fails to grow the program at In 1998 the Transportation Equity transit program to reducing conges- the pace of inflation, it cuts guaran- Act for the 21st Century (TEA–21) was tion, strengthening our national econ- teed funding over the 6 year period, so enacted and from a budgetary perspec- omy, and improving our quality of life. that the guaranteed level in fiscal year tive introduced two new concepts: two The clear message of these hearings is 2009 is actually less than the program transportation categories (for high- that TEA–21 works. The guaranteed level today. Without a serious commit- ways and transit) within the discre- funding, the program structure, and ment from the administration to make tionary spending limits and an annual the balanced approach to transpor- the kind of investment needed, and automatic adjustment to those limits, tation planning encompassed within strong bipartisan bicameral leadership aka RABA. Both concepts were en- TEA–21 have contributed to a renais- in the Congress, it will be very difficult shrined in section 251 as well as in the sance for transit in this country; in for us to reauthorize the surface trans- transportation laws. In general, section fact, transit has experienced the high- portation programs even when this 251 set out the statutory discretionary est percentage of ridership growth short-term extension expires. spending limits through FY 2002. These among all modes of surface transpor- Until that commitment is made, limits were enforced through seques- tation, growing over 28 percent be- however, it is essential that our States tration. In other words, back in 1998 tween 1993 and 2001. For this reason, I and local communities be able to con- special (one might even say privileged) am pleased that this legislation pre- tinue to operate and maintain our Na- consideration was afforded transpor- serves the structure and programs of tion’s roads, bridges, and transit sys- tation spending within the context of TEA–21 for the next 5 months. tems. I encourage the Department of an overall goal to limit spending and While we are talking today about a Transportation to use the authority balance the budget by 2002. While TEA– short-term extension, I think we must granted by this legislation to provide 21 purported to establish special budg- take a moment to look toward the fu- the needed assistance as expeditiously etary treatment through FY 2003, the ture. The transportation needs of this as possible. I urge my colleagues to mechanisms were placed within section Nation are significant, as more and support this legislation. 251 which expired on September 30, 2002 more communities find themselves Mr. NICKLES. Mr. President, as the (pursuant to section 275(b)). Con- confronting the problems of traffic Senate considers this temporary exten- sequently this special budgetary treat- congestion and delay. According to the sion of our transportation programs, I ment of transportation spending ceased Texas Transportation Institute, in the would like to note for my colleagues to have any substantive meaning near- year 2000, Americans in 75 urban areas the budgetary implications of this leg- ly 2 years ago—after enactment of the spent 3.6 billion hours stuck in traffic, islation. FY 2002 appropriations bills. with an estimated cost to the Nation of This bill is subject to a point of order I must also remind my colleagues $67.5 billion in lost time and wasted pursuant to section 302(f) of the Budget that this RABA mechanism was to fuel. As these figures show, congestion Act because the total level of contract have been a two-way street. If gas tax has a real economic cost to this Na- authority for transportation programs revenues exceeded previous estimates, tion, in addition to the psychological within the jurisdiction of the Com- spending for transportation would go and social costs of spending hours each mittee on Commerce, Science and up. Similarly if gas tax revenues de- day sitting in traffic. Transportation—on an annualized creased, spending levels were to have It is clear to me that we will have to basis—exceeds the allocation provided gone down—thus not altering the ‘‘path greatly increase Federal support for to that committee in the FY 2004 budg- to a balanced budget.’’ This mechanism transportation to help local commu- et resolution. Because the amount is worked well through the boom time of nities make the investments in infra- not significant, and the bill is only a the late 1990’s as actual gas tax reve- structure and system preservation that short-term extension, I have chosen nues consistently exceeded previous es- will keep America moving forward in not to pursue the point of order at this timates and Congress and the Presi- the 21st century. The Department of time. dent happily spent this windfall. How- Transportation’s Conditions and Per- In addition, section 10 of the bill con- ever, when actual gas receipts cam in formance Report estimates that an av- tains a number of provisions that are below predicted levels and the Presi- erage of $127 billion per year is needed within the jurisdiction of the Com- dent reflected the lower levels dictated over the next two decades to maintain mittee on the Budget, thus subjecting by TEA–21 in his FY 2003 budget, few in and improve the condition of our high- the bill to another 60-vote point of Washington were willing to acknowl- ways, bridges, and transit systems. order pursuant to section 306 of the edge this reality and spend less. Other estimates show an even greater Budget Act. Subsections (a), (b) and (c) I mention this today because I am need. I believe that failure to make the amend sections 250 and 251 of the Bal- concerned by the language in this bill

VerDate jul 14 2003 02:14 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00070 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.075 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12097 that expresses the ‘‘Sense of Congress’’ Through these battles, some progress that are out there. Now the challenge on RABA. While the language is not has been made, but we still have a long is to get to that level. My colleagues binding and merely suggests that any way to go to achieve fairness for Michi- on the Committee on Environment and future provisions should seek to mini- gan and other States on the return on Public Works and I have been working mize fluctuations in spending—which our Highway Trust Fund contributions. closely with Senators GRASSLEY and sounds like a good thing—its very pres- At stake are tens of millions of dollars BAUCUS to find the money. In the ence in H.R. 3087 might lead some to a year in additional funding to pay for meantime, we have to address the im- believe that the concept of separate badly needed transportation improve- minent expiration of TEA–21. transportation categories and the ments in our States and the jobs that H.R. 3087 provides 5 months worth of RABA adjustment’s inclusion in a go with it. Unfortunately, this short- the $35.5 billion allowed under the long-term extension is a done deal. term extension bill does not make any budget resolution of $14.8 billion and a The Senate should remember that improvements on the rate of return for corresponding amount of obligation when TEA–21 was enacted it was done donor States, even on the new funds limitation. This is a significant, 7 per- so in the context of 5-year discre- that are included in this bill that are cent increase in highway funding over tionary spending limits—which I re- above last year’s funding levels. 2003. This additional $2.2 billion in mind my colleagues were designed to My colleagues have argued that this highway funding will translate into manage the growth of discretionary short-term bill is a straight ‘‘clean’’ over 100,000 new jobs. spending in order to reach a balanced extension of Federal highway and tran- Of course, the best thing we can do to budget by 2002. Since then, balanced sit programs. They have argued that budgets, surpluses and the days of 5- create economic opportunity is enact a we cannot accommodate any policy comprehensive, 6-year reauthorization. year caps have come and gone. And changes in an extension bill such as while I sincerely hope we can exercise As we all know, highway bills are job improving the rate of return for donor bills. A highway bill drafted at $255 bil- fiscal constraint in the coming years, I States. But this bill does include one do not know when or if we will again lion over 6 years will create about 2 policy change. It includes an increase million new American jobs. This com- put 5-year discretionary caps into law. in funding over last year. In fairness to Our recent experiences have shown us bined with the tax cuts signed by donor States and to bring us closer to President Bush is the best stimulus the that, at best, caps might be useful for narrowing the funding gap between 2 years. Consequently, I believe that as economy can receive. donor and donee States, the additional Let me be very clear that my pref- we work towards a long-term reauthor- money contained in this bill should ization of our Federal transportation erence is that we would be considering have been distributed to donor States programs, we must take a fresh look at a 6-year comprehensive bill today, not at a higher rate. a 5-month extension, but reality is that any associated budgetary mechanisms. Unfortunately, this bill does not do I look forward to working with my the funding needed to do a comprehen- this. It contains more money than last colleagues on these important issues in sive 6-year bill at $255 billion has not year yet fails to address the long- the future. yet been identified. Because of that, I Mr. LEVIN. Mr. President, I am re- standing inequity. Every time we ex- believe the best outcome for the long- luctant to enact a short-term exten- tend these programs without address- term is to do a 5-year month extension sion of the highway funding bill with- ing equity, donor States lose out on and continue to work on a comprehen- out improving equity for donor States. getting back their fair share of gas tax sive 6-year bill. At issue is the historic mistreatment dollars currently being spent in other Again, I urge my colleagues to sup- of about 20 States, including Michigan, States. There is no logical reason for port H.R. 3087. some States to continue to send that known as ‘‘donor’’ States, who, year Mr. JEFFORDS. Mr. President. I rise money to other States to subsidize after year, have sent more gas tax dol- in support of H.R. 3087, a bill to extend their road and bridge projects and to lars to the Highway Trust Fund in the Nation’s surface transportation perpetuate this imbalance is simply Washington than were returned in program, TEA–21, for a five-month pe- unfair. transportation infrastructure spending. riod. Absent enactment of H.R. 3087, I plan to enter into a colloquy with The remaining 30 States, known as the program will shut down on Sep- the chairman of the Senate Environ- ‘‘donee’’ States, have received more tember 30, 2003. I urge my colleagues to ment and Public Works Committee to transportation funding than they paid join me in support of this bill. obtain a commitment to achieve a 95 into the Highway Trust Fund. I regret the need for a short term ex- This came about in 1956 when Sen- percent rate of return for a donor State’s share of its contributions to tension to TEA–21. A short term exten- ators from a number of small and large sion brings uncertainty to our State States banded together to develop a the Highway Trust Fund in the long- term transportation reauthorization transportation departments. This leads formula to distribute Federal highway to postponed projects and job loss. But dollars that advantaged their States at bill, up from 90.5 percent under the cur- we have yet to find sufficient revenues the expense of the remaining States. rent bill. to bring a full, 6-year reauthorization They formed a coalition of about 30 This is an issue of simple fairness and bill to the floor. States that would benefit from the for- we should not be satisfied until we mula and, once that formula was in achieve it. I have worked for the last 2 years on place, have tenaciously defended it. Mr. INHOFE. Mr. President. I urge reauthorization of the transportation At the beginning there was some le- my colleagues to support H.R. 3087, the program, first as chairman of the com- gitimacy to the large low-population Surface Transportation Extension Act mittee on Environment and Public predominately Western States getting of 2003, which extends the expiring Works, and now as ranking member. more funds than they contributed to Transportation Equity Act for the 21st This work has been bipartisan. I thank the system in order to build a national Century for an additional 5 months. and commend Chairman INHOFE and interstate highway system. Some argu- As my colleagues are aware, we are our subcommittee chairman and rank- ments remain for providing additional just days from the expiration of TEA– ing member, Senators BOND and REID funds to those States to maintain the 21. We continue to make progress in for their approach to this task. national system and our bill will do our negotiations on a comprehensive 6- We have made great progress. We that. However, there is no justification year bill, but we need more time. Ear- concluded early on that the Nation’s for any State getting more than its fair lier this year, 79 Senators voted for the infrastructure needs far exceed current share. Bond-Reid amendment to the fiscal resources. We shared our findings with Each time the highway bill is reau- year 2004 budget resolution which stat- our Senate colleagues. They in turn thorized the donor States that have ed clearly that the Senate wanted the gave overwhelming support to the traditionally subsidized other States’ funding for a 6-year highway bill at Bond-Reid amendment to the Senate road and bridge projects have fought to $255 billion. Budget Resolution, to increase spend- correct this inequity in highway fund- I believe $255 billion is a reasonable ing on the transportation program by ing. It has been a long struggle to and responsible level given the pressing roughly 40 percent to $311 billion. This change these outdated formulas. transportation infrastructure needs has guided our work.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00071 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.078 S26PT1 S12098 CONGRESSIONAL RECORD — SENATE September 26, 2003 Our hearings revealed strong support dition and performance of highways sured that States that consume eth- for the existing TEA–21 program struc- and bridges is projected to be $75.9 bil- anol-blended fuel are no longer penal- ture. In our work to date, we have re- lion through 2020. This amount if 17.5 ized. The Finance Committee reported tained the program structure largely percent higher than capital spending in legislation I have cosponsored that intact. My goal is to maintain the cur- 2000. would transfer 2.5 cents of the Federal rent patterns in resources allocation If we continue to ignore the upkeep, tax on ethanol-blended fuel from the among program categories, as well. On and allow the deterioration of our in- General Fund of the Treasury to the funding formulas, we have committed frastructure, we risk disruptions in Highway Account of the Highway Trust to benefitting all States as the pro- commerce and reduced protection for Fund and replace the 5.2 cents per gal- gram grows. And the program growth public safety, health, and the environ- lon reduced tax rate for ethanol-blend- levels approved by our Senate budget ment. In my view, it is the responsi- ed fuel with a tax credit. As a result, resolution will enable such an out- bility of Congress to ensure that fund- the same Federal tax will be collected come. ing levels are adequate and efficiently and deposited into the Highway Trust I will continue to work with Chair- allocated to the Nation’s priority Fund regardless of whether a gallon of man INHOFE to bring a full, 6-year bill needs. In 1998, Congress recognized the fuel contains ethanol. The Ohio De- to the Senate floor within the next 5 importance of the Nation’s transpor- partment of Transportation, ODOT, es- months. tation system through the enactment timates that Ohio would restore up to Mr. VOINOVICH. Mr. President, I of TEA–21, a 6-year bill which increased $170 million annually as a result of the rise in support of H.R. 3087, a bill to by nearly 40 percent Federal invest- Finance Committee’s legislation. I am provide an extension of highway, high- ment in highways and transit. Under hopeful this legislation will be passed way safety, motor carrier safety, tran- TEA–21, Ohio received a 23 percent in- soon. sit, and other programs funded out of crease in transportation funding. the Highway Trust Fund until Feb- Ohio has the Nation’s tenth largest As chairman of the National Gov- highway network, the fifth highest vol- ruary 29, 2004 pending enactment of a ernors Association, I was involved in law reauthorizing the Transportation ume of traffic, the fourth largest inter- negotiating TEA–21 and lobbied Con- state highway network, and the second Equity Act for the 21st Century, TEA– gress to ensure that all Highway Trust 21. However, I am disappointed that largest inventory of bridges in the Fund revenues were spent on transpor- country. Ohio’s transportation chal- Congress has been unable to enact a 6- tation. I also fought to even out high- year reauthorization of TEA–21 prior to lenge is to expand its 1960s transpor- way funding fluctuations and assure a tation system to meet 21st century September 30, 2003. predictable flow of funding to the According to the American Road and needs. Recently, Ohio approved a State States. TEA–21 achieved this goal with Transportation Builders Association, motor fuel tax increase that will en- record, guaranteed levels of funding. ARTBA, employment in the transpor- sure an annual $250 million new con- tation construction industry was down While TEA–21 has enabled States and struction program for the next 10 years in July 2003 compared to July 2002. localities to improve the condition of while maintaining bridge and highway Specifically, there were 12,100 fewer deteriorating and unsafe highways and conditions. With additional Federal workers on project sites over the last to increase capacity and performance, funds, ODOT has set a goal of having a year, a decrease of 3.7 percent. In Ohio, the system is still aging, and in need of $5 billion, 10-year Ohio construction according to the Bureau of Labor Sta- additional investment. program dedicated to addressing Ohio’s TEA–21 also dedicated nearly all tistics, heavy construction jobs are up most pressing congestion, safety, and slightly from last year; however, there highway gas taxes to transportation rural access needs. The plan is predi- are still 3,800 fewer jobs than in August funding and guarantees that States cated on Congress enacting legislation 2000 when they were at their peak. will receive at least 90.5 percent of to correct the ‘‘ethanol penalty’’ which Moreover, last year had the lowest their share of their contribution to the reduces Ohio’s transportation revenue, number of employees in heavy con- highway account of the Highway Trust increase donor states’ minimum rate- struction since 1995. Fund. One of my top priorities for of-return to 95 percent, and provide an Our economy needs a public works TEA–21 reauthorization is to increase increased level of investment in the na- program to create jobs. Investment in the minimum share for donor states to tion’s highways and bridges. at least 95 percent. This increase in the our Nation’s transportation infrastruc- This is why a 6-year reauthorization rate of return would generate an addi- ture through a 6-year reauthorization is important to my State. I am hopeful tional $60 million or more in Federal bill would create thousands of jobs and that Congress can reach a consensus on highway funding for the State of Ohio. jumpstart our sluggish economy. Ac- how to fund a longer-term reauthoriza- cording to the U.S. Department of In May 2003, Senator CARL LEVIN and I, along with House majority leader tion. As far as this Senator is con- Transportation, for every $1 billion in- cerned, I support the principle that the TOM DELAY and Congressman BARON vested in highway construction, 47,500 highway program is a fully user-fee HILL introduced legislation—the High- jobs are created. It is also estimated based system that pays its own way, that every dollar invested in the Na- way Funding Equity Act of 2003—to in- crease donor States’ minimum rate-of- and I am reluctant to borrow more tion’s highway system generates $5.70 money for highways. in economic benefits, including reduced return to 95 percent. Currently, there Furthermore, as chairman of the delays, improved safety, and reduced are 143 cosponsors of the House bill and Clean Air Subcommittee of the Envi- vehicle operations costs. This is a six- 22 cosponsors of the Senate bill. ronment and Public Works Committee, to-one return on investment. The legislation we are considering Although a 5-month extension exten- today does not improve donor State eq- I look forward to working with my col- sion will continue the flow of Federal uity; rather, it continues current law leagues to include provisions in the 6- funding to States’ highway programs, with respect to the minimum guar- year reauthorization that will stream- it will not deal with the Nation’s press- antee program. For donor States, this line the project delivery process while ing, long-term transportation infra- is another reason why a 6-year reau- protecting the environment and his- structure needs. According to the Fed- thorization is so important and critical toric resources, reform the conformity eral Highway Administration’s, FHWA, to our States. I am strongly committed process, and reauthorize and improve 2002 Conditions and Performance Re- to improving donor state equity in the the Congestion Mitigation and Air port, the average annual investment longer term reauthorization, and look Quality program. level needed to make improvements to forward to working with my colleagues I urge my colleagues to work to- highways and bridges is projected to be on the Environment and Public Works gether to produce a six-year reauthor- $106.9 billion through 2020. This amount Committee to ensure that states re- ization of TEA–21 before the extension is 65.3 percent higher than the $64.6 bil- ceive their fair share of Highway Trust bill expires at the end of next Feb- lion of total capital investments spent Fund dollars. ruary. Reauthorization of TEA–21 will by all levels of government in 2000. I am disappointed that the legisla- be one of the most important actions The average annual investment level tion we are considering does not con- this Congress will take to get people necessary to maintain the current con- tain language which would have en- back to work.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00072 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.080 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12099 INEQUITY OF DONOR STATES ing the return to donor States. It is my cently enacted PROTECT Act legisla- Mr. LEVIN. Mr. President, I am con- intention that any comprehensive 6- tion, and presents another milestone in cerned that the 5-month highway bill year reauthorization bill considered by our efforts to safeguard all of our chil- extension being considered by the Sen- the Senate include a provision that dren. ate today does not address the inequity guarantees all donor States get to a 95 In the 29 years since it became law, faced by the donor States for so many percent minimum rate of return at the the Runaway and Homeless Youth Act years. The donor State inequity issue end of the life of the bill without harm- has helped some of the most vulnerable is the historic problem of about 20 ing the opportunity for all States to children in our country. I have worked States, including Michigan, Ohio and grow. However, Members need to un- in the past to extend the program, Oklahoma, known as ‘‘donor’’ States, derstand that this is only possible if we most recently in the 106th Congress, who have sent more gas tax dollars are able to fund the bill at $255 billion when I cosponsored S. 249, the Missing, year after year to the Highway Trust which means we must identify addi- Exploited, and Runaway Children Pro- Fund in Washington than were re- tional revenue. tection Act, which extended the act turned in transportation infrastructure I also want to further assure my through this year. I am pleased to help spending. The remaining 30 States, donor State colleagues that the next extend it once again. known as ‘‘donee’’ States, have re- highway bill I plan to mark up is a 6- A Justice Department report released ceived more transportation funding year bill. last year estimated that 1.7 million than they paid into the Highway Trust Mr. LEVIN. Mr. President, I am reas- young people either ran away from or Fund. For a long time there has been sured to hear such a strong commit- were thrown out of their homes in 1999 no legitimacy to retaining such anti- ment from my colleague from Okla- alone. Other studies have suggested an quated and unfair formulas that re- homa to achieve a 95-percent minimum even higher number. This law and the quire taxpayers in 20 of our States to rate of return for all States in the programs it funds provide a safety net subsidize highway projects in 30 other long-term highway reauthorization that helps give these young people a States. We should not consider a high- bill. I look forward to continuing to chance to build lives for themselves. It way bill without addressing this impor- work closely with the chairman to is slated to expire at the end of this fis- tant issue. achieve this goal and in the fight for cal year, and we should not allow that It is a high priority to see that this true donor State equity. to happen. historic inequity be corrected. At stake Mr. VOINOVICH. Mr. President, I am In my State, both the Vermont Coali- are tens of millions of dollars a year in also reassured to hear the strong con- tion for Runaway and Homeless Youth additional funding to pay for badly viction of my colleague from Okla- and Spectrum Youth and Family Serv- needed transportation improvements in homa that donor States should receive ices in Burlington receive grants under Michigan and the jobs that go with it. a minimum rate of return of 95 percent this law, and they have provided excel- My colleague from Ohio and I have au- on the share of their contributions to lent services both to young people try- thored legislation that would bring the Highway Trust Fund. I too look ing to build lives on their own and to donor States to a 95 percent rate of re- forward to working with the chairman those who are struggling on the turn on their contributions to the and my colleague from Michigan to im- streets. Reauthorizing this law will Highway Trust Fund. This would be up prove donor State equity. allow them to continue their enor- from the current minimum rate of re- Mr. FRIST. Mr. President, I ask mously important work. turn of 90.5 percent under the current unanimous consent that the bill be This bill would improve the law by TEA–21 bill. I am reluctant to see even read a third time and passed, the mo- extending the period during which a short term extension of the highway tion to reconsider be laid upon the older homeless youth can receive serv- bill go through without increasing the table; and that any statements relating ices under the Transitional Living Pro- minimum rate of return for donor to the bill be printed in the RECORD. gram, to ensure that all homeless States to address the inequity. I would The PRESIDING OFFICER. Without youth can take advantage of services at the very least like to get a commit- objection, it is so ordered. at least until they turn 18. The bill ment from the chairman that achiev- The bill (H.R. 3087) was read the third would also make permanent the Sec- ing donor State equity in a 6-year reau- time and passed. retary of Health and Human Services’ thorization bill in his intention and an f authority to make grants explicitly to urgent priority. I know he is as deter- help rural areas meet the unique RUNAWAY, HOMELESS, AND MISS- mined as we are to achieve equity for stresses of providing services to run- ING CHILDREN PROTECTION ACT donor States. away and homeless youth. Programs Mr. VOINOVICH. Mr. President, I Mr. FRIST. Mr. President, I ask serving runaway and homeless youth couldn’t agree more with my colleague unanimous consent that the Senate have found that those in rural areas from Michigan. There is no logical rea- proceed to the immediate consider- are particularly difficult to reach and son why donor States should be con- ation of Calendar No. 289, S. 1451. serve effectively, and this bill recog- tributing more dollars to the Highway The PRESIDING OFFICER. The nizes that fact. Trust Fund than are returned to them clerk will report the bill by title. The improvements proposed in this for highway, bridge, and other surface The assistant legislative clerk read bill to the Missing Children’s Assist- transportation projects. Donor States as follows: ance Act build on provisions included like Ohio, Michigan, and Oklahoma A bill (S. 1451) to reauthorize programs in the PROTECT Act legislation that have as many transportation infra- under the Runaway and Homeless Youth Act we enacted earlier this year. In that structure needs as other States. With and the Missing Children’s Assistance Act, bill, we authorized National Center for so many projects needing funding in and for other purposes. Missing and Exploited Children, our own States, why should the citi- There being no objection, the Senate NCMEC, activities through 2005 and au- zens in our States continue to pay for proceeded to consider the bill. thorized the Center to strengthen its transportation improvements in other Mr. LEAHY. Mr. President, I urge the CyberTipline to provide online users an States? Senate to take up and pass S. 1451, the effective means of reporting Internet- I, too, would like an assurance that Runaway, Homeless, and Missing Chil- related child sexual exploitation in dis- the donor State equity issue will be ad- dren Protection Act. It passed unani- tribution of child pornography, online dressed in the reauthorization of the mously in the Judiciary Committee enticement of children for sexual acts, Transportation Equity Act for the 21st earlier today, and it deserves the sup- and child prostitution. This bill would Century and that this long-term reau- port of every Senator. I joined with extend NCMEC through 2008. Now more thorization will be presented to the Senator HATCH in introducing this leg- than ever, it is critical for Congress to Senate as soon as possible. islation to reauthorize and improve the give the center the resources it needs Mr. INHOFE. Mr. President, I want Runaway and Homeless Youth Act, and in order to pursue its important work. my colleagues from Michigan, Ohio, to extend the authorization of the A missing or abducted child is the and the many other donor States to Missing Children’s Assistance Act. This worst nightmare of any parent or know that I am committed to improv- bill follows in the footsteps of the re- grandparent, and NCMEC has proved to

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00073 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.084 S26PT1 S12100 CONGRESSIONAL RECORD — SENATE September 26, 2003 be an invaluable resource in Federal, and other street youth need opportunities to amended by inserting after ‘‘days’’ the fol- State, and local efforts to recover chil- complete high school or earn a general lowing: ‘‘, except that a youth in a program dren who have disappeared. equivalency degree, learn job skills, and ob- under this part who is under the age of 18 Although this is a good bill on the tain employment; and years on the last day of the 540-day period ‘‘(5) improved coordination and collabora- may, if otherwise qualified for the program, whole, I am disappointed that Senator tion between the Federal programs that remain in the program until the earlier of HATCH did not agree to remove a provi- serve runaway and homeless youth are nec- the youth’s 18th birthday or the 180th day sion that was included in the House- essary for the development of a long-term after the end of the 540-day period’’. passed bill that prohibits grantees from strategy for responding to the needs of this SEC. 109. PART A PLAN COORDINATION ASSUR- using any funds provided under this population.’’. ANCES. program for needle distribution pro- SEC. 102. GRANT PROGRAM CONFORMING Section 312(b)(4)(B) of the Runaway and AMENDMENT. grams. This is a superfluous provision Homeless Youth Act (42 U.S.C. 5712(b)(4)(B)) The heading for part A of the Runaway and that simply repeats what is already is amended by striking ‘‘personnel’’ and all Homeless Youth Act (42 U.S.C. 5711 et seq.) is law. In addition, it is unnecessary be- that follows through the semicolon and in- amended by striking ‘‘RUNAWAY AND HOME- serting ‘‘McKinney-Vento school district li- cause no grantee under this program LESS YOUTH’’ and inserting ‘‘BASIC CENTER’’. aisons, designated under section operates needle exchange programs or SEC. 103. GRANTS FOR SERVICES PROVIDED. has expressed interest in doing so. The 722(g)(1)(J)(ii) of the McKinney-Vento Home- Section 311(a)(2)(C) of the Runaway and less Assistance Act (42 U.S.C. inclusion of this needless provision, Homeless Youth Act (42 U.S.C. 5711(a)(2)(C)) 11432(g)(1)(J)(ii)), to assure that runaway and however, does not change the fact that is amended— homeless youth are provided information this is still a very good bill. (1) in clause (ii) by striking ‘‘and’’; about the educational services available to The Runaway and Homeless Youth (2) in clause (iii) by striking the period and such youth under subtitle B of title VII of Act programs have received tremen- inserting ‘‘; and’’; and that Act;’’. dous bipartisan support over the years, (3) after clause (iii) by inserting the fol- lowing: SEC. 110. PART B PLAN COORDINATION AGREE- and the House has already passed its ‘‘(iv) at the request of runaway and home- MENT. version of this bill by a vote of 404 to less youth, testing for sexually transmitted Section 322(a) of the Runaway and Home- 14. I urge the Senate to follow suit diseases.’’. less Youth Act (42 U.S.C. 5714–2(a)) is amend- today. SEC. 104. REPEAL OF OBSOLETE PROVISION RE- ed— Mr. FRIST. Mr. President, I ask LATING TO CERTAIN ALLOTMENTS. (1) by striking ‘‘and’’ after the semicolon unanimous consent that the bill be Section 311(b) the Runaway and Homeless at the end of paragraph (13); read a third time and passed, the mo- Youth Act (42 U.S.C. 5711(b)) is amended— (2) by striking the period at the end of (1) in paragraph (2), by striking ‘‘Subject paragraph (14) and inserting ‘‘; and’’; and tion to reconsider be laid upon the (3) by adding at the end the following new table, and that any statements relating to paragraph (3), the’’ and inserting ‘‘The’’; (2) by striking paragraph (3); and paragraph: to the bill be printed in the RECORD. (3) by redesignating paragraph (4) as para- ‘‘(15) to coordinate services with McKin- The PRESIDING OFFICER. Without graph (3). ney-Vento school district liaisons, des- objection, it is so ordered. SEC. 105. ELIGIBILITY PROVISION. ignated under section 722(g)(1)(J)(ii) of the The bill (S. 1451) was read the third Section 312(a) of the Runaway and Home- McKinney-Vento Homeless Assistance Act time and passed, as follows: less Youth Act (42 U.S.C. 5712(a)) is amended (42 U.S.C. 11432(g)(1)(J)(ii)), to assure that S. 1451 by striking ‘‘juveniles’’ each place it appears runaway and homeless youth are provided and inserting ‘‘youth’’. information about the educational services Be it enacted by the Senate and House of Rep- available to such youth under subtitle B of SEC. 106. RECOGNITION OF STATE LAW RELAT- resentatives of the United States of America in title VII of that Act.’’. Congress assembled, ING TO CAPACITY LIMITATION ON ELIGIBLE RUNAWAY AND HOMELESS SECTION 1. SHORT TITLE. SEC. 111. PART B PLAN DEVELOPMENT. YOUTH CENTERS. Section 322(a)(7) of the Runaway and This Act may be cited as the ‘‘Runaway, Section 312(b)(2)(A) of the Runaway and Homeless Youth Act (42 U.S.C. 5714–2(a)(7)) is Homeless, and Missing Children Protection Homeless Youth Act (42 U.S.C. 5712(b)(2)(A)) amended to read as follows: Act’’. is amended by inserting after ‘‘youth’’ the ‘‘(7) to develop an adequate plan to ensure TITLE I—AMENDMENTS TO RUNAWAY AND following: ‘‘, except where the applicant proper referral of homeless youth to social HOMELESS YOUTH ACT assures that the State where the center or service, law enforcement, educational (in- SEC. 101. AMENDMENT TO FINDINGS. locally controlled facility is located has a cluding post-secondary education), voca- Section 302 of the Runaway and Homeless State or local law or regulation that requires tional, training (including services and pro- Youth Act (42 U.S.C. 5701) is amended to read a higher maximum to comply with licensure grams for youth available under the Work- as follows: requirements for child and youth serving fa- force Investment Act of 1998), welfare (in- cilities’’. ‘‘SEC. 302. FINDINGS. cluding programs under the Personal Re- ‘‘The Congress finds that— SEC. 107. MATERNITY GROUP HOMES. sponsibility and Work Opportunity Rec- ‘‘(1) youth who have become homeless or (a) ELIGIBILITY.—Section 322(a)(1) of the onciliation Act of 1996), legal service, and who leave and remain away from home with- Runaway and Homeless Youth Act (42 U.S.C. health care programs and to help integrate out parental permission, are at risk of devel- 5714–2(a)(1)) is amended— and coordinate such services for youths;’’. oping, and have a disproportionate share of, (1) by inserting after ‘‘group homes,’’ the serious health, behavioral, and emotional following: ‘‘including maternity group SEC. 112. COORDINATION OF PROGRAMS. problems because they lack sufficient re- homes,’’; and Section 341 of the Runaway and Homeless sources to obtain care and may live on the (2) by inserting after ‘‘use of credit,’’ the Youth Act (42 U.S.C. 5714–21) is amended— street for extended periods thereby endan- following: ‘‘parenting skills (as appro- (1) in paragraph (1), by striking ‘‘and’’ gering themselves and creating a substantial priate),’’. after the semicolon at the end; law enforcement problem for communities in (b) DEFINITION.—Section 322 of the Run- (2) in paragraph (2), by striking the period which they congregate; away and Homeless Youth Act (42 U.S.C. at the end and inserting ‘‘; and’’; and ‘‘(2) many such young people, because of 5714–2) is amended by adding at the end the (3) by adding at the end the following new their age and situation, are urgently in need following new subsection: paragraph: of temporary shelter and services, including ‘‘(c) DEFINITION.—In this part, the term ‘‘(3) shall consult, as appropriate, the Sec- services that are linguistically appropriate ‘maternity group home’ means a commu- retary of Housing and Urban Development to and acknowledge the environment of youth nity-based, adult-supervised transitional liv- ensure coordination of programs and services seeking these services; ing arrangement that provides pregnant or for homeless youth.’’. ‘‘(3) in view of the interstate nature of the parenting youth and their children with a SEC. 113. CLARIFICATION OF GRANT AUTHORITY. problem, it is the responsibility of the Fed- supportive and supervised living arrange- Section 343(a) of the Runaway and Home- eral Government to develop an accurate na- ment in which such pregnant or parenting less Youth Act (42 U.S.C. 5714–23(a)) is tional reporting system to report the prob- youth are required to learn parenting skills, amended by inserting after ‘‘service lem, and to assist in the development of an including child development, family budg- projects’’ the following: ‘‘regarding activi- effective system of care (including preven- eting, health and nutrition, and other skills ties under this title’’. tive and aftercare services, emergency shel- to promote their long-term economic inde- ter services, extended residential shelter, pendence in order to ensure the well-being of SEC. 114. TECHNICAL AMENDMENT RELATING TO and street outreach services) outside the their children.’’. DEMONSTRATION PROJECTS. welfare system and the law enforcement sys- SEC. 108. LIMITED EXTENSION OF 540-DAY SHEL- The section heading of section 344 of the tem; TER ELIGIBILITY PERIOD. Runaway and Homeless Youth Act (42 U.S.C. ‘‘(4) to make a successful transition to Section 322(a)(2) of the Runaway and 5714–24) is amended by striking ‘‘TEM- adulthood, runaway youth, homeless youth, Homeless Youth Act (42 U.S.C. 5714–2(a)(2)) is PORARY’’.

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00074 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.052 S26PT1 September 26, 2003 CONGRESSIONAL RECORD — SENATE S12101 SEC. 115. REPEAL OF OBSOLETE PROVISION RE- ‘‘(1) each year thousands of children are managers will continue to work LATING TO STUDY. abducted or removed from the control of a through remaining amendments to the The Runaway and Homeless Youth Act (42 parent having legal custody without such bill. I do expect to have votes during U.S.C. 5701 et seq.) is amended by striking parent’s consent, under circumstances which Monday’s session. If amendments are section 345 (42 U.S.C. 5714–25). immediately place the child in grave danger; offered to the bill, then it is possible SEC. 116. AGE LIMIT FOR HOMELESS YOUTH. ‘‘(2) many missing children are at great Section 387(3)(A)(i) of the Runaway and risk of both physical harm and sexual exploi- we could have votes on those amend- Homeless Youth Act (42 U.S.C. 5732a(3)(A)(i)) tation; ments Monday evening. If we are un- is amended by inserting after ‘‘of age’’ the ‘‘(3) in many cases, parents and local law able to make further progress on the following: ‘‘, or, in the case of a youth seek- enforcement officials have neither the re- bill, I would expect a vote on any avail- ing shelter in a center under part A, not sources nor the expertise to mount expanded able nominations. more than 18 years of age’’. search efforts; f SEC. 117. AUTHORIZATION OF APPROPRIATIONS. ‘‘(4) abducted children are frequently (a) OTHER THAN PART E.—Section 388(a)(1) moved from one locality to another, requir- THIS WEEK IN THE SENATE of the Runaway and Homeless Youth Act (42 ing the cooperation and coordination of Mr. FRIST. Mr. President, although U.S.C. 5751(a)(1)) is amended by striking local, State, and Federal law enforcement ef- we have not been able to finish the DC ‘‘such sums as may be necessary for fiscal forts; ‘‘(5) the National Center for Missing and appropriations this week, we have ad- years 2000, 2001, 2002, and 2003’’ and inserting dressed a number of significant, very ‘‘$105,000,000 for fiscal year 2004, and such Exploited Children— sums as may be necessary for fiscal years ‘‘(A) serves as the national resource center important issues over the course of the 2005, 2006, 2007, and 2008’’. and clearinghouse; week. (b) PART E.—Section 388(a)(4) of the Run- ‘‘(B) works in partnership with the Depart- Earlier in the week, we finished the away and Homeless Youth Act (42 U.S.C. ment of Justice, the Federal Bureau of Inves- Interior appropriations bill, after a lot 5751(a)(4)) is amended by striking ‘‘2000, 2001, tigation, the Department of the Treasury, of great work, fantastic work and lead- 2002, and 2003’’ and inserting ‘‘2004, 2005, 2006, the Department of State, and many other ership by Senator CONRAD BURNS and 2007, and 2008’’. agencies in the effort to find missing chil- the ranking member. (c) PART B ALLOCATION.—Section dren and prevent child victimization; and In addition, we completed final ac- ‘‘(C) operates a national and increasingly 388(a)(2)(B) of the Runaway and Homeless tion on three appropriations conference Youth Act (42 U.S.C. 5751(a)(2)(B)) is amend- worldwide network, linking the Center on- ed by striking ‘‘not less than 20 percent, and line with each of the missing children clear- reports, those being the Department of not more than 30 percent’’ and inserting ‘‘45 inghouses operated by the 50 States, the Dis- Defense, Homeland Security, and the percent and, in those fiscal years in which trict of Columbia, and Puerto Rico, as well legislative branch bills. Those will now continuation grant obligations and the qual- as with Scotland Yard in the United King- be sent to the President for his signa- ity and number of applicants for parts A and dom, the Royal Canadian Mounted Police, ture. B warrant not more than 55 percent’’. INTERPOL headquarters in Lyon, France, I am also pleased that the Senate was SEC. 118. REPORT ON PROMISING STRATEGIES and others, which enable the Center to trans- able to respond, very appropriately and TO END YOUTH HOMELESSNESS. mit images and information regarding miss- very quickly, on the Do Not Call legis- Not later than 2 years after the date of the ing children to law enforcement across the lation, although within several hours United States and around the world in- enactment of this Act, the Secretary of after passage, we had yet another set- Health and Human Services, in consultation stantly.’’. back, a setback in the sense that the with the United States Interagency Council SEC. 202. AUTHORIZATION OF APPROPRIATIONS. will of the American people is being on Homelessness, shall submit to the Con- (a) ANNUAL GRANT TO NATIONAL CENTER gress a report on promising strategies to end FOR MISSING AND EXPLOITED CHILDREN.—Sec- trumped by a decision made in a Colo- youth homelessness. tion 404(b)(2) of the Missing Children’s As- rado court on this issue of ‘‘do not SEC. 119. STUDY OF HOUSING SERVICES AND sistance Act (42 U.S.C. 5773(b)(2)) is amended call.’’ STRATEGIES. by striking ‘‘2005’’ and inserting ‘‘2008’’. Earlier this week, a Federal judge in The Secretary of Health and Human Serv- (b) IN GENERAL.—Section 408(a) of the Miss- Oklahoma had ruled that the Federal ices shall conduct a study of programs fund- ing Children’s Assistance Act (42 U.S.C. Trade Commission had no authority to ed under part B of the Runaway and Home- 5777(a)) is amended by striking ‘‘2005.’’ and operate the Do Not Call Telemarketing less Youth Act (42 U.S.C. 5714–1 et seq.) to re- inserting ‘‘2008’’. Registry, which was just about ready port on long-term housing outcomes for f to go into effect, and very quickly we youth after exiting the program. The study of any such program should provide informa- ORDERS FOR MONDAY, responded with legislation. But then, tion on housing services available to youth SEPTEMBER 29, 2003 last night, as most people know, a Col- upon exiting the program, including assist- orado judge ruled that the registry re- ance in locating and retaining permanent Mr. FRIST. Mr. President, I ask strictions were a violation of the first housing and referrals to other residential unanimous consent that when the Sen- amendment. programs. In addition, the study should iden- ate completes its business today, it ad- Even over the course of the morning, tify housing models and placement strate- journ until 1 p.m., Monday, September I can tell you, because of the number of gies that prevent future episodes of home- 29. I further ask consent that following phone calls that have come to me, and lessness. the prayer and pledge, the morning talking with constituents back home, SEC. 120. RESTRICTION ON USE OF FUNDS. hour be deemed expired, the Journal of as well as the news media, it clearly is The Runaway and Homeless Youth Act (42 proceedings be approved to date, the the sentiment, the feeling of the over- U.S.C. 5701 et seq.) is amended by adding at time for the two leaders be reserved for the end the following new section: whelming majority of Americans that their use later in the day, and there these decisions make no sense. ‘‘SEC. 389. RESTRICTION ON USE OF FUNDS. then be a period of morning business ‘‘(a) IN GENERAL.—None of the funds con- Americans this summer have signed tained in this title may be used for any pro- until 2 o’clock, with the time equally up for that ‘‘sound of silence’’ in the gram of distributing sterile needles or sy- divided in the usual form. Further, I evenings from that telephone ring ringes for the hypodermic injection of any il- ask consent that at 2 o’clock the Sen- right when they are sitting down for legal drug. ate resume consideration of H.R. 2765, that very special time—dinner with ‘‘(b) SEPARATE ACCOUNTING.—Any indi- the District of Columbia appropria- their family—and there are the repet- vidual or entity who receives any funds con- tions bill. itive phone calls that start coming to tained in this title and who carries out any The PRESIDING OFFICER. Without them by telemarketers hawking the program described in subsection (a) shall ac- objection, it is so ordered. count for all funds used for such program variety of wares with which we are all separately from any funds contained in this f familiar. The daily lives of millions of people title.’’. PROGRAM TITLE II—AMENDMENTS TO MISSING are interrupted each and every day— CHILDREN’S ASSISTANCE ACT Mr. FRIST. Mr. President, for the in- again and again—with that telephone SEC. 201. AMENDMENT TO FINDINGS. formation of all Senators, on Monday ring interrupting meals and family Section 402 of the Missing Children’s As- the Senate will resume consideration time, interrupting their togetherness. sistance Act (42 U.S.C. 5771) is amended to of the District of Columbia appropria- You pick up the phone and hear the read as follows: tions bill. It is my hope that the Sen- pitch. ‘‘SEC. 402. FINDINGS. ate will complete action on this meas- Every time I am in Tennessee, I hear ‘‘The Congress finds that— ure early in the week. On Monday, the about this. According to the FTC, as of

VerDate jul 14 2003 00:38 Sep 27, 2003 Jkt 019060 PO 00000 Frm 00075 Fmt 0637 Sfmt 0634 E:\CR\FM\A26SE6.076 S26PT1 S12102 CONGRESSIONAL RECORD — SENATE September 26, 2003 September 16—the most recent infor- ation from the floor, to work with us THE FOLLOWING NAMED OFFICER FOR APPOINTMENT IN THE UNITED STATES NAVY TO THE GRADE INDICATED mation available—677,669 Tennessee and to allow these individuals to be WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND phone numbers have been registered scheduled for votes. We have nomina- RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION 601: with the National Do Not Call Reg- tions, in fact, that have been on the To be vice admiral istry; over 187,000 of those registered by Executive Calendar since March, again, REAR ADM. HENRY G. ULRICH III phone and over 490,000 by the Internet waiting for us to act. I hope each of us THE FOLLOWING NAMED OFFICER FOR APPOINTMENT alone. will address this very important issue. AS CHIEF OF NAVAL RESERVE, UNITED STATES NAVY, As for parents, it is, as we all know, I do thank my colleagues in advance AND APPOINTMENT TO THE GRADE INDICATED WHILE for addressing this over the coming ASSIGNED TO A POSITION OF IMPORTANCE AND RESPON- one of those important interests, and SIBILITY UNDER TITLE 10, U.S.C., SECTIONS 601 AND 5143: we are committed to do something days. about that. f To be vice admiral Yesterday, with the leadership of ADJOURNMENT UNTIL 1 P.M., REAR ADM. JOHN G. COTTON Chairman BILLY TAUZIN in the House, MONDAY, SEPTEMBER 29, 2003 THE FOLLOWING NAMED OFFICER FOR APPOINTMENT the House responded with legislation. IN THE UNITED STATES NAVY TO THE GRADE INDICATED Mr. FRIST. Mr. President, if there is WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND Chairman MCCAIN, along with Senators no further business to come before the RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION 601: ENSIGN and DORGAN and many others in Senate, I ask unanimous consent the this body, worked on legislation iden- To be vice admiral Senate stand in adjournment under the tical to the Tauzin bill. We passed that VICE ADM. TIMOTHY J. KEATING previous order. bill. The House passed their bill. We THE FOLLOWING NAMED OFFICER FOR APPOINTMENT There being no objection, the Senate, IN THE UNITED STATES NAVY TO THE GRADE INDICATED passed our bill. Yet we now have this at 2:12 p.m., adjourned until Monday, UNDER TITLE 10, U.S.C., SECTION 624: Colorado ruling, from late yesterday, September 29, 2003, at 1 p.m. To be rear admiral (lower half) which goes counter to the will of the f American people. CAPT. ROBERT F. BURT CONFIRMATIONS At this juncture we will have to re- IN THE MARINE CORPS view the decision to determine how Executive nominations confirmed by THE FOLLOWING NAMED OFFICER FOR APPOINTMENT best to proceed, and for telemarketers the Senate September 26, 2003: IN THE UNITED STATES MARINE CORPS TO THE GRADE how we can put—and we will figure out DEPARTMENT OF DEFENSE INDICATED WHILE ASSIGNED TO A POSITION OF IMPOR- TANCE AND RESPONSIBILITY UNDER TITLE 10, U.S.C., some way to do it—some sort of perma- GORDON ENGLAND, OF TEXAS, TO BE SECRETARY OF SECTION 601: nent busy signal on the phones of fami- THE NAVY. THE ABOVE NOMINATION WAS APPROVED SUBJECT TO To be lieutenant general lies in Tennessee and indeed across the THE NOMINEE’S COMMITMENT TO RESPOND TO RE- QUESTS TO APPEAR AND TESTIFY BEFORE ANY DULY MAJ. GEN. JAN C. HULY country. CONSTITUTED COMMITTEE OF THE SENATE. Finally, earlier this week, we were AIR FORCE NOMINATIONS BEGINNING MARK T. ALLI- IN THE AIR FORCE SON AND ENDING FREDERICK M. WOLFE, WHICH NOMINA- able to schedule and give consent to TIONS WERE RECEIVED BY THE SENATE AND APPEARED THE FOLLOWING NAMED OFFICER FOR APPOINTMENT IN THE CONGRESSIONAL RECORD ON FEBRUARY 25, 2003. Senator DEWINE’s Video Voyeurism IN THE UNITED STATES AIR FORCE TO THE GRADE INDI- AIR FORCE NOMINATIONS BEGINNING GEOFFREY H. Prevention Act. Several important au- CATED WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION HILLS AND ENDING JOHN B. STEELE, WHICH NOMINA- thorizations were completed this week, 601: TIONS WERE RECEIVED BY THE SENATE AND APPEARED IN THE CONGRESSIONAL RECORD ON SEPTEMBER 2, 2003. including the one we just did with the To be lieutenant general AIR FORCE NOMINATIONS BEGINNING CRAIG H. MORRIS AND ENDING SHERICE D. YOUNG, WHICH NOMINATIONS Small Business reauthorization, as well LT. GEN. LANCE L. SMITH as the authorization for the Federal WERE RECEIVED BY THE SENATE AND APPEARED IN THE THE FOLLOWING NAMED OFFICER FOR APPOINTMENT CONGRESSIONAL RECORD ON SEPTEMBER 2, 2003. Maritime Commission. Senators IN THE UNITED STATES AIR FORCE TO THE GRADE INDI- AIR FORCE NOMINATION OF BRIAN P. OLSON. MCCAIN and SNOWE guided passage of CATED WHILE ASSIGNED TO A POSITION OF IMPORTANCE AIR FORCE NOMINATIONS BEGINNING TERI L. AND RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION POULTON-CONSOLDANE AND ENDING SHELDON G. WHITE, those measures. 601: WHICH NOMINATIONS WERE RECEIVED BY THE SENATE We also successfully negotiated an To be lieutenant general AND APPEARED IN THE CONGRESSIONAL RECORD ON agreement to allow for Senate passage SEPTEMBER 2, 2003. LT. GEN. WILLIAM R. LOONEY III AIR FORCE NOMINATIONS BEGINNING SCOTT G. BOOK of the U.S. Olympic Committee Reform IN THE ARMY AND ENDING SARAH K. SLAVENS, WHICH NOMINATIONS Act. Senator CAMPBELL and MCCAIN en- WERE RECEIVED BY THE SENATE AND APPEARED IN THE THE FOLLOWING NAMED OFFICER FOR APPOINTMENT CONGRESSIONAL RECORD ON SEPTEMBER 2, 2003. gaged in that effort and pushed ahead. IN THE RESERVE OF THE ARMY TO THE GRADE INDI- AIR FORCE NOMINATIONS BEGINNING STEPHEN W. Just a few moments ago, we also con- CATED UNDER TITLE 10, U.S.C., SECTION 12203: HUMPHREY AND ENDING RANDY J. YOVANOVICH, WHICH To be brigadier general NOMINATIONS WERE RECEIVED BY THE SENATE AND AP- firmed formally a number of military PEARED IN THE CONGRESSIONAL RECORD ON SEP- nominations, including Gordon Eng- COLONEL DENNIS P. GEOGHAN TEMBER 4, 2003. land to be Secretary of the Navy. AIR FORCE NOMINATION OF GERILYN A. POSNER. THE FOLLOWING NAMED OFFICER FOR APPOINTMENT ARMY NOMINATIONS BEGINNING WILLIAM T BARBEE, IN THE UNITED STATES ARMY TO THE GRADE INDICATED I would like to say, also, that we con- JR. AND ENDING KENNETH W YATES, WHICH NOMINA- WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND TIONS WERE RECEIVED BY THE SENATE AND APPEARED firmed six district judges this week. RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION 601: IN THE CONGRESSIONAL RECORD ON JUNE 16, 2003. Again, steady progress has been made To be lieutenant general ARMY NOMINATIONS BEGINNING STEPHEN W. AUSTIN AND ENDING NATHAN L. ZIMMERMAN, WHICH NOMINA- with respect to these judicial nomina- MAJ. GEN. CLAUDE V. CHRISTIANSON tions. Yet I very quickly have to re- TIONS WERE RECEIVED BY THE SENATE AND APPEARED THE FOLLOWING NAMED OFFICER FOR APPOINTMENT IN THE CONGRESSIONAL RECORD ON JULY 30, 2003. mind my colleagues that we have an IN THE UNITED STATES ARMY TO THE GRADE INDICATED ARMY NOMINATIONS BEGINNING MICHAEL J BULLOCK additional 12 judges that are now wait- WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND AND ENDING PAUL A TRAPANI, WHICH NOMINATIONS WERE RECEIVED BY THE SENATE AND APPEARED IN THE ing on the Executive Calendar. I will RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION 601: To be lieutenant general CONGRESSIONAL RECORD ON JULY 30, 2003. continue to work with the Democratic ARMY NOMINATIONS BEGINNING MADELFIA A. ABB LT. GEN. WILLIAM E. WARD AND ENDING X0007, WHICH NOMINATIONS WERE RE- leader to schedule Senate votes on CEIVED BY THE SENATE AND APPEARED IN THE CON- IN THE NAVY those remaining nominations. GRESSIONAL RECORD ON AUGUST 1, 2003. Let me close by saying—this is really THE FOLLOWING NAMED OFFICER FOR APPOINTMENT ARMY NOMINATIONS BEGINNING RICHARD K. ADDO IN THE UNITED STATES NAVAL RESERVE TO THE GRADE AND ENDING VERONICA S. ZSIDO, WHICH NOMINATIONS to notify my colleagues—on the Execu- INDICATED UNDER TITLE 10, U.S.C., SECTION 12203: WERE RECEIVED BY THE SENATE AND APPEARED IN THE tive Calendar we have a whole number CONGRESSIONAL RECORD ON AUGUST 1, 2003. To be rear admiral ARMY NOMINATIONS BEGINNING BRYAN K. ADAMS AND of—too many, I think—nonjudicial REAR ADM. (LH) PETER L. ANDRUS ENDING JOSEPH M. YOSWA, WHICH NOMINATIONS WERE nominations that are pending for floor RECEIVED BY THE SENATE AND APPEARED IN THE CON- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT GRESSIONAL RECORD ON AUGUST 1, 2003. action. IN THE UNITED STATES NAVAL RESERVE TO THE GRADE ARMY NOMINATIONS BEGINNING SCOTT E. ALEXANDER I know that individual Members may INDICATED UNDER TITLE 10, U.S.C., SECTION 12203: AND ENDING WILLIAM H. WOODS, WHICH NOMINATIONS To be rear admiral WERE RECEIVED BY THE SENATE AND APPEARED IN THE have specific concerns with some of CONGRESSIONAL RECORD ON AUGUST 1, 2003. these nominations, but I am also aware REAR ADM. (LH) JAMES M. MCGARRAH ARMY NOMINATION OF KEVIN J. CHAPMAN. that Senators will hold these nomina- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT ARMY NOMINATION OF MARY M. MCCORD. IN THE UNITED STATES NAVY TO THE GRADE INDICATED ARMY NOMINATION OF CHARLES A. JARNOT. tions so we cannot address them on the UNDER TITLE 10, U.S.C., SECTION 624: ARMY NOMINATION OF JOSEPH T. RAMSEY. ARMY NOMINATION OF JOHN B. MUNOZATKINSON. floor for unrelated issues. Because we To be rear admiral (lower half) are now coming down to the closing ARMY NOMINATION OF ANDREW D. STEWART. CAPT. RICHARD E. CELLON ARMY NOMINATIONS BEGINNING TYRONE C. * ABERO weeks of this session, I do hope and en- AND ENDING X3713, WHICH NOMINATIONS WERE RE- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT CEIVED BY THE SENATE AND APPEARED IN THE CON- courage each and every one of our IN THE UNITED STATES NAVAL RESERVE TO THE GRADE GRESSIONAL RECORD ON SEPTEMBER 10, 2003. Members to address, from their own INDICATED UNDER TITLE 10, U.S.C., SECTION 12203: ARMY NOMINATION OF GREGORY S. JOHNSON. To be rear admiral (lower half) ARMY NOMINATION OF TIMOTHY C. KELLY. perspective, these nominations, and if ARMY NOMINATIONS BEGINNING PAUL D. HARRELL there is something holding up consider- CAPT. BEN F. GAUMER AND ENDING WILLIAM S. LEE, WHICH NOMINATIONS

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WERE RECEIVED BY THE SENATE AND APPEARED IN THE NAVY NOMINATIONS BEGINNING EMMA J. M. BROWN WERE RECEIVED BY THE SENATE AND APPEARED IN THE CONGRESSIONAL RECORD ON SEPTEMBER 17, 2003. AND ENDING MARCIA L. ZIEMBA, WHICH NOMINATIONS CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. MARINE CORPS NOMINATION OF BRYAN D. MCKINNEY. WERE RECEIVED BY THE SENATE AND APPEARED IN THE NAVY NOMINATION OF PAUL C. BOWN. MARINE CORPS NOMINATION OF JON C. RHODES. CONGRESSIONAL RECORD ON AUGUST 1, 2003. NAVY NOMINATION OF PAUL H. EVERS. MARINE CORPS NOMINATION OF COLIN D. SMITH. NAVY NOMINATIONS BEGINNING BRENT T. CHANNELL NAVY NOMINATION OF ROBERT E. STONE. NAVY NOMINATIONS BEGINNING STEPHEN M. SAIA AND AND ENDING MATTHEW W. EDWARDS, WHICH NOMINA- NAVY NOMINATIONS BEGINNING WILLIAM K. BANE AND ENDING DAVID A. TUBLEY, WHICH NOMINATIONS WERE TIONS WERE RECEIVED BY THE SENATE AND APPEARED ENDING ANDY J. LANCASTER, WHICH NOMINATIONS RECEIVED BY THE SENATE AND APPEARED IN THE CON- IN THE CONGRESSIONAL RECORD ON AUGUST 1, 2003. GRESSIONAL RECORD ON JULY 30, 2003. NAVY NOMINATIONS BEGINNING MARC E BOYD AND WERE RECEIVED BY THE SENATE AND APPEARED IN THE NAVY NOMINATIONS BEGINNING ROLAND E. ARELLANO ENDING WENDY L SNYDER, WHICH NOMINATIONS WERE CONGRESSIONAL RECORD ON SEPTEMBER 17, 2003. AND ENDING MARVA L. WHEELER, WHICH NOMINATIONS RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING BRADLEY A WERE RECEIVED BY THE SENATE AND APPEARED IN THE GRESSIONAL RECORD ON SEPTEMBER 3, 2003. APPLEMAN AND ENDING FLORENCIO J YUZON, WHICH CONGRESSIONAL RECORD ON JULY 30, 2003. NAVY NOMINATIONS BEGINNING OLIVIA L BETHEA AND NOMINATIONS WERE RECEIVED BY THE SENATE AND AP- NAVY NOMINATIONS BEGINNING VIDA M. ENDING THERESA A TALBERT, WHICH NOMINATIONS PEARED IN THE CONGRESSIONAL RECORD ON SEP- ANTOLINJENKINS AND ENDING DOMINICK G. YACONO, WERE RECEIVED BY THE SENATE AND APPEARED IN THE TEMBER 17, 2003. JR., WHICH NOMINATIONS WERE RECEIVED BY THE SEN- CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. NAVY NOMINATIONS BEGINNING ERSKINE L ALVIS AND ATE AND APPEARED IN THE CONGRESSIONAL RECORD NAVY NOMINATIONS BEGINNING JASON B BABCOCK ENDING RANDY E WILLIAMS, WHICH NOMINATIONS WERE ON JULY 30, 2003. AND ENDING TIMOTHY J ZINCK, WHICH NOMINATIONS RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING JAMES J. ANDERSON WERE RECEIVED BY THE SENATE AND APPEARED IN THE GRESSIONAL RECORD ON SEPTEMBER 17, 2003. AND ENDING JOHN F. ZOLLO, WHICH NOMINATIONS WERE CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. NAVY NOMINATIONS BEGINNING MICHAEL S AGABEGI RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING REID B APPLEQUIST GRESSIONAL RECORD ON JULY 30, 2003. AND ENDING BRET A WASHBURN, WHICH NOMINATIONS AND ENDING REID J WINKLER, WHICH NOMINATIONS NAVY NOMINATIONS BEGINNING MICHAEL T. AKIN AND WERE RECEIVED BY THE SENATE AND APPEARED IN THE WERE RECEIVED BY THE SENATE AND APPEARED IN THE ENDING PETER G. WOODSON, WHICH NOMINATIONS WERE CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. CONGRESSIONAL RECORD ON SEPTEMBER 17, 2003. RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING TRACIE L ANDRUSIAK NAVY NOMINATIONS BEGINNING JOHN R ANDERSON GRESSIONAL RECORD ON JULY 30, 2003. AND ENDING ROBERT A WOLF, WHICH NOMINATIONS AND ENDING NICOLAS D I YAMODIS, WHICH NOMINA- NAVY NOMINATIONS BEGINNING RICHARD E. AGUILA WERE RECEIVED BY THE SENATE AND APPEARED IN THE TIONS WERE RECEIVED BY THE SENATE AND APPEARED AND ENDING SCOTT D. THOMAS, WHICH NOMINATIONS CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. IN THE CONGRESSIONAL RECORD ON SEPTEMBER 17, 2003. WERE RECEIVED BY THE SENATE AND APPEARED IN THE NAVY NOMINATIONS BEGINNING TIMOTHY A ANDER- NAVY NOMINATIONS BEGINNING ALAN L ADAMS AND CONGRESSIONAL RECORD ON JULY 30, 2003. SON AND ENDING DOUGLAS T WAHL, WHICH NOMINA- ENDING GEORGES E YOUNES, WHICH NOMINATIONS WERE NAVY NOMINATIONS BEGINNING LINDA M. ACOSTA AND TIONS WERE RECEIVED BY THE SENATE AND APPEARED RECEIVED BY THE SENATE AND APPEARED IN THE CON- ENDING JOAN L. WRIGHT, WHICH NOMINATIONS WERE IN THE CONGRESSIONAL RECORD ON SEPTEMBER 3, 2003. GRESSIONAL RECORD ON SEPTEMBER 17, 2003. RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING SOWON S AHN AND NAVY NOMINATIONS BEGINNING JAMES D ABBOTT AND GRESSIONAL RECORD ON JULY 30, 2003. ENDING SCOTT D YOUNG, WHICH NOMINATIONS WERE RE- NAVY NOMINATIONS BEGINNING LEANNE K. AABY AND CEIVED BY THE SENATE AND APPEARED IN THE CON- ENDING ROBERT W ZURSCHMIT, WHICH NOMINATIONS ENDING MICHAEL J. ZUCCHERO, WHICH NOMINATIONS GRESSIONAL RECORD ON SEPTEMBER 3, 2003. WERE RECEIVED BY THE SENATE AND APPEARED IN THE WERE RECEIVED BY THE SENATE AND APPEARED IN THE NAVY NOMINATIONS BEGINNING LEON S ABRAMS AND CONGRESSIONAL RECORD ON SEPTEMBER 17, 2003. CONGRESSIONAL RECORD ON JULY 30, 2003. ENDING CARL ZEIGLER, WHICH NOMINATIONS WERE RE- NAVY NOMINATIONS BEGINNING TIM K ADAMS AND NAVY NOMINATIONS BEGINNING LEE A. AXTELL AND CEIVED BY THE SENATE AND APPEARED IN THE CON- ENDING TIMOTHY P ZINKUS, WHICH NOMINATIONS WERE ENDING DENNIS W. YOUNG, WHICH NOMINATIONS WERE GRESSIONAL RECORD ON SEPTEMBER 3, 2003. RECEIVED BY THE SENATE AND APPEARED IN THE CON- RECEIVED BY THE SENATE AND APPEARED IN THE CON- NAVY NOMINATIONS BEGINNING RAFAEL A ACEVEDO GRESSIONAL RECORD ON SEPTEMBER 17, 2003. GRESSIONAL RECORD ON JULY 30, 2003. AND ENDING TODD A ZIRKLE, WHICH NOMINATIONS

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