E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 109 CONGRESS, FIRST SESSION

Vol. 151 WASHINGTON, THURSDAY, NOVEMBER 17, 2005 No. 153—Book II Senate IRAQ PRE-WAR INTELLIGENCE izing war. The vote on the resolution Mr. President, I yield the floor. Mr. KENNEDY. Mr. President, yes- occurred 1 week later, on October 11. Mr. GRASSLEY. Mr. President, I terday Vice President CHENEY said Beyond the NIE, the suggestion that spend most of my time with the work elected officials had access to the intel- the Members of Congress have access of the Judiciary Committee and the ligence and were free to draw their own to the same classified material as the work of the Finance Committee. I do conclusions. They arrived at the same President is preposterous. The Presi- not get into intelligence and Armed judgment about Iraq’s capabilities and dent receives a Presidential daily brief Services issues very often. But I lis- intentions made by this administration and a briefing every morning with top tened to Senator KENNEDY’s criticism and by the previous administration. intelligence officials. The White House of President Bush and Vice President What world is the Vice President living has access to memos with intelligence CHENEY that they deceived the Amer- in? No one seriously believes what the information that the Congress never ican people. Vice President is saying. Once again, sees. Even when we ask for this infor- I saw some things on television last he is deliberately deceiving the Amer- mation, they do not provide it. night of which Senator KENNEDY ought ican people. It is a calculated, partisan, It is abundantly clear that the ad- to be reminded. If he watched tele- political ploy. ministration is engaged in nothing vision last night, he might have a little President Bush and the Vice Presi- more than a devious attempt to ob- different view. dent have begun a new campaign of dis- scure the facts and take the focus off I heard him say that President Bush tortion and manipulation because the the real reason we went to war in Iraq. maybe had more information than Con- polls show that Americans have lost No matter what the Vice President gress had, and so it was wrong for the trust in the President and believe he says, 150,000 American troops are President today to say that Congress is manipulated intelligence before the bogged down in a quagmire in Iraq be- rewriting history in any way because war. The President and Vice President cause the Bush administration mis- he maybe had more information than have abandoned any pretense of leading represented and distorted the intel- we had. I believe that is what Senator this country and have gone back on to ligence to justify a war America never KENNEDY said. the campaign trail. should have fought. They misled us on I do not know for sure if the Presi- But the country won’t have it this al-Qaida. They misled us on aluminum dent has more information than we time. Not only can the President and tubes, materials from Africa, and nu- have because when I go upstairs to S– Vice President not find weapons of clear weapons. 407, to our secure briefing room, I am mass destruction, they cannot find the What was said before by the adminis- assuming I am getting the same infor- truth either. The administration broke tration does matter. The President’s mation as the President is getting. the essential bond of trust that has to words matter, and so do the Vice Presi- Perhaps not as often, but getting the exist between the White House and the dent’s, and so do the Secretary of same information. So I think it is ludi- American people. They have to be able State’s, and so do the Secretary of De- crous to say that Members of the Sen- to trust that we will be told the truth, fense’s, and the other high officials in ate cannot be up to speed on what the especially on the important issues of the administration, and they did not threats are to our Nation. But, for war and peace. square with the facts. sure, if he had watched television last The Congress did not have access to The Intelligence Committee agreed night, he would have heard a speech by the intelligence the President and the to investigate the clear discrepancies, President Clinton in 1998. The speech Vice President had. It is plain wrong. and it is important they get to the bot- was on the threat of Saddam Hussein The administration’s drumbeat for war tom of this and find out how and why to our country at that time. Surely, began in the summer of 2002, but it did this President took America to war in Senator KENNEDY cannot deny that not provide an intelligence estimate— Iraq. Americans are dying. Already President Clinton had exactly the same the collective wisdom of the intel- more than 2,000 have been killed, and information President Bush would have ligence community—to back up its more than 15,000 have been wounded. had from our intelligence community. claims about al-Qaida and nuclear The American people deserve the I very clearly heard President Clinton, weapons and the immediate threats truth. It is time for the President to when he was President, speak of the until Democrats on the Intelligence stop passing the buck and for him to be terrible threat that Saddam Hussein Committee demanded it. held accountable. It is time for a was to the world and to America, and Even then, the administration did change in this country. Something has that he was going down a road to do not provide the intelligence estimate to give. A tarnished White House and something about it. until October 1, 2002—2 days before the damaged Presidency is pulling America Now, obviously, that did not happen. debate began on the resolution author- backwards. But we did pass a resolution called the

∑ 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 Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00001 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.089 S17NOPT2 S13148 CONGRESSIONAL RECORD — SENATE November 17, 2005 Iraqi Liberation Act, where Congress, pointed to a commission to look into believed that a free press is a corner- in a unanimous vote took a position at this, have reported. When you take all stone of democracy, both here and that period of time that we considered of these things into consideration, plus abroad. Last year, at my urging, Con- Saddam Hussein a threat and that he the quotes of Senator CLINTON that I gress created a free press institute at ought to be removed from office, from referred to in the year 2002 that I saw the National Endowment for Democ- the leadership of his country. on television last night, or the state- racy to promote, as part of our democ- If President Clinton, while he was in ments by President Clinton in 1998 racy-building efforts, free, independent office, using that intelligence, saw Sad- when he was President that I saw on and sustainable news media organiza- dam Hussein as a threat, the same way television last night, it seems to me it tions overseas. This year, I introduced President Bush did, I do not see how is absolutely wrong and misleading to the Free Flow of Information Act to any Democrat can be on the floor of come up here and say the President of allow journalists in this country to the Senate and say the President of the the United States and the Vice Presi- protect the identity of their confiden- United States is deceiving the Amer- dent were deceiving the American peo- tial sources. After I introduced the leg- ican people. ple, particularly when Senators can islation, a reporter for one of Amer- Also, last night I happened to hear a have briefings if they want them. ica’s most respected media organiza- tions, Judith Miller of the New York 2- or 3-minute speech by Senator CLIN- f TON, made in 2002, how horrible Saddam Times, was jailed for 85 days for failing Hussein was and how he was somebody FREEDOM IN ASIA AND BURMA to disclose a confidential source, while to fear and a threat and the inclination Mr. MCCONNELL. Mr. President, I another, Matt Cooper of Time maga- of doing something about it. want to take a moment to commend zine, was also threatened with jail for It is intellectually dishonest for any President Bush for his superb remarks the same reason. I believe that in order Democrat to come to the floor and ac- regarding freedom and democracy in for the United States to foster the cuse our President of misleading the Asia. It is fitting that these comments spread of freedom and democracy glob- American people. They ought to be were made in Japan, a key strategic ally, we must support an open and free ashamed of themselves. Have they no ally of the United States. press at home. shame? I will not recount the entire speech— According to Reporters Without Bor- I have something I want to refer to which I encourage all my colleagues to ders, 112 journalists are currently because we have had people outside the read—but will highlight two para- jailed in 23 countries, including places Congress, outside the administration, graphs. The President said: like China, Cuba, Eritrea, and Burma. This is not good company for the look at some of these very issues. We Unlike China, some Asian nations still had the Robb-Silberman commission have not taken even the first steps toward United States to keep. I urge the ad- report. Senator Robb is a former Demo- freedom. These regimes understand that eco- ministration and our diplomats over- cratic Member of this body. Judge Sil- nomic liberty and political liberty go hand seas to do everything they can to gain berman is a Republican, served on the in hand, and they refuse to open up at all. the release of these jailed journalists, DC Circuit. They gave a report about The ruling parties in these countries have who were doing nothing more than try- Presidential daily briefings versus managed to hold onto power. The price of ing to keep their fellow citizens in- what is in the National Intelligence Es- their refusal to open up is isolation, back- formed. I ask unanimous consent that wardness, and brutality. By closing the door timate. There is no significant dif- the following information from Report- to freedom, they create misery at home and ers Without Borders be printed in the ference between the two reports, the sow instability abroad. These nations rep- Presidential daily briefing and the Na- resent Asia’s past, not its future. RECORD. tional Intelligence Estimate. Quoting We see that lack of freedom in Burma—a There being no objection, the mate- from the report: nation that should be one of the most pros- rial was ordered to be printed in the RECORD, as follows: It was not that the intelligence was mark- perous and successful in Asia but is instead edly different. Rather, it was that the PDBs one of the region’s poorest. Fifteen years 16TH JAILED JOURNALISTS’ SUPPORT DAY, and the SEIBs, with their attention-grabbing ago, the Burmese people cast their ballots— THURSDAY, NOVEMBER 17, 2005. headlines and drumbeat of repetition, left an and they chose democracy. The government Reporters Without Borders calls on the impression of many corroborating reports responded by jailing the leader of the pro-de- media to demonstrate their solidarity with where in fact there were very few sources. mocracy majority. The result is that a coun- imprisoned journalists. We were exception- And in other instances, intelligence sug- try rich in human talent and natural re- ally active when journalists were being held gesting the existence of weapons programs sources is a place where millions struggle hostage in Iraq, and our challenges may was conveyed to senior policymakers, but simply to stay alive. The abuses by the Bur- seem less urgent now. But that is not the later information casting doubt upon the va- mese military are widespread, and include case. A total of 186 media people (112 journal- lidity of that intelligence was not. rape, and torture, and execution, and forced ists, 3 assistants and 71 cyber-dissidents) are relocation. Forced labor, trafficking in per- imprisoned in 23 countries. What crimes have That is shortcomings of our intel- sons, and use of child soldiers, and religious ligence community, the same short- they committed? They have revealed sen- discrimination are all too common. The peo- sitive issue, called for democracy and great- comings that President Clinton prob- ple of Burma live in the darkness of tyr- er respect for individual freedoms, refused to ably experienced during his time in of- anny—but the light of freedom shines in give in to censorship or to an enforced line of fice, when he was making estimates of their hearts. They want their liberty—and thought. In short, they simply tried to do the threat of Saddam Hussein, the one day, they will have it. their jobs. same way that President Bush was These words should ring loudly and In an appeal for solidarity with imprisoned making those estimates. clearly throughout the region. I com- journalists, Reporters Without Borders is or- The Robb-Silberman commission mend President Bush for these com- ganizing the 16th consecutive annual day of action. We are urging the worldwide news found Presidential daily briefings to ments and for the solid leadership he media- throughout the world— to acknowl- contain similar intelligence in ‘‘more provides in supporting freedom in edge the fate of those who have to struggle alarmist’’ and ‘‘less nuanced’’ lan- Burma. Moreover, I applaud the efforts every day for the right to report the news. guage. Continuing to quote: made by President Bush and Secretary To break the silence concerning their As problematic as the October 2002 [Na- Rice to put Burma on the U.N. Secu- plight and to bring it to the public attention tional Intelligence Estimate] was, it was not rity Council’s agenda. of the public, Reporters Without Borders the Community’s biggest analytic failure on calls on the news media to highlight the case f Iraq. Even more misleading was the river of of an imprisoned journalist on this year’s intelligence that flowed from the CIA to top SUPPORT FOR JAILED ‘‘action day’’, Thursday, November 17. The jails of three countries alone are hold- policymakers over long periods of time—in JOURNALISTS DAY the President’s Daily Brief and in its more ing more than half of the world’s imprisoned widely distributed companion, the Senior Mr. LUGAR. Mr. President, today is journalists. The three countries that con- Executive Intelligence Brief. These daily re- ‘‘action day’’ to support jailed journal- stitute the world’s biggest prisons traps for ports were, if anything, more alarmist and ists around the world, as declared by the press are China (with 31 journalists be- hind bars), Cuba (23), and Eritrea (13). less nuanced than the [National Intelligence the independent organization, Report- Mobilization is needed to ease the harsh re- Estimate]. ers Without Borders. I rise today to ex- ality of prison conditions. Denied contact That is what one former Democratic press my support for this cause and to with their families and even proper nourish- Senator and a Republican judge, ap- emphasize that our country has long ment, most of these journalists live within

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00002 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.090 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13149 poor or non-existent sanitary conditions. and phone. He appeared last August before He has a groin hernia which could kill him They are frequently isolated from fellow the prison disciplinary council for sending if he does have an operation. prisoners and left to cope in terrible isola- information to Miami radio stations. He was Dominique Makeli—RWANDA tion. then put in solitary confinement, without Dominique Makeli, a Radio Rwanda com- The purpose of this Day is above to free electricity, and was not allowed to use the mentator, has been in prison in Rwanda these journalists from yet another prison, phone. since 18 September 1994. After being moved that of silence and oblivion. Unless their His health has steadily worsened in prison. several times, he is now in the main prison cases are regularly brought before inter- His frequent spells in solitary confinement in Kigali. national public the guilty governments will (73 days in his first 11 months) aggravated The public prosecutor told Reporters With- retain impunity. They will have no reason to his ailments, including frequent diarrhea, out Borders in October 2001 that he was ac- worry about the fate of prisoners in their stomach and joint pains, swollen feet and a cused of ‘‘incitement to genocide in his re- jails. Publicity thus becomes a sort of ‘‘life paralyzed arm and, in April 2005, high fever, porting.’’ He had reported on an apparition insurance’’ contributing directly to the pro- urinary problems and back pain. He does not of the Virgin Mary in Kibeho (west of tection of the prisoners. get the medicine he needs. Butare) in May 1994 and had quoted her sup- It also allows a furtherance of the struggle Win Tin—BURMA begun by the imprisoned journalists. Articles posed words : ‘‘The parent is in heaven.’’ Win Tin, one of the political mentors of The prosecutor said people would have un- that media write about them underscore the Nobel Peace Prize winner Aung San Suu Kyi, reasons and the circumstances of their arrest derstood this as divine support for President continues to serve his 20–year prison sen- [Juvenal] Habyarimana and, by extension, as well as the issues the journalists were tence. He is regularly offered freedom in ex- working on before they were imprisoned. In for the policy of exterminating Tutsis. change for a signed promise to give up all po- Thiswas disputed by Makeli and many wit- speaking about their case, the sponsor cir- litical activity. But ‘‘Saya’’ (Teacher), as his cumvents the censorship they suffered and nesses. His case-file was sent in August 2004 friends call him, has always refused to cut to a gacaca (a village court system revived exposes the unfairness of their imprison- such a deal and break his ties with the Na- ment. by the authorities). tional League for Democracy, which was Complete biographies of these journalists A media’s decision to cover the plight of a cheated out of its landslide victory at the journalist demonstrates its commitment to and others are available upon request. Please 1990 general elections. contact Lucie Morillon, Reporters Without defend the right to freely inform and to be He was convicted of ‘‘subversion’’ and informed. It allows journalists to show their Borders Washington Director, (202) 256–5613 ‘‘anti-government propaganda.’’ In 1996, he or [email protected] solidarity with colleagues with whom they was held for five months in a dog-kennel at share their passion for a job that is so cru- Rangoon’s Insein prison. He has since had PRESS FREEDOM KEY STATISTICS AS OF cial to ensuring democracy. Since this cam- two heart attacks and lost most of his teeth. NOVEMBER 2, 2005 paign was launched in 1989, more than 100 Now 75, he has been shuttling back and forth Reporters Without Borders has been de- journalists have been sponsored by media all between his cell and the spartan prisoners’ fending the public’s right to news and infor- around the world. Some media outlets de- wing of Rangoon hospital for the past few mation for 20 years. It intervenes as soon as cided to cover their plight without endorsing years. possible when the freedom to inform and be one particular case. Almost half of them These days, Burma’s military rulers treat informed is under threat is at risk, or as have been released and in part as a result of him with a little more respect and he now soon as a journalist somewhere in the world the support from their sponsors. Several has his own cell. But he is still not allowed is imprisoned anywhere just for doing their journalists sponsored by International media to write anything. job. Journalists are still being routinely tar- have been released like Fatimah Nisreen Akbar Ganji—IRAN geted in more than half the world’s countries (The Maldives) amnestied on 9 May 2005 or This Iranian journalist with the reformist represented at the United Nations. Raul Rivero (Cuba) released on 30 November daily Sobh-e-Emruz, Neshat and Asr-e´- By paying for defense lawyers when to as- 2004. Azadegan was arrested on April 22, 2000 when sist journalists are tried at their trial, giving On the day of their release, many journal- he returned from a conference in Berlin that financial aid to the families of murdered or ists stressed the value of not feeling ‘‘utterly the Iranian authorities considered ‘‘anti-Is- imprisoned journalists who have been killed forgotten’’. It gave them the courage to con- lamic’’ and ‘‘anti-revolutionary.’’ In January or imprisoned, waging public- awareness tinue to bear their imprisonment. 2001, he was sentenced to 10 years in jail and campaigns and taking care offering help to The struggle the news media undertake to banishment. of journalists who are forced to flee their alongside Reporters Without Borders to de- He had to answer 10 charges, based on com- country, Reporters Without Borders takes fend the existence of a free press is not hope- plaints filed by the ministry of intelligence, action every day to combat censorship. less. Even when those steps appear to have the police and a former minister of intel- PRESS FREEDOM BAROMETER been in vain, we know that international ligence. The prosecutor accused him of ‘‘act- backing for a prisoner brings essential psy- Worldwide, more than 684 journalists have ing against national security’’, ‘‘circulating chological support and often protects his or been killed since 1992. propaganda against the Islamic system’’, and her life. This achievement alone represents a More than 1,450 journalists were arrested, ‘‘insulting religious figures.’’ He was also ac- victory over authoritarianism and repression beaten, threatened, kidnapped or otherwise cused of publishing articles accusing senior carried out by so many governments. harassed and more than 320 media were officials of involvement in the murder of re- Please find below: censored in 2004. gime opponents and intellectuals in 1998. In —a few examples of cases of jailed journal- 53 journalists have been killed since the May 2001, his sentence was reduced from 10 ists start of 2005. —press freedom barometer—Key statistics years to six months. In July 2001, the Su- 5 media assistants have lost their lives —the list of 112 journalists imprisoned preme Court increased it to 6 years. since the start of 2005. Akbar Ganji was held in Evin prison in worldwide (as of November 2, October 2005) 73 journalists have been killed in Iraq in —the list of the current sponsors Tehran, where he was able to continue read- March 2003, making it the deadliest war for ing and writing. But he was not able to tele- Yu Dongyue—CHINA the press since World War II. phone his family or receive medical treat- Worldwide, 112 journalists and 3 media as- A journalist and art critic with the ment despite suffering from acute asthma. sistants are currently in prison for doing Liuyang News, he was arrested on 23 May He began a hunger strike on June 11 and lost their job. 1989 during student demonstrations in 44 kilos in the course of the next month. 71 cyber-dissidents are currently in prison, Tienanmen Square in Beijing. He was con- Akbar Ganji finally calls off his hunger 62 of them in China. 112 journalists are cur- victed on 11 July that year of ‘‘sabotage’’ strike after more than 60 days. He was sent rently in prison just for trying to report the and ‘‘counter-revolutionary propaganda’’ and back to Evin prison in early September. news. jailed by the Beijing intermediate municipal Pham Hong Son—VIETNAM The jails of three countries alone are hold- court for 20 years, with five years depriva- Medical doctor and local representative of ing more than half of the world’s imprisoned tion of civil rights. His sentence was cut by a foreign pharmaceutical company. He has journalists. two years in March 2000 but he is not due to been in prison since March 2002 for trans- The three countries that constitute the be released until 21 May 2007. Yu is suffering lating and posting online an article from the world’s biggest prisons traps for the press from psychological problems as a result of local US embassy website called ‘‘What is de- are China (with 31 journalists behind bars), long spells in solitary confinement. mocracy?’’ and an essay called ‘‘Encouraging Cuba (23), and Eritrea (13). Miguel Galva´ n Gutie´rrez—CUBA signs for democracy in Vietnam.’’ He had Their crimes? Revealing embarrassing Journalist with the independent news earlier written and posted on Vietnamese on- facts, demanding more respect for civil agency Havana Press, he was accused of line discussion groups several articles advo- rights, or refusing to submit to censorship or being ‘‘a mercenary in the pay of a foreign cating democracy and human rights. adopt a particular set of views. Physical and power’’ and convicted to 26 years in jail. As He was sentenced to 13 years imprisonment psychological harassment, intimidation and with other dissidents arrested at the time, in June 2003 for ‘‘spying,’’ followed by three permanent surveillance are also used rou- his arrest reportedly came after a long years of house arrest, by the Hanoi People’s tine. search of his home and seizure of papers and Court. The prison sentence was reduced on The 112 journalists imprisoned worldwide equipment such as a typewriter, fax machine appeal to five years on 26 August that year. (as of November 2, October 2005)

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00003 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.078 S17NOPT2 S13150 CONGRESSIONAL RECORD — SENATE November 17, 2005 Afghanistan (1): Ali Mohaqiq Nasab: sen- Alfredo Felipe Fuentes: sentenced to 26 Akbar Ganji: sentenced to 6 years in pris- tenced to two years in prison. years. on. Algeria (1): Mohammed Benchicou: sen- Mijail Barzaga Lugo: sentenced to 15 years. Laos (1): Thongpaseuth Keuakoun was sen- tenced to two years in prison. Mario Enrique Mayo Herna´ ndez: sentenced tenced to 20 years in prison. Burma (6): Lazing La Htoi: arrested on to 20 years. Libya (1): Abdullah Ali Al-Sanussi Al- July 27 July, 2004, and still awaiting trial. Pablo Pacheco A´ vila: sentenced to 20 Darrat has been in prison since January 1, Ne Min: sentenced to 15 years. years. 1973 and, is by all accounts, has yet to have Monywa Aung-Shin: sentenced to 7 years. Fabio Prieto Llorente: sentenced to 20 been sentenced. Than Win Lhaing: sentenced to 7 years. years. Maldives (3): Jennifer Latheef: sentenced Thaung Tun: sentenced to 8 years. Adolfo Ferna´ ndez Sainz: sentenced to 15 to 10 years in prison. Win Tin: sentenced to 20 years. years. Colonel Mohammed Nasheed: awaiting China (31): Asia continues to be the world’s He´ctor Maseda Gutie´rrez: sentenced to 20 trial. most repressive continent for journalists. In years. Abdullah Saeed: awaiting trial. East Asia, China is ranked 159th in the Re- Julio Ce´sar Ga´ lvez Rodrı´guez: sentenced to Morocco (2): Anas Tadili: sentenced to 10 porters Without Borders Worldwide Press 15 years. months in prison on a non-political charge Freedom Index (October 20, 2005), making. Alfredo Manuel Pulido Lo´ pez: sentenced to dating back 10 years, and then was given an That puts it among one of the world’s 10 14 years. additional 6 months in a press case. The sen- worst countries. Some media have been Jose´ Ubaldo Izquierdo Herna´ ndez: sen- tences were commuted to 1 year on appeal privatized, but the government’s propaganda tenced to 16 years. (on September 29, 2004) to one year. The Ju- department is watchful scrutinizing the Victor Rolando Arroyo Carmona: sen- dicial authorities are investigating some 10 media and the banned media has been banned tenced to 26 years. other accusations that have been brought from covering dozens of sensitive subjects in Miguel Galva´ n Gutie´rrez: sentenced to 26 against him. the course of the pover the last year. Crack- years. Abderrahmane El Badraoui: sentenced to 4 downs by the authorities and violence Pedro Argu¨ elles Mora´ n: sentenced to 20 years. against journalists by armed groups prevent years. Nepal (2): Nagendra Upadhyaya and are keeping the media from expressing them- Omar Rodrı´guez Saludes: sentenced to 27 Tejnarayan Sapkota: detained under an anti- selves freely. years. terrorist law, and awaiting trial. Ching Cheong: imprisoned in jail since Jose´ Luis Garcı´a Paneque: sentenced to 24 Uzbekistan (4): Nosir Zokirov: sentenced April 22, 2005. Still awaiting trial. years. on August 26, 2005 to 6 months in prison. Tashi Gyaltsen, Lobsang Dhargay, Thoe Ricardo Gonza´ lez Alfonso: Reporters With- Sabirjon Yakubov: sentenced to 20 years in Samden, Tsultrim Phelgay, Jampel Gyatso: out Borders correspondent, sentenced to 20 prison. imprisoned since January 14, 2005. Awaiting years. Jusuf Ruzimuradov: arrested on August 18, trial. Ivan Herna´ ndez Carrillo: sentenced to 25 1999. Sentenced to 8 years in prison. Shi Tao: sentenced to 10 years in prison. years. Mohammed Bekjanov: sentenced to 15 Zhao Yan: awaiting trial. Egypt (1): Abd al-Munim Gamal al Din Abd years in prison. Li Minying: sentenced to 6 years. al Munim has been subject to serving out an Rwanda (4): Father Guy Theunis: impris- Yu Huafeng: sentenced to 8 years. indefinite internment order since October 30, oned since September 10, 2005, pending trial. Zhang Wei: sentenced to 6 years. 1993. Jean-Leo´ nard Rugambage: detained since Zuo Shangwen: sentenced to 5 years. Eritrea (13): 166th in the Worldwide Press September 7, 2005, pending trial. Ou Yan: his release date has yet to be an- Freedom Index-, is a ‘‘black hole’’ country Tatiana Mukakibibi: detained since Octo- nounced. Although he has already completed for news. Not one of the 13 journalists cur- ber 2, 1996. Has not yet been tried. a 2-year prison sentence. rently detained in custody has ever been Dominique Makeli: imprisoned since Sep- Wang Daqi: sentenced to 1 year in prison, given a trial. So therefore, none has received tember 18, 1994. Not yet been tried. he was not freed after completing serving his an official sentence. Sierra Leone (1): Paul Kamara: serving sentence. Hamid Mohamed Said, Saleh Al Jezaeeri prison sentences totalling 4 years (two year Lu Wanbin: arrested on December 22, 2001. and Saidia Ahmed have been in prison since sentences). Awaiting trial. February 2002. Tunisia (1): Hamadi Jebali: sentenced on Ma Linhai: arrested on November 24, 2001. Seyoum Tsehaye, jailed since September January 31, 1991 to 1 year in prison for defa- Awaiting trial. 21, 2001. mation. Given an additional 16–year sentence Feng Daxun: he was never released after Temesgen Gebreyesus and Said on August 28, 1992 for ‘‘membership in an il- completing a 3-year prison sentence. Abdulkader, since September 20, 2001. legal organization’’ and ‘‘wanting to change Jiang Weiping: sentenced to 9 years. Mattewos Habteab and Yusuf Mohamed the nature of the state.’’ Xu Zerong: sentenced to 13 years. Ali, since September 19, 2001. Turkey (2) Memik Horuz: sentenced to 15 Li Jian: arrested in November 1999. No Medhanie Haile, Emanuel Asrat, Dawit years in prison on June 13, 2002 to 15 years in news about his trial. Isaac and Fessehaye Yohannes, since Sep- prison. Zha Jianguo: sentenced to 9 years. Sinan Kara: sentenced to 9 months in pris- Gao Hongming: sentenced to 8 years. tember 18, 2001. on. Yu Tianxiang: sentenced to 10 years. Dawit Habtemichael, since September 2001. Working together to advance the cause of Gao Qinrong: sentenced to 13 years. Ethiopia (2): Neither of the two imprisoned Qin Yongmin: sentenced to 12 years. journalists have been tried, and so neither of press freedom. Reporters Without Borders Fan Yingshang: sentenced to 15 years. them have been officially sentenced. would like to thank the sponsors of impris- Zhang Yafei: sentenced to 11 years. Shiferraw Insermu and Dhabassa Wakjira: oned journalists for all they have done and Hu Liping: sentenced to 10 years. imprisoned prisoners since 22 April 2004. will continue to do to achieve obtain the re- Yu Dongyue: sentenced to 20 years. Iraq (5): Five journalists are being held in- lease of those they have their adopted col- Chen Renjie and Lin Youping: sentenced to communicado by the US Army without any leagues. life imprisonment in July 1983. information being provided to them. Since 1989, we have been inviting the North Korea (1): There has been no news of Hameed Majeed: detained since September French and international news media to Song Keum Chul since he was jailed in 1996. 15, 2005. adopt journalists who are in prison just for Cuba (24): 161st place in the Worldwide Ali Omar Abrahem Al-Mashadani: detained doing their jobs. On November 17, sponsors Press Freedom Index. Two journalists have since August 8, 2005. are will be asked to take special initiatives just joined the 21 others who have been im- Samer Mohamed Noor: imprisoned behind specific actions to pressure authorities for prisoned since the March 2003 crackdown. bars since June 4, 2005. releasing of their adopted journalists and to One of them, Oscar Mario Gonza´ lez Pe´rez, is Ammar Daham Naef Khalaf: detained since publicize their cases, so that they will not be awaiting trial and faces up to 20 years in April 11, 2005. forgotten and so that the publicity affords prison under Law 88, which that protects Abdel Amir Younes Hussein: in prison will offer them some protection from their ‘‘Cuba’s national independence and econ- since April 5, 2005. jailers. By writing to journalists in prison, omy.’’ Iran (6): Mohammad Sedigh Kabovand: sen- contacting their families, protesting to the Lamasiel Gutie´rrez Romero: sentenced to 7 tenced to 18 months. relevant competent authorities, and getting months in prison. Madh Amadi: awaiting trial, in prison viewers, listeners, readers and Internet users Albert Santiago Du Bouchet Ferna´ ndez: since July 28, 2005. interested in their cases, the news organiza- sentenced to 1 year in prison. Masoud Bastani: awaiting trial, in prison tions, festivals and city halls who are spon- Normando Herna´ ndez Gonza´ lez: sentenced since July 25, 2005. sors can help Reporters Without Borders to to 25 years. Siamak Pourzand: sentenced to 11 years in support these men and women whose only Omar Moise´s Ruiz Herna´ ndez: sentenced to prison. Thanks to international pressure, he crime is was wanting to reporting the news. 18 years. was given leave to return home for an indefi- Thanks to the media that support a jour- Juan Carlos Herrera Acosta: sentenced to nite period in December 2002, but was sent nalist: 20 years. back to prison on March 30, 2003. 93.3 Radio Que´bec, Christian Action for the Alejandro Gonza´ lez Raga: sentenced to 14 Hossein Ghazian: sentenced to four-and-a- Abolition of Torture and Executions (ACAT), years. half years in prison. AGEFI, Agencia Cover, Agriculture Horizon,

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00004 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.081 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13151 Alternatives Internationales, Amiens tion. However, I rise to explain that I across our national borders from State Me´tropole—JDA, Amina, Antena 3 TV, Arte, am voting for this bill reluctantly be- to State and city to city by sophisti- Associacio´ n de la Prensa de Ca´ diz, Assas/IFP, cause I feel that some of the funding cated drug cartels and street gangs. Avaldoci-Union Web periodistas, Azur FM, priorities set forth in the bill will leave How does a local sheriff prevent drugs Bel RTL (French-language Belgian radio sta- tion), BFM, Cadena SER, Cambio 16 our communities more vulnerable to that start out in a foreign country Aldateka Hamasei, Espacio de Informacion terrorist attacks traditional crime. In from being trafficked into his or her General (EIG), Cape Breton Post, Baden- particular, this bill continues the county? How does a police chief pre- Baden Press Club, Bordeaux Press Club, wrongheaded trend of slashing Federal vent the recruitment of local kids into Clermont-Ferrand Press Club, Lille Press funding for State and local law enforce- international street gangs? In my opin- Club, Montpellier Press Club, Nimes Press ment and important criminal justice ion, crime is a national problem, and it Club, La Semaine de Nıˆmes, Press Club of programs. This bill slashes funding for requires a national response. The COPS Saint-Etienne and La Loire, UCPF, the Justice Assistance Grant and the Program demonstrated the Federal Strasbourg Press Club, Toulon Press Club, COPS Program. And, for the first time, Government’s commitment to ap- Pays Basque Press Club, Grenoble and Ise`re Press Club, Corriere Canadese, Coup d’oeil/ the Congress has decided to zero out proach crime as a national problem— Vers l’avenir, Courrier International, the COPS hiring Program. I believe and it worked. Dernie`res Nouvelles d’Alsace, that this decision is a terrible mistake I would also point out that State and Diariocritico.com, Echo vedettes, Edmonton on so many levels, and I fear that our local law enforcement forms our first Sun, El Correo Espanol/El Pueblo Vasco, El Nation’s citizens will be less safe from line of defense against terrorism. Mundo, El Pais, El Periodico de Catalunya, traditional crime and terrorism as a re- Homeland security experts have point- El Punt, El Siglo, En Marche, Enjeux sult. Further, the bill slashes Federal ed out the value that community polic- internationaux, Festival International du assistance for the effective and cost-ef- ing programs can have in combating Scoop et du Journalisme, Flair/L’Hebdo, ficient drug court program by an as- France 2, France 3 sud Languedoc- terrorism. This only makes sense—it is Roussillon, France bleu pays d’Auvergne, tounding 75 percent. the local officer who knows the neigh- France Culture, France Info, France Inter, Back in 1994 when we passed the leg- borhood who will be able to provide the France Soir, Fun Radio, Gene`ve Home Infor- islation that created the COPS Pro- types information necessary to help in- mation (GHI), Grands Reportages, gram, our crime rates were at all-time filtrate a local terror cell. In addition, www.cubantrip.com, Ici, Il Manifesto highs. At that time, we made a com- it will be a local officer walking the (Rome)(Q), Institut Pratique de Journalisme, mitment to our State and local law en- beat who happens to catch a suspect ISR Info, JHR McGill Newsletter, forcement partners. During those trying to pump sarin gas into the local Kommunalarbetaren, L’Expansion, years, we invested roughly $2.1 billion ´ mall air-conditioning ducts. It won’t be L’Express, L’Express.fr, L’Humanite, for State and local law enforcement L’Union du Cantal, L’Union(s), La presse a brave Special Forces agent with dans tous ses e´tats CIBL, La Tribune, La each year and substantially upgraded night vision goggles; it will be a local Vanguardia, La Voz del Occidente, Le our ability to combat crime. We added cop walking the beat. In this era of un- Courrier Picard, Le Devoir, Le Figaro, Le over 100,000 officers to patrol our neigh- certainty, we need to be providing Journal du Dimanche, Le Ligueur, Le Maine borhoods, and we expanded crime pre- more support for our local police agen- libre, Le Monde, Le Mouv’, Le Nouvel vention programs such as community cies to help make their efforts against Observateur, Le Nouvelliste (Q), Le Peuple, policing programs across the Nation. terrorism and crime as robust as pos- Le Populaire du Centre, Le Quotidien What was the ultimate result? Crime ´ sible. Jurassien, Le Reflet, Le Republicain Lor- rates for violent crime, murder and rain, Le Semeur hebdo, Le Soir, Le Soir And by cutting the drug court pro- Magazine, Le Te´le´gramme de Brest et de rape were all reduced, and today they gram—one of the most effective pro- l’Ouest, Le Vif/L’Express, Les Cle´s de remain at all-time lows. Many law en- grams to reduce substance abuse in the l’Actualite´, Les Petites affiches, Lethbridge forcement experts and local officials criminal population—we are sending a Herald, Libe´ration, www.liberation.fr, credit the COPS Program for helping devastating message to the 16,000 indi- L’Inde´pendant, Maires de France, Mairie to achieve these results. In fact, no viduals that graduate from drug courts d’Arlanc, Mairie de Longeau, Mairie de one, to my knowledge, with law en- each year. We are telling them that we Nancy, Mairie de Romans/Romans Magazine, forcement expertise has argued other- don’t care that diversion programs are Maison de la presse de Charleroi, Maison de wise. The International Association of la presse de Mons, McGill Daily, Me´moire de successful at helping people overcome trame, Me´tro Belgique, Midi Libre, Chiefs of Police, the National Sheriffs addiction to reenter society as produc- Milhistorias, Miljo¨ rapporten, Mirror, Mozaik Association, the Fraternal Order of Po- tive citizens, holding down jobs, and re- Media, Nice Matin, NRJ, Okapi, Ottawa Cit- lice, the National Association of Police gaining custody of their children. We izen, Ottawa Sun, Ouest-France, Paca Infor- Organizations, and other local law en- are sending a message that we would mations e´conomiques, Paris Normandie, forcement groups all support the COPS prefer to revert to the bad old days of Pe`lerin magazine, Perfiles, Periodistas- Program. Attorney General Ashcroft locking up nonviolent drug offenders in es.org, Photographie.com, Plurimedias, has stated that the COPS Program was prisons where most will get no drug ‘‘Points chauds’’ sur Telequebec, Pressens a miraculous success, and Attorney Tidning, Prix Bayeux des correspondants de treatment and they will most likely guerre, Radio Classique, Radio contact/Con- General Gonzalez stated that the COPS just sink deeper into a life of crime. tact Inter Radio Coˆ te d’Amour, Radio Program put officers on the street and And what message are we sending to Nostalgie, REE, RFI, RMC, RNE, RTBF, we reduced crime. Moreover, a recent the 70,000 people currently enrolled in RTBF TV, RTL–TVI, Servimedia, report by the Government Account- drug courts who are working hard to So¨ dermanlands Nyheter, Star Phoenix, SVM ability Office concluded that COPS hir- live sober, crime-free lives? By slashing MAC, Te´le´ Bruxelles, Te´le´pro, Te´le´rama, ing grants had an impact on reducing funding for the drug court program we TF1, The Concordian, The Link, The Tele- crime rates. are telling them that we are not in- gram, Tiempo, TV3, TV3 de Catalunya, TV5 Why would the Congress eliminate a vested in their recovery and we are monde, TVE-Television nationale, UDF, Vers program that is strongly supported by l’avenir, Vlan, VSD, www.expotimes.net, putting their future in drug court pro- www.press-list.com, Les Journalistes- local law enforcement officials and has grams in jeopardy. e´crivains pour la Nature et l’Ecologie. been proven effective by statisticians It makes absolutely no sense to me f at the Government Accountability Of- that we are cutting this cost-effective fice? Well, it has its basis in ideology. program by 75 percent. By enrolling SCIENCE-STATE-JUSTICE Some of my Republican colleagues nonviolent drug offenders in drug APPROPRIATIONS argue that local crime is a local prob- courts, States save an enormous Mr. BIDEN. Mr. President, yesterday lem and the Federal Government amount of money. One study showed the U.S. Senate approved the con- should not be funding these local ef- that California’s drug courts save the ference report to accompany H.R. 2862, forts. I completely disagree. How can it State $18 million a year. Another study the Science-State-Justice appropria- be a local responsibility when roughly showed that every dollar spent on a tions bill. I voted for this legislation 60 percent of all the crimes committed drug court program saves the city of because it provides critical funding for in America relate to drugs, abuse of Dallas, TX, $9.43 over a 40 month pe- the Department of Justice, the FBI, drugs, and the sale and trafficking of riod. It is inconceivable to me that we and the Drug Enforcement Administra- illicit drugs? These drugs are smuggled would choose to cut this program. The

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00005 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.085 S17NOPT2 S13152 CONGRESSIONAL RECORD — SENATE November 17, 2005 National Association of Drug Court the same 32 percent rate. This will not have done this because on Feb- Professionals estimates that our ac- level the playing field for operations in ruary 21 they were more than 2 days’ tions here today will result in more Puerto Rico and operations in the walking distance from the crime scene. than 13,000 individuals losing access to States. I have a number of constituent It was soon determined, however, that drug court services. These 13,000 people corporations that operate in my State there were soldiers only half a day’s will likely continue their lives of crime and have operations in Puerto Rico, walk away, and army helicopters had and drugs and being a threat to public and this provision is important to recently been seen in the vicinity. safety instead of getting enrolled in a them. While it has not been proven who is tough-love program that will help I realize the proposal cannot be added responsible for this horrific crime, the them to turn their lives around and get to the budget reconciliation tax bill at government’s rush to judgment was sober. It is truly a tragedy. this time but am hopeful it will be con- only its first mistake. That was quick- It is my opinion that we found a win- sidered and enacted this year. ly followed by the decision, against the ning formula when we made the deci- I want to applaud Ways and Means wishes of the community, to send sion to invest in our State and local Committee Chairman BILL THOMAS for armed police officers into their midst. law enforcement partners and smart on introducing H.R. 4323, which includes While I do not doubt the authority of crime initiatives in the nineties, and I this extension of the manufacturing de- Colombian police to enter that terri- believe that we are making a terrible duction to Puerto Rico. I look forward tory, it caused the majority of its in- mistake when we reduce funding for to working with Chairman THOMAS to habitants to flee their homes out of them. There is no greater responsi- get this important provision enacted. fear that the police would become a bility of the Federal Government than f target of illegal groups and that the the protection of its citizens. This is villagers could once again be harmed. MASSACRE AT SAN JOSE DE true whether the threat comes from In fact, such an attack took place on APARTADO international terrorist or from a thug June 26, when three policemen were down the street, and I strongly believe Mr. LEAHY. I want to speak about a wounded in an attack by the FARC and that we are taking the wrong approach matter that I suspect few Senators are community members were caught in when we cut funding for our State and aware of, but which should concern the crossfire. Later, on July 18, an old local law enforcement partners. Sheriff each of us. man was found beaten to death. There Ted Sexton, the president of the Na- On February 21, 2005, in the small Co- were two more killings by the FARC, tional Sheriffs Association, got it right lombian community of San Jose de one in August and another in Sep- when he stated that ‘‘cuts of this mag- Apartado, eight people, including three tember, and verbal threats and acts of nitude will seriously inhibit our ability children, were brutally murdered. Sev- intimidation by soldiers and police of- to protect our communities and secure eral of the bodies were mutilated and ficers towards members of the commu- the homeland.’’ And, the president of left to be eaten by wild animals. nity have reportedly steadily in- the International Association of Chiefs This, unfortunately, was not unusual, creased. Then last month, there were of Police was correct in pointing out as some 150 people, overwhelmingly ci- three incidents in which armed that ‘‘demanding that we play a cen- vilians caught in the midst of Colom- paramilitaries and soldiers reportedly tral role in our Nation’s homeland se- bia’s conflict, have been killed by threatened members of the community curity efforts, while at the same time paramilitaries, rebels, and Colombian and destroyed property. It appears that cutting the resources we need to do our soldiers in that same community since the community may be no safer today job, is both hypocritical and irrespon- 1997. None of those crimes has resulted than it was on February 21. sible.’’ I hope that the Republican-led in effective investigations or prosecu- One of the consequences of the gov- Congress and President Bush will heed tions. No one has been punished. ernment’s tactless approach to this and the call of these brave men and women That is an astonishing fact. Think of previous cases is that several witnesses and fully fund these critical programs 150 murders, including massacres of from the community have refused to next year. groups of people, in a single rural com- come forward and give testimony, and munity, and no one punished. f this has hindered the investigation. This latest atrocity occurred in a re- After a massacre of 6 members of this MANUFACTURING DEDUCTION mote area frequented by rebels and same community 5 years ago when over LEGISLATION paramilitaries. As a result, the pres- 100 people gave testimony to judicial Mr. SANTORUM. I introduced a bill ence of the Colombian army has also authorities, no one was convicted and last month, S. 1816, that is vitally im- grown significantly there. Yet the no report on the investigation was ever portant to manufacturing businesses army, which was sent to that area to issued. Convincing witnesses to come and the workers they employ in Puerto protect civilians from attacks by ille- forward this time will require a degree Rico. My bill extends the benefits of gal armed groups, is now suspected by of sensitivity by the government that the manufacturing deduction, enacted some of having committed this mas- has, to date, been sorely lacking. last year with the American Jobs Cre- sacre. We are told by the Colombian Gov- ation Act of 2004, to apply to manufac- Residents of San Jose de Apartado ernment that an investigation of the turing operations that are conducted in have blamed the army, and inter- massacre is ongoing. That, unfortu- Puerto Rico and are subject to full U.S. national observers who went with com- nately, is the story of most heinous tax. munity members to locate the bodies crimes in Colombia. Investigations The new manufacturing deduction witnessed disturbing behavior by sol- often continue without end, and often means that U.S. businesses operating diers who reportedly laughed while the perpetrators avoid punishment. I in any of the 50 States will pay tax on body parts were being exhumed, who am concerned that this case may be no their manufacturing income at 32 per- took pictures of themselves making different. cent. Without the manufacturing de- victory signs, and who mishandled evi- According to information I have re- duction, U.S. businesses operating a dence from the massacre sites. There is ceived, neither the soldiers who were in branch in Puerto Rico will pay tax on also the possibility that paramilitaries the area at the time of the February 21 their manufacturing income at 35 per- acted in collusion with the army. And killings nor hospital workers who cent. This difference in tax treatment some have speculated that there were treated a girl who was wounded by sol- creates a disincentive for U.S. compa- two separate groups of perpetrators, diers there the previous day have been nies to conduct manufacturing oper- perhaps including the FARC, the Revo- interviewed by investigators. I find ations in Puerto Rico, distorting man- lutionary Armed Forces of Colombia, this hard to believe, but if it is correct ufacturing location choices and putting the country’s oldest rebel group. the government has much to answer Puerto Rico at a disadvantage in terms Even before an investigation began, for. of attracting and retaining investment. top Colombian officials publicly de- For 5 years, the United States has My bill makes sure that manufac- clared that the FARC was responsible. provided significant military aid to Co- turing in the 50 States and manufac- The Minister of Defense, who has since lombia despite ongoing concerns about turing in Puerto Rico will be taxed at resigned, insisted that the army could human rights. Several months ago, the

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00006 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.049 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13153 Secretary of State certified that the quested a copy of the report of that in- member of the bipartisan Senate Can- Colombian Government had met the vestigation. If this is correct I urge the cer Coalition, I certainly understand human rights conditions in our law, government to do so immediately and that there are few things that would and recommended the release of addi- to release as much of the report to the have a greater impact on the quality of tional military aid. However, the re- public as possible without compro- life, for millions throughout the world, port accompanying her certification mising the investigation. than the eradication of this terrible also noted that ‘‘[w]hile the human This conflict has brought nothing but disease. rights performance of many of the suffering to the Colombian people. It Unfortunately, we are also all aware Army’s units is improving, an excep- has caused the deaths of countless in- of the fact that we have not yet found tion is evidenced by continued accusa- nocent civilians, uprooted millions a cure. And while scientists and re- tions of human rights violations and from their homes, and perpetuated the searchers around the world work fever- collusion with paramilitaries against trade in illegal drugs that has cor- ishly towards this lofty aspiration, the the Army’s 17th Brigade, which oper- rupted many sectors of society. The most important action we can take is ates in northern Colombia. These re- people of San Jose de Apartado, with the promotion of cancer prevention. portedly include some 200 allegations the conflict raging around them, The Great American Smokeout is a involving the peace community of San sought to insolate themselves from wonderful example of a successful pro- Jose de Apartado in 2000–2001 and, most this danger by declaring themselves a gram aimed at assisting those at great recently, of involvement in the killings peace community. That strategy failed, risk of developing cancer to change near San Jose de Apartado in February as one after another of their members their ways. This annual event has, un- 2005. . . As a result of these allegations, was brutally murdered. doubtedly, saved lives. the United States has informed the Before February 21, I was not aware Since the inaugural Great American Government of Colombia that it will of the many tragedies this community Smokeout took place in 1976, this ini- not consider providing assistance to had already suffered. While I do know, tiative has provided a powerful plat- the 17th Brigade until all significant as a former prosecutor, that some form for the American Cancer Society human rights allegations involving the crimes are harder to solve than others, to encourage Americans to stop smok- unit have been credibly addressed.’’ in Colombia, as in so many countries, ing. This event, which urges Americans While I might differ with the Sec- political will is often what really mat- who take the unnecessary health risks retary’s decision to make the certifi- ters. It is imperative that this case not associated with the use of tobacco cation at the time she did, which co- be added to the long list of unsolved, products to band together and make a incidently occurred just hours before unpunished crimes in San Jose de lifestyle change, is one of the most rec- President Uribe’s arrival at President Apartado, or become part of the his- ognized awareness initiatives in the Bush’s ranch in Texas, I commend her tory of impunity in Colombia. Who history of the American Cancer Soci- decision to withhold aid to the 17th ever was responsible must be brought ety—and rightfully so. Rarely does any Brigade. It is noteworthy, however, to justice. organization touch so many with its that concerns about the 17th Brigade Mr. President, I also want to mention message in a single day as the Amer- had been conveyed to the State Depart- the demobilization of paramilitaries ican Cancer Society during the ment well before this incident, includ- that is underway in Colombia. We all smokeout. And rarely is the intention ing reports that its members were want these narco-terrorist organiza- of the message as important as reduc- openly colluding with paramilitaries. tions to be dismantled, their com- ing the number of Americans who use Yet there is reason to believe that U.S. manders punished, their illegally ac- tobacco products. aid continued despite those reports. quired assets seized, and their victims I am also pleased that the American This case presents the Bush adminis- compensated. The Colombian Govern- Cancer Society has chosen my home tration with an important challenge. It ment is asking the United States for State to host this year’s smokeout. shows that despite billions of dollars millions of dollars to help finance the Pennsylvania has a long history of from the United States and lofty rhet- demobilization, and we want to help. working with the American Cancer So- oric about human rights, the Colom- I am concerned, however, because if ciety, and in 2002, together with the bian Government’s initial reaction to the demobilization of the paramilitary Pennsylvania Department of Health, this despicable crime was not appre- unit located in the area of San Jose de they established the Pennsylvania Free ciably different from what we saw Apartado is indicative of the way this Quitline. This toll-free service, avail- years ago. They denied responsibility process is unfolding, there are serious able 24 hours a day, 7 days a week, pro- and blamed the victims even before an problems that need to be addressed. Ac- vides advice and counseling to those investigation began, and some of the cording to reports I have received, attempting to quit smoking. Studies key witnesses may not even have been paramilitaries are engaging in the have shown that smokers who take ad- interviewed 8 months later. same threatening and violent behavior, vantage of such services are twice as This is unfortunate because there has they continue to collude with the likely to successfully quit smoking. By been progress on human rights under army, and some have joined the army. choosing Pennsylvania as the host for President Uribe’s government. Parts of Little has changed for the people in one of their most important events, the the country are noticeably safer. The that area who continue to live in fear society is reaffirming its commitment government reports a significant de- of losing their property and their lives. to decreasing the prevalence of tobacco cline in violent crime. But labor lead- I hope the Colombian authorities who use in my state—and, in turn, improv- ers and human rights defenders are have been touting the success of the ing the health of all Pennsylvanians. still threatened and killed, the judicial demobilization process will investigate Mr. President, these types of efforts system remains sluggish, and impunity these reports. have helped the American Cancer Soci- is more the rule than the exception. f ety develop a reputation as one of the Clearly, much more needs to be done to most influential and effective partici- protect human rights. THE GREAT AMERICAN SMOKEOUT pants in the fight to better the health This case also presents a challenge Mr. SANTORUM. Mr. President, I of every American. The Great Amer- for the Colombian Government to dem- would like to take a moment to ac- ican Smokeout is a vital event put on onstrate, albeit belatedly, that it can knowledge an important event that is by a truly impressive organization, and respond with sympathy, with impar- taking place today in Philadelphia, PA I thank the American Cancer Society tiality, and effectively to bring justice and across the Nation—the 29th Annual for its leadership. to the victims of a crime that epito- American Cancer Society Great Amer- f mizes the worst of Colombia’s conflict. ican Smokeout. I am also told that the Office of the We are all aware that cancer is one of COLON CANCER SCREEN FOR LIFE United Nations High Commissioner for the greatest healthcare risks facing ACT Human Rights conducted its own inves- Americans today. For years, this dis- Mr. NELSON of Nebraska. Mr. Presi- tigation of the massacre, but that the ease has taken the lives of our families, dent, I rise in support of the Colon Can- Colombian Government has not re- our friends, and our neighbors. As a cer Screen for Life Act, S. 1010. Some

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00007 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.135 S17NOPT2 S13154 CONGRESSIONAL RECORD — SENATE November 17, 2005 of its provisions were included in an ate colleagues joining in support of efforts to make adoption easier for par- amendment included in the reconcili- this important legislation. ents, children and other important ation package. This legislation will in- f players in the adoption process. crease the likelihood that Medicare f beneficiaries will receive a colonoscopy NATIONAL ADOPTION DAY screening examination which is proven Mr. JOHNSON. Mr. President, I rise HONORING OUR ARMED FORCES to be the most effective way to detect today to acknowledge National Adop- PRIVATE FIRST CLASS TYLER R. MACKENZIE and treat colorectal cancer. tion Day on November 19, 2005. With Mr. SALAZAR. Mr. President, I want Colorectal cancer is the No. 2 cancer over 118,000 children available for adop- to take a few moments of this body’s killer in the United States today. This tion out of the U.S. foster care system, time to remember a true fallen hero, a year, according to the American Can- I think it is crucial to celebrate those Coloradan that has been lost to us in cer Society, approximately 145,000 new lawyers, social workers, officials, and, defense of our freedoms. cases will be diagnosed and 56,000 most importantly, parents who help Last week, on Veterans’ Day, the Americans will die from colon cancer. get many children out of foster homes family of PFC Tyler R. Mackenzie bur- We have the power to change these so- into adoptive families. ied him back home in Weld County. A bering statistics by increasing access National Adoption Day was started native of Evans, CO, Private First to this lifesaving procedure. Although in 2000 by the Alliance for Children’s Class Mackenzie was killed in early Congress passed a colonoscopy screen- Rights, the Freddie Mac Foundation, November near Baghdad when an im- ing benefit for Medicare beneficiaries and the Dave Thomas Foundation for provised explosive device detonated back in 1997, the percentage of seniors Adoption and helped complete foster near his Humvee. He was only 20 years receiving a colonoscopy reportedly has care adoptions in nine jurisdictions. old, taken from his family and friends increased by only an estimated 1 per- National Adoption Day continued to just a few days shy of his 21st birthday. cent. A recent UCLA study, as dis- grow and in 2001 completed adoptions Tyler was a tower of a young man, a cussed in an October 11 Wall Street in 17 jurisdictions. In 2002, the Casey six-foot-seven-inch high school football Journal article, documents the con- Family Services, Children’s Action player at Greeley West High School. tinuing underutilization of screening Network, the Congressional Coalition Tyler’s coaches remember him for hav- colonoscopies. It points out that on Adoption Institute and Target be- ing held himself to the highest stand- colorectal cancer screening rates still came National Adoption Day partners ards and being his own toughest critic. lag far behind those for cervical, breast and helped 34 cities across the country He enjoyed the horticulture classes at and prostate cancer. As the Wall Street finalize 1,350 adoptions. In 2003, 3,100 Greeley West. He expected excellence Journal article concludes, ‘‘The results adoptions were completed. National from himself and refused to accept any- were particularly disturbing because Adoption Day 2004 was the biggest cele- thing less. ‘we could eliminate this disease if bration to date, finalizing the adop- After graduating Greeley West in America had the will,’’’ as the study’s tions of more than 3,400 children from 2003, Tyler went to work at his family’s lead author noted. foster care. It seems quite appropriate business, manufacturing kitchen cabi- One reason for the underutilization that as we celebrate Thanksgiving, we nets. He also worked for the Greeley- of colonoscopy screening in the Medi- also celebrate the formation of new Evans School District 6. care population is rapidly declining families through adoption. Tyler was a man of faith, active in rates of reimbursement for the proce- As a member of the bipartisan Con- his church. Tyler also had a sense of dure. Medicare reimbursement for gressional Coalition on Adoption, I am humor, and his older sister used to call colonoscopies performed in the out- committed to assisting children in the him ‘‘Monkey’’ for his ability to climb patient setting has dropped by nearly United States to find stable, loving and across the rafters of the family’s base- one-third from the initial 1998 reim- permanent homes. Additionally, I sup- ment. bursement rates. In the majority of port the goals of National Adoption But seeking something else, perhaps States today, Medicaid payment rates Day to encourage others to adopt chil- a larger opportunity to give back to actually exceed Medicare reimburse- dren from foster care, to build stronger this Nation, Tyler joined the Army in ment for colonoscopy. This fact alone ties between local adoption agencies, January of this year. He became a underscores the Medicare reimburse- courts, and adoption advocacy organi- member of the 1st Battalion, 502nd In- ment problem is real. This legislation zations, and to continue to research fantry Regiment, 2nd Brigade Combat increases Medicare reimbursement for and learn more about families wanting Team of the storied 101st Airborne Di- colorectal cancer-related procedures to to adopt and the children waiting to be vision that bravely halted the march of assure more equitable reimbursement adopted. tyranny across Europe during World for physicians who absorb significant I am also proud that Members of the War II. Private First Class Mackenzie costs in providing these valuable serv- Senate continue to support ways to was following a long tradition of mili- ices. make adoption easier and more afford- tary service in his family: his two Another reason for this underutiliza- able. Since the cost of adoption can be grandfathers had served in the Navy tion is that Medicare currently does very high, we ought to do what we can during World War II, and his father had not pay for a physician office visit to lessen this initial burden for the ex- served as a military police officer with prior to a screening colonoscopy, al- ceptional people who provide caring the Army. though it does pay for a physician of- homes for children. Adoption pro- Private First Class Mackenzie com- fice visit prior to a diagnostic ceedings and legal fees for some domes- pleted basic training in May of this colonoscopy. The procedures are iden- tic adoptions can cost more than year and was deployed to Iraq on Sep- tical—both involve the same amount of $40,000. To ease some of this burden, tember 28. He had been in Iraq only 6 risk, so there is simply no reason why Congress adopted a $10,000 tax credit weeks before his tragic death. Medicare would pay for an office visit for adoption expenses. If we ask indi- Tyler is exactly the kind of young prior to one procedure and not the viduals to care for and adopt children, man we as a Nation are so fortunate to other. Because Medicare does not pay we must provide some relief from the have serving in our Armed Forces. He for this necessary office visit, many financial burdens associated with that was a young man of intellect, self-dis- physicians must provide them for free. care. The adoption tax credit is an ef- cipline, courage and concern. He joined This amendment would fix this discrep- fective vehicle to provide this relief. the Army because he wanted to help, to ancy by providing Medicare coverage The commitment of adoptive parents serve his country as his father and for a preoperative visit or consultation in South Dakota and throughout our grandfathers and so many others had prior to a screening colonoscopy, as it country to provide children with safe, before him. He wanted to ensure that does for a diagnostic colonoscopy. permanent, and loving homes will, of Iraqis knew the full blessings of their Every year, thousands of Americans course, have a positive impact on their new freedom and could share the same needlessly die from colorectal cancer. lives. As we celebrate National Adop- opportunities he had here. We have the means to change this and tion Day on November 19, 2005, I call on Tyler’s sacrifice on behalf of this Na- we should do so. I appreciate our Sen- my colleagues to continue supporting tion is a reminder to all of us of the

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00008 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.054 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13155 precious gift we have to live in such a ation Iraqi Freedom by an improvised who he was. But to those of us who country. To his parents, David and explosive device outside of Ashraf, knew him and were his friends, his Julie, his sister Nicole and the entire Iraq. He served with B Battery of the presence made a profound impact in Mackenzie family, this Nation humbly 2nd battalion, 123rd Field Artillery our lives that still continues to shape thanks you for Tyler. We are forever Regiment in the Army National Guard. us today.’’ grateful for your sacrifice and his. I request that all Americans join me Scott was killed while serving his MARINE LANCE CORPORAL JEREMY P. today in honoring Staff Sergeant country in Operation Iraqi Freedom. TAMBURELLO Wehrly. We should all remember his He was a member of the 2nd Batallion, Mr. President, I wish to speak for a bravery, his compassion, and his final 7th Marine Regiment, 1st Marine Divi- moment about a brave son of West- sacrifice to the cause of freedom. sion, I Marine Expeditionary Force. minster, CO, lost to us in the fighting Throughout our history, great men and This brave young soldier leaves behind in Iraq: Marine LCpl Jeremy P. women have stood up and given their his wife, Klancey; his mother, Barbara Tamburello. lives for their country, and it is with Weitzel; his father, Richard Zubowski; Lance Cpl. Tamburello was killed great sadness that we pay tribute to and his brothers, David and Brian. earlier this month when his military another brave American whose time Today, I join Scott’s family and vehicle was struck by an improvised with us was all too short. friends in mourning his death. While explosive device near Rutbah, Iraq. He Staff Sergeant Wehrly patriotically we struggle to bear our sorrow over was a member of the 1st Light Armor joined the National Guard when he was this loss, we can also take pride in the Reconnaissance Battalion, 1st Marine only a junior in high school and was example he set, bravely fighting to Division, I Marine Expeditionary sent to the Middle East in October 2004. make the world a safer place. It is his Force, and was only 19 years old. Upon his arrival in Iraq, his father, courage and strength of character that Jeremy was a straight-A high school Rev. Peter Wehrly of Springfield, IL, people will remember when they think student at Ranum High School in recalls that his son only wanted to be of Scott, a memory that will burn Adams County. Jeremy had a gift for sent things he could give away to the brightly during these continuing days science and dreams of serving his Na- Iraqi children. ‘‘All he wanted was stuff of conflict and grief. tion in the United States Marine Corps for kids. Candy, flip-flops. . . . We had Scott was known for his dedication before going on to pursue a degree in five boxes of stuff. He didn’t want any- to his family and his love of country. computer science. thing for himself,’’ Reverend Wehrly Today and always, Scott will be re- When Jeremy announced his inten- said. membered by family members, friends tion to join the Marine Corps, his fa- All those who knew Staff Sergeant and fellow Hoosiers as a true American ther, Kevin tried at first to talk him Wehrly will greatly miss him. My pray- hero and we honor the sacrifice he out of it, warning him of the terrible ers go out to his family and friends in made while dutifully serving his coun- risks of serving during this time of their time of grief, his father Peter, his try. conflict in Iraq. Kevin suggested to his mother Nita, and his wife Janet. We As I search for words to do justice in son that he pursue a computer science should especially remember Staff Ser- honoring Scott’s sacrifice, I am re- degree at a technical college. geant Wehrly’s 6-year-old daughter, minded of President Lincoln’s remarks Jeremy’s response to his father was Kylee, who will unfortunately grow up as he addressed the families of the fall- respectful, but firm: ‘‘This is what I with too few memories of her coura- en soldiers in Gettysburg: ‘‘We cannot want to do, Dad. Sign the papers.’’ geous and compassionate father. Our dedicate, we cannot consecrate, we And so in the summer of 2004, Jeremy thoughts and prayers are with her and cannot hallow this ground. The brave Tamburello joined the Marine Corps with the entire family. It is important men, living and dead, who struggled and began his brave journey of service to remind them and to remind all here, have consecrated it, far above our to America. This past August, he was Americans that Staff Sergeant Wehrly poor power to add or detract. The deployed to Iraq. It was a challenge in did not die in vain but, rather, died world will little note nor long remem- which he was a firm believer. He cared protecting his country and protecting ber what we say here, but it can never about the future of the people of Iraq the freedom of countless individuals forget what they did here.’’ This state- and about the sacrifices made by the around the world. May he always be re- ment is just as true today as it was over 3,000 Americans in the September membered as the true American hero nearly 150 years ago, as I am certain 11th attacks. He wanted to serve his that he was. that the impact of Scott’s actions will Nation and protect those freedoms that LANCE CORPORAL SCOTT ZUBOWSKI live on far longer that any record of all too often so many of us take for Mr. BAYH. Mr. President, I rise these words. granted and help bring them to the today with a heavy heart and deep It is my sad duty to enter the name fledgling democracy of Iraq. sense of gratitude to honor the life of a of Scott Zubowski in the official record This Nation is blessed to have a brave young man who grew up in North of the United States Senate for his young man like Lance Cpl. Manchester. Scott Zubowski, 20 years service to this country and for his pro- Tamburello. He served his country old, died on November 12 near Fallujah, found commitment to freedom, democ- with honor and distinction, with a Iraq when a roadside bomb exploded racy and peace. When I think about courage and conviction that makes us under the military vehicle in which he this just cause in which we are en- all so very proud. Lance Cpl. was riding. With his entire life before gaged, and the unfortunate pain that Tamburello did not seek glory or pa- him, Scott risked everything to fight comes with the loss of our heroes, I rade honors, but instead chose to hum- for the values Americans hold close to hope that families like Scott’s can find bly serve to help shine the blessings of our hearts, in a land halfway around comfort in the words of the prophet freedom and liberty to those who had the world. Isaiah who said, ‘‘He will swallow up for too long languished behind a cur- Remembered for his intelligence and death in victory; and the Lord God will tain of oppression. honorable service, Scott was killed wipe away tears from off all faces.’’ To Jeremy’s family, I can only offer during his second tour of duty in Iraq. May God grant strength and peace to the quiet and humble thanks of a A 2003 graduate of Manchester High those who mourn, and may God be with grateful Nation. Jeremy exemplified School, Scott enlisted in the Marine all of you, as I know He is with Scott. the nobility and honor, courage and Corps shortly after graduation, in- f self sacrifice, that has made every spired by his older brother’s Marine American proud of his example. We service. Recently married to another LOCAL LAW ENFORCEMENT shall not forget your sacrifice, nor his. Manchester graduate, Scott was set to ENHANCEMENT ACT OF 2005 TRIBUTE TO STAFF SERGEANT KYLE B. WEHRLY return home before his 21st birthday in Mr. SMITH. Mr. President, I rise Mr. GRASSLEY. Mr. President, March. One of his classmates told the today to speak about the need for hate today I pay tribute to a true American Muncie Star Press that ‘‘Not only was crimes legislation. Each Congress, Sen- hero, SSG Kyle B. Wehrly. On Novem- he the smartest guy I’ve ever known, ator KENNEDY and I introduce hate ber 3, 2005, Staff Sergeant Wehrly was he was unique in a way for which words crimes legislation that would add new tragically killed in action during Oper- aren’t good enough to actually describe categories to current hate crimes law,

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00009 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.006 S17NOPT2 S13156 CONGRESSIONAL RECORD — SENATE November 17, 2005 sending a signal that violence of any helping to establish Colorado as a lead- gency planning, Tommy put Colorado kind is unacceptable in our society. er in the areas of homeland security in a very desirable position from a pre- Likewise, each Congress I have come to and emergency management. Prior to paredness standpoint at a most appro- the floor to highlight a separate hate working for the State of Colorado, BG priate time. In preparation for the Den- crime that has occurred in our coun- Tommy F. Grier served his country as ver Summit of the Eight in 1997, he ini- try. an operations officer in the U.S. Army tiated and coordinated several innova- On October 22, 1998, in Madison, WI, with assignments spanning the gamut tive technical assistance visits from Johnny L. Ellis attacked a man in of organizations from battalion though the Department of Defense Chemical what police say was a hate motivated division level. He is a graduate of both and Biological Defense Command. crime. The victim, a man dressed in the Naval War College and the Army Tommy’s remarkable insight un- woman’s clothing, was hit over the War College. doubtedly set the benchmark for future head with a full 40-ounce bottle of malt Tommy had a long and distinguished programs. His WMD efforts in Colorado liquor, causing the bottle to break. Mr. military career, earning the Silver predate the Defense Against Weapons Ellis then stabbed the victim in the Star, the Legion of Merit with Oak of Mass Destruction Act of 1996, also stomach with the broken bottle, caus- Leaf Cluster, the Distinguished Flying known as the Nunn-Lugar-Domenici ing a wound that required 55 stitches. Cross with three Oak Leaf Clusters, the amendment to the National Defense Throughout the ordeal Mr. Ellis re- Bronze Star with two Oak Leaf Clus- Authorization Act for fiscal year 1997, ferred to the victim as a ‘‘he-she.’’ ters, Meritorious Service Medal with which stipulated the training of first I believe that our Government’s first four Oak Leaf Clusters, Air Medal with responders to deal with WMD terrorist duty is to defend its citizens, in all cir- ‘‘V’’ device and Numeral ‘‘40’’, the incidents. cumstances, from threats to them at Army Commendation Medal, the mas- Tommy worked closely with the Fed- home. The Local Law Enforcement En- ter Parachutist Badge, Senior Army eral Emergency Management Agency, hancement Act is a major step forward Aviator Badge, Special Forces Tab, and FEMA, to ensure affected local com- in achieving that goal. I believe that Army Staff Identification Badge. munities received the support nec- He received his commission on Au- by passing this legislation and chang- essary to facilitate recovery during nu- gust 16, 1962, through the U.S. Army ing current law, we can change hearts merous Colorado emergencies, includ- Reserve Officers Training Corps. In and minds as well. ing the 1997 and the 1999 floods, the 2002 July 1963, he was transferred to the f wildfires, and the ‘‘blizzard of the cen- Special Forces Training Group where tury’’ in 2003. ADDITIONAL STATEMENTS he served as executive officer to the But perhaps Tommy’s greatest con- commander and then subsequently as tribution to the State of Colorado has an instructor. been his efforts in helping modernize RECOGNITION OF DANIEL PACK In 1966, he began the first of two the State’s emergency preparedness ef- tours in Southeast Asia, serving as an ∑ Mr. ALLARD. Mr. President, I rise forts. Playing a key role in the set up armed helicopter section leader with today to congratulate Daniel Pack for of the new Colorado Multi-Agency Co- the 121st Aviation Company in the Re- receiving Colorado’s Professor of the ordination Center, MACC, and State public of Vietnam; as Operations Offi- Year Award in 2005. Emergency Operations Center, SEOC, Daniel J. Pack, Ph.D., P.E. currently cer, 25th Aviation Battalion, 25th In- fantry Division during the Cambodian his in-depth knowledge and operational serves as a professor in the Department expertise has helped craft a nationwide of Electrical Engineering at the U.S. Incursion, and he commanded the 238th Aerial Weapons Company in I Corps, II model of excellence. Air Force Academy, Colorado Springs, Tommy and his wife Jan are the CO. He has enjoyed a distinguished ca- Corps, and Laos. Grier’s assignments included the Di- proud parents of three sons: Tom III, reer as teacher, scholar, and profes- rectorate, Office of the Deputy Chief of Jud, and Andy. sional peer. Daniel Pack’s long list of Staff for Operations in Washington, I commend Tommy Grier for his dedi- accomplishments is evidence of his su- DC; Executive to the Director of Re- cated service to his country, his com- perb teaching ability, dedication to his quirements; Senior Operations Officer, mitment to ensuring public safety, and students and commitment to U.S. Air Joint Staff for Planning and Control- his leadership in emergency manage- Force Academy. ling for ‘‘Jack Frost ’79’’—a full-scale ment. Colorado is a better place be- It is an honor for me to recognize ∑ military joint force readiness exercise; cause Tommy Grier chose to serve. this outstanding achievement of Daniel Chief, Infantry and Armor Branch, En- f Pack. I commend him for his efforts to listed Personnel Management Direc- TRIBUTE TO PEGGY SHADDUCK enhance the quality of education and torate, Military Personnel Center; and scholarship. We are very grateful for PALOMBI Operations Officer, 7th Infantry Divi- ∑ all he does to make a difference. His ef- sion at Fort Ord, CA. Mr. BUNNING. Mr. President, today I forts are greatly appreciated. From July 1987 until his retirement pay tribute to Peggy Shadduck Now more than ever before, it is es- from active duty, he served as Senior Palombi of Lexington, KY, on being sential that our students receive a Advisor for the Colorado Army Na- recognized as one of America’s top pro- well-rounded education. We must be tional Guard. Brigadier General fessors in the 2005 U.S. Professors of able to trust in the skills and talents of Tommy F. Grier was appointed Assist- the Year Program by the Council for college professors like Daniel Pack if ant Adjutant general and Commander Advancement and Support of Edu- we are to produce the next generation of the Army National Guard on Oct. 1, cation. of our nation’s leaders. 1993. He retired from the Colorado The annual U.S. Professors of the Congratulations again to Daniel Army National Guard in 1996. Year Program was established in 1981 Pack, recipient of Colorado’s Professor While serving as the Assistant Adju- to reward outstanding professors for of the Year Award in 2005.∑ tant General for Army and commander their dedication to teaching, commit- f of the Colorado Army National Guard, ment to students, and innovative in- Brigadier General F. Tommy Grier structional methods. It is the only na- TRIBUTE TO TOMMY F. GRIER oversaw the participation of State tional program to recognize college ∑ Mr. ALLARD. Mr. President, I rise troops and assets for World Youth Day and university professors for their today to pay tribute to Tommy F. 1993 where more than half a million pil- teaching skills. Grier, who is retiring as the director of grims traveled to Denver to hear Pope Ms. Palombi, an associate professor the Division of Emergency Manage- John Paul II deliver his international at Transylvania University, in Lex- ment for the State of Colorado after message of peace. Tommy has also ington, KY, has been recognized by the spending more than 12 years in the planned, directed, and participated in Council for Advancement and Support emergency management field. countless search and rescue missions of Education for her tireless work in Colorado has been honored to have both domestically and abroad. exhibiting excellence at Transylvania Tommy, a leading expert in the field of With relentless emphasis on weapons University. Ms. Palombi sets an exam- operational design and preparedness, of mass destruction, WMD, contin- ple of excellence for both colleagues

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00010 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.048 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13157 and students alike. She inspires her While Michigan State was the first ni, and supporters good luck and con- students to achieve academically and agricultural college in the United tinued success as they work to make contribute to the community. States, the curriculum studied by its the next 150 years as productive and I now ask my fellow colleagues to students went far beyond agriculture full of accomplishment as previous 150 join me in thanking Ms. Palombi for and included classes in English, philos- have been.∑ her dedication and commitment to the ophy, and economics. This multi- ∑ Ms. STABENOW. Mr. President, I education of America’s future. In order faceted approach to higher education rise today to celebrate the sesqui- for our society to continue to advance produced well-rounded graduates and centennial, the 150th anniversary, of in the right direction, we must have became the foundation of the edu- my alma mater, Michigan State Uni- professors like Peggy Shadduck cational philosophy later employed by versity, MSU. Palombi in our institutions of higher the land grant colleges created by Con- Located on the banks of the Red learning, in our communities, and in gress in 1862. In addition, this philos- Cedar River, Michigan State Univer- our lives. She is Kentucky at its fin- ophy marked an important change in sity was the first agricultural college est.∑ the way higher education was per- in the Nation and the prototype for f ceived around the country. No longer land-grant institutions later estab- was a college degree available only to lished under the Morrill Act of 1862. In RECOGNIZING OF THE SOCIETY OF society’s elite, but also to the less priv- fact, in the mid 1950s, the U.S. Postal PHYSICS STUDENTS ileged who made use of the practical Service honored Michigan State Uni- ∑ Mr. BUNNING. Mr. President, I pay education they received to improve versity with a postage stamp com- tribute to the members of the Society their own standard of living as well as memorating it as the original land- of Physics Students, SPS, in the De- that of their family, community, and grant university. partment of Physics at the University our Nation as a whole. The significance The land-grant philosophy is rooted of Louisville. The SPS will be cele- of this shift in thinking cannot be in the principle to extend the values of brating 2005 as the World Year of Phys- overstated and remains as important education to all who seek it, and the ics. The celebration will coincide with today as it was in the mid-1800s. Morrill Act grew out of a movement to the 100 year anniversary of the publica- Of course, President Roosevelt’s com- bring benefits of education to rural tion of Albert Einstein’s Special The- mencement address was only one of areas. The original tract of land in 1855 ory of Relativity, Quantization of the many significant events in the history for my nascent college, then known as Electromagnetic Field, and the En- of Michigan State University. The Uni- the Agricultural College of the State of ergy-Mass Relationship. versity welcomed its first female stu- Michigan, consisted of 677 acres. Addi- The University of Louisville chapter dents in 1870 and presented 22 degrees tional lands were purchased, and pres- has been recognized for achievement by to women by 1895. Michigan State’s ently, the combined size of Michigan numerous national physics organiza- color barrier was broken in the early State lands—from its central campus tions. Their recent accomplishments 1900s when it awarded its first degrees to its research stations around the include the Blake Lilly Prize for Out- to an African-American man, William state—totals close to 20,000 acres reach, a national SPS designation as Thompson, in 1904 and an African- across Michigan. As the campus has Outstanding Chapter, along with the American woman, Myrtle Craig, in grown, so has Michigan State’s imprint Marsh White Award for Education and 1907. on the world through its commitment Outreach from the Sigma Pi Sigma Na- Among the nearly 400,000 Michigan to its students and its offering of a tional Physics Honor Society. In light State Alumni worldwide are 16 Rhodes quality, public higher education to all. of these efforts, I ask my fellow col- Scholars, a Pulitzer Prize winner, a Academically, MSU students and col- leagues to join me in recognizing the Grammy award winner, two former leges are highly regarded. The univer- Society of Physics Students at the Uni- Michigan Governors, a former U.S. sity has had more Rhodes Scholars versity of Louisville for their celebra- Senator and Secretary of Energy, and than any other Big Ten Conference uni- tion of 2005 as the World Year of Phys- the first women to represent the State versity in the past generation. U.S. ics.∑ of Michigan in the U.S. Senate, my col- News & World Report ranks 10 of f league and friend, Debbie STABENOW. MSU’s graduate departments in the Michigan State now offers more than Top 10 in their field nationally. On an MICHIGAN STATE UNIVERSITY 200 programs of study and serves al- international note, the University’s SESQUICENTENNIAL most 45,000 current students from all 50 Study Abroad program is the largest of ∑ Mr. LEVIN. Mr. President, I rise to States and more than 120 foreign coun- any public university in the Nation, of- pay tribute to Michigan State Univer- tries. fering more than 190 programs in more sity as they continue their 150th anni- Among many other things, research- than 60 countries on all continents, in- versary celebration. Throughout its ers at Michigan State University are cluding Antarctica. Furthermore, MSU history, Michigan State has made a credited with the development of lead- is proud to have the highest percentage tremendous contribution to the State ing cancer fighting drugs and the proc- of in-state students among Michigan of Michigan and to our Nation as a ess of milk homogenization. Michigan universities, with many of those who whole. State is currently home to the Na- receive a bachelor’s degree from MSU Michigan State University, or the tional Superconducting Cyclotron Lab- staying and working in the state. Agricultural College of the State of oratory, the leading rare isotope re- The University has a notable and Michigan as it was originally known, search facility in the country. The nu- strong athletic history. In its 108-year was created in 1855 by an act of the clear science research taking place at football history, Michigan State has Michigan Legislature authorizing the this facility is improving our knowl- won six NCAA national football cham- creation of a school of higher education edge of the elements that make up the pionships, while last year, both its for agriculture. Two years later, Michi- world around us and could provide new men’s and women’s basketball teams gan State welcomed its first class of 63 medical breakthroughs, including new made it to their respective and coveted students. tools for the treatment of cancer. This Final Four tournaments. Sparty the Nearly 100 years ago, President research, primarily funded by the Na- Spartan is Michigan State University’s Teddy Roosevelt visited Michigan tional Science Foundation and the uni- fearless and loveable mascot, a figure State and delivered a commencement versity, has made Michigan State’s nu- known throughout the State of Michi- speech to more than 20,000 students, clear physics doctoral program one of gan and recognized across the Nation faculty, and family of the graduates. In the most prestigious in the Nation. as well. Sparty is the heart of Michigan his speech, he stated ‘‘The fiftieth an- I know my colleagues will join me in State, forever supporting its teams, niversary of the founding of this col- congratulating Michigan State Univer- bringing smiles to young and old and lege is an event of national signifi- sity on 150 years of contributions to continually uplifting all who meet cance, for Michigan was the first State Michigan and the Nation as a whole. I him. in the Union to found this, the first ag- would also like to wish Michigan State The State of Michigan has always ricultural college in America.’’ University, its students, faculty, alum- been the ‘‘first beneficiary’’ of MSU’s

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00011 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.052 S17NOPT2 S13158 CONGRESSIONAL RECORD — SENATE November 17, 2005 high-quality academic programs and Ms. Niland, one of its reading clerks, bill (H.R. 3010) making appropriations its global networks. But it is through announced that the House has passed for the Departments of Labor, Health those networks that MSU also is en- the following bills, in which it requests and Human Services, and Education, gaged with the world beyond the the concurrence of the Senate: and Related Agencies for the fiscal boundaries of its campus. Michigan H.R. 562. An act to authorize the Govern- year ending September 30, 2006, and for State has built partnerships across the ment of Ukraine to establish a memorial on other purposes, it was, Nation and around the globe that ful- Federal land in the District of Columbia to Resolved, that the House insist upon fill its land-grant responsibilities to an honor the victims of the manmade famine its disagreement to the amendment of international society and at the same that occurred in Ukraine in 1932–1933. the Senate. H.R. 866. An act to make technical correc- time rebound benefits to Michigan, tions to the United States Code. f working in ways that will bring my H.R. 1036. An act to amend title 17, United MEASURES REFERRED constituents the greatest value and re- States Code, to make technical corrections turn, ways that will strengthen our relating to Copyright Royalty Judges, and The following bills were read the first communities, fuel our economy and for other purposes. and the second times by unanimous provide all of our citizens with a better H.R. 1442. An act to complete the codifica- consent, and referred as indicated: tion of title 46, United States Code, ‘‘Ship- quality of life. H.R. 562. An act to authorize the Govern- ping’’, as positive law. As I applaud today the deep history ment of Ukraine to establish a memorial on H.R. 1492. An act to provide for the preser- Federal land in the District of Columbia to and strength of Michigan State Univer- vation of the historic confinement sites honor the victims of the manmade famine sity, I know its best days are still be- where Japanese Americans were detained that occurred in Ukraine in 1932–1933; to the fore it. From this Spartan, I wish during World War II, and for other purposes. Michigan State University a most won- H.R. 1790. An act to protect children and Committee on Energy and Natural Re- sources. derful sesquicentennial.∑ their parents from being coerced into admin- istering a controlled substance in order to H.R. 866. An act to make technical correc- f attend school, and for other purposes. tions to the United States Code; to the Com- mittee on the Judiciary. MESSAGES FROM THE PRESIDENT H.R. 3351. An act to make technical correc- tions to laws relating to Native Americans, H.R. 1036. To amend title 17, United States Messages from the President of the and for other purposes. Code, to make technical corrections relating United States were communicated to H.R. 3647. An act to render nationals of to Copyright Royalty Judges, and for other the Senate by Mr. Williams, one of his Denmark eligible to enter the United States purposes; to the Committee on the Judici- secretaries. as nonimmigrant traders and investors. ary. H.R. 4133. An act to temporarily increase H.R. 1442. An act to complete the codifica- f the borrowing authority of the Federal tion of title 46, United States Code, ‘‘Ship- EXECUTIVE MESSAGES REFERRED Emergency Management Agency for car- ping’’, as positive law; to the Committee on rying out the national flood insurance pro- the Judiciary. As in executive session the Presiding gram. H.R. 1492. An act to provide for the preser- Officer laid before the Senate messages H.R. 4337. An act to amend the Internal vation of the historic confinement sites from the President of the United Revenue Code of 1986 to provide for Gulf tax where Japanese Americans were detained States submitting sundry nominations credit bonds and advance refundings of cer- during World War II, and for other purposes; which were referred to the Committee tain tax-exempt bonds, and to provide a Fed- to the Committee on Energy and Natural Re- eral guarantee of certain State bonds. sources. on Environment and Public Works. H.R. 1790. To protect children and their (The nominations received today are The message also announced that the parents from being coerced into admin- printed at the end of the Senate pro- House has passed the following bill, istering a controlled substance in order to ceedings.) without amendment: attend school, and for other purposes; to the f S. 1234. An act to increase, effective as of Committee on Health, Education, Labor, and December 1, 2005, the rates of compensation Pensions. MESSAGES FROM THE HOUSE for veterans with service-connected disabil- H.R. 3647. An act to render nationals of ities and the rates of dependency and indem- Denmark eligible to enter the United States nity compensation for the survivors of cer- as nonimmigrant traders and investors; to ENROLLED BILL SIGNED tain disabled veterans. the Committee on the Judiciary. At 9:34 a.m., a message from the The message further announced that The following concurrent resolutions House of Representatives, delivered by the House has agreed to the following were read, and referred as indicated: Ms. Niland, one of its reading clerks, concurrent resolutions, in which it re- H. Con. Res. 230. Concurrent resolution ex- announced that the Speaker has signed quests the concurrence of the Senate: pressing the sense of the Congress that the the following enrolled bill: H. Con. Res. 230. Concurrent resolution ex- Russian Federation must protect intellec- pressing the sense of the Congress that the tual property rights; to the Committee on S. 161. An act to provide for a land ex- Foreign Relations. change in the State of Arizona between the Russian Federation must protect intellec- tual property rights. H. Con. Res. 268. Concurrent resolution ex- Secretary of Agriculture and Yavapai Ranch pressing the sense of the Congress regarding Limited Partnership. H. Con. Res. 268. Concurrent resolution ex- pressing the sense of the Congress regarding oversight of the Internet Corporation for As- The enrolled bill was signed subse- oversight of the Internet Corporation for As- signed Names and Numbers; to the Com- quently by the President pro tempore signed Names and Numbers. mittee on Commerce, Science, and Transpor- (Mr. STEVENS). tation. f At 2:36 p.m., a message from the f House of Representatives, delivered by ENROLLED BILLS PRESENTED ENROLLED BILL SIGNED Ms. Niland, one of its reading clerks, At 10:55 a.m., a message from the announced that the House has passed The Secretary of the Senate reported House of Representatives, delivered by the following joint resolution, in which that on today, November 17, 2005, she Ms. Chiappardi, one of its reading it requests the concurrence of the Sen- had presented to the President of the clerks, announced that the Speaker has ate: United States the following enrolled signed the following enrolled bill: H.J. Res. 72. Joint resolution making fur- bills: H.R. 2862. An act making appropriations ther continuing appropriations for the fiscal S. 161. An act to provide for a land ex- for Science, the Departments of State, Jus- year 2006, and for other purposes. change in the State of Arizona between the tice, and Commerce, and related agencies for Secretary of Agriculture and Yavapai Ranch the fiscal year ending September 30,2006, and At 4:36 p.m., a message from the Limited Partnership. for other purposes. House of Representatives, delivered by S. 1713. An act to make amendments to the Iran Nonproliferation Act to 2000 related to The enrolled bill was signed subse- Mr. Hays, one of its reading clerks, an- nounced that the House, having had International Space Station payments, and quently by the President pro tempore for other purposes. (Mr. STEVENS). under consideration the report of the S. 1894. An act to amend part E of title IV committee of conference on the dis- of the Social Security Act to provide for the At 12:22 p.m., a message from the agreeing votes of the two Houses on making of foster care maintenance payments House of Representatives, delivered by the amendment of the Senate to the to private for-profit agencies.

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00012 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.010 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13159 EXECUTIVE AND OTHER law, the annual report for 2004 on United EC–4691. A communication from the Pro- COMMUNICATIONS States Participation in the United Nations; gram Analyst, Federal Aviation Administra- to the Committee on Foreign Relations. tion, Department of Transportation, trans- The following communications were EC–4682. A communication from the Under mitting, pursuant to law, the report of a rule laid before the Senate, together with Secretary of Commerce for Oceans and At- entitled ‘‘Modification of Class D and Class E accompanying papers, reports, and doc- mosphere, Department of Commerce, trans- Airspace; Salina Municipal Airport, KS’’ uments, and were referred as indicated: mitting, pursuant to law, the Northwest At- ((RIN2120–AA66)(2005–0241)) received on No- vember 15, 2005; to the Committee on Com- EC–4673. A communication from the Sec- lantic Fisheries Convention Act 2004 Annual Report; to the Committee on Commerce, merce, Science, and Transportation. retary, Judicial Conference of the United EC–4692. A communication from the Pro- States, transmitting, a report of legislative Science, and Transportation. EC–4683. A communication from the Acting gram Analyst, Federal Aviation Administra- proposals to amend sections 1441(a) and 1447 Director, Office of Sustainable Fisheries, Na- tion, Department of Transportation, trans- of title 28, United States Code, to amend 18 tional Marine Fisheries Service, National mitting, pursuant to law, the report of a rule U.S.C. 3672, and to amend 28 U.S.C. 753 and Oceanic and Atmospheric Administration, entitled ‘‘Modification of Class E Airspace; the Judiciary Appropriations Act of 1991; to transmitting, pursuant to law, the report of Dodge City Regional Airport, KS’’ ((RIN2120– the Committee on the Judiciary. a rule entitled ‘‘Temporary Rule: Closure of AA66)(2005–0242)) received on November 15, EC–4674. A communication from Assistant the Regular B Days-at Sea Pilot Program’’ 2005; to the Committee on Commerce, Attorney General, Office of Legislative Af- (I.D. No. 100305A) received on November 15, Science, and Transportation. fairs, Department of Justice, transmitting, 2005; to the Committee on Commerce, EC–4693. A communication from the Pro- pursuant to law, a report entitled ‘‘Report to gram Analyst, Federal Aviation Administra- Science, and Transportation. Congress on the Activities and Operations of EC–4684. A communication from the Acting tion, Department of Transportation, trans- the Public Integrity Section for 2004 (COR- Director, Office of Sustainable Fisheries, Na- mitting, pursuant to law, the report of a rule RECTED)’’; to the Committee on the Judici- tional Marine Fisheries Service, National entitled ‘‘Modification of Legal Description of Class D and Class E Airspace; Topeka, ary. Oceanic and Atmospheric Administration, Forbes Field, KS’’ ((RIN2120–AA66)(2005– EC–4675. A communication from the Execu- transmitting, pursuant to law, the report of 0238)) received on November 15, 2005; to the tive Secretary and Chief of Staff, U.S. Agen- a rule entitled ‘‘Fisheries of the North- Committee on Commerce, Science, and cy for International Development, transmit- eastern United States; Summer Flounder Transportation. ting, pursuant to law, the report of a con- Fishery; Quota Transfer’’ (I.D. No. 053105F) formation in the position of Assistant Ad- EC–4694. A communication from the Pro- received on November 15, 2005; to the Com- gram Analyst, Federal Aviation Administra- ministrator, Bureau for Global Health and a mittee on Commerce, Science, and Transpor- conformation in the position of Assistant tion, Department of Transportation, trans- tation. mitting, pursuant to law, the report of a rule Administrator, Bureau for Economic EC–4685. A communication from the Dep- Growth, Agriculture and Trade, received on entitled ‘‘Establishment and Revision of uty Assistant Administrator for Regulatory Area Navigation Routes; Western United November 15, 2005; to the Committee on For- Programs, Office of Sustainable Fisheries, eign Relations. States’’ ((RIN2120–AA66)(2005–0245)) received National Marine Fisheries Service, National on November 15, 2005; to the Committee on EC–4676. A communication from the Acting Oceanic and Atmospheric Administration, Assistant Secretary, Legislative Affairs, De- Commerce, Science, and Transportation. transmitting, pursuant to law, the report of EC–4695. A communication from the Pro- partment of State, transmitting, pursuant to a rule entitled ‘‘Temporary Rule; Emergency gram Analyst, Federal Aviation Administra- the Arms Export Control Act, a certification Action for Paralytic Shellfish Poisoning Clo- tion, Department of Transportation, trans- regarding the proposed transfer of major de- sure’’ (RIN0648–AT48) received on November mitting, pursuant to law, the report of a rule fense equipment valued at $14,000,000 or more 15, 2005; to the Committee on Commerce, entitled ‘‘Establishment of Colored Federal from the Government of the Netherlands to Science, and Transportation. Airways; AK’’ ((RIN2120–AA66)(2005–0243)) re- the Government of Chile; to the Committee EC–4686. A communication from the Pro- ceived on November 15, 2005; to the Com- on Foreign Relations. gram Analyst, Federal Aviation Administra- mittee on Commerce, Science, and Transpor- EC–4677. A communication from the Assist- tion, Department of Transportation, trans- tation. ant Secretary, Legislative Affairs, Depart- mitting, pursuant to law, the report of a rule EC–4696. A communication from the Pro- ment of State, transmitting, pursuant to the entitled ‘‘Change of Controlling Agency for gram Analyst, Federal Aviation Administra- Arms Export Control Act, the certification Restricted Areas; HI’’ ((RIN2120–AA66)(2005– tion, Department of Transportation, trans- of a proposed license for the export of major 0236)) received on November 15, 2005; to the mitting, pursuant to law, the report of a rule defense equipment and defense articles in Committee on Commerce, Science, and entitled ‘‘Establishment and Revision of the amount of $50,000,000 or more to the Re- Transportation. Area Navigation Routes; Western United public of Korea, Australia, Canada, United EC–4687. A communication from the Pro- States’’ ((RIN2120–AA66)(2005–0244)) received Kingdom, Israel, and Italy; to the Committee gram Analyst, Federal Aviation Administra- on November 15, 2005; to the Committee on on Foreign Relations. tion, Department of Transportation, trans- Commerce, Science, and Transportation. EC–4678. A communication from the Assist- mitting, pursuant to law, the report of a rule EC–4697. A communication from the Pro- ant Secretary, Legislative Affairs, Depart- entitled ‘‘Revision of VOR Federal Airway gram Analyst, Federal Aviation Administra- ment of State, transmitting, pursuant to the V–343; MT’’ ((RIN2120–AA66)(2005–0235)) re- tion, Department of Transportation, trans- Arms Export Control Act, the certification ceived on November 15, 2005; to the Com- mitting, pursuant to law, the report of a rule of a proposed license for the export of major mittee on Commerce, Science, and Transpor- entitled ‘‘Revision of Class E Airspace; defense equipment and defense articles in tation. Yakutat, AK’’ ((RIN2120–AA66)(2005–0237)) re- the amount of $14,000,000 or more to Mexico EC–4688. A communication from the Pro- ceived on November 15, 2005; to the Com- (Sentinel radars and Sentry command and gram Analyst, Federal Aviation Administra- mittee on Commerce, Science, and Transpor- control software); to the Committee on For- tion, Department of Transportation, trans- tation. EC–4698. A communication from the Pro- eign Relations. mitting, pursuant to law, the report of a rule EC–4679. A communication from the Assist- gram Analyst, Federal Aviation Administra- entitled ‘‘Establishment of Organization tion, Department of Transportation, trans- ant Secretary, Legislative Affairs, Depart- Designation Authorization Program’’ mitting, pursuant to law, the report of a rule ment of State, transmitting, pursuant to the (RIN2120–AH79) received on November 15, entitled ‘‘Establishment of Class E Airspace; Arms Export Control Act, the certification 2005; to the Committee on Commerce, Eagle, CO’’ ((RIN2120–AA66)(2005–0240)) re- of a proposed license for the export of de- Science, and Transportation. ceived on November 15, 2005; to the Com- fense articles or defense services sold com- EC–4689. A communication from the Pro- mittee on Commerce, Science, and Transpor- mercially under a contract in the amount of gram Analyst, Federal Aviation Administra- tation. $100,000,000 or more to the United Kingdom tion, Department of Transportation, trans- EC–4699. A communication from the Pro- (AN/VIC–3 Vehicle Intercommunications mitting, pursuant to law, the report of a rule gram Analyst, Federal Aviation Administra- System); to the Committee on Foreign Rela- entitled ‘‘Reservation System for Unsched- tion, Department of Transportation, trans- tions. uled Arrivals at Chicago’s O’Hare Inter- mitting, pursuant to law, the report of a rule EC–4680. A communication from the Assist- national Airport’’ ((RIN2120–AI47)(2005–0002)) entitled ‘‘Establishment of Class E3 Air- ant Secretary, Legislative Affairs, Depart- received on November 15, 2005; to the Com- space; Riverside March Field, CA’’ ((RIN2120– ment of State, transmitting, pursuant to the mittee on Commerce, Science, and Transpor- AA66)(2005–0246)) received on November 15, Arms Export Control Act, the certification tation. 2005; to the Committee on Commerce, of a proposed license for the export of de- EC–4690. A communication from the Pro- Science, and Transportation. fense articles or defense services in the gram Analyst, Federal Aviation Administra- EC–4700. A communication from the Pro- amount of $100,000,000 or more to Japan (F–15 tion, Department of Transportation, trans- gram Analyst, Federal Aviation Administra- aircraft spare parts and equipment and F100 mitting, pursuant to law, the report of a rule tion, Department of Transportation, trans- engines); to the Committee on Foreign Rela- entitled ‘‘Revision of Class E Airspace; Chey- mitting, pursuant to law, the report of a rule tions. enne, WY’’ ((RIN2120–AA66)(2005–0239)) re- entitled ‘‘Hazardous Materials Training Re- EC–4681. A communication from the Acting ceived on November 15, 2005; to the Com- quirements’’ (RIN2120–AG75) received on No- Assistant Secretary, Legislative Affairs, De- mittee on Commerce, Science, and Transpor- vember 15, 2005; to the Committee on Com- partment of State, transmitting, pursuant to tation. merce, Science, and Transportation.

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00013 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.111 S17NOPT2 S13160 CONGRESSIONAL RECORD — SENATE November 17, 2005 EC–4701. A communication from the Pro- S. 2006. A bill to provide for recovery ef- tify before any duly constituted com- gram Analyst, Federal Aviation Administra- forts relating to Hurricanes Katrina and mittee of the Senate. tion, Department of Transportation, trans- Rita for Corps of Engineers projects. (Nominations without an asterisk mitting, pursuant to law, the report of a rule By Mr. SHELBY, from the Committee on were reported with the recommenda- entitled ‘‘Airworthiness Directives; Banking, Housing, and Urban Affairs, with- Aviointeriors S.p.A., Series 312 Box Mounted out amendment: tion that they be confirmed.) Seats’’ ((RIN2120–AA64)(2005–0503)) received S. 2032. An original bill to authorize the f on November 15, 2005; to the Committee on Secretary of Homeland Security to award INTRODUCTION OF BILLS AND Commerce, Science, and Transportation. grants to public transportation agencies to EC–4702. A communication from the Pro- improve security, and for other purposes. JOINT RESOLUTIONS gram Analyst, Federal Aviation Administra- The following bills and joint resolu- tion, Department of Transportation, trans- EXECUTIVE REPORT OF tions were introduced, read the first mitting, pursuant to law, the report of a rule COMMITTEE and second times by unanimous con- entitled ‘‘Airworthiness Directives; Airbus The following executive report of sent, and referred as indicated: Model A320–111 Airplanes; and Model A320– committee was submitted on November 200, A321–100, and A321–200 Series Airplanes’’ By Mr. BYRD (for himself and Mr. ((RIN2120–AA64)(2005–0504)) received on No- 16,2005: ROCKEFELLER): vember 15, 2005; to the Committee on Com- By Mr. WARNER for the Committee on S. 2028. A bill to provide for the reinstate- merce, Science, and Transportation. Armed Services: ment of a license for a certain Federal En- EC–4703. A communication from the Pro- Army nominations beginning with Briga- ergy Regulatory Commission project; to the gram Analyst, Federal Aviation Administra- dier General Robert P. French and ending Committee on Energy and Natural Re- tion, Department of Transportation, trans- with Colonel Terry L. Wiley, which nomina- sources. mitting, pursuant to law, the report of a rule tions were received by the Senate and ap- By Mr. STEVENS: entitled ‘‘Airworthiness Directives; Boeing peared in the Congressional Record on No- S. 2029. An original bill to amend and en- Model 747–100, 747–100B, 747–100B SUD, 747– vember 4,2005. hance certain maritime programs of the De- 200B, 747–300, 747SP, and 747SR Series Air- partment of Transportation, and for other f planes’’ ((RIN2120–AA64)(2005–0505)) received purposes; from the Committee on Commerce, on November 15, 2005; to the Committee on EXECUTIVE REPORTS OF Science, and Transportation; placed on the calendar. Commerce, Science, and Transportation. COMMITTEES EC–4704. A communication from the Pro- By Mr. BIDEN: gram Analyst, Federal Aviation Administra- The following executive reports of S. 2030. A bill to bring the FBI to full tion, Department of Transportation, trans- committees were submitted: strength to carry out its mission; to the Committee on the Judiciary. mitting, pursuant to law, the report of a rule By Mr. STEVENS for the Committee on By Mr. DAYTON: entitled ‘‘Airworthiness Directives; Boeing Commerce, Science, and Transportation. S. 2031. A bill to provide for the valuation Model 727, 727C, 727–100, and 727–100C Series *William E. Kovacic, of Virginia, to be a of employee personal use of noncommercial Airplanes’’ ((RIN2120–AA64)(2005–0506)) re- Federal Trade Commissioner for a term of aircraft for purposes of Federal income tax ceived on November 15, 2005; to the Com- seven years from September 26, 2004. inclusion; to the Committee on Finance. mittee on Commerce, Science, and Transpor- *J. Thomas Rosch, of California, to be a By Mr. SHELBY: tation. Federal Trade Commissioner for the term of S. 2032. An original bill to authorize the seven years from September 26, 2005. f Secretary of Homeland Security to award Coast Guard nominations beginning with grants to public transportation agencies to REPORTS OF COMMITTEES Capt. William D. Baumgartner and ending improve security, and for other purposes; with Capt. Brian M. Salerno, which nomina- The following reports of committees from the Committee on Banking, Housing, tions were received by the Senate and ap- were submitted: and Urban Affairs; placed on the calendar. peared in the Congressional Record on Sep- By Mr. STEVENS, from the Committee on By Mr. KENNEDY (for himself and Mr. tember 8, 2005. Commerce, Science, and Transportation, KERRY): with amendments: By Mr. SPECTER for the Committee on S. 2033. A bill to amend the Wild and Sce- S. 1390. A bill to reauthorize the Coral Reef the Judiciary. nic Rivers Act to designate segments of the Conservation Act of 2000, and for other pur- Joseph Frank Bianco, of New York, to be Taunton River in the Commonwealth of Mas- poses (Rept. No. 109-182). United States District Judge for the Eastern sachusetts as a component of the National By Mr. STEVENS, from the Committee on District of New York. Wild and Scenic Rivers System; to the Com- Commerce, Science, and Transportation, Timothy Mark Burgess, of Alaska, to be mittee on Energy and Natural Resources. without amendment: United States District Judge for the District By Mr. KENNEDY (for himself and Mr. S. 2029. An original bill to amend and en- of Alaska. KERRY): hance certain maritime programs of the De- Gregory F. Van Tatenhove, of Kentucky, S. 2034. A bill to direct the Secretary of the partment of Transportation, and for other to be United States District Judge for the Interior to conduct a study to evaluate the purposes (Rept. No. 109-183). Eastern District of Kentucky. significance of the Colonel James Barrett By Mr. SPECTER, from the Committee on Eric Nicholas Vitaliano, of New York, to Farm in the Commonwealth of Massachu- the Judiciary, without amendment: be United States District Judge for the East- setts and assess the suitability and feasi- S. 1354. A bill to establish commissions to ern District of New York. bility of including the farm in the National review the facts and circumstances sur- Kristi Dubose, of Alabama, to be United Park System as part of the Minute Man Na- rounding injustices suffered by European States District Judge for the Southern Dis- tional Historical Park, and for other pur- Americans, European Latin Americans, and trict of Alabama. poses; to the Committee on Energy and Nat- Jewish refugees during World War II. W. Keith Watkins, of Alabama, to be By Mr. ENZI, from the Committee on ural Resources. United States District Judge for the Middle Health, Education, Labor, and Pensions, By Mr. CRAIG (for himself and Mr. District of Alabama. with an amendment in the nature of a sub- CRAPO): Virginia Mary Kendall, of Illinois, to be S. 2035. A bill to extend the time required stitute: S. 1614. A bill to extend the authorization United States District Judge for the North- for construction of a hydroelectric project in of programs under the Higher Education Act ern District of Illinois. the State of Idaho, and for other purposes; to of 1965, and for other purposes. Emilio T. Gonzalez, of Florida, to be Direc- the Committee on Energy and Natural Re- By Mr. SPECTER, from the Committee on tor of the Bureau of Citizenship and Immi- sources. the Judiciary, with an amendment in the na- gration Services, Department of Homeland By Mr. KENNEDY (for himself and Mr. ture of a substitute: Security. KERRY): S. 1789. A bill to prevent and mitigate iden- Catherine Lucille Hanaway, of Missouri, to S. 2036. A bill to designate the facility of tity theft, to ensure privacy, to provide no- be United States Attorney for the Eastern the United States Postal Service located at tice of security breaches, and to enhance District of Missouri for the term of four 320 High Street in Clinton, Massachusetts, as criminal penalties, law enforcement assist- years. the ‘‘Raymond J. Salmon Post Office.’’; to ance, and other protections against security By Mr. ROBERTS for the Select Com- the Committee on Homeland Security and breaches, fraudulent access, and misuse of mittee on Intelligence. Governmental Affairs. personally identifiable information. *Dale W. Meyerrose, of Indiana, to be Chief By Mr. SALAZAR: By Mr. SPECTER, from the Committee on Information Officer, Office of the Director of S. 2037. A bill to establish the Sangre de the Judiciary, without amendment: National Intelligence. Cristo National Heritage Area in the State of S. 1961. A bill to extend and expand the Colorado, and for other purposes; to the Child Safety Pilot Program. *Nomination was reported with rec- Committee on Energy and Natural Re- By Mr. INHOFE, from the Committee on ommendation that it be confirmed sub- sources. Environment and Public Works, with amend- ject to the nominee’s commitment to By Mr. BURNS (for himself, Mr. BAU- ments: respond to requests to appear and tes- CUS, Mr. THUNE, Mr. GRASSLEY, Mr.

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00014 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.113 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13161 ENZI, Mr. THOMAS, Mr. BINGAMAN, Mr. By Mr. DOMENICI (for himself, Mr. for its threatening behavior and to sup- JOHNSON, Mr. HARKIN, Mr. DORGAN, DORGAN, and Mr. TALENT): port a transition to democracy in Iran. Mr. CONRAD, Mr. BYRD, and Mr. S. 2049. A bill to improve the security of S. 380 WYDEN): the United States borders and for other pur- S. 2038. A bill to amend the Agricultural poses; to the Committee on the Judiciary. At the request of Ms. COLLINS, the Marketing Act of 1946 to restore the original By Ms. SNOWE (for herself and Ms. names of the Senator from Michigan deadline for mandatory country of origin; to CANTWELL): (Ms. STABENOW) and the Senator from the Committee on Agriculture, Nutrition, S. 2050. A bill to establish a commission on South Dakota (Mr. JOHNSON) were and Forestry. inland waters policy; to the Committee on added as cosponsors of S. 380, a bill to By Mr. DURBIN (for himself, Mr. SPEC- Commerce, Science, and Transportation. amend the Public Health Service Act TER, Mr. DEWINE, Mr. LEAHY, Mr. By Mr. AKAKA (for himself and Mr. to establish a State family support KENNEDY, Mrs. FEINSTEIN, Mr. FEIN- INOUYE): GOLD, Mr. HARKIN, Mr. AKAKA, Mr. S. 2051. A bill to extend eligibility for cer- grant program to end the practice of LAUTENBERG, Ms. CANTWELL, Mr. tain Federal benefits to citizens of the Free- parents giving legal custody of their PRYOR, and Mr. KERRY): ly Associated States; to the Committee on seriously emotionally disturbed chil- S. 2039. A bill to provide for loan repay- Finance. dren to State agencies for the purpose ment for prosecutors and public defenders; to of obtaining mental health services for the Committee on the Judiciary. f those children. By Mr. AKAKA (for himself, Mr. LAU- SUBMISSION OF CONCURRENT AND TENBERG, and Mr. CARPER): S. 441 SENATE RESOLUTIONS S. 2040. A bill to amend the Homeland Se- At the request of Mr. SANTORUM, the curity Act of 2002 (6 U.S.C. 101 et seq.) to en- The following concurrent resolutions name of the Senator from South Caro- sure that the Department of Homeland Secu- and Senate resolutions were read, and lina (Mr. DEMINT) was added as a co- rity is led by qualified, experienced per- referred (or acted upon), as indicated: sonnel; to the Committee on Homeland Secu- sponsor of S. 441, a bill to amend the rity and Governmental Affairs. By Mr. CHAMBLISS (for himself and Internal Revenue Code of 1986 to make By Mr. REID: Mr. ISAKSON): permanent the classification of a mo- S. 2041. A bill to provide for the convey- S. Res. 318. A resolution designating No- torsports entertainment complex. ance of a United States Fish and Wildlife vember 27, 2005, as ‘‘Drive Safer Sunday’’; to S. 863 Service administrative site to the city of Las the Committee on the Judiciary. Vegas, Nevada; to the Committee on Envi- By Ms. MIKULSKI: At the request of Mr. CONRAD, the ronment and Public Works. S. Res. 319. A resolution commending relief names of the Senator from Indiana By Mr. CHAMBLISS (for himself and efforts in response to the earthquake in (Mr. BAYH), the Senator from Delaware Mr. HARKIN): South Asia and urging a commitment by the (Mr. BIDEN), the Senator from Cali- S. 2042. A bill to amend the Federal Insec- United States and the international commu- fornia (Mrs. BOXER), the Senator from ticide, Fungicide, and Rodenticide Act to im- nity to help rebuild critical infrastructure in plement pesticide-related obligations of the the affected areas; to the Committee on For- Georgia (Mr. CHAMBLISS), the Senator United States under the international con- eign Relations. from Minnesota (Mr. COLEMAN), the ventions or protocols known as the PIC Con- By Mr. BURR (for himself, Mr. OBAMA, Senator from Maine (Ms. COLLINS), the vention, the POPs Convention, and the Mr. BINGAMAN, Mr. BOND, Mr. KERRY, Senator from Texas (Mr. CORNYN), the LRTAP POPs Protocol; to the Committee on Mr. SMITH, Mr. SALAZAR, Mr. SCHU- Senator from Minnesota (Mr. DAYTON), Agriculture, Nutrition, and Forestry. MER, Mr. DURBIN, Ms. COLLINS, and the Senator from Wyoming (Mr. ENZI), By Mr. DURBIN (for himself, Mr. COCH- Ms. SNOWE): the Senator from South Carolina (Mr. RAN, and Mr. SALAZAR): S. Con. Res. 65. A concurrent resolution GRAHAM), the Senator from Iowa (Mr. S. 2043. A bill to amend the Robert T. Staf- recognizing the benefits and importance of ford Disaster Relief and Emergency Assist- Federally-qualified health centers and their GRASSLEY), the Senator from New ance Act to provide grants for mass evacu- Medicaid prospective payment system; to Hampshire (Mr. GREGG), the Senator ation exercises for urban and suburban areas the Committee on Finance. from Utah (Mr. HATCH), the Senator and the execution of emergency response By Mr. VITTER: from Louisiana (Ms. LANDRIEU), the plans, and for other purposes; to the Com- S. Con. Res. 66. A concurrent resolution af- Senator from Indiana (Mr. LUGAR), the mittee on Homeland Security and Govern- firming that the intent of Congress in pass- Senator from Florida (Mr. MARTINEZ), mental Affairs. ing the National Wildlife Refuge System Im- the Senator from Maryland (Ms. MI- By Mr. LEVIN: provement Act of 1997 was to allow hunting KULSKI), the Senator from Washington S. 2044. A bill to amend the Immigration and fishing on public land within the Na- and Nationality Act to resolve inequities in tional Wildlife Refuge System and declaring (Mrs. MURRAY), the Senator from Illi- existing law by reducing the residency re- that the purpose of reserving certain land as nois (Mr. OBAMA), the Senator from Ne- quirement for the naturalization of aliens public land is to make the land available to vada (Mr. REID), the Senator from Wy- with extraordinary ability so that such the public for reasonable uses; to the Com- oming (Mr. THOMAS) and the Senator aliens may represent the United States at mittee on Energy and Natural Resources. international events; to the Committee on from Oregon (Mr. WYDEN) were added the Judiciary. f as cosponsors of S. 863, a bill to require By Mr. OBAMA: the Secretary of the Treasury to mint S. 2045. A bill to provide incentives to the ADDITIONAL COSPONSORS coins in commemoration of the cen- auto industry to accelerate efforts to develop S. 31 tenary of the bestowal of the Nobel more energy-efficient vehicles to lessen de- At the request of Mr. BIDEN, his name Peace Prize on President Theodore pendence on oil; to the Committee on Fi- Roosevelt, and for other purposes. nance. was added as a cosponsor of S. 31, a bill By Mr. DEWINE: to amend the Electronic Fund Transfer S. 908 S. 2046. A bill to establish a National Meth- Act to extend certain consumer protec- At the request of Mr. MCCONNELL, amphetamine Information Clearinghouse to tions to international remittance the name of the Senator from South promote sharing information regarding suc- transfers of funds originating in the Carolina (Mr. GRAHAM) was added as a cessful law enforcement, treatment, environ- United States, and for other purposes. mental, social services, and other programs cosponsor of S. 908, a bill to allow Con- related to the production, use, or effects of S. 132 gress, State legislatures, and regu- methamphetamine and grants available for At the request of Mr. SMITH, the latory agencies to determine appro- such programs, and for the other purposes; to name of the Senator from Virginia (Mr. priate laws, rules, and regulations to the Committee on the Judiciary. WARNER) was added as a cosponsor of S. address the problems of weight gain, By Mr. OBAMA (for himself and Mrs. 132, a bill to amend the Internal Rev- obesity, and health conditions associ- CLINTON): ated with weight gain or obesity. S. 2047. A bill to promote healthy commu- enue Code of 1986 to allow a deduction nities; to the Committee on Health, Edu- for premiums on mortgage insurance. S. 1215 cation, Labor, and Pensions. S. 333 At the request of Mr. GREGG, the By Mr. OBAMA: At the request of Mr. SANTORUM, the name of the Senator from Oregon (Mr. S. 2048. A bill to direct the Consumer Prod- names of the Senator from Mississippi WYDEN) was added as a cosponsor of S. uct Safety Commission to classify certain children’s products containing lead to be (Mr. COCHRAN) and the Senator from 1215, a bill to authorize the acquisition banned hazardous substances; to the Com- California (Mrs. FEINSTEIN) were added of interests in underdeveloped coastal mittee on Commerce, Science, and Transpor- as cosponsors of S. 333, a bill to hold areas in order better to ensure their tation. the current regime in Iran accountable protection from development.

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00015 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.125 S17NOPT2 S13162 CONGRESSIONAL RECORD — SENATE November 17, 2005 S. 1418 1970 to assist property owners and Fed- onciliation pursuant to section 202(b) At the request of Mr. ENZI, the names eral agencies in resolving disputes re- of the concurrent resolution on the of the Senator from Maine (Ms. lating to private property. budget for fiscal year 2006. SNOWE), the Senator from Michigan S. 1952 AMENDMENT NO. 2596 (Ms. STABENOW) and the Senator from At the request of Mr. COLEMAN, the At the request of Mr. DURBIN, the Pennsylvania (Mr. SANTORUM) were name of the Senator from Mississippi names of the Senator from Massachu- added as cosponsors of S. 1418, a bill to (Mr. COCHRAN) was added as a cospon- setts (Mr. KERRY), the Senator from enhance the adoption of a nationwide sor of S. 1952, a bill to provide grants Washington (Mrs. MURRAY) and the inter operable health information tech- for rural health information tech- Senator from California (Mrs. FEIN- nology system and to improve the nology development activities. STEIN) were added as cosponsors of quality and reduce the costs of health S. 1959 amendment No. 2596 proposed to S. care in the United States. At the request of Mr. KERRY, the 2020, an original bill to provide for rec- S. 1496 names of the Senator from Indiana onciliation pursuant to section 202(b) At the request of Mr. CRAPO, the (Mr. BAYH) and the Senator from Mis- of the concurrent resolution on the name of the Senator from South Da- sissippi (Mr. COCHRAN) were added as budget for fiscal year 2006. kota (Mr. THUNE) was added as a co- cosponsors of S. 1959, a bill to direct f sponsor of S. 1496, a bill to direct the the Architect of the Capitol to obtain a STATEMENTS ON INTRODUCED Secretary of the Interior to conduct a statue of Rosa Parks and to place the BILLS AND JOINT RESOLUTIONS pilot program under which up to 15 statue in the United States Capitol in States may issue electronic Federal National Statuary Hall. By Mr. BYRD (for himself and migratory bird hunting stamps. S. 1961 Mr. ROCKEFELLER): S. 2028. A bill to provide for the rein- S. 1508 At the request of Mr. BIDEN, the At the request of Mr. FEINGOLD, the name of the Senator from Hawaii (Mr. statement of a license for a certain Federal Energy Regulatory Commis- name of the Senator from Rhode Island AKAKA) was added as a cosponsor of S. (Mr. CHAFEE) was added as a cosponsor 1961, a bill to extend and expand the sion project; to the Committee on En- of S. 1508, a bill to require Senate can- Child Safety Pilot Program. ergy and Natural Resources. Mr. BYRD. Mr. President, I ask unan- didates to file designations, state- S. 1969 ments, and reports in electronic form. imous consent that the text of my bill At the request of Mr. BAUCUS, the to reinstate a hydroelectric license for S. 1513 names of the Senator from New Mexico a Federal Energy Regulatory Commis- At the request of Ms. MIKULSKI, the (Mr. BINGAMAN) and the Senator from sion project in Grafton, WV, be printed names of the Senator from New Jersey Massachusetts (Mr. KERRY) were added in the RECORD. (Mr. CORZINE), the Senator from Con- as cosponsors of S. 1969, a bill to ex- There being no objection, the bill was necticut (Mr. DODD), the Senator from press the sense of the Senate regarding ordered to be printed in the RECORD, as Michigan (Mr. LEVIN) and the Senator Medicaid reconciliation legislation to follows: from Pennsylvania (Mr. SPECTER) were be reported by a conference committee added as cosponsors of S. 1513, a bill to during the 109th Congress. S. 2028 Be it enacted by the Senate and House of Rep- reauthorize the HOPE VI program for S. 2015 revitalization of severely distressed resentatives of the United States of America in At the request of Mr. ISAKSON, the Congress assembled, public housing, and for other purposes. name of the Senator from Georgia (Mr. SECTION 1. REINSTATEMENT OF LICENSE FOR S. 1631 CHAMBLISS) was added as a cosponsor of FEDERAL ENERGY REGULATORY At the request of Mr. DORGAN, the S. 2015, a bill to provide a site for con- COMMISSION PROJECT. names of the Senator from Vermont struction of a national health museum, (a) IN GENERAL.—Notwithstanding the time (Mr. LEAHY) and the Senator from Wis- and for other purposes. period specified in section 13 of the Federal Power Act (16 U.S.C. 806) that would other- consin (Mr. KOHL) were added as co- S. CON. RES. 55 wise apply to project numbered 7307 of the sponsors of S. 1631, a bill to amend the At the request of Mr. CRAIG, the Federal Energy Regulatory Commission, the Internal Revenue Code of 1986 to im- names of the Senator from Kentucky Commission shall, on the request of the li- pose a temporary windfall profit tax on (Mr. BUNNING), the Senator from Mon- censee for the project, in accordance with crude oil and to rebate the tax col- tana (Mr. BURNS), the Senator from that section (including the good faith, due lected back to the American consumer, Oklahoma (Mr. COBURN), the Senator diligence, and public interest requirements of that section and procedures established and for other purposes. from Texas (Mrs. HUTCHISON) and the under that section), extend the time required S. 1719 Senator from Connecticut (Mr. DODD) for commencement of construction of the At the request of Mr. INOUYE, the were added as cosponsors of S. Con. project until December 31, 2007. name of the Senator from Texas (Mrs. Res. 55, a concurrent resolution ex- (b) APPLICABILITY.—Subsection (a) shall HUTCHISON) was added as a cosponsor of pressing the sense of the Congress re- apply to the project on the expiration of any S. 1719, a bill to provide for the preser- garding the conditions for the United extension, issued by the Commission under vation of the historic confinement sites States to become a signatory to any section 13 of the Federal Power Act (16 where Japanese Americans were de- multilateral agreement on trade re- U.S.C. 806), of the time required for com- tained during World War II, and for sulting from the World Trade Organiza- mencement of construction of the project. (c) REINSTATEMENT OF EXPIRED LICENSE.— other purposes. tion’s Doha Development Agenda If a license of the Commission for the project S. 1841 Round. expires before the date of enactment of this At the request of Mr. NELSON of Flor- S. CON. RES. 60 Act, the Commission shall— ida, the name of the Senator from Min- At the request of Mr. TALENT, the (1) reinstate the license effective as of the nesota (Mr. DAYTON) was added as a co- names of the Senator from Illinois (Mr. date of the expiration of the license; and (2) extend the time required for commence- sponsor of S. 1841, a bill to amend title DURBIN) and the Senator from Kansas ment of construction of the project until De- XVIII of the Social Security Act to (Mr. ROBERTS) were added as cospon- cember 31, 2007. provide extended and additional pro- sors of S. Con. Res. 60, a concurrent tection to Medicare beneficiaries who resolution designating the Negro By Mr. BIDEN: enroll for the Medicare prescription Leagues Baseball Museum in Kansas S. 2030. A bill to bring the FBI to full drug benefit during 2006. City, Missouri, as America’s National strength to carry out its mission; to S. 1883 Negro Leagues Baseball Museum. the Committee on the Judiciary. At the request of Mr. HATCH, the AMENDMENT NO. 2587 Mr. BIDEN. Mr. President, I rise name of the Senator from Mississippi At the request of Mr. DORGAN, the today to introduce the Full Strength (Mr. COCHRAN) was added as a cospon- name of the Senator from Vermont Bureau Initiative Act of 2005. This is a sor of S. 1883, a bill to amend the Uni- (Mr. LEAHY) was added as a cosponsor piece of legislation that I think is form Relocation Assistance and Real of amendment No. 2587 proposed to S. critically important to our national se- Property Acquisition Policies Act of 2020, an original bill to provide for rec- curity. Over the past four years, we

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00016 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.127 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13163 have had numerous debates here in the effort—while critical—has had an im- year, there were over 16,000 murders Senate about what we need to do to pact on the FBI’s traditional crime throughout the United States, and po- protect ourselves from international fighting efforts. lice chiefs and sheriffs are reporting terrorists. While I have disagreed with In addition to investigating Federal worrying signs of local youth violence. many of the specific decisions this Con- crimes, the FBI also provides critical Indeed, a 2005 report by the FBI on gress and President Bush have made, I assistance to State and local law en- youth gangs shows that gang activity do agree that we face a grave threat forcement. Quite simply, the FBI has is on the rise. Rather than pull-back, from radical fundamental terrorists. technical expertise and resources that we need to re-double our effort to en- And, it should be a primary focus of are not available to many State and sure that crime rates don’t rise in the our national security efforts. However, local agencies—especially smaller ju- future and to push them even lower. it simply makes no sense for us to risdictions. These local agencies rely I’ve often said that the safety of Na- spend all of our time worrying about on the FBI to assist them on technical tion’s citizens should be the top pri- terrorism if we turn a blind eye to tra- matters, and as the FBI continues to ority of our Federal Government—this ditional crime and the threat that it divert resources from criminal cases, a applies to combating international ter- poses to our citizens. We simply have gap in overall law enforcement capa- rorists and traditional crime. to be able to do both, and the legisla- bilities is developing. In order to pre- We spent a bulk of the nineties cre- tion that I am introducing today will serve public safety and national secu- ating a Federal, State, and local part- help do that. rity this is a gap that must be filled. nership that helped make our Nation Part of the response to address this Unfortunately, local budget woes are safer than it has been in a generation. threat has been to shift the primary making it impossible for local agencies This partnership is breaking down be- function of the Federal Bureau of In- to fill the slack. A recent survey indi- cause the President and many in Con- vestigation from investigating and cap- cated that 23 of 44 police agencies are gress feel that local crime is not a na- turing criminals to the prevention of facing an officer shortfall. The USA tional priority. I couldn’t disagree terror attacks. I don’t disagree that Today and the New York Times have more. The safety of the American peo- this is an appropriate shift in prior- reported officer shortages in New York, ple is the most important priority that ities, but, we haven’t made the invest- Cleveland, Los Angeles, Houston and we have. It doesn’t matter whether the ments necessary for the FBI to shift others. In addition, I recently attended threat comes from international ter- priorities and meet its commitment to a Judiciary Committee hearing in rorists, drug traffickers, or from the combat traditional crime. To address Philadelphia and we heard testimony thug down the street. In my opinion, it this concern, I am introducing legisla- from the Philadelphia Chief of Police is a terrible mistake to use the suc- tion that will authorize funding for the that he had lost 2,000 officers in recent cesses of the past ten years and the FBI to hire an additional 1,000 agents. years, and the Pittsburgh police chief new focus on terrorism as an excuse to These agents will replace the ones that reported that she had lost nearly 1⁄4 of abandon our critical anti-crime respon- have been reassigned to her officers and had to suspend her sibilities. We can—and we must do counterterrorism cases and will help community policing programs and both. The American people are count- keep our communities safe. The cost— other crime prevention programs due ing on us, and the legislation that I am $160 million per year—is minimal when to budget cuts. introducing today will help ensure that compared to the benefits it will pro- In addition to local budget woes, the we meet our commitment to the Amer- vide. Its passage will help ensure that U.S. Congress continues to slash Fed- ican people to make sure that they are the FBI has the resources to achieve eral assistance for State and local law safe from crime and terrorism. its counterterrorism priorities without enforcement. In this year’s Commerce, neglecting its traditional crime fight- Justice, State appropriations bill, the By Mr. DURBIN (for himself, Mr. ing functions. Congress cut roughly $300 million from SPECTER, Mr. DEWINE, Mr. A 2004 Government Accountability the Justice Assistance Grant and com- LEAHY, Mr. KENNEDY, Mrs. Office found that the number of overall pletely eliminated the COPS hiring FEINSTEIN, Mr. FEINGOLD, Mr. agents at the FBI has increased by program. Any local sheriff or police HARKIN, Mr. AKAKA, Mr. LAU- only seven percent since 2001. During chief will tell you how important this TENBERG, Ms. CANTWELL, Mr. the same time, the overall percentage funding assistance is to their efforts, PRYOR, and Mr. KERRY): of agents dedicated to and the investments that we made in S. 2039. A bill to provide for loan re- counterterrorism by twenty five per- them over the past ten years helped payment for prosecutors and public de- cent—with 678 agents being perma- drive down crime rates from all-time fenders; to the Committee on the Judi- nently shifted from drug, white collar, highs to the lowest levels in a genera- ciary. and violent crime cases to counter-ter- tion. In addition, the COPS program Mr. DURBIN. Mr. President, I rise ror activities. In addition, we know has been statistically proven to reduce today to introduce the Prosecutors and that many agents are working on crime by the Government Account- Defenders Incentive Act of 2005. I am counterterrorism cases even if they ability Office, and the Justice Assist- honored to have the support and co- have not been ‘‘officially’’ dedicated to ance Grants are the primary grant pro- sponsorship of Senator DEWINE with that effort in a process know within grams used by local agencies to combat whom I have enjoyed working on simi- the FBI as ‘‘overburning.’’ illegal drug use in their communities. I lar measures in previous Congresses. I Ultimately, the GAO concluded, as it voted for this spending bill because it am further pleased that Senators SPEC- often does, that the impact on tradi- provided critical funding for the FBI TER, LEAHY, KENNEDY, FEINGOLD, FEIN- tional crime was statistically inconclu- and the Drug Enforcement Agency, but STEIN, AKAKA, CANTWELL, HARKIN, LAU- sive; however the report demonstrated I remain very critical of the cuts to TENBERG, PRYOR, and KERRY have also many concerns. First, the report found state and local law enforcement assist- agreed to join me as original cospon- that the FBI referred 236 ance and hope that the President and sors of this legislation. Our bill is de- counterterrorism matters to U.S. At- the Republican-led Congress will signed to encourage the best and the torneys for prosecution in fiscal year change course. brightest law school graduates to enter 2001, which ended three weeks after Unfortunately, these cuts and the public service as criminal prosecutors September 11. Two years later, in fiscal FBI reprogramming of agents from and public defenders by making a stu- year 2003, the FBI referred 1,821 crime to counter-terror cases is cre- dent loan repayment program available counterterrorism cases to U.S. Attor- ating a perfect storm that I’m afraid to them. neys for prosecution—this is a 671 per- will contribute to rising crime rates in I am pleased that this legislation en- cent increase. During the same period the future. The good news is that the joys bipartisan support. I am anxious of time, referrals for drug, whitecollar, 2004 Uniform Crime Reports show that to work closely with Chairman SPEC- and violent crime matters all declined crime rates remain at historic lows. TER and Ranking Member LEAHY to ad- by 39 percent, 23 percent, and 10 per- But, many criminologists have pointed vance it through the Judiciary Com- cent respectively. This statistically out that many crime indicators should mittee and secure its enactment by the demonstrates that the reprogramming caution against complacency. Last full Senate.

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00017 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.131 S17NOPT2 S13164 CONGRESSIONAL RECORD — SENATE November 17, 2005 Our proposed loan repayment pro- eighth, the legal profession and society practice have risen at a much faster gram is supported by the American Bar pay a severe price when law graduates pace than entry-level public service Association, the National District At- are shut out from pursuing public serv- salaries. Between 1985 and 2002, the me- torneys Association, the National As- ice legal careers due to high edu- dian starting salaries at private law sociation of Prosecutor Coordinators, cational debt burden. firms rose by about 280 percent. Gov- the National Legal Aid and Defender On the matter of skyrocketing tui- ernment lawyers, such as prosecutors Association, and the American Council tion levels, since the early 1970s, there and public defenders, saw their salaries of Chief Defenders. have been steep and persistent hikes in increase by just 70 percent. We can—and should—do more to help the costs of legal education and in the According to the 2004 Public Sector prosecutor and public defender offices tuition rates law schools charge. Re- and Public Interest Attorney Salary compete with the higher salaries avail- searchers found that tuition increased Report, published in August 2004 by the able in the private sector. In many in- about 340 percent from 1985 to 2002 for National Association for Law Place- stances, despite high aspirations and private law school students and out-of- ment, Inc., the median entry-level sal- strong motivation to work in the pub- state students at public law schools. In ary for public defenders is $39,000; with lic sector, many graduates find it eco- state students at public law schools 11 to 15 years of experience, the median nomically impossible to pursue that saw their tuition jump about 500 per- is $65,000. The salary progression for career path due to the overwhelming cent. During the period 1992–2002, the State and local prosecuting attorneys burden of debt. The availability of stu- cost of living in the United States rose is similar, starting at about $40,000 and dent loan repayment can be a powerful 28 percent while the cost of tuition for progressing to $68,000–69,000 for those incentive for attracting some of our public law schools rose 134 percent for with 11 to 15 years of experience. most talented new lawyers to public residents and 100 percent for non- In August 2004, NALP also released the results of its tenth annual com- service employment. residents, and private law school tui- prehensive survey of associate com- Many of today’s law graduates are tion increased 76 percent. finishing law school owing staggering In 1975, when private law school tui- pensation in private sector law firms. amounts of student loan debt. Accord- tion averaged $2,525 and public law According to the 2004 Associate Salary ing to the American Bar Association, school tuition for in state residents Survey Report, based on salary infor- mation as of April 1, 2004 provided by the median total cumulative edu- was $700, the need to borrow to finance 599 offices, the median salary for first- cational debt for law school graduates a legal education was not as prevalent year associates ranged from $65,000 in in the class of 2004 was $97,763 for pri- or necessary. In 1990, when tuition was firms of 2 to 25 attorneys to $120,000 in vate schools and $66,810 for public $11,680 for private institutions and firms of 500 attorneys or more, with a schools. Educational loan debts rep- $3,012 for public law schools, it was at first-year median for all participating resent a serious financial obligation least manageable. In 2002, the median firms of $95,000. These figures evidence which must be repaid. A default on any law school annual tuitions were $24,920 the stark reality of compensation dif- loan triggers serious consequences. for private law schools, $18,131 for non- ferentials for those graduates electing Moreover, the looming obligation can resident students at public law schools, to devote their skills to public service impact career choices for many new and $9,252 for resident students at pub- jobs as prosecutors and defenders. graduates. lic law schools. High student debt bars many law Many budding prosecutors and public A computation of the tuition rates of graduates from pursuing public service defenders face a disheartening di- the 186 ABA-accredited law schools for careers. As law school tuition and stu- lemma. On the one hand, they have a 2004 reflects that charges for State dent debt have sharply escalated, fewer deep commitment to pursuing a career residents at public law schools average and fewer law school graduates can af- in public service. On the other hand, $10,820 per year. For nonresidents at- ford to take the comparatively low- they need a level of income to meet the tending public law schools, the average paying public service positions that are demands of exorbitant educational tuition amounts to $20,176 per year. available in government agencies or loan liabilities. This wrenching choice Students attending private law schools with prosecutor, public defender, or has not only personal impact but ad- pay an average of $25,603 per year. legal services offices. verse implications for the legal profes- Additional amounts for food, lodging, A national study of law school debt sion and its commitment to ensuring books, fees and personal expenses in- conducted by Equal Justice Works, the access to justice for all citizens. And crease the costs for 3 years to more Partnership for Public Service, and the from an employer’s perspective, com- than $60,000 in almost all cases and National Association for Law Place- paratively low salaries and high debt well over $100,000 in many instances. ment found that law student debt pre- make it extremely difficult to recruit The vast majority of law students vented two-thirds of law student re- and retain attorneys in prosecutor and must borrow funds to finance their spondents from considering a public public defender offices. legal education. In 2002, almost 87 per- service career. The results of a special study, ‘‘Lift- cent of law students borrowed to fi- The report was based on a spring 2002 ing the Burden: Law Student Debt as a nance their legal education. That level survey of graduating law students. Sur- Barrier to Public Service,’’ published remained consistent in 2004. Many of vey respondents included 1,622 students in August 2003 by the American Bar As- these students also carried unpaid debt from 117 law schools representing 40 sociation, reflects eight key findings, from their undergraduate studies. States, the District of Columbia, and which I will describe in more speci- Law students are borrowing increas- Canada. Among the findings reported ficity in my remarks. ingly larger sums to finance their legal were the following: Overall, 66 percent First, law school tuition levels have education. As tuition and other ex- of respondents stated that law school skyrocketed. Second, the vast majority penses of attending law school rose, debt kept them from considering a pub- of law students borrow funds to finance more and more students found they lic interest or government job. The per- their legal education. Third, law stu- needed to borrow to pay for law school. centage is higher among those who ul- dents are borrowing increasingly larger During the 1990s, the average amount timately accepted jobs in small or sums to finance their legal education. students borrowed more than doubled. large private firms, with 83 percent and Fourth, public service salaries have not Today, the amount borrowed by many 78 percent, respectively, stating that kept pace with rising law school debt students exceeds $80,000. debt prevented them from seeking burdens or private sector salaries. Public service salaries have not kept work with public interest organiza- Fifth, high student debt bars many law pace with rising law school debt bur- tions or the Federal Government. graduates from pursuing public service dens or private sector salaries. Entry- Seventy-three percent of students careers. Sixth, many law graduates level salaries for government or other who had not yet accepted a job when who take public service legal jobs must public service position, have always surveyed also indicated that they were leave after they gain 2 to 3 years of ex- been significantly lower than those in disinclined to seek a public interest or perience. Seventh, public service em- private practice. government position due to heavy debt ployers report serious difficulty re- Over the years since the mid-1970s, load. Providing $6,000 a year in avail- cruiting and retaining lawyers. And the median starting salaries in private able loan repayment assistance would

VerDate Aug 31 2005 00:22 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00018 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.127 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13165 result in increased interest in a post fits for the preceding fiscal year and sive. It is justice and it has made me a graduate Federal Government job for have completed less than 3 years of the better person. . . . However, the one 83 percent of student respondents. first required service period. Borrowers problem that I have consistently had Despite their high debt burden, some could enter into an additional agree- since becoming a public defender is law graduates initially accept public ment, after the required 3-year period, getting my student loans paid. I have a service jobs. However, the magnitude for a successive period of service which debt burden over $110,000. . . . My stu- of debt precipitates high turnover be- may be less than 3 years. It would dent loan payments will soon exceed cause many of these cannot repay loan cover student loans made, insured, or $950 a month. This represents about obligations on a median starting salary guaranteed under the Higher Education one-third of my monthly take-home of $36,000 and pay all their other re- Act of 1965, including consolidation pay. I cannot help pay the mortgage on maining living expenses with the re- loans. Furthermore, it would extend to my house. I cannot save for my two maining $1,100 per month. Some who Federal public defenders the existing children’s futures. During a financial begin careers in public service, and who Perkins loan forgiveness program crisis, my husband knows that he can- would like to remain, leave after a few available for Federal prosecutors. not look to me to help the family fi- years when they find their debts are Our bill is modeled on the program nances. . . . I am now faced with a Hob- too severely constraining on their for Federal executive branch employ- son’s choice—do I fulfill the needs of hopes for making ends meet, much less ees which has been enjoying growing my indigent clients or my struggling raising children or saving for retire- success. Federal law permits Federal family? I absolutely, positively don’t ment. executive branch agencies to repay want to leave. But my responsibilities Many public service employers report their employees’ student loans, up to to my family and my student loan having a difficult time attracting the $10,000 in a year, and up to a lifetime creditors make staying in the public best qualified law graduates. Public maximum of $60,000. In exchange, the sector feel selfish and irresponsible. service employers, such as prosecutor employee must agree to remain with Imagine that—working for the public or public defender offices, have vacan- the agency for at least 3 years. good seems selfish and irresponsible be- cies they cannot fill because new law During fiscal year 2004, 28 executive cause I cannot do what I love and, at graduates cannot afford to work for branch agencies provided 2,945 Federal the same time, repay what I owe.’’ them. Alternatively, those who do hire employees with more than $16.4 million I appreciate Ms. Walsh’s willingness law graduates find that, because of in student loan repayments, as re- to share her perspectives with me. By educational debt payments, those ported by the Office of Personnel Man- enacting and funding this legislation, whom they do hire leave just at the agement in April 2005. This marked a we can take a meaningful step toward point when they have acquired the ex- 42-percent increase in the number of alleviating some of the financial bur- perience to provide the most valuable beneficiaries and a 79-percent increase den for attorneys such as Ms. Walsh services. in benefits over fiscal year 2003. who choose careers as criminal pros- The legal profession and society pay It is noteworthy that across the Fed- ecutors and public defenders. a severe price when law graduates are eral Government in 2004, agencies used I know there are many other law shut out from pursuing public service the loan repayment program most graduates who, like Jennifer Walsh, legal careers due to high educational often to recruit and retain attorneys. want to apply their legal training and debt burden. Lawyers with dreams of In fiscal year 2004, 473 Federal lawyers develop their skills in the public sec- serving their communities as prosecu- received loan repayments, representing tor, but are deterred by the weight of tors or public defenders are unable to 16.1 percent of all employees who re- student loan obligations. Passage of use their skills to do so. And when gov- ceived the benefit. our legislation will help them make ernments cannot hire new lawyers or The Securities and Exchange Com- their careers dreams a reality. I urge keep experienced ones, the ability to mission provided the benefit to 239 law- its swift adoption. protect the public safety is challenged. yers, and the Justice Department dis- I ask unanimous consent that the The inability of poor and moderate-in- tributed program benefits to 118 of its text of the bill be printed in the come persons to obtain legal assistance attorneys. According to the Office of RECORD. can result in dire consequences to Personnel Management’s report, the There being no objection, the bill was those individuals and the communities Nuclear Regulatory Commission re- ordered to be printed in the RECORD, as in which they live. ported that the program has been of follows: Our bill, the Prosecutors and Defend- tremendous benefit in recruiting and S. 2039 ers Incentive Act, is designed to help retaining attorneys in its Honors Law Be it enacted by the Senate and House of Rep- remedy some of these problems. Enact- Graduate Program. NRC commented resentatives of the United States of America in ing this measure will help make legal that law school debt is continuing to Congress assembled, careers in public service as prosecutors rise—to more than $100,000 in some SECTION 1. SHORT TITLE. and public defenders in the criminal cases—and a gap exists between Fed- This Act may be cited as the ‘‘Prosecutors and Defenders Incentive Act of 2005’’. justice system more financially viable eral and private law firm salaries. As a SEC. 2. LOAN REPAYMENT FOR PROSECUTORS and attractive to law school graduates result, some quality candidates may AND DEFENDERS. who have incurred significant financial rule out a career as an attorney in the Title I of the Omnibus Crime Control and obligations in acquiring their edu- Federal Government. NRC believes the Safe Streets Act of 1968 (42 U.S.C. 3711 et cation. Federal student loan repayment pro- seq.) is amended by adding at the end the fol- Our proposal would establish, within gram helps the Commission overcome lowing: the Department of Justice, a program these obstacles. ‘‘PART HH—LOAN REPAYMENT FOR of student loan repayment for bor- I recently received a compelling let- PROSECUTORS AND PUBLIC DEFENDERS rowers who agree to remain employed ter from Jennifer Walsh, the assistant ‘‘SEC. 2901. GRANT AUTHORIZATION. for at least 3 years as public attorneys appellate defender for the State of Illi- ‘‘(a) PURPOSE.—The purpose of this section who are either State or local criminal nois. Her experiences portray in testa- is to encourage qualified individuals to enter and continue employment as prosecutors and prosecutors or State, local, or Federal mentary terms the real dilemmas en- public defenders. public defenders in criminal cases. It countered by perhaps thousands of at- ‘‘(b) DEFINITIONS.—In this section: would allow eligible attorneys to re- torneys desiring public service careers ‘‘(1) PROSECUTOR.—The term ‘prosecutor’ ceive student loan debt repayments of despite exorbitant student loan obliga- means a full-time employee of a State or up to $10,000 per year, with a maximum tions. local agency who— aggregate over time of $60,000. To simply paraphrase Ms. Walsh’s ‘‘(A) is continually licensed to practice Repayment benefits for such public sentiments would diminish their im- law; and attorneys would be made available on a pact, so I would like to quote some ex- ‘‘(B) prosecutes criminal cases at the State or local level. first-come, first-served basis and sub- cerpts from her letter: ‘‘I love being a ‘‘(2) PUBLIC DEFENDER.—The term ‘public ject to the availability of appropria- public servant. . . . Helping those who defender’ means an attorney who— tions. Priority would be given to bor- cannot afford to help themselves isn’t ‘‘(A) is continually licensed to practice rowers who received repayment bene- charity and it isn’t socially progres- law; and

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00019 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.128 S17NOPT2 S13166 CONGRESSIONAL RECORD — SENATE November 17, 2005 ‘‘(B) is— ‘‘(3) LIMITATIONS.— appointees in the Federal Government. ‘‘(i) a full-time employee of a State or ‘‘(A) STUDENT LOAN PAYMENT AMOUNT.— Mr. Brown had minimal emergency local agency or a nonprofit organization op- Student loan repayments made by the Attor- management experience prior to join- erating under a contract with a State or unit ney General under this section shall be made of local government, that provides legal rep- subject to such terms, limitations, or condi- ing the Federal Emergency Manage- resentation to indigent persons in criminal tions as may be mutually agreed upon by the ment Agency, FEMA. Despite Mr. cases; or borrower and the Attorney General in an Brown’s 3 years as a senior official at ‘‘(ii) employed as a full-time Federal de- agreement under paragraph (1), except that FEMA, the agency faltered during Hur- fender attorney in a defender organization the amount paid by the Attorney General ricane Katrina under his leadership. established pursuant to subsection (g) of sec- under this section shall not exceed— tion 3006A of title 18, United States Code, ‘‘(i) $10,000 for any borrower in any cal- While not all of the Government’s that provides legal representation to indi- endar year; or failures to prepare for and respond to gent persons in criminal cases. ‘‘(ii) an aggregate total of $60,000 in the Hurricane Katrina can be placed at Mr. ‘‘(3) STUDENT LOAN.—The term ‘student case of any borrower. loan’ means— Brown’s doorstep, leadership matters. ‘‘(B) BEGINNING OF PAYMENTS.—Nothing in At a recent Homeland Security and ‘‘(A) a loan made, insured, or guaranteed this section shall authorize the Attorney under part B of title IV of the Higher Edu- General to pay any amount to reimburse a Governmental Affairs Committee hear- cation Act of 1965(20 U.S.C. 1071 et seq.); borrower for any repayments made by such ing on the Coast Guard’s response to ‘‘(B) a loan made under part D or E of title borrower prior to the date on which the At- Hurricane Katrina, Cpt Bruce C. Jones, IV of the Higher Education Act of 1965(20 torney General entered into an agreement the commanding officer of Coast Guard U.S.C. 1087a et seq. and 1087aa et seq.); and with the borrower under this subsection. Air Station New Orleans, testified, ‘‘(C) a loan made under section 428C or ‘‘(e) ADDITIONAL AGREEMENTS.— 455(g) of the Higher Education Act of 1965(20 ‘‘What counts most in a crisis, is not ‘‘(1) IN GENERAL.—On completion of the re- the plan, it’s leadership. Not processes, U.S.C. 1078–3 and 1087e(g)) to the extent that quired period of service under an agreement such loan was used to repay a Federal Direct under subsection (d), the borrower and the but people. And not organizational Stafford Loan, a Federal Direct Unsubsidized Attorney General may, subject to paragraph charts, but organizational culture.’’ Stafford Loan, or a loan made under section (2), enter into an additional agreement in ac- According to Captain Jones, one of 428 or 428H of such Act. cordance with subsection (d). the reasons the Coast Guard was able ‘‘(c) PROGRAM AUTHORIZED.—The Attorney ‘‘(2) TERM.—An agreement entered into General shall establish a program by which under paragraph (1) may require the bor- to respond immediately and perform the Department of Justice shall assume the rower to remain employed as a prosecutor or efficiently during Hurricane Katrina is obligation to repay a student loan, by direct public defender for less than 3 years. because the leaders of the Eighth Dis- payments on behalf of a borrower to the ‘‘(f) AWARD BASIS; PRIORITY.— holder of such loan, in accordance with sub- trict and Sector New Orleans were able ‘‘(1) AWARD BASIS.—Subject to paragraph to make quick, sound decisions while section (d), for any borrower who— (2), the Attorney General shall provide re- ‘‘(1) is employed as a prosecutor or public payment benefits under this section on a following a predetermined plan. Quick defender; and first-come, first-served basis, and subject to thinking and good judgement cannot ‘‘(2) is not in default on a loan for which the availability of appropriations. be written into a plan. the borrower seeks forgiveness. ‘‘(2) PRIORITY.—The Attorney General shall ‘‘(d) TERMS OF AGREEMENT.— In addition, DHS, with its multitude give priority in providing repayment bene- ‘‘(1) IN GENERAL.—To be eligible to receive fits under this section in any fiscal year to a of management challenges, requires repayment benefits under subsection (c), a borrower who— leaders with strong management expe- borrower shall enter into a written agree- ‘‘(A) received repayment benefits under rience. Over the past few years, the ment that specifies that— this section during the preceding fiscal year; ‘‘(A) the borrower will remain employed as DHS Inspector General and the Govern- and a prosecutor or public defender for a required ment Accountability Office have cited ‘‘(B) has completed less than 3 years of the period of service of not less than 3 years, un- DHS for poor contract management, first required period of service specified for less involuntarily separated from that em- the borrower in an agreement entered into ineffective financial systems, and ployment; under subsection (d). major human capital challenges. More- ‘‘(B) if the borrower is involuntarily sepa- ‘‘(g) REGULATIONS.—The Attorney General over, DHS is in the process of imple- rated from employment on account of mis- is authorized to issue such regulations as conduct, or voluntarily separates from em- menting its Second Stage Review, an may be necessary to carry out the provisions attempt to better organize the Depart- ployment, before the end of the period speci- of this section. fied in the agreement, the borrower will ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.— ment to meet its many missions. As repay the Attorney General the amount of There are authorized to be appropriated to Secretary Michael Chertoff overhauls any benefits received by such employee carry out this section $25,000,000 for fiscal the Department to create what will under this section; year 2006 and such sums as may be necessary hopefully be a structure that serve ‘‘(C) if the borrower is required to repay an for each succeeding fiscal year.’’. DHS well for years to come, he needs amount to the Attorney General under sub- senior officials who have experience paragraph (B) and fails to repay such By Mr. AKAKA (for himself, Mr. running large organizations—people amount, a sum equal to that amount shall be LAUTENBERG, and Mr. CARPER): who know which systems and chains of recoverable by the Federal Government from S. 2040. A bill to amend the Homeland the employee (or such employee’s estate, if Security Act of 2002 (6 U.S.C. 101 et command work and which do not. Good applicable) by such methods as are provided managers are needed across the Fed- by law for the recovery of amounts owed to seq.) to ensure that the Department of Homeland Security is led by qualified, eral Government, but nowhere are they the Federal Government; more needed than in an infant agency. ‘‘(D) the Attorney General may waive, in experienced personnel; to the Com- whole or in part, a right of recovery under mittee on Homeland Security and Gov- Comptroller General David Walker this subsection if it is shown that recovery ernmental Affairs. said in a September 21, 2005, interview would be against equity and good conscience Mr. AKAKA. Mr. President, I rise with Federal Times that ‘‘for certain or against the public interest; and today to introduce legislation that will positions, given the nature of the posi- ‘‘(E) the Attorney General shall make stu- help ensure our homeland security is in tion, there should be statutory quali- dent loan payments under this section for the hands of the best and the brightest the period of the agreement, subject to the fication requirements for any nomi- availability of appropriations. leaders. The Department of Homeland nee.’’ I agree. ‘‘(2) REPAYMENTS.— Security Qualified Leaders Act will es- tablish minimum qualification stand- For these reasons, we must ensure ‘‘(A) IN GENERAL.—Any amount repaid by, that the right people are leading DHS. or recovered from, an individual or the es- ards for most Senate-confirmed posi- tate of an individual under this subsection tions in the Department of Homeland Our bill delineates requirements for shall be credited to the appropriation ac- Security, DHS. I am joined by Senators Senate-confirmed positions based on count from which the amount involved was LAUTENBERG and CARPER in intro- their compensation under the Execu- originally paid. ducing this bill, and I thank them for tive Schedule. The most senior offi- ‘‘(B) MERGER.—Any amount credited under their support. cials, those in Executive Level II and subparagraph (A) shall be merged with other III, will be required to possess at least sums in such account and shall be available Hurricane Katrina and the resigna- for the same purposes and period, and sub- tion of Under Secretary Michael Brown 5 years of management experience, 5 ject to the same limitations, if any, as the have raised concerns regarding the ex- years of experience in a field relevant sums with which the amount was merged. perience and qualifications of political to the position for which the individual

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00020 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.133 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13167 is nominated, such as customs intel- ‘‘SEC. 104. QUALIFICATIONS OF CERTAIN SENIOR Committee on Environment and Public ligence, or cybersecurity, and a dem- OFFICERS. Works. ‘‘(a) EXECUTIVE SCHEDULE LEVEL II OR III onstrated ability to manage a substan- Mr. REID. Mr. President, I rise today POSITIONS.— to introduce the Ed Fountain Park Ex- tial staff and budget. These require- ‘‘(1) POSITIONS.—This subsection shall ments will apply to the following posi- apply to any position in the Department pansion Act. This legislation would tions: the Under Secretary of Science that— transfer approximately eight acres of and Technology; the Under Secretary ‘‘(A) requires appointment by the Presi- Federal land to the city of Las Vegas of Preparedness; the Director of FEMA; dent, by and with the advice and consent of to allow for the expansion of one of the and the Under Secretary of Manage- the Senate; and city’s most popular parks. ment. The Secretary and Deputy Sec- ‘‘(B) is at level II or III of the Executive Ed Fountain Park is one of the best Schedule under section 5313 or 5314 of title 5, retary of Homeland Security are ex- known and well-used parks in the city United States Code, (including any position of Las Vegas. Located in a mature part empt from this bill. for which the rate of pay is determined by Executive Level IV positions will be reference to level II or III of the Executive of the city, adjacent to the city’s old- required to possess significant manage- Schedule). est golf course, Ed Fountain Park has ment experience, at least 5 years of ex- ‘‘(2) ADDITIONAL QUALIFICATIONS.—In addi- provided recreational opportunities for perience in a field relevant to the posi- tion to any other qualification applicable to generations of local residents. For tion for which the individual is nomi- a position described under paragraph (1), any many years it has been home to Pop nated, and a demonstrated ability to individual appointed to such a position shall Warner football practices, youth soccer manage a substantial staff and budget. possess— games, and family picnics and re- ‘‘(A) at least 5 years of executive leader- unions. On any given day or night, a These position include the Assistant ship and management experience in the pub- Secretary for Immigration and Cus- lic or private sector; multitude of activities are taking place toms Enforcement; the Assistant Sec- ‘‘(B) at least 5 years of significant experi- at the park, many of which are associ- retary for Customs and Border Patrol; ence in a field relevant to the position for ated with the numerous nonprofit orga- the Assistant Secretary for Border and which the individual is nominated; and nizations that utilize the park’s re- Transportation Security Policy; the ‘‘(C) a demonstrated ability to manage a sources. Assistant Secretary for Plans, Pro- substantial staff and budget. The city of Las Vegas contacted my ‘‘(b) EXECUTIVE SCHEDULE LEVEL IV POSI- grams, and Budgets; the Director of the office several months ago to express TIONS.— their desire to expand Ed Fountain Office State and Local Government Co- ‘‘(1) POSITIONS.—This subsection shall ordination and Preparedness; the Di- apply to any position in the Department Park by acquiring land adjacent to the rector of U.S. Citizenship and Immigra- that— park that served as the site of the local tion Services; the Inspector General; ‘‘(A) requires appointment by the Presi- administrative offices for the Bureau the Chief Financial Officer; the U.S. dent, by and with the advice and consent of of Land Management, BLM, and U.S. Fire Administrator; and the General the Senate; and Fish and Wildlife Service. The property Counsel. The bill exempts the com- ‘‘(B) is at level IV of the Executive Sched- was vacated by both Federal land man- ule under section 5315 of title 5, United mandant of the Coast Guard from this agement agencies several years ago States Code, (including any position for after they relocated to a larger, multi- section since requirements for selec- which the rate of pay is determined by ref- tion of the commandant already exist erence to level IV of the Executive Sched- jurisdictional facility in the northwest in law. ule). part of the Las Vegas Valley. I believe that any program or agency ‘‘(2) ADDITIONAL QUALIFICATIONS.—In addi- The property to be acquired by the will succeed or fail based on leadership. tion to any other qualification applicable to city is technically classified as part of This is especially true at Federal agen- a position described under paragraph (1), any the Desert National Wildlife Refuge cies, which need senior leaders with individual appointed to such a position shall Complex and is currently under the ju- management skills and subject matter possess— risdiction of the Fish and Wildlife ‘‘(A) significant executive leadership and Service. The parcel in question, how- expertise. Our bill is a step in the right management experience in the public or pri- direction, and I urge my colleagues to vate sector; ever, is many miles away the actual join us in passing this important legis- ‘‘(B) at least 5 years of significant experi- wildlife refuge and sits as a vacant lation. ence in a field relevant to the position for urban lot. The former administrative I ask unanimous consent that the which the individual is nominated; and offices that were housed on the land text of the bill be printed in the ‘‘(C) a demonstrated ability to manage a were placed there many decades ago RECORD following my statement. substantial staff and budget. when this area was considered to be in There being no objection, the bill was ‘‘(c) EXCEPTIONS.—This section shall not the outskirts of town. Now, after years apply to the position of— of unprecedented growth, this land is ordered to be printed in the RECORD, as ‘‘(1) the Secretary; follows: ‘‘(2) the Deputy Secretary of Homeland Se- surrounded by well-established neigh- S. 2040 curity; or borhoods. The site also contains a sin- Be it enacted by the Senate and House of Rep- ‘‘(3) the Commandant of the Coast Guard. gle empty historical structure that resentatives of the United States of America in ‘‘(d) RULE OF CONSTRUCTION.—Nothing in would be part of the conveyance. Congress assembled, this section shall be construed to lessen any Were the property under the jurisdic- SECTION 1. SHORT TITLE. qualification otherwise required of any posi- tion of the BLM, as is usually the case This Act may be cited as the ‘‘Department tion. in the Las Vegas Valley, the property of Homeland Security Qualified Leaders Act ‘‘(e) SENSE OF CONGRESS.—It is the sense of could have been transferred adminis- of 2005’’. Congress that individuals nominated by the President for the positions of Secretary and tratively under the authority of the SEC. 2. FINDINGS. Deputy Secretary of Homeland Security Recreation and Public Purposes Act. Congress finds that— should possess significant management expe- But because it is the property of the (1) the Department of Homeland Security, rience and expertise in a relevant field be- Fish and Wildlife Service, legislation is a large organization comprised of 180,000 em- cause of the significant level of responsi- needed to transfer ownership of the ployees and 22 legacy agencies, has a com- bility entrusted to these individuals.’’. plex mission of securing the homeland from property from the Fish and Wildlife (b) TECHNICAL AND CONFORMING AMEND- man-made and natural disasters; Service to the city. MENT.—The table of contents in section 1 of This legislation provides the city (2) the Department and the agencies within the Homeland Security Act of 2002 (6 U.S.C. require strong leadership from proven man- 101) is amended by inserting after the item with maximum flexibility to use the agers with significant experience in their re- relating to section 103 the following: parcel to expand Ed Fountain Park, to spective fields; and build new athletic fields, to develop a (3) the majority of positions requiring Sen- ‘‘Sec. 104. Qualifications of certain sen- ior officers.’’. community center, or any combination ate confirmation at the Department do not of these uses. All of these potential have minimum qualifications. By Mr. REID: uses are in the public interest and pro- SEC. 3. QUALIFICATIONS OF CERTAIN SENIOR OF- FICERS. S. 2041. A bill to provide for the con- vide important justification for con- (a) IN GENERAL.—The Homeland Security veyance of a United States Fish and veying the land to the city at no cost. Act of 2002 (6 U.S.C. 101 et seq.) is amended Wildlife Service administrative site to I look forward to working with the by inserting after section 103 the following: the city of Las Vegas, Nevada; to the distinguished chairman and ranking

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00021 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.135 S17NOPT2 S13168 CONGRESSIONAL RECORD — SENATE November 17, 2005 member of the Environment and Public under the Stockholm Convention on cial assistance available to developing Works Committee to move this legisla- Persistent Organic Pollutants (POPs nations under the POPs Convention. tion forward in a timely manner. Convention), the Aarhus Protocol on Also, the LRTAP POPs Protocol in- I ask unanimous consent that the Persistent Organic Pollutants to the cludes four additional chemicals to the text of the bill be printed in the Geneva Convention on Long Range 12 listed in the POPs Convention. RECORD. Transboundary Air Pollution (LRTAP In 1998, the PIC Convention estab- There being no objection, the bill was POPs Protocol) and the Rotterdam lished an information-sharing process ordered to be printed in the RECORD, as Convention on the Prior Informed Con- to promote cooperative efforts among follows: sent Procedure for Certain Hazardous the parties to the convention regarding S. 2041 Chemicals and Pesticides in Inter- trade in chemicals. The process is de- Be it enacted by the Senate and House of Rep- national Trade (PIC Convention). signed to help nations decide whether resentatives of the United States of America in POPs are certain chemicals that are to allow a chemical to be imported. Ba- Congress assembled, toxic, persist in the environment for an sically, the PIC Convention provides SECTION 1. SHORT TITLE. extended period of time and can bio- for prior notification to potential im- This Act may be cited as the ‘‘Ed Fountain accumulate in the human food chain. porting countries by nations exporting Park Expansion Act ’’. POPs have been linked to adverse chemicals that have been banned or se- SEC. 2. DEFINITIONS. health effects on humans and animals. verely restricted in the exporting coun- In this Act: Due to their persistent characteristics try. Countries exporting the chemicals (1) ADMINISTRATIVE SITE.—The term ‘‘ad- and ability to circulate globally, POPs listed in the convention must generally ministrative site’’ means the parcel of real that are released in one part of the ensure that the importing country has property identified as ‘‘Lands to be Conveyed world can travel to neighboring regions consented to import the chemical. to the City of Las Vegas; approximately, 7.89 acres’’ on the map entitled ‘‘Ed Fountain and negatively affect environments The bill we are introducing today Park Expansion’’ and dated November 1, where they are not produced or used. would prohibit the sale, distribution, 2005. The United States has taken a lead- use, production or disposal of any list- (2) CITY.—The term ‘‘City’’ means the city ing role in reducing and eliminating ed POPs pesticides or LRTAP POPs of Las Vegas, Nevada. the use POPs. For example, in the late pesticide. It would establish notice and (3) SECRETARY.—The term ‘‘Secretary’’ 1970s, the United States prohibited the reporting procedures to ensure the means the Secretary of the Interior, acting manufacture of new PCBs and severely American public is aware of potential through the Director of the United States restricted the use of remaining stocks. actions and decisions made by the par- Fish and Wildlife Service. And over the past 35 years, the United ties to the conventions. The bill also SEC. 3. CONVEYANCE OF UNITED STATES FISH AND WILDLIFE SERVICE ADMINIS- States has had a strong regulatory would add new export reporting and la- TRATIVE SITE, LAS VEGAS, NEVADA. process that restricted the production beling requirements to ensure compli- (a) IN GENERAL.—The Secretary shall con- and use of dangerous pesticides. Even ance with U.S. obligations under the vey to the City, without consideration, all prior to signing the POPs Convention, PIC Convention. right, title, and interest of the United States the United States prohibited the sale of In order for the United States to be- in and to the administrative site for use by all the POPs pesticides initially tar- come a party to the conventions, the the City— geted by the convention. Senate must ratify the POPs and PIC (1) as a park; or In 2001, President George W. Bush Conventions. Congress also must pass (2) for any other recreation or nonprofit-re- lated purpose. signed the POPs Convention. Its ulti- implementing legislation. This bill (b) ADMINISTRATIVE EXPENSES.—As a condi- mate goal is the safe management of does not include a ratification resolu- tion of the conveyance under subsection (a), hazardous chemicals. Over time, the tion and it does not amend the Toxic the Secretary shall require that the City pay convention will help bring an end to Substances Control Act. the administrative costs of the conveyance, the production and use of dangerous At this time, the United States is not including survey costs and any other costs pollutants around the world and to a party to the conventions and does not associated with the conveyance. positively affect the U.S. environment have a seat at the negotiating table. (c) REVERSIONARY INTEREST.— and public health. This weak position hampers the ability (1) IN GENERAL.—If the Secretary deter- mines that the City is not using the adminis- Specifically, the convention requires of our technical experts and nego- trative site for a purpose described in para- all signatory nations to stop the pro- tiators to protect our leadership role in graph (1) or (2) of subsection (a), all right, duction and use of 12 listed POPs, in- international pesticide policy and reg- title, and interest of the City in and to the cluding DDT, PCBs and dioxins. Par- ulation. Our observer-only status also administrative site (including any improve- ties to the convention also agree to limits our ability to participate in the ments to the administrative site) shall re- control sources of POPs by-products to critical decisions that affect U.S. busi- vert, at the option of the Secretary, to the reduce releases and provide for the safe nesses and economic interests and our United States. handling and disposal of POPs in an en- environment and public health. The (2) HEARING.—Any determination of the Secretary with respect to a reversion under vironmentally sound manner. The con- delay in ratifying the conventions paragraph (1) shall be made— vention includes a science-based proce- serves to marginalize us. (A) on the record; and dure to allow other POPs to be added The U.S. delegation was unable to (B) after an opportunity for a hearing. and provides technical and financial fully participate in the first meeting of assistance to help developing countries parties to the POPs Convention held in By Mr. CHAMBLISS (for himself manage and control POPs. May 2005 in Punta del Este, Uruguay. and Mr. HARKIN): In 1998, the United States and mem- The next meeting of the parties to the S. 2042. A bill to amend the Federal bers of the United Nations Economic POPs Convention is May 2006. I urge Insecticide, Fungicide, and Rodenticide Commission for Europe (UN-ECE) ne- my colleagues to ratify the conven- Act to implement pesticide-related ob- gotiated a regional protocol on POPs tions and pass implementing legisla- ligations of the United States under under the auspices of the Convention tion so that the United States can re- the international conventions or proto- on Long Range Transboundary Air Pol- claim its rightful place as a world lead- cols known as the PIC Convention, the lution (LRTAP). Informally, the agree- er in the safe management of haz- POPs Convention, and the LRTAP ment is called the LRTAP POPs Pro- ardous chemicals. POPs Protocol; to the Committee on tocol. The goal of the protocol is to I look forward to working with my Agriculture, Nutrition, and Forestry. eliminate production and reduce emis- colleagues on the Senate Foreign Rela- Mr. CHAMBLISS. Mr. President, sions of POPs in North America and tions Committee and the Environment today, Senator HARKIN and I are intro- Europe. and Public Works Committee on this ducing the POPs, LRTAP POPs and The LRTAP POPs Protocol was the matter. PIC Implementation Act of 2005. This basis for the POPs Convention. The Mr. HARKIN. Mr. President, today I bill would amend the Federal Insecti- two agreements are similar in purpose, am pleased to join with Chairman cide, Fungicide and Rodenticide Act except that the LRTAP treaty is re- CHAMBLISS in introducing legislation to (FIFRA) to implement the United gional and it does not include trade re- implement the Stockholm Convention States’ pesticide-related obligations strictions or the technical and finan- on Persistent Organic Pollutants, the

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00022 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.137 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13169 LRTAP POPs Protocol, and the Rot- would not provide an automatic proc- would never be subject to ratification terdam PIC Protocol. These three ess that compelled the Environmental by the Senate. My concern with this agreements provide an international Protection Agency, EPA, to take ac- constitutional theory resulted in an ex- framework for controlling and elimi- tion. In essence, we are allowing the change of correspondence last year, nating the use of chemicals that have EPA to move forward and take action when this bill was being drafted by the greatest potential for long-term en- on a chemical if the case made in the then-Chairman COCHRAN. vironmental damage. These persistent international review for a ban is I wrote to then-Administrator Mi- organic pollutants, or POPs, are chemi- strong, and not make EPA reinvent the chael Leavitt at the EPA, asking for a cals that do not easily break down in wheel and generate new data to back written explanation of the administra- the environment. As a result, they tend up their conclusions, while at the same tion’s position on this issue. This re- to move across international bound- time, not mandating EPA action to sulted in two letters, one from Admin- aries and bio-accumulate—in other ban or regulate a chemical. This legis- istrator Leavitt on behalf of the EPA words, they travel up the food chain. lation strikes a fair balance and one dated March 25, 2004, and one from As- This legislation modifies existing U.S. that is consistent with the limited goal sistant Attorney General William law under the Federal Insecticide, Fun- we have in this process to bring FIFRA Moschella on behalf of the Department gicide and Rodenticide Act, FIFRA, to into compliance with our international of Justice dated March 25, 2004. Fi- bring us into compliance with these obligations. nally, I requested an analysis of the agreements with regard to chemicals The most controversial aspects of constitutional issues raised by this used in agriculture. Implementation of this legislation are the provisions that provision from the American Law Divi- the agreements will also require modi- deal with the process by which new sion of the Congressional Research fication of the Toxic Substances Con- chemicals are brought under the con- Service and received a memorandum trol Act, TSCA. vention’s control. It is critically im- dated March 30, 2004. I will offer all of These conventions and protocols portant that the position of the United these letters and the CRS memo- have already entered into force. But at States in the international regulation randum for inclusion in the RECORD at this point, though the United States is of chemicals take into account the the end of my statement. a signatory to all of them, we have not views of all parties—pesticide manufac- Having reviewed all this material, I ratified them. All of the chemicals that turers, farmers, environmental sci- find that the administration’s position are listed in the agreement are already entists, State regulators—everyone is not well supported, and I would urge banned or tightly controlled under U.S. who has a stake in the process. the Senate to reject any effort to in- law, but the Stockholm Convention’s Under the Stockholm Convention, clude it in this legislation. The CRS Review Committee just met in Geneva the process of listing new POPs chemi- memorandum on the EPA draft sum- and further meetings are planned, and cals follows a three-part process. The marizes the state of the law as follows: decisions are being made without our review committee determines whether Stated succinctly, the separation of delegation able to fully participate as a a chemical satisfies the agreed screen- powers doctrine ‘‘implicit in the Con- party to the agreement. The United ing criteria in the convention; if the stitution and well established in case States needs to ratify the convention criteria are satisfied, a risk profile is law, forbids Congress from infringing in order to have a voice in this process. prepared; if on the basis of the risk pro- upon the Executive Branch’s ability to Our goal in writing this legislation is file, it is determined that global action perform its traditional functions.’’ The narrow. It has not been our intention is required, the committee or parties Supreme Court has established that in to open up FIFRA as part of this proc- would consider listing the chemical. determining whether an act of Con- ess, but only to craft those changes In each of these stages, the U.S. posi- gress has violated the doctrine, ‘‘the compelled by our international com- tion should be informed by formal no- proper inquiry focuses on the extent to mitments. That is not to say that tice and comment periods as provided which it prevents the Executive Branch FIFRA is perfect or could not be im- in existing law. The Federal notice and from accomplishing its constitu- proved and strengthened—only that comment process is open, well devel- tionally assigned functions.’’ this is not the occasion to launch into oped, and well understood by stake- The memo goes on to state that it is changing the domestic law beyond the holders in the process. If this process is ‘‘difficult to see how a mandatory no- narrow goal of compliance with these optional, there is the risk that the U.S. tice and comment requirement would agreements. position could be formed without tak- implicate this traditional executive Some have urged that this measure ing into account important views. function.’’ The memorandum concludes provide for automatic processes trig- While nothing in this legislation dic- that ‘‘it does not appear that a manda- gered by the decisions of the review tates that any particular position in tory notice and comment requirement committee overseeing the Stockholm this established process be taken by would present any substantive separa- Convention. For instance, if the review the administration, there is a require- tion of powers concerns.’’ Clearly, committee lists a chemical, they would ment that the administration use this there is no merit to the Justice Depart- have the United States automatically process to collect information to in- ment’s contention that mandatory no- take steps to regulate or ban the chem- form its position in the international tice and comment would be an uncon- ical domestically. I have sympathy body regarding any particular chem- stitutional intrusion into the Presi- with that approach, and I would hope ical. dent’s exclusive prerogative over for- that our existing environmental laws The administration’s draft of this eign policy. Clearly, future steps taken would be used to restrict the use of legislation gave the EPA Adminis- domestically to carry out these inter- such a chemical before international trator permission to initiate a notice national agreements should be in- action, as they have with all the initial and comment period but did not re- formed by the views of all stakeholders chemicals listed in the Stockholm Con- quire it. The argument for this position and build the record through the notice vention. was a constitutional claim that the ex- and comment procedure for domestic But that is not what is called for in ecutive’s authority over negotiations implementation of any international the Stockholm Convention. The con- with other nations includes a right to action. This legislation makes the vention that this legislation will im- rely on whatever information that the right choice by mandating notice and plement does not compel parties to president chooses to use. The ‘‘rem- comment. adopt new chemicals added to the con- edy’’ for negotiating a faulty treaty, I appreciate the opportunity to work vention in future years. Instead, the according to the letter received from with Chairman CHAMBLISS on this leg- parties are allowed to opt in to the the Department of Justice, is for the islation, and with our committee’s pre- convention’s restrictions. The legisla- Senate to refuse to consent to the trea- vious chair, Senator COCHRAN, whose tion we are introducing today would ty. staff worked tirelessly to develop this allow for any information or studies This position is not consistent with legislation. I am hopeful that we can generated as part of the international existing Federal law and is impractical work together with the other body to process to be used as part of a domestic particularly in a process like this one, reach agreement on implementing leg- regulatory action on the chemical, but where the negotiation in question islation along the lines of this bill,

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00023 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.098 S17NOPT2 S13170 CONGRESSIONAL RECORD — SENATE November 17, 2005 that will clear the way for ratification appreciate your willingness to support the sions in the international process, it does of the Stockholm Convention. legislative efforts of the Administration to not raise the same constitutional concerns. I ask unanimous consent to include allow the United States to become a Party This new provision also obligates the Envi- in the RECORD a letter to Adminis- to the Stockholm Convention on Persistent ronmental Protection Agency to consider trator Michael Leavitt, his response Organic Pollutants, the Rotterdam Conven- comments received as a result of these semi- tion on the Prior Informed Consent Proce- annual federal register notices. I will be in- from March 25, 2004, the response to the dure for Certain Hazardous Chemicals and terested in your reaction to this proposal, same letter by William Moschella on Pesticides in International Trade and the which I believe addresses our respective con- behalf of the Justice Department, and Protocol on Persistent Organic Pollutants to cerns. the memorandum of law from the Con- the 1979 Convention on Long-Range I appreciate the reiteration of your com- gressional Research Service. Transboundary Air Pollution. mitment to passing this legislation and to There being no objection, the mate- In your letter, you noted a particular in- completing the necessary steps for the rial was ordered to be printed in the terest in the discretionary notice and com- United States to deposit its instrument of ment procedures contained within the Ad- RECORD, as follows: consent to join these three very important ministration’s proposed legislation to imple- multilateral environmental treaties. I look COMMITTEE ON AGRICULTURE, ment the FIFRA-related obligations of the forward to working with you. If you have NUTRITION, AND FORESTRY, three environmental treaties referenced any further questions or concerns, please Washington, DC, February 12, 2004. above. The Administration’s proposal does contact me or your staff may contact Peter Hon. MICHAEL LEAVITT, not make these notice and comment proce- Pagano in EPA’s Office of Congressional and Administrator, Environmental Protection Ad- dures mandatory, and you requested addi- Intergovernmental Relations, at (202) 564– ministration, Washington, DC. tional information about the constitutional 3678. DEAR ADMINISTRATOR LEAVITT: Thank you concerns that underlie that decision. I asked Sincerely, for your note asking for my help in passing my staff to organize a meeting for the De- MICHAEL O. LEAVITT. legislation to implement the Stockholm Pro- partment of Justice to discuss its constitu- tocols. I certainly want to be helpful in that tional concerns with your legislative assist- U.S. DEPARTMENT OF JUSTICE, regard and support moving implementing ants and to answer any questions. I under- OFFICE OF LEGISLATIVE AFFAIRS, legislation quickly that will enhance the stand that meeting occurred on March 3, Washington, DC, March 25, 2004. ability of the Environmental Protection 2004. Agency to eliminate the threat that per- As you know, the Stockholm Convention Hon. TOM HARKIN, sistent organic pollutants (POPs) pose to our creates an international ‘‘Persistent Organic Ranking Member, Committee on Agriculture, environment. Pollutants Review Committee’’ to evaluate Nutrition, and Forestry, U.S. Senate, Wash- As we move forward on this legislation, I whether various substances should be added ington, DC. believe it is important to regulate not only or removed from the Convention’s coverage. DEAR SENATOR HARKIN: The EPA has for- the so-called ‘‘dirty dozen’’ POPs that are The United States expects to play a strong warded to the Department of Justice your explicitly controlled by the Stockholm Pro- role at the international meetings of the Re- letter dated February 12, 2004, regarding leg- tocols, but also to improve your agency’s view Committee, and, as you note in your islation proposed by the Administration to ability to address these types of pollutants letter, the United States could use the notice implement the Stockholm Convention on through the EPA’s regulatory system as ex- and comment procedures under the proposed Persistent Organic Pollutants, the Rot- peditiously as possible, with opportunities bill to ‘‘allow public input at each of the terdam Convention on the Prior Informed for public participation and comment. This three stages of the review committee proc- Consent Procedure for Certain Hazardous public participation and comment is particu- ess.’’ Chemicals and Pesticides in International larly important to inform the agency in its U.S. stakeholders will no doubt have a Trade, and the Protocol on Persistent Or- evaluation of potential new pollutants great deal of expertise about proposed pol- ganic Pollutants to the 1979 Convention on brought before the review committee formed lutants brought before the international re- Long-Range Transboundary Air Pollution. by this legislation. view committee, and the Administration Specifically, you are interested in the dis- One version of proposed implementing leg- proposal specifically includes notice and cretionary notice and comment procedures islation would provide for mandatory notice comment procedures to allow the Executive contained within the Administration’s pro- and comment periods to allow public input branch to take advantage of this knowledge. posed legislation to implement the FIFRA- at each of the three stages of the review The statutory notice and comment proce- related obligations of the three environ- committee process. The most recent draft of dures are precatory, however, because the mental treaties referenced above. At the re- the legislation put forward by the EPA, how- Department of Justice has advised the Ad- quest of the Department of Justice, the Ad- ever, makes each of these notice and com- ministration’s proposal does not make these ment periods fully subject to the agency’s ministration that it has concluded that a mandatory consultation requirement would consultations mandatory, and you requested discretion. It has also been asserted that if additional information about the constitu- Congress required the agency to provide a raise constitutional concerns with respect to the President’s authority to conduct nego- tional concerns underlying that decision. notice and comment period based on action The Stockholm Convention creates an of the international body, it would unconsti- tiations with other nations. I have forwarded your letter to the Department of Justice to international ‘‘Persistent Organic Pollutants tutionally impinge on our national sov- Review Committee’’ to evaluate whether ereignty. This is a novel constitutional anal- respond to you more specifically on this point. various substances should be added to, or re- ysis that I would like to understand better moved from, the Convention’s coverage. before this legislation moves forward. I do, however, agree with the concern be- Also, as you note in your letter, the notice I request that, prior to our Committee tak- hind your letter that ‘‘public participation and comment procedures under the proposed ing up this issue, you provide me with any and notice and comment is particularly im- legal analysis, legal opinions, and citations portant to inform the agency in its evalua- bill would ‘‘allow public input at each of the to any legal authority supporting the propo- tion of potential new pollutants brought be- three stages of the review committee proc- sition that Congress cannot require the EPA fore the review committee.’’ The constitu- ess.’’ The statutory notice and comment pro- to hold notice and comment periods in re- tional concerns that are presented by a man- cedures are precatory, however, because a sponse to the actions of an international datory requirement could be avoided by fully mandatory consultation requirement would body. I know that you are as committed as I authorizing the Executive Branch to gather raise constitutional concerns. am to move this legislation expeditiously, information from the public, but not requir- The Executive branch has sole authority and I look forward to receiving this informa- ing the Executive Branch to exercise that over the United States’ negotiations with tion soon. authority. In order to ensure that the public other nations. See, e.g., Letter to Edmond Again, I look forward to working with you is well informed about events that are tak- Charles Genet, from Thomas Jefferson, Sec- on this matter and want to help in any way ing place internationally, and to provide an retary of State (1793), reprinted in 9 The I can to assist you in your work of improving opportunity for the consideration of public Writings of Thomas Jefferson 256 (Andrew A. our nation’s environment. comment in the event that the Administra- Lipscomb ed., 1903) (‘‘[T]he President of the Sincerely, tion does not execute the discretionary no- United States. . . being the only channel of TOM HARKIN, tice and comment procedures, my staff has communication between this country and Ranking Democratic Member. included a new section in the legislation that foreign nations, it is from him alone that I transmitted to you on February 25. foreign nations or their agents are to learn UNITED STATES ENVIRONMENTAL In this section, there is a mandatory re- what is or has been the will of the nation.’’). PROTECTION AGENCY, quirement that the Administration publish a The Supreme Court has long concurred in Washington, DC, March 25, 2004. semiannual federal register notice that pro- this understanding of the President’s power, Hon. TOM HARKIN, vides a full description of the events occur- noting that this exclusive authority extends Ranking Member, Committee on Agriculture, ring at the international level and any do- throughout the entire ‘‘field of negotiation.’’ Nutrition and Forestry, U.S. Senate, Wash- mestic regulatory actions that have been ini- See United States v. Curtiss-Wright Corp., 299 ington, DC. tiated. Because this requirement is based on U.S. 304,319 (1936) (‘‘In this vast external DEAR SENATOR HARKIN: Thank you very the calendar, relates to information that is realm, with its important, complicated, deli- much for your letter of February 12, 2004. I publicly available, and is not linked to deci- cate, and manifold problems, the President

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00024 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.098 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13171

alone has the power to speak or listen as a claim of executive privilege. Presidents of CONGRESSIONAL RESEARCH SERVICE, representative of the nation. He makes trea- both parties have also noted concerns about Washington, DC, March 30, 2004. ties with the advice and consent of the Sen- appropriations legislation containing similar Re: Validity of Provisions Mandating Notice ate; but he alone negotiates. Into the field of provisions, and have stated that they would and Comment Proceedings in Response negotiation the Senate cannot intrude; and interpret such provisions not to intrude into to the Decisions of Parties Operating Congress itself is powerless to invade it.’’). this exclusive constitutional power over Pursuant to International Conventions See also New York Times Co. v. United States, international negotiations. See Statement on and Protocols. 403 U.S. 713, 728 (1971) (Stewart, J., concur- Signing the Foreign Operations, Export Fi- Hon. TOM HARKIN: Pursuant to your re- ring) (‘‘In the governmental structure cre- nancing, and Related Programs Appropria- quest, this memorandum analyzes certain ated by our Constitution, the Executive is tions Act, 2001 36 Weekly Comp. Pres. Doc. provisions of a draft bill forwarded by the endowed with enormous power in the two re- 2809–10 (Nov. 13, 2000) (Statement of Presi- Administration that would amend the Fed- lated areas of national defense and inter- dent Clinton) (‘‘Certain provisions of the Act eral Insecticide, Fungicide, and Rodenticide national relations.’’); United States v. Lou- could interfere with my sole constitutional Act (FIFRA) to allow for the implementa- isiana, 363 U.S. 1, 35 (1960) (the President is authority in the area of foreign affairs by di- tion of the Stockholm Convention on Per- ‘‘the constitutional representative of the recting or burdening my negotiations with sistent Organic Pollutants (POPs Conven- United States in its dealings with foreign na- foreign governments and international orga- tion), the Rotterdam Convention on the tions’’); Earth Island Inst. v. Christopher, 6 nizations . . . I will not interpret these pro- Prior Informed Consent Procedure for Cer- F.3d 648, 652–54 (9th Cir. 1993); Sanchez- visions to limit my ability to negotiate and tain Hazardous Chemicals and Pesticides in International Trade (PIC Convention) and Espinoza v. Reagan, 770 F.2d 202, 210 (D.C. Cir. enter into agreements with foreign na- the Protocol on Persistent Organic Pollut- 1985) (Scalia, J.) (‘‘[B]road leeway’’ is ‘‘tradi- tions.’’); Statement on Signing the Foreign ants to the Convention on Long-Range tionally accorded the Executive in matters Operations, Export Financing, and Related Transboundary Air Pollution (LRTAP POPs of foreign affairs.’’). Programs Appropriations, 2002, 38 Weekly Protocol). In pertinent part, the draft bill Within this constitutional framework, Comp. Pres. Doc. 49–50 (Jan. 10, 2002) (State- would imbue the Administrator of the Envi- statutes cannot direct the President to vote ment of President Bush) (objecting to . pro- ronmental Protection Agency (hereinafter a certain way in an international forum, and vision ‘‘which purports to direct the Sec- referred to as ‘‘Administrator’’) with discre- they cannot require that the President con- retary of State to consult certain inter- tionary authority to publish notices in the sult with specific private organizations as he national organizations in determining the Federal Register and to provide an oppor- prepares to cast such a vote. Congress can state of events abroad’’ and noting this and tunity for comment in response to certain certainly assist the President in his inten- other provisions ‘‘shall be construed con- actions taken by parties to the POPs Con- tional negotiations by providing him with sistent with my constitutional authorities to vention and the LRTAP POPs Protocol. the authority to gather information from conduct foreign affairs, participate in inter- private citizens, cf. New York Times Co., 403 The Administration has asserted that the national negotiations, and supervise the Ex- notice and comment provisions in its pro- U.S. at 729–30, but it remains for the Presi- ecutive Branch’’). dent to decide how much, if any, additional posal are necessarily ‘‘precatory’’ in nature, information is needed and what should be In the pending legislation, the Department ‘‘because a mandatory consultation require- done with it. If a proposed treaty is ill-in- concluded that a mandatory requirement for ment would raise constitutional concerns.’’ You have asked whether it would be con- formed, then the Constitution provides the ‘‘public participation and comment’’ would stitutionally problematic to make the notice remedy: the Senate may refuse to concur in raise similar constitutional concerns and and comment provisions in the draft pro- that document. Joseph Story, 3 Com- therefore recommended that more precatory posal mandatory, despite the concerns raised mentaries on the Constitution of the United language be used. by the Administration. A review of relevant States § 1507 (1833) (‘‘The President is the im- constitutional principles appears to indicate mediate author and finisher of all treaties; That said, the Department does not take that such a requirement would pass constitu- and all the advantages, which can be derived issue with the general belief that ‘‘public tional muster. from talents, information, integrity, and de- participation and notice and comment is par- liberate investigation on the one hand, and ticularly important to inform the [Adminis- POPS CONVENTION from secrecy and despatch on the other, are tration] in its evaluation of potential new The POPs Convention was signed by the thus combined in the system. But no treaty, pollutants brought before the review com- United States on May 31, 2001, and requires nations to reduce or eliminate the produc- so formed, becomes binding upon the coun- mittee.’’ The constitutional concerns that try, unless it receives the deliberate assent tion and use of listed chemicals. The POPs are presented by a mandatory consultation of two thirds of the Senate.’’). What Con- Convention allows new chemicals to be requirement can be avoided by fully author- gress may not do is direct, through legisla- added to the list by amendment to the rel- tion, how the President exercises his exclu- izing the Executive Branch to gather infor- evant treaty annexes, and an amendment sive power to negotiate. mation from the public, but not requiring may be proposed by any party to the Conven- The Administration’s concerns over legis- the Executive Branch to exercise that au- tion. Amendments may be adopted at a lation that would mandate consultation with thority. To ensure that the public is well in- meeting of the Conference of the Parties Congress or with private parties in connec- formed about events that are taking place after the circulation of such a proposal to all parties at least six months in advance of the tion with the conduct of international nego- internationally, and to provide an oppor- meeting. The POPs convention also creates a tiations are not new. Similar concerns were tunity for the consideration of public com- raised by the Department of Justice under Persistent Organic Pollutants Review Com- ment in the event that the President chooses President Clinton, President George H. W. mittee (POPs Review Committee) that is to not to execute the discretionary notice and Bush, and President Reagan. In each case, consist of government-designated experts in the Department objected to legislative pro- comment procedures, the bill requires that chemical assessment or management. The posals that would have required that the Ex- the Administration publish a semi-annual POPs Review Committee is charged gen- ecutive branch consult in the context of Federal Register notice that provides a full erally with determining whether a listing international negotiations. For example, description of the events occurring at the proposal submitted by a party meets screen- during the Clinton administration, the De- international level and any domestic regu- ing criteria established in the Convention, partment of Justice objected to legislative latory actions that have been initiated. Be- determining whether global action is war- ranted regarding the proposal, and recom- proposals that would have directed the Exec- cause this requirement based on the cal- utive branch to consult with interested par- mending whether a proposed chemical should endar, relates to information that is publicly be considered for listing by the Conference of ties prior to negotiating trade agreements or available, and is not linked to decisions in prior to taking a position before the World the Parties. the international process, this does not raise Trade Organization. In 1991, the Department LRTAP POPS PROTOCOL the same constitutional concerns. advised that the United States Trade Rep- The 1998 Aarhus Protocol on Persistent Or- resentative could not be required to periodi- We trust this provides an answer to your ganic Pollutants (hereinafter referred to as cally consult with interested parties on the inquiry. We would welcome the opportunity ‘‘LRTAP POPs Protocol’’) amended the Con- progress of international trade negotiations. to assist you with any future inquiries you vention on Long-Range Transboundary Air During the Reagan Administration, the De- may have. The Office of Management and Pollution with the objective of eliminating discharges, emissions and losses of listed per- partment wrote to Senator Lowell Weicker Budget has advised that there is no objection explaining that a proposed consultation re- sistent organic pollutants during their pro- to the submission of this letter from the quirement was objectionable because any duction, use and disposal. Any party may provision that would require that the Execu- standpoint of the Administration’s program. offer an amendment to add a new chemical tive branch disclose information that might Sincerely, to the LRTAP POPs Protocol, which may be interfere with the success of international WILLIAM MOSCHELLA, adopted by consensus of the parties rep- negotiations would be subject to a valid Assistant Attorney General. resented at a session of the Executive Body

VerDate Aug 31 2005 02:01 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00025 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.142 S17NOPT2 S13172 CONGRESSIONAL RECORD — SENATE November 17, 2005 of the Convention. Prior to the addition of a well established in case law, forbids Congress tailed notices in the Federal Register when- chemical, the LRTAP POPs Protocol re- from infringing upon the Executive Branch’s ever it is a party to any dispute settlement quires the completion of a risk profile on the ability to perform its traditional functions.’’ proceedings under the WTO. Furthermore, it chemical establishing that it meets selection The Supreme Court has established that in should be noted that this notification provi- criteria specified under the protocol. determining whether an act of Congress has sion could be likened to reporting require- THE DRAFT PROPOSAL violated the doctrine, ‘‘the proper inquiry fo- ments that are often imposed by Congress. The Administration’s draft proposal, as cuses on the extent to which it prevents the As a general proposition, Congress is entitled supplied by your office, provides for the im- Executive Branch from accomplishing its to full access to information that is in the plementation of the PIC and POPs Conven- constitutionally assigned functions.’’ Fur- possession of the Executive Branch, subject tions and the LRTAP POPs Protocol. To ef- thermore, as was noted by the Court of Ap- to claims of executive privilege. fectuate this implementation, the proposal peals for the Ninth Circuit in Confederated In addition to the general assertion that a imbues the Administrator with the discre- Tribes of Siletz Indians v. United States: mandatory notice and comment requirement tionary authority to publish notices in the Although the Supreme Court has not an- would intrude on the President’s power over Federal Register in response to actions nounced a formal list of elements to be con- the ‘‘field of negotiation’’ in foreign affairs, taken to add chemicals to the list of those sidered when determining whether a viola- the DOJ letter states that any potential re- covered under the POPs Convention and the tion of the doctrine has taken place, it has quirement that the Administrator consult LRTAP POPs Protocol specifically. consistently looked to at least two factors: with private parties or give consideration to As noted above, the POPs Convention es- (1) the governmental branch to which the comments received therefrom would also be tablishes a POPs Review Committee that is function in question is traditionally as- constitutionally problematic. However, it is responsible for considering proposals to add signed, see Mistretta, 488 U.S. at 364, 109 S.Ct. likewise difficult to ascertain how such a chemicals to those listed in the POPs Con- at 65–51; Morrison v. Olson, 487 U.S. 654, 694– provision would necessarily impair the abil- vention and recommending to the Con- 96, 108 S.Ct. 2597, 2620–22, 101 L.Ed. 2d 659 ity of the executive branch to carry out its ference of the Parties whether a proposed (1988); and (2) the control of the function re- core functions in this context. There is no chemical should be considered for listing by tained by the branch, see Mistretta, 488 U.S. indication that such a provision would be the Conference. In the event that the POPs at 408–12, 109 S.Ct. at 673–75; Morrison, 487 drafted so as to require the disclosure of sen- Review Committee does not forward a pro- U.S. at 692–96, 108 S.Ct. at 2619–22. sitive information, or to require the inclu- posal, the Conference may choose to consider Applying these factors to the case at hand, sion of such individuals in the actual nego- the proposal on its own accord. Section 3(4) it appears unlikely that a reviewing court tiation process. Rather, the notice and com- of the draft bill contains several provisions would hold that mandatory notice and com- ment procedures at issue would appear to be authorizing the Administrator of the EPA to ment provisions would violate the doctrine. tailored to ensure that the public is kept in- publish notices in the Federal Register at As is indicated by the DOJ letter, it seems formed regarding ongoing proceedings in this certain stages of the listing process and to that any argument that a mandatory re- context, and is further afforded the oppor- provide an opportunity for comment on a quirement would offend the separation of tunity to comment on proposals under con- proposed listing. In particular, Section 3(4), powers doctrine would hinge on the assertion sideration. Accordingly, it appears that such establishing a new 7 U.S.C. 136o(e)(3), author- that such a requirement necessarily con- a dynamic would not raise concerns any izes the publication of a notice and oppor- stitutes an intrusion into the core power of more significant than existing consultation tunity for comment after a decision by the the Executive Branch over external affairs. requirements. Based on these factors, it does POPs Review Committee that a listing pro- Specifically, in United States v. Curtiss-Wright not appear that a mandatory notice and posal meets the screening criteria specified Corp., the Supreme Court declared: comment requirement would present any [n]ot only . . . is the federal power over ex- in the POPs Convention or, alternatively, if substantive separation of powers concerns. ternal affairs in origin and essential char- the Conference of the Parties decides that T.J. HALSTEAD, acter different from that over internal af- such a proposal should proceed. Legislative Attorney, fairs, but participation in the exercise of the Likewise, a new 7 U.S.C. 136o(e)(4) would American Law Division. authorize the publication of notice and op- power is significantly limited. In this vast portunity for comment upon a determination external realm, with its important, com- By Mr. DURBIN (for himself, Mr. by the POPs Review Committee that a pro- plicated, delicate and manifold problems, the COCHRAN, and Mr. SALAZAR): posed listing warrants global action, or, al- President alone has the power to speak or ternatively, if the Conference of the Parties listen as a representative of the nation. He S. 2043. A bill to amend the Robert T. decides that the proposal should proceed. Fi- makes treaties with the advice and consent Stafford Disaster Relief and Emer- nally, a new 7 U.S.C. 136o(e)(5) would author- of the Senate; but he alone negotiates. Into gency Assistance Act to provide grants ize the publication of notice and opportunity the field of negotiation the Senate cannot in- for mass evacuation exercises for urban for comment after the POPs Review Com- trude; and Congress itself is powerless to in- and suburban areas and the execution mittee recommends that the Conference of vade it. As Marshall said in his great argu- of emergency response plans, and for the Parties consider making a listing deci- ment of March 7, 1800, in the House of Rep- other purposes; to the Committee on sion regarding the chemical at issue. resentatives, ‘the President is the sole organ Publication of notice and opportunity for of the nation in its external relations, and Homeland Security and Governmental comment would also be authorized after a its sole representative with foreign nations.’ Affairs. party to the LRTAP POPs Protocol submits However, it is difficult to see how a manda- Mr. DURBIN. Mr. President, I ask a risk profile in support of a proposal to add tory notice and comment requirement would unanimous consent that the text of the a chemical to those already listed. Addi- implicate this traditional executive func- bill be printed in the RECORD. tional notice and comment proceedings tion. Specifically, while it is generally con- There being no objection, the bill was would be authorized in instances where the ceded that there are some powers enjoyed by ordered to be printed in the RECORD, as Executive Body determines that further con- the President alone regarding foreign affairs, follows: sideration of a pesticide is warranted, as well it is likewise evident that Congress possesses as after the completion of a technical review wide authority to promulgate policies re- S. 2043 of a proposal to add a chemical to the specting foreign affairs. Congress has often Be it enacted by the Senate and House of Rep- LRTAP POPs Protocol. It is interesting to exercised this authority to determine policy resentatives of the United States of America in note that while the draft proposal makes the objectives for the United States in inter- Congress assembled, decision as to whether to engage at all in no- national negotiations and to require subse- SECTION 1. SHORT TITLE. tice and comment procedures discretionary, quent legislative approval of international This Act may be cited as the ‘‘Mass Evacu- the Administrator is required to provide de- agreements before they may enter into force ation Exercise Assistance Act of 2005’’. tailed elements of notice in the event that for the United States. SEC. 2. MASS EVACUATION EXERCISES AND EXE- such procedures are offered. A mandatory notice and comment require- CUTION OF EMERGENCY RESPONSE ANALYSIS ment would not appear to be an attempt to PLANS. You have specifically inquired as to wheth- control the substance of negotiations be- Section 201 of the Robert T. Stafford Dis- er it would violate the doctrine of separation tween the United States and other parties to aster Relief and Emergency Assistance Act of powers to make the aforementioned dis- POPs Convention or the LRTAP POPs Pro- (42 U.S.C. 5131) is amended by adding at the cretionary notice and comment procedures tocol. Instead, such a requirement would end the following: mandatory, irrespective of the general con- simply establish that the Administrator ‘‘(e) GRANTS FOR MASS EVACUATION EXER- cern voiced by the Administration that ‘‘a must publish notices in the Federal Register CISES FOR URBAN AND SUBURBAN AREAS AND mandatory consultation requirement would providing information regarding chemicals THE EXECUTION OF EMERGENCY RESPONSE raise constitutional concerns.’’ An examina- that are being considered for listing to either PLANS.— tion of applicable principles and precedent the Convention or the Protocol. A somewhat ‘‘(1) IN GENERAL.—The Secretary of Home- appears to indicate that a mandatory notice analogous requirement in the international land Security shall make grants to States or and comment requirement would be con- arena may be found at 19 U.S.C. 3537, which units of local governments nominated by stitutionally permissible. requires the United States Trade Represent- States to— Stated succinctly, the separation of powers ative to consult with the appropriate con- ‘‘(A) establish programs for the develop- doctrine ‘‘implicit in the Constitution and gressional committees and to publish de- ment of plans and conduct of exercises for

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00026 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.144 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13173 the mass evacuation of persons in urban and necessary agreements with neighboring ju- able for such programs, and for the suburban areas; and risdictions to operate or use the shelters in other purposes; to the Committee on ‘‘(B) execute plans developed under sub- the event of a mass evacuation; the Judiciary. paragraph (A), including the purchase and ‘‘(F) establish procedures for informing the Mr. DEWINE. Mr. President, today I stockpiling of necessary supplies for emer- public of evacuation procedures before and am introducing a bill that would create gency routes and shelters. during an evacuation and return procedures a National Methamphetamine Informa- ‘‘(2) CONDITIONS.—As a condition for the re- after an evacuation, including using tele- ceipt of assistance under paragraph (1)(A), vision, radio, print, and online media, land- tion Clearinghouse (NMIC). This web- the Secretary of Homeland Security may es- based and mobile phone technology, and ve- based source of information would pro- tablish any guidelines and standards for the hicles equipped with public address systems; mote sharing of ‘‘best practices’’ re- programs that the Secretary determines to ‘‘(G) identify primary and alternate stag- garding law enforcement, treatment, be appropriate. ing locations for emergency responders; environmental, social services, and ‘‘(3) REQUIREMENTS.—To the maximum ex- ‘‘(H) identify gaps in the ability to respond other programs to combat the produc- tent practicable, a program assisted under to different types of disasters, including the tion, use, and effects of methamphet- paragraph (1)(A) shall incorporate the co- capacity to handle surges in demand for hos- amine. ordinated use of public and private transpor- pital, emergency medical, coroner, morgue, tation resources in the plans developed and The purpose of the NMIC is to make and mortuary services, quarantines, decon- a one-stop shop, where all the ‘‘best the exercises carried out under the program. taminations, and criminal investigations; ‘‘(4) PARTICIPATION OF MEMBERS OF THE ‘‘(I) establish procedures to evacuate indi- practices’’ in the fight against meth ARMED FORCES.— viduals with special needs, including individ- can be found—information from law en- ‘‘(A) IN GENERAL.—The Secretary of De- uals who are low-income, disabled, homeless, forcement, treatment-based organiza- fense may authorize the participation of or elderly or who do not speak English; tions, social services and environ- members of the Armed Forces and the use of ‘‘(J) establish procedures for evacuating mental agencies. It will be a website appropriate Department of Defense equip- animals that assist the disabled; providing information that agencies ment and materials in an exercise carried ‘‘(K) establish procedures for protecting out under a program assisted under this sub- and organizations submit, describing property, preventing looting, and accounting what has worked in their local commu- section. for pets; and ‘‘(B) REIMBURSEMENT FOR PARTICIPATION OF ‘‘(L) ensure the participation of the private nities. The people who have had suc- GUARD.—In the event members of the Na- and nonprofit sectors. cess with addressing meth and meth-re- tional Guard in State status participate in ‘‘(4) UPDATING OF PLANS.—State, county, lated issues will be providing this in- an exercise carried out under a program as- municipal, and private plans under this sub- formation. Additionally, there will be sisted under this subsection pursuant to an section shall be updated on a regular basis. information and links regarding avail- authorization of the chief executive officer ‘‘(g) ADDITIONAL ASSISTANCE TO STATES.— able grants for establishing and main- of a State, the Secretary of Defense may, The Secretary of Homeland Security shall using amounts available to the Department taining anti-meth programs. assist States and local governments in devel- The NMIC will serve two distinct of Defense, reimburse the State for the costs oping and maintaining the plans described in to the State of the participation of such subsection (f) by— populations—law enforcement and the members in such exercise. ‘‘(1) establishing and maintaining com- broader community. The NMIC will ‘‘(5) AUTHORIZATION OF APPROPRIATIONS.— prehensive best practices for evacuation contain a restricted access section There is authorized to be appropriated to planning, training, and execution; where law enforcement will be able to carry out this subsection $250,000,000 for each ‘‘(2) developing assistance teams to travel post their successful strategies, train- of fiscal years 2006 through 2010. to States and assist local governments in ing techniques, and conference notes so ‘‘(f) MASS EVACUATION PLANS.— planning, training, and execution; that other law enforcement will be able ‘‘(1) REQUIREMENT.—Each State or unit of ‘‘(3) developing a training curriculum local government receiving a grant under to get ideas and incorporate them in based on the best practices established under their own jurisdictions. The unre- subsection (e)(1) shall, in consultation with paragraph (1); relevant local governments, develop and ‘‘(4) providing the training curriculum de- stricted portion of the website will in- maintain detailed and comprehensive mass veloped under paragraph (3) to State and clude resources for other agencies and evacuation plans for each area in the juris- local officials; the public at large. For example, child diction of the State unit of local govern- ‘‘(5) maintaining a list of qualified govern- protection agencies might post tech- ment. ment agencies, private sector consultants, niques on dealing with meth orphans, ‘‘(2) PLAN DEVELOPMENT.—In developing and nonprofit organizations that can assist the evacuation plans required under para- community health centers might post local governments in setting up evacuation graph (1), each State or unit of local govern- treatment options that provided them plans; and ment shall, to the maximum extent prac- with some success, and environmental ‘‘(6) establishing and maintaining a com- ticable— groups might post tips on cleaning up prehensive guide for State and local govern- ‘‘(A) assist urban and suburban county and ments regarding— the toxic waste. municipal governments in establishing and ‘‘(A) the types of Federal assistance that So, a landlord or hotel owner whose maintaining mass evacuation plans; are available to respond to emergencies; and property was used as a meth lab and ‘‘(B) assist hospitals, nursing homes, other ‘‘(B) the steps necessary to apply for that who wants to be able to rent out the institutional adult congregate living facili- assistance. property again, or the mother who ties, group homes, and other health or resi- ‘‘(h) REPORT TO CONGRESS.—Not later than wants to figure out if her child is a dential care facilities that house individuals 1 year after the date of enactment of this with special needs in establishing and main- meth addict—and what to do if she is subsection, the Comptroller General of the they would all be able to find useful in- taining mass evacuation plans; and United States shall conduct a study detail- ‘‘(C) integrate the plans described in sub- ing— formation on the site. paragraphs (A) and (B) and coordinate evacu- ‘‘(1) any Federal laws that pose an obstacle One of our challenges in the fight ation efforts with the entities described in to effective evacuation planning; against meth is finding those who need subparagraphs (A) and (B). ‘‘(2) any State or local laws that pose an assistance and connecting them with ‘‘(3) PLAN CONTENTS.—State, county, and obstacle to effective evacuation planning; those who can help—and that is ex- municipal mass evacuation plans shall, to and actly what this clearinghouse can do. the maximum extent practicable— ‘‘(3) the political and economic pressures Many people and organizations that ‘‘(A) establish incident command and deci- that discourage governors, county execu- have had some success in controlling sionmaking processes; tives, mayors, and other officials from— ‘‘(B) identify primary and alternate escape meth are more than willing to share ‘‘(A) ordering an evacuation; or the techniques they found that work, if routes; ‘‘(B) conducting exercises for the mass ‘‘(C) establish procedures for converting 2- evacuation of people.’’. only they knew who needed the infor- way traffic to 1-way evacuation routes, re- mation. And, there are those who are moving tollgates, ensuring the free move- By Mr. DEWINE: just starting to attack the meth prob- ment of emergency vehicles, and deploying S. 2046. A bill to establish a National lem in their communities and need traffic management personnel and appro- Methamphetamine Information Clear- guidance as to how to make that start priate traffic signs; inghouse to promote sharing informa- an effective one. The NMIC can help ‘‘(D) maintain detailed inventories of driv- ers and public and private vehicles, including tion regarding successful law enforce- bring those groups of people together buses, vans, and handicap-accessible vehi- ment, treatment, environmental, so- and enhance everyone’s ability to fight cles, that may be pressed into service; cial services, and other programs re- the plague of meth. ‘‘(E) maintain detailed inventories of lated to the production, use, or effects NMIC will be housed under the aus- emergency shelter locations and develop the of methamphetamine and grants avail- pices of the Department of Justice and

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00027 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.149 S17NOPT2 S13174 CONGRESSIONAL RECORD — SENATE November 17, 2005 will be governed by an Advisory Coun- enforcement, treatment, environmental, so- Over the last few decades, our med- cil comprised of 10 members from a va- cial services, and other programs related to ical researchers and scientists have de- riety of agencies and organizations. It the production, use, or effects of meth- veloped increasingly sophisticated and is this Council who will monitor the amphetamine and grants available for such high tech methods to diagnose and submissions to the Clearinghouse and programs. (b) COMPONENTS.—The NMIC shall in- treat disease. Yet, this approach has make sure that the information found clude— caused us to lose sight of the need for on the site is accurate, up-to-date, and (1) a toll-free number; and preventing diseases on the front-end, useful. (2) a website that— with greater investment in basic public The bill I am introducing today pro- (A) provides information on the short-term health interventions that too often get vides the basic outline of this idea, and and long-term effects of methamphetamine short shrift. over the next two months, I will be use; Today, I would like to bring it back working closely with law enforcement (B) provides information regarding meth- to the basics and talk about environ- and community groups to modify and amphetamine treatment programs and pro- mental quality. The air we breathe, the grams for drug endangered children, includ- improve the Clearinghouse before we food we eat, the houses in which we move forward with this legislation next ing descriptions of successful programs and contact information for such programs; live, and the parks in which our chil- year. I look forward to that process (C) provides information regarding grants dren play—all of these factors con- and encourage all of my colleagues to for methamphetamine-related programs, in- tribute to our health. Environmental join me in this effort to combat the cluding contact information and links to health, as defined by the World Health meth problem. websites; Organization, includes both the direct, I ask unanimous consent that the (D) allows a qualified entity to submit damaging effects of chemicals, radi- text of the bill be printed in the items to be posted on the website regarding ation, and some biological agents, and successful public or private programs or RECORD. the effects on health and well-being of There being no objection, the bill was other useful information related the produc- the broad physical, psychological, so- ordered to be printed in the RECORD, as tion, use, or effects of methamphetamine; follows: (E) includes a restricted section that may cial, and aesthetic environment. The only be accessed by a law enforcement orga- legislation that I have introduced S. 2046 nization that contain successful strategies, draws attention to that aspect of the Be it enacted by the Senate and House of Rep- training techniques, and other information environment that is the physical envi- resentatives of the United States of America in that the Council determines helpful to law Congress assembled, ronment—the toxicants and pollutants enforcement agency efforts to combat the that we may not notice, but are SECTION 1. SHORT TITLE. production, use or effects of methamphet- This Act may be cited as the ‘‘National amine; present in our everyday surroundings Methamphetamine Information Clearing- (F) allows public access to all information and taking a toll on our health. house Act of 2005’’. not in a restricted section; and My home State of Illinois faces a SEC. 2. DEFINITIONS. (G) contains any additional information number of environmental challenges, In this Act— the Council determines may be useful in including high levels of lead poisoning. (1) the term ‘‘Council’’ means the National combating the production, use, or effects of It is estimated that over 400,000 chil- Methamphetamine Advisory Council estab- methamphetamine. lished under section 3(b)(1); dren in this country suffer from ele- (c) REVIEW OF POSTED INFORMATION.— vated blood lead levels. Chicago has (2) the term ‘‘drug endangered children’’ (1) IN GENERAL.—Not later than 30 days means children whose physical, mental, or after the date of submission of an item by a the unfortunate distinction of ranking emotional health are at risk because of the qualified entity, the Council shall review an number 1 for children with elevated production, use, or effects of methamphet- item submitted for posting on the website blood lead levels. 6,691 children have amine by another person; described in subsection (b)(2)— elevated blood lead levels, which is 50 (3) the term ‘‘National Methamphetamine (A) to evaluate and determine whether the percent higher than the number of chil- Information Clearinghouse’’ or ‘‘NMIC’’ item, as submitted or as modified, meets the dren in the second ranked city of means the information clearinghouse estab- requirements for posting; and lished under section 3(a); and Philadelphia. Elevated blood levels are (B) in consultation with the Attorney Gen- known to cause behavioral and learn- (4) the term ‘‘qualified entity’’ means a eral, to determine whether the item should State or local government, school board, or be posted in a restricted section of the ing problems, slowed growth, impaired public health, law enforcement, nonprofit, or website. hearing and damage to the kidneys, other nongovernmental organization pro- (2) DETERMINATION.—Not later than 45 days brain and bone marrow. Adults are not viding services related to after the date of submission of an item, the exempt from lead toxicity—poisoned methamphetamines. Council shall— adults suffer pregnancy difficulties, SEC. 3. ESTABLISHMENT OF CLEARINGHOUSE (A) post the item on the website described AND ADVISORY COUNCIL. high blood pressure, digestive prob- in subsection (b)(2); or lems, nerve disorders, memory and con- (a) CLEARINGHOUSE.—There is established, (B) notify the qualified entity that sub- under the supervision of the Attorney Gen- centration problems, and muscle and mitted the item regarding the reason such eral of the United States, an information item shall not be posted and modifications, joint pain. Lead poisoning is com- clearinghouse to be know as the National if any, that the qualified entity may make to pletely preventable, and although our Methamphetamine Information Clearing- allow the item to be posted. agencies have made good progress, we house. can and must do more to address this (b) ADVISORY COUNCIL.— SEC. 5. AUTHORIZATION OF APPROPRIATIONS. (1) IN GENERAL.—There is established an There are authorized to be appropriated— issue. advisory council to be known as the National (1) for fiscal year 2006— Obviously lead is only one of many Methamphetamine Advisory Council. (A) $1,000,000 to establish the NMIC and toxicants and pollutants with which we (2) MEMBERSHIP.—The Council shall consist Council; and must contend. Different areas of the of 10 members appointed by the Attorney (B) such sums as are necessary for the op- U.S. face unique challenges—States General— eration of the NMIC and Council; and like California are grappling with the (A) not fewer than 3 of whom shall be rep- (2) for each of fiscal years 2007 through 2010, such sums as are necessary for the oper- repercussions of air pollution, while resentatives of law enforcement agencies; Massachusetts and others in the North- (B) not fewer than 4 of whom shall be rep- ation of the NMIC and Council. resentatives of nongovernmental and non- east are challenged with high levels of profit organizations providing services re- By Mr. OBAMA (for himself and mercury in the water. As much as we lated to methamphetamines; and Mrs. CLINTON): know about these hazards, the effects (C) 1 of whom shall be a representative of S. 2047. A bill to promote healthy of many chemicals are unknown. the Department of Health and Human Serv- communities; to the Committee on Less than half of the chemicals pro- ices. Health, Education, Labor, and Pen- duced in this country in quantities (3) PERIOD OF APPOINTMENT; VACANCIES.— sions. greater than 10,000 pounds have been Members shall be appointed for 3 years. Any Mr. OBAMA. Mr. President, today, I tested for their potential human tox- vacancy in the Council shall not affect its am introducing the Healthy Commu- icity, with less than 10 percent studied powers, but shall be filled in the same man- ner as the original appointment. nities Act of 2005, and I am pleased to to assess effects on development. This SEC. 4. NMIC REQUIREMENTS AND REVIEW. have the support of my good friend and lack of knowledge has serious health (a) IN GENERAL.—The NMIC shall promote colleague Senator HILLARY RODHAM repercussions—in children, environ- sharing information regarding successful law CLINTON. mental toxins are estimated to cause

VerDate Aug 31 2005 00:32 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00028 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.131 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13175 up to 35 percent of asthma cases, up to Act of 2005, which directs the Consumer dren’s products. Specifically, the CDC 10 percent of cancer cases, and up to 20 Product Safety Commission to inten- urged a more systematic approach to percent of neurobehavioral disorders. sify efforts to reduce lead exposure for identifying lead-contaminated items Overall, an estimated 25 percent of pre- children. and prohibiting their sale before chil- ventable illnesses worldwide can be at- The unfortunate reality for many dren are exposed, rather than usual re- tributed to poor environmental qual- children—particularly in low-income call efforts after exposure has occurred. ity. Diseases such as cancer, heart dis- and minority households—is the con- The Consumer Product Safety Com- ease, asthma, birth defects, infertility, tinued presence of high blood lead lev- mission leads our national efforts to and obesity are all caused or exacer- els. Over 400,000 children in this coun- safeguard our children from potentially bated by toxicants or pollutants in the try have elevated blood lead levels, dangerous objects. However, the Com- environment. with my own hometown of Chicago mission has dragged its feet in aggres- Minority Americans are significantly having the largest concentration of sively addressing the problem of lead more likely to be affected than other these children. in toys. The Lead Free Toys Act, intro- Americans. Some studies have found Lead is a highly toxic substance that duced by my colleague Congressman that 3 of every 5 African- and Latino can produce a range of health problems HENRY WAXMAN earlier this year, re- Americans live in communities with in young children, including IQ defi- quires the Consumer Product Safety one or more toxic waste sites. Commu- ciencies, reading and learning disabil- Commission to prescribe regulations nities with existing incinerators, and ities, impaired hearing, reduced atten- classifying any children’s product con- those that are proposed for placement tion spans, hyperactivity, and damage taining lead as a banned hazardous sub- of new incinerators, have substantially to the kidneys, brain and bone marrow. stance under the Hazardous Substances higher numbers of minority residents. Even low levels of blood lead in preg- Act. It defines ‘‘children’s product con- Minority Americans are already nant women, infants and children can taining lead’’ as any consumer product plagued with higher rates of death and lead to impaired cognitive abilities, marketed or used by children under age 6 that contains more than trace disease, and fewer health resources in fetal organ development and behav- amounts of lead as determined by the their neighborhoods. As we focus our ioral problems. efforts on environmental health, we We know that lead poisoning is com- Commission and prescribed by regula- tions. The Act also requires the Com- must be cognizant that some groups pletely preventable. As the Nation has mission to issue standards for reduc- are disproportionately affected by fed- increased efforts to reduce environ- tion in lead in electronic devices. eral policies and decision-making, and mental lead exposure, the number of deserve careful attention. It’s a national disgrace that toys children with high blood levels has that could pose a serious and signifi- The Healthy Communities Act of 2005 steadily dropped. Restricting lead in addresses environmental health con- cant danger to children are readily gasoline and paint represent two major available in our department stores and cerns in a comprehensive fashion, accomplishments in this regard. But building upon many of the successful markets. The Lead Free Toys Act of much work remains to be done. 2005 will help us keep our children safe federal initiatives and filling in gaps in Earlier today I introduced the other critical areas. The bill estab- and healthy, and contribute to na- Healthy Communities Act of 2005, to tional efforts to reduce lead exposure. I lishes an independent advisory com- strengthen Federal, State and local ef- mittee to provide recommendations ask each of my colleagues to help sup- forts to address environmental health port this Act. across all relevant Federal agencies. It issues in communities already affected asks the CDC and the EPA to assess by lead and other toxins. However, we By Mr. DOMENICI (for himself, and report the environmental public need to take greater proactive steps to Mr. DORGAN, and Mr. TALENT): health of the nation, and each State. prevent contamination, and the Lead S. 2049. A bill to improve the security The Health Action Zone Program will Free Toys Act of 2005 will help us do of the United States borders and for provide intense Federal attention and just that. other purposes; to the Committee on resources to clean up and address the Disturbingly, lead is present in a the Judiciary. health needs of the nation’s most number of toys and other frequently Mr. DOMENICI. Mr. President, I rise blighted communities. Environmental used objects by young children. Ac- today with my friend from North Da- research is expanded, including bio- cording to research conducted by the kota, Senator DORGAN, and my friend monitoring and health tracking initia- National Center for Environmental from Missouri, Senator TALENT, to in- tives. Finally, the Act promotes envi- Health, about half of tested lunch troduce a bill of critical importance to ronmental health workforce programs boxes have unsafe levels of lead. The the security of our borders: the Border at the CDC and the NIH. highly popular Angela Anaconda lunch Modernization and Security Act of The Healthy Communities Act of 2005 box was found to have 56,400 parts per 2005. will increase national attention on the million of lead, which is more than 90 Securing our borders is the first nec- importance of the environment, and its essary step towards immigration re- times the 600 parts per million legal relationship to good health. As we form, and I believe the legislation I am limit for lead in paint for children’s work to make our future stronger for introducing makes an enormous leap in products. Other lunch boxes showed our communities, let us look to our the right direction. levels of lead between two and twenty- past. In the National Environmental Our bill builds upon legislation we in- Policy Act (NEPA) of 1969, Congress five times the legal limit for lead paint troduced in the last Congress to im- wrote that it is the continuing respon- in children’s products. In most cases, prove our port of entry infrastructure sibility of the Federal Government to the highest lead levels were found in as well as a lot of good ideas proposed assure that all Americans live in ‘‘safe, the lining of lunch boxes, where lead by other Senators in this Congress, and healthful and aesthetically and cul- could come into direct contact with adds some provisions that I think are turally pleasing surroundings.’’ Almost food. important to a comprehensive border forty years later, our responsibility to This problem is not limited to security and immigration reform ef- the American people continues. I en- lunchboxes. One study found that 60 fort. courage all of my colleagues to join me percent of more than 400 pieces of cos- The Border Modernization and Secu- and support passage of this bill. tume jewelry purchased at major de- rity Act increases the number of Cus- partment stories contain dangerous toms and Border Protection (CBP) offi- By Mr. OBAMA: amounts of lead. From September 2003 cers and Immigration and Customs En- S. 2048. A bill to direct the Consumer through July 2004, there were 3 recalls forcement (ICE) agents each by 1000 for Product Safety Commission to classify of nearly 150 million pieces of toy jew- each of fiscal years 2007 through 2011. certain children’s products containing elry because of toxic levels of lead. These personnel are necessary to im- lead to be banned hazardous sub- This past August the Centers for Dis- prove our enforcement at ports of stances; to the Committee on Com- ease Control updated their ‘‘Preventing entry and within the United States, merce, Science, and Transportation. Lead Poisoning in Young Children’’ and increasing the number of these em- Mr. OBAMA. Mr. President, I rise statement calling for the elimination ployees goes hand in hand with our re- today to introduce the Lead Free Toys of all nonessential uses of lead in chil- cent efforts to increase the number of

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00029 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.130 S17NOPT2 S13176 CONGRESSIONAL RECORD — SENATE November 17, 2005 border patrol agents who are enforcing implement these projects based on am pleased to introduce this bill today the law along our international bor- needs along the border. The Secretary with Senators DORGAN and TALENT. ders. Along this same line, the bill al- of Homeland Security would also have I ask unanimous consent that the lows the Department of Homeland Se- to prepare a Land Border Security Plan text of the bill be printed in the curity (DHS) to support its border and to assess the vulnerabilities at each RECORD. immigration forces with National port of entry located on the northern There being no objection, the bill was Guard personnel and volunteer retired border or the southern border. This ordered to be printed in the RECORD, as law enforcement officers, provides for plan will require the cooperation of follows: an increase in the number of DHS alien Federal, State and local entities in- S. 2049 and immigration investigative per- volved at our borders to ensure that ev- Be it enacted by the Senate and House of Rep- sonnel, and increases the number of eryone who plays a role in border secu- resentatives of the United States of America in Deputy Marshals to investigate crimi- rity is consulted about the plan. Congress assembled, nal immigration matters. The Border Modernization and Secu- SECTION 1. SHORT TITLE. Increasing the number of DHS em- rity Act would also modernize home- This Act may be cited as the ‘‘Border Secu- ployees alone will not solve our border land security along the United States’ rity and Modernization Act of 2005’’. problems. Unauthorized aliens also borders by implementing technology SEC. 2. DEFINITIONS. cause a significant burden on our demonstration programs to test and In this Act: courts. For example, for the 12-month (1) DEPARTMENT.—Except as otherwise pro- evaluate new port of entry and border vided, the term ‘‘Department’’ means the De- period ending September 30, 2004, 364 security technologies. Because equip- partment of Homeland Security. felony cases per judge were filed in the ment and technology alone will not (2) SECRETARY.—Except as otherwise pro- New Mexico District. It is apparent solve the security problems on our bor- vided, the term ‘‘Secretary’’ means the Sec- how burdensome this number is for my der, these test sites will also house fa- retary of Homeland Security. border State’s court when you consider cilities to provide the necessary train- (3) STATE.—Except as otherwise provided, that the national average of felony ing to personnel who must implement the term ‘‘State’’ has the meaning given cases filed per judge is 88. To help with and use these technologies under real- that term in section 101(a)(36) of the Immi- these high caseload levels, our bill in- gration and Nationality Act (8 U.S.C. 1101 istic conditions. (a)(36)). creases the number of DHS immigra- We must also improve the enforce- SEC. 3. CONSTRUCTION. tion attorneys, federal defenders, Of- ment of existing immigration laws. Our Nothing in this Act may be construed to fice of Immigration Litigation attor- bill authorizes funds for the Depart- require law enforcement personnel of a State neys, assistant US Attorneys, and im- ment of Homeland Security to expand or political subdivision of a State to— migration judges. its Expedited Removal Procedures so (1) report the identity of a victim of, or a Increased personnel is only one as- DHS can expeditiously return non- witness to, a criminal offense to the Sec- pect of our effort to secure the border. Mexican illegal aliens who have spent retary for immigration enforcement pur- Any border security effort must pro- less than 14 days in the US and who are poses; vide DHS personnel with necessary apprehended within 100 miles of the (2) arrest such victim or witness for a vio- technologies and assets. To that end, lation of the immigration laws of the United international border to the alien’s States; or our bill authorizes funds for the De- country of origin. We also allow DHS (3) enforce the immigration laws of the partment to acquire new technologies, to create an automated biometric United States. construct roads, fences, and barriers, entry and exit data system at our land TITLE I—BORDER PROTECTION purchase air assets, vehicles, and other ports of entry so we can more accu- Subtitle A—Personnel and Training equipment, maintain temporary and rately keep track of who is entering SEC. 101. PERSONNEL OF THE DEPARTMENT OF permanent border checkpoints, and and leaving the US. HOMELAND SECURITY. construct the appropriate facilities to In order for the Department to more (a) IN GENERAL.— support the increased number of DHS easily identify and remove unauthor- (1) CUSTOMS AND BORDER PROTECTION OFFI- personnel being hired. Such assets are ized aliens who commit crimes under CERS.—During each of the fiscal years 2007 invaluable tools for our CBP and ICE State law and are held in State and through 2011, the Secretary shall, subject to employees, and we must make sure local prisons, we authorize the expan- the availability of appropriations for such those men and women have what they sion of DHS’ Institutional Removal purpose, increase by not less than 1,000 the number of positions for full-time active duty need. We also provide for up to 15,000 Program. Because of the burden these officers of the Bureau of Customs and Border new detention beds for unauthorized aliens place on our State and local Protection of the Department for such fiscal aliens in our bill. prisons, DHS will be responsible for re- year. Another area Congress must address imbursing prisons that detain an alien (2) IMMIGRATION AND CUSTOMS ENFORCEMENT is our land port of entry infrastructure. after the alien has completed his prison INSPECTORS.—Section 5203 of the Intelligence No American border has undergone a sentence in order to effectuate the Reform and Terrorism Prevention Act of 2004 comprehensive infrastructure overhaul alien’s transfer to federal custody. (Public Law 108–458; 118 Stat. 3734) is amend- since 1986, when Senator Dennis Along the same line, the Border Mod- ed by striking ‘‘800’’ and inserting ‘‘1000’’. DeConcini of Arizona and I put forth a ernization and Security Act provides (3) INVESTIGATIVE PERSONNEL.—In addition to the positions authorized under section $357 million effort to modernize the additional assistance to States that are 5203 of the Intelligence Reform and Ter- southwest border. A great deal has impacted by unauthorized aliens who rorism Prevention Act of 2004, as amended by changed in the past nineteen years. commit crimes. I know first hand the paragraph (2), during each of the fiscal years More importantly, much has changed impact such aliens have on our State 2007 through 2011, the Secretary shall, sub- since September 11, 2001. Congress has and local prisons from talking to pros- ject to the availability of appropriations for passed legislation to improve security ecutors and judges in New Mexico, so such purpose, increase by not less than 100 at airports and seaports, but we have our bill reauthorizes the State Crimi- the number of positions for investigative not yet addressed the needs of our busi- nal Alien Assistance Program to help personnel within the Department to inves- tigate alien smuggling and immigration sta- est ports, located on the United States’ our States with the costs of incarcer- tus violations for such fiscal year. northern and southwestern land bor- ating these aliens. Additionally, the (4) LEGAL PERSONNEL.—During each of the ders. The Border Modernization and Se- bill allows for the reimbursement of fiscal years 2007 through 2011, the Secretary curity Act would change that and State and local costs of processing ille- shall, subject to the availability of appro- would prevent terrorists from exploit- gal aliens through the criminal justice priations for such purpose, increase by not ing weaknesses at our land ports. system and creates a new grant pro- less than 100 the number of positions for at- My bill requires the General Service gram for State, local, and Indian tribe torneys in the Office of General Counsel of Administration (GSA) to identify port law enforcement agencies who incur the Department who represent the Depart- of entry infrastructure and technology ment in immigration matters for such fiscal costs related to border security activi- year. improvement projects that would en- ties. (5) WAIVER OF FTE LIMITATION.—The Sec- hance homeland security. The GSA I believe that these measures are an retary is authorized to waive any limitation would work with the Department of important part of addressing this na- on the number of full-time equivalent per- Homeland Security to prioritize and tion’s homeland security needs, and I sonnel employed by the Department to fulfill

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the requirements of paragraph (1) and the land Security to secure the international (1) COMMISSIONER.—The term ‘‘Commis- amendment made by paragraph (2). borders of the United States, including con- sioner’’ means the Commissioner of the Bu- (b) TRAINING.—The Secretary shall provide structing roads, fencing, and vehicle bar- reau of Customs and Border Protection of appropriate training for the agents, officers, riers, assisting in search and rescue oper- the Department. inspectors, and associated support staff of ations conducted by personnel of the Depart- (2) MAQUILADORA.—The term ‘‘maquilado- the Department on an ongoing basis to uti- ment of Homeland Security, and monitoring ra’’ means an entity located in Mexico that lize new technologies and techniques and to international borders, and excluding any law assembles and produces goods from imported ensure that the proficiency levels of such enforcement activities conducted by per- parts for export to the United States. personnel are acceptable to protect the sonnel of the Department of Homeland Secu- (3) NORTHERN BORDER.—The term ‘‘north- international borders of the United States. rity.’’. ern border’’ means the international border (c) AUTHORIZATION OF APPROPRIATIONS.— SEC. 104. DEPUTY BORDER PATROL AGENT PRO- between the United States and Canada. There are authorized to be appropriated to GRAM. (4) SOUTHERN BORDER.—The term ‘‘southern the Secretary for each of fiscal years 2007 (a) AUTHORITY TO ESTABLISH.—The Sec- border’’ means the international border be- through 2011, such sums as may be necessary retary may establish a Deputy Border Patrol tween the United States and Mexico. to carry out this section. Agent Program (in this section referred to as SEC. 102. PERSONNEL OF THE DEPARTMENT OF the ‘‘Program’’) in the Office of Border Pa- (b) BORDER TECHNOLOGIES, ASSETS, AND JUSTICE AND OTHER ATTORNEYS. trol. CONSTRUCTION.— (a) LITIGATION ATTORNEYS.—During each of (b) PURPOSE.—The purpose of the Program (1) ACQUISITION.—The Secretary shall pro- the fiscal years 2007 through 2011, the Attor- shall be to establish a volunteer force of cure technologies necessary to support the ney General shall, subject to the availability trained, retired law enforcement officers to mission of the Department to achieve oper- of appropriations for such purpose, increase assist the Secretary in carrying out the mis- ational control of the international borders by not less than 50 the number of positions sion of the Department to achieve oper- of the United States. In determining what for attorneys in the Office of Immigration ational control of the borders of the United technologies to procure, the Secretary shall Litigation of the Department of Justice for States. consult with the Secretary of Defense and such fiscal year. (c) QUALIFICATIONS.—An individual may the head of the National Laboratories and (b) UNITED STATES ATTORNEYS.—During participate as a volunteer in the Program Technology Centers of the Department of each of the fiscal years 2007 through 2011, the only if such individual is a retired law en- Energy. Attorney General shall, subject to the avail- forcement officer, who is or was previously (2) CONSTRUCTION OF BORDER CONTROL FA- licensed by a Federal or State authority to ability of appropriations for such purpose, CILITIES.—The Secretary shall construct increase by not less than 50 the number of enforce Federal, State, or local penal of- roads, acquire vehicle barriers, and construct United States Attorneys to litigate immigra- fenses. fencing necessary to support such mission. (d) UTILIZATION OF VOLUNTEERS.—The Sec- tion cases in the Federal courts for such fis- (3) ASSETS.—The Secretary shall acquire retary may utilize an individual who partici- cal year. unmanned aerial vehicles, police-type vehi- pates as a volunteer in the Program to pro- (c) UNITED STATES MARSHALS.—During cles, helicopters, all terrain vehicles, inter- vide such border security functions that the each of the fiscal years 2007 through 2011, the operable communications equipment, fire- Attorney General shall, subject to the avail- Secretary determines are appropriate. (e) TRAINING AND OTHER REQUIREMENTS.— arms, sensors, cameras, lighting and such ability of appropriations for such purpose, The Secretary may require an individual other equipment and assets as may be nec- increase by not less than 50 the number of who participates as a volunteer in the Pro- essary to support such mission. Deputy United States Marshals to inves- gram to participate in such training, testing, (4) FACILITIES.—The Secretary shall con- tigate criminal immigration matters. and other requirements that the Secretary struct such facilities as may be necessary to (d) IMMIGRATION JUDGES.—During each of determines are appropriate. support the number of employees of the De- fiscal years 2007 through 2011, the Attorney (f) SWEARING IN.—Upon completion of any partment who are hired pursuant to any pro- General shall, subject to the availability of training, testing, or other procedures re- vision of this Act or of subtitle B of title V appropriations for such purpose, increase by quired by the Secretary, an individual who of the Intelligence Reform and Terrorism not less than 100 the number of immigration participates in the Program shall be sworn Prevention Act of 2004 (Public Law 108–458; judges for such fiscal year. in and assigned to the Office of Border Pa- 118 Stat. 3733). (e) DEFENSE ATTORNEYS.—During each of trol. (5) CHECKPOINTS.—The Secretary may con- the fiscal years 2007 through 2011, the Direc- (g) ASSIGNMENT OF VOLUNTEERS.—The Sec- struct and maintain temporary or perma- tor of the Administrative Office of the retary may assign individuals participating nent checkpoints on roadways located in United States Courts shall, subject to the in the Program to provide patrol services at close proximity to the northern border or availability of appropriations for such pur- facilities and locations along the inter- the southern border to support such mission. pose, increase by not less than 100 the num- national borders of the United States. (c) PORT OF ENTRY INFRASTRUCTURE AS- ber of attorneys in the Federal Defenders (h) OVERSIGHT OF AGENTS.—The Secretary, Program for such fiscal year. acting through the Commissioner of the Bu- SESSMENT STUDY.— (f) AUTHORIZATION OF APPROPRIATIONS.— reau of Customs and Border Protection of (1) REQUIREMENT TO UPDATE.—In order to There are authorized to be appropriated to the Department, shall have oversight of all carry out the mission of the Department to the Attorney General for each of fiscal years individuals participating in the Program. achieve operational control of the inter- 2007 through 2011 such sums as may be nec- Such volunteers shall serve at the pleasure national borders of the United States, not essary to carry out this section, including of the Secretary, acting through the Com- later than January 31 of each year, the Ad- the hiring of necessary support staff. missioner of the Bureau of Customs and Bor- ministrator of General Services shall update SEC. 103. USE OF THE NATIONAL GUARD FOR der Protection. the Port of Entry Infrastructure Assessment BORDER PROTECTION ACTIVITIES. (i) AUTHORIZATION OF APPROPRIATIONS.— Study prepared by the United States Cus- (a) IN GENERAL.—Section 112 of title 32, There are authorized to be appropriated toms Service, the Immigration and Natu- United States Code, is amended— $10,000,000 for each of the fiscal years 2007 ralization Service, and the General Services (1) by striking ‘‘drug interdiction and through 2011 to carry out this section. Administration in accordance with the mat- counter-drug activities’’ each place it ap- SEC. 105. DOCUMENT FRAUD DETECTION. ter relating to the ports of entry infrastruc- pears and inserting ‘‘drug interdiction, (a) TRAINING.—The Secretary shall provide ture assessment that is set out in the joint counter drug, and border activities’’; and appropriate officers of the Bureau of Cus- explanatory statement in the conference re- (2) in subparagraphs (A) and (B) of sub- toms and Border Protection of the Depart- port accompanying H.R. 2490 of the 106th section (e)(1), by striking ‘‘drug interdiction ment with training in identifying and detect- Congress, 1st session (House of Representa- or counter-drug activities’’ each place it ap- ing fraudulent travel documents. Such train- tives Rep. No. 106–319, page 67) and submit pears and inserting ‘‘drug interdiction, ing shall be developed in consultation with such updated study to Congress. counter-drug, or border activities’’. the Forensic Document Laboratory of the (2) CONSULTATION.—In preparing the up- (b) DEFINITION OF DRUG INTERDICTION, Bureau of Immigration and Customs En- dated studies required by paragraph (1), the COUNTER-DRUG, AND BORDER ACTIVITIES.— forcement of such Department. Administrator of General Services shall con- Subsection (h)(1) of such section is amended (b) FORENSIC DOCUMENT LABORATORY.—The sult with the Director of the Office of Man- to read as follows: Secretary shall provide all officers of the Bu- agement and Budget, the Secretary, and the ‘‘(1) The term ‘drug interdiction, counter- reau of Customs and Border Protection with Commissioner. drug, and border activities’, with respect to access to the Forensic Document Labora- (3) CONTENT.—Each updated study required the National Guard of a State, means the use tory. by paragraph (1) shall— of National Guard personnel in— (c) AUTHORIZATION OF APPROPRIATIONS.— (A) identify port of entry infrastructure ‘‘(A) drug interdiction and counter-drug There are authorized to be appropriated and technology improvement projects that law enforcement activities, including drug $10,000,000 for each of the fiscal years 2007 would enhance border security and facilitate demand reduction activities authorized by through 2011 to carry out this section. the flow of legitimate commerce if imple- the law of the State and requested by the Subtitle B—Infrastructure mented; Governor of the State; or SEC. 111. MODERNIZATION OF BORDER INFRA- (B) include the projects identified in the ‘‘(B) activities conducted in cooperation STRUCTURE. National Land Border Security Plan required with personnel of the Department of Home- (a) DEFINITIONS.—In this section: by subsection (d); and

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00031 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.153 S17NOPT2 S13178 CONGRESSIONAL RECORD — SENATE November 17, 2005 (C) prioritize each project described in sub- shall carry out a technology demonstration curity technologies and train personnel paragraph (A) or (B) based on the likelihood program to test and evaluate new port of under realistic conditions. that the project will— entry technologies, refine port of entry tech- (2) TECHNOLOGY AND FACILITIES.— (i) fulfill immediate security requirements; nologies and operational concepts, and train (A) TECHNOLOGY TESTED.—Under the dem- and personnel under realistic conditions. The onstration program, the Secretary shall test (ii) facilitate trade across the borders of Commissioner of the Bureau of Customs and technologies that enhance border security, the United States. Border Protection shall oversee the program including those related to communications, (4) PROJECT IMPLEMENTATION.— in consultation and cooperation with other sensory devices, personal detection, and de- (A) IN GENERAL.—The Commissioner shall divisions of the Department. cision support. implement the infrastructure and tech- (2) TECHNOLOGY AND FACILITIES.— (B) FACILITIES DEVELOPMENT.—At a site nology improvement projects described in (A) TECHNOLOGY TESTED.—Under the dem- where border patrol agents participate in law each updated study required by paragraph (1) onstration program, the Secretary shall test enforcement training, the Secretary shall in the order of priority assigned to each technologies that enhance port of entry op- develop facilities to carry out the dem- project under paragraph (3)(C). erations, including those related to inspec- onstration program, including providing ap- (B) EXCEPTION.—The Commissioner may di- tions, communications, port tracking, iden- propriate training to law enforcement per- verge from the priority order if the Commis- tification of persons and cargo, sensory de- sonnel who have responsibility for border se- sioner determines that significantly changed vices, personal detection, decision support, curity, including cross-training among agen- circumstances, such as immediate security and the detection and identification of weap- cies, advanced law enforcement training, and needs or changes in infrastructure in Mexico ons of mass destruction. equipment orientation. or Canada, compellingly alter the need for a (B) FACILITIES DEVELOPED.—At a dem- (3) RELATIONSHIP WITH OTHER AGENCIES.— project in the United States. onstration site selected pursuant to para- The Secretary shall permit personnel from (d) NATIONAL LAND BORDER SECURITY graph (3)(B), the Secretary shall develop fa- an appropriate Federal or State agency to PLAN.— cilities to provide appropriate training to utilize the demonstration site described in (1) REQUIREMENT FOR PLAN.—In order to law enforcement personnel who have respon- this subsection to test technologies that en- carry out the mission of the Department to sibility for border security, including cross- hance border security, including those re- achieve operational control of the inter- training among agencies, advanced law en- lated to communications, sensory devices, national borders of the United States, not forcement training, and equipment orienta- personal detection, and decision support. later than January 31 of each year, the Sec- tion. (4) REPORT.— retary shall prepare a National Land Border (3) DEMONSTRATION SITES.— (A) REQUIREMENT.—Not later than 1 year Security Plan and submit such plan to Con- (A) NUMBER.—The Secretary shall carry after the date of enactment of this Act, and gress. out the demonstration program at not less annually thereafter, the Secretary shall sub- (2) CONSULTATION.—In preparing the plan than 3 sites and not more than 5 sites. mit to Congress a report on the activities required by paragraph (1), the Secretary (B) SELECTION CRITERIA.—To ensure that at carried out at the demonstration site under shall consult with the Under Secretary for least 1 of the facilities selected as a port of the technology demonstration program es- Information Analysis and Infrastructure entry demonstration site for the demonstra- tablished under this subsection. Protection and the Federal, State, and local tion program has the most up-to-date design, (B) CONTENT.—Each report submitted pur- law enforcement agencies and private enti- contains sufficient space to conduct the suant to subparagraph (A) shall include an ties that are involved in international trade demonstration program, has a traffic volume assessment by the Secretary of the feasi- across the northern border or the southern low enough to easily incorporate new tech- bility of incorporating any demonstrated border. nologies without interrupting normal proc- technology for use throughout the Depart- (3) VULNERABILITY ASSESSMENT.— essing activity, and can efficiently carry out ment. (A) IN GENERAL.—The plan required by demonstration and port of entry operations, (h) INTERNATIONAL AGREEMENTS.—Funds paragraph (1) shall include a vulnerability at least 1 port of entry selected as a dem- authorized in this Act may be used for the assessment of each port of entry located on onstration site shall— implementation of projects described in the the northern border or the southern border. (i) have been established not more than 15 Declaration on Embracing Technology and (B) PORT SECURITY COORDINATORS.—The years before the date of enactment of this Cooperation to Promote the Secure and Effi- Secretary may establish 1 or more port secu- Act; cient Flow of People and Commerce across rity coordinators at each port of entry lo- (ii) consist of not less than 65 acres, with our Shared Border between the United cated on the northern border or the southern the possibility of expansion onto not less States and Mexico, agreed to March 22, 2002, border— than 25 adjacent acres; and Monterrey, Mexico (commonly known as the (i) to assist in conducting a vulnerability (iii) have serviced an average of not more Border Partnership Action Plan) or the assessment at such port; and than 50,000 vehicles per month in the 12 full Smart Border Declaration between the (ii) to provide other assistance with the months preceding the date of enactment of United States and Canada, agreed to Decem- preparation of the plan required by para- this Act. ber 12, 2001, Ottawa, Canada that are con- graph (1). (4) RELATIONSHIP WITH OTHER AGENCIES.— sistent with the provisions of this Act. (e) EXPANSION OF TRADE SECURITY PRO- The Secretary shall permit personnel from (i) AUTHORIZATION OF APPROPRIATIONS.— GRAMS.— an appropriate Federal or State agency to There are authorized to be appropriated the (1) CUSTOMS-TRADE PARTNERSHIP AGAINST utilize a demonstration site described in following: TERRORISM.— paragraph (3) to test technologies that en- (1) For each of the fiscal years 2007 through (A) IN GENERAL.—Not later than 180 days hance port of entry operations, including 2011, $1,000,000,000 to carry out subsection (b). after the date of enactment of this Act, the those related to inspections, communica- (2) For each of the fiscal years 2007 through Commissioner, in consultation with the Sec- tions, port tracking, identification of per- 2011, such sums as may be necessary to carry retary, shall develop a plan to expand the sons and cargo, sensory devices, personal de- out paragraph (1) of subsection (c). size and scope (including personnel needs) of tection, decision support, and the detection (3) For each of the fiscal years 2007 through the Customs-Trade Partnership Against Ter- and identification of weapons of mass de- 2011, $100,000,000 to carry out paragraph (4) of rorism programs along the northern border struction. subsection (c). and southern border, including— (5) REPORT.— (4) For each of the fiscal years 2007 through (i) the Business Anti-Smuggling Coalition; (A) REQUIREMENT.—Not later than 1 year 2011, such sums as may be necessary to carry (ii) the Carrier Initiative Program; after the date of enactment of this Act, and out subsection (d). (iii) the Americas Counter Smuggling Ini- annually thereafter, the Secretary shall sub- (5)(A) For fiscal year 2007, $30,000,000 to tiative; mit to Congress a report on the activities carry out paragraph (1) of subsection (e); and (iv) the Free and Secure Trade Initiative; carried out at each demonstration site under (B) For each of the fiscal years 2008 and the technology demonstration program es- through 2011, such sums as may be necessary (v) other Industry Partnership Programs tablished under this subsection. to carry out such paragraph. administered by the Commissioner. (B) CONTENT.—Each report submitted pur- (6)(A) For fiscal year 2007, $5,000,000 to (2) MAQUILADORA DEMONSTRATION PRO- suant to subparagraph (A) shall include an carry out paragraph (2) of subsection (e); and GRAM.—Not later than 180 days after the date assessment by the Secretary of the feasi- (B) For each of the fiscal years 2008 of enactment of this Act, the Commissioner bility of incorporating any demonstrated through 2011, such sums as may be necessary shall establish a demonstration program to technology for use throughout the Bureau of to carry out such paragraph. develop a cooperative trade security system Customs and Border Protection. (7)(A) For fiscal year 2007, $50,000,000 to with maquiladoras to improve supply chain (g) BORDER PATROL TECHNOLOGY DEM- carry out subsection (f), and not more than security. ONSTRATION PROGRAM.— $10,000,000 of such amount may be expended (f) PORT OF ENTRY TECHNOLOGY DEM- (1) ESTABLISHMENT.—In order to carry out for technology demonstration program ac- ONSTRATION PROGRAM.— the mission of the Department to achieve tivities at any 1 port of entry demonstration (1) ESTABLISHMENT.—In order to carry out operational control of the international bor- site during such fiscal year. the mission of the Department to achieve ders of the United States, the Secretary (B) For each of the fiscal years 2008 operational control of the international bor- shall carry out a technology demonstration through 2011, such sums as may be necessary ders of the United States, the Secretary program to test and evaluate new border se- to carry out subsection (f), and not more

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than $10,000,000 may be expended for tech- aliens residing in all States, based on the (b) COLLECTION OF BIOMETRIC DATA FROM nology demonstration program activities at most recent decennial census; and ALIENS DEPARTING THE UNITED STATES.—Sec- any 1 port of entry demonstration site in any (5) the percentage of undocumented alien tion 215 of the Immigration and Nationality such fiscal year. apprehensions in the law enforcement agen- Act (8 U.S.C. 1185) is amended— (8) For each of the fiscal years 2007 through cy’s State in that fiscal year compared to (1) by redesignating subsection (c) as sub- 2011, $10,000,000 to carry out subsection (g). the total of such apprehensions for all such section (g); and SEC. 112. DETENTION SPACE AND REMOVAL CA- States for that fiscal year. (2) by inserting after subsection (b) the fol- PACITY. (d) USE OF FUNDS.—Grants awarded under lowing: Section 5204(a) of the Intelligence Reform subsection (b) shall be used to provide addi- ‘‘(c) The Secretary of Homeland Security is and Terrorism Protection Act of 2004 (Public tional resources for a law enforcement agen- authorized to require aliens departing the Law 108-458; 118 Stat. 3734) is amended by cy to address criminal activity occurring United States to provide biometric data and striking ‘‘8,000’’ and inserting ‘‘15,000’’. near an international border of the United other information relating to their immigra- States, including— SEC. 113. INCREASE OF FEDERAL DETENTION tion status.’’. SPACE AND THE UTILIZATION OF (1) law enforcement technologies; (c) INSPECTION OF APPLICANTS FOR ADMIS- FEDERAL FACILITIES IDENTIFIED (2) equipment such as police-type vehicles, SION.—Section 235(d) of the Immigration and FOR CLOSURE. all terrain vehicles, firearms, sensors, cam- Nationality Act (8 U.S.C. 1185(d)) is amended (a) CONSTRUCTION OR ACQUISITION OF DE- eras, and lighting; and by adding at the end the following: TENTION FACILITIES.— (3) such other resources as are available to ‘‘(5) AUTHORITY TO COLLECT BIOMETRIC (1) IN GENERAL.—The Secretary shall con- assist the law enforcement agency. DATA.—In conducting inspections under sub- struct or acquire additional detention facili- (e) APPLICATION.—The head of a law en- section (b), immigration officers are author- ties in the United States. forcement agency seeking to apply for a ized to collect biometric data from— (2) DETERMINATION OF LOCATION.—The loca- grant under this section shall submit an ap- ‘‘(A) any applicant for admission or alien tion of any detention facility built or ac- plication to the Secretary at such time, in seeking to transit through the United quired in accordance with this subsection such manner, and with such information as States; or shall be determined by the Deputy Assistant the Secretary may require. ‘‘(B) any lawful permanent resident who Director of the Office of Detention and Re- (f) AUTHORIZATION OF APPROPRIATIONS.— is— There are authorized to be appropriated moval Operations within the Bureau of Im- ‘‘(i) entering the United States; and $500,000,000 for each of the fiscal years 2007 migration and Customs Enforcement of the ‘‘(ii) not regarded as seeking an admission through 2011 to carry out this section. Department. into the United States pursuant to section (3) USE OF FEDERAL FACILITIES IDENTIFIED TITLE II—IMMIGRATION PROVISIONS 101(a)(13)(C).’’. FOR CLOSURE.—In acquiring detention facili- SEC. 201. EXPEDITED REMOVAL BETWEEN PORTS (d) COLLECTION OF BIOMETRIC DATA FROM ties under this subsection, the Secretary OF ENTRY. ALIEN CREWMAN.—Section 252 of the Immi- shall, to the maximum extent practical, re- (a) IN GENERAL.—Section 235 of the Immi- gration and Nationality Act (8 U.S.C. 1282) is quest the transfer of appropriate portions of gration and Nationality Act (8 U.S.C. 1225) is amended by inserting ‘‘Immigration officers military installations approved for closure amended— are authorized to collect biometric data or realignment and any other Federal facili- (1) in subsection (b)(1)(A)(i), by striking from any alien crewman seeking permission ties identified for closure. ‘‘the officer’’ and inserting ‘‘a supervisory of- to land temporarily in the United States.’’ (b) AUTHORIZATION OF APPROPRIATIONS.— ficer’’; and after ‘‘this title’’. There are authorized to be appropriated such (2) in subsection (c), by adding at the end (e) IMPLEMENTATION.—Section 7208 of the 9/ sums as may be necessary to carry out this the following: 11 Commission Implementation Act of 2004 (8 section. ‘‘(4) EXPANSION.—The Secretary of Home- U.S.C. 1365b) is amended in subsection (l)— land Security shall make the expedited re- SEC. 114. ALTERNATIVES TO DETENTION. (1) by striking ‘‘There are authorized’’ and moval procedures under this subsection The Secretary shall implement demonstra- inserting the following: available in all border patrol sectors on the tion programs in each State located along ‘‘(1) IN GENERAL.—There are authorized’’; southern border of the United States as soon the international border between the United and as operationally possible. States and Canada or along the international (2) by adding at the end the following: ‘‘(5) TRAINING.—The Secretary of Homeland border between the United States and Mex- ‘‘(2) IMPLEMENTATION AT ALL LAND BORDER Security shall provide employees of the De- ico to study the effectiveness of alternatives PORTS OF ENTRY.—There are authorized to be partment of Homeland Security with com- to the detention of aliens, including elec- appropriated such sums as may be necessary prehensive training on the procedures au- tronic monitoring devices and intensive su- for each of fiscal years 2008, 2009, and 2010 to thorized under this subsection.’’. pervision programs, that ensure that alien’s implement the automated biometric entry (b) AUTHORIZATION OF APPROPRIATIONS.— and exit data system at all land border ports appearance at court and compliance with re- There are authorized to be appropriated moval orders. of entry.’’. $20,000,000 for each of fiscal years 2007 SEC. 204. REIMBURSEMENT FOR STATES. Subtitle C—Grants for States through 2011 to carry out the amendments (a) INCARCERATION COSTS.—Section 241(i)(5) SEC. 121. BORDER LAW ENFORCEMENT GRANTS. made by this section. of the Immigration and Nationality Act (8 (a) LAW ENFORCEMENT AGENCY DEFINED.— SEC. 202. CANCELLATION OF VISAS. U.S.C. 1231(i)(5)) is amended to read as fol- In this section, the term ‘‘law enforcement Section 222(g) of the Immigration and Na- lows: agency’’ means a Tribal, State, or local law tionality Act (8 U.S.C. 1202(g)) is amended— ‘‘(5) There are authorized to be appro- enforcement agency. (1) in paragraph (1), by inserting ‘‘and any priated to carry out this subsection— (b) AUTHORITY TO AWARD GRANTS.—The other nonimmigrant visa issued by the ‘‘(A) $750,000,000 for fiscal year 2007; Secretary is authorized to award grants to United States that is in the possession of the ‘‘(B) $850,000,000 for fiscal year 2008; and an eligible law enforcement agency to pro- alien’’ after ‘‘such visa’’; and ‘‘(C) $950,000,000 for each of the fiscal years vide assistance with costs associated with (2) in paragraph (2)(A), by striking ‘‘(other 2009 through 2011.’’. State border security efforts, including ef- than the visa described in paragraph (1)) (b) REIMBURSEMENT FOR COSTS ASSOCIATED forts to combat criminal activity that occurs issued in a consular office located in the WITH PROCESSING CRIMINAL ILLEGAL in the jurisdiction of such agency by virtue country of the aliens nationality’’ and in- ALIENS.— of such agency’s proximity to an inter- serting ‘‘(other than a visa described in para- (1) IN GENERAL.—The Secretary shall reim- national border of the United States. graph (1)) issued in a consular office located burse States and units of local government (c) CRITERIA.—The Secretary shall award in the country of the aliens nationality or for costs associated with processing illegal grants under subsection (b) on a competitive foreign residence’’. aliens through the criminal justice system, basis, considering criteria including— SEC. 203. BIOMETRIC ENTRY-EXIT SYSTEM. including— (1) the law enforcement agency’s distance (a) GROUNDS OF INADMISSIBILITY.—Section (A) indigent defense; from the international border, with commu- 212 of the Immigration and Nationality Act (B) criminal prosecution; nities closer to the border given priority be- (8 U.S.C. 1182) is amended— (C) autopsies; cause of their proximity; (1) in subsection (a)(7), by adding at the (D) translators and interpreters; and (2) population, with smaller communities end the following: (E) courts costs. given priority; ‘‘(C) WITHHOLDERS OF BIOMETRIC DATA.— (2) AUTHORIZATION OF APPROPRIATIONS.— (3) the criminal caseload of the law en- Any alien who fails to comply with a lawful There are authorized to be appropriated forcement agency, based upon the number of request for biometric data is inadmissible.’’; $500,000,000 for each of the fiscal years 2007 felony criminal cases filed per judge in the and through 2011 to carry out paragraph (1). United States district court located in the (2) in subsection (d), by inserting after SEC. 205. COMPLETION OF BACKGROUND AND SE- district that the law enforcement agency has paragraph (1) the following: CURITY CHECKS. jurisdiction over, with priority given to ‘‘(2) The Secretary of Homeland Security Section 103 of the Immigration and Nation- those with higher caseloads; may waive the application of subparagraph ality Act (8 U.S.C. 1103) is amended by add- (4) the percentage of undocumented aliens (C) of subsection (a)(7) for an individual alien ing at the end the following: residing in the law enforcement agency’s or a class of aliens, at the discretion of the ‘‘(i) Notwithstanding any other provision State compared to the total number of such Secretary.’’. of law, the Secretary of Homeland Security,

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00033 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.153 S17NOPT2 S13180 CONGRESSIONAL RECORD — SENATE November 17, 2005 the Attorney General, or any court may SEC. 302. INCREASED CRIMINAL PENALTIES FOR TITLE IV—REMOVAL AND VIOLATION not— DOCUMENT FRAUD. TRACKING Section 1546 of title 18, United States Code, ‘‘(1) grant or order the grant of adjustment SEC. 401. INSTITUTIONAL REMOVAL PROGRAM. of status to that of an alien lawfully admit- is amended— (a) INSTITUTIONAL REMOVAL PROGRAM.— ted for permanent residence; (1) in subsection (a)— (1) CONTINUATION.—The Secretary shall (A) by striking ‘‘not more than 25 years’’ ‘‘(2) grant or order the grant of any other continue to operate the Institutional Re- and inserting ‘‘not less than 25 years’’; status, relief, protection from removal, or moval Program of the Department to— (B) by inserting ‘‘and if the terrorism of- other benefit under the immigration laws; or (A) identify removable criminal aliens in ‘‘(3) issue any documentation evidencing or fense resulted in the death of any person, Federal and State correctional facilities; related to such grant by the Attorney Gen- shall be punished by death or imprisoned for (B) ensure that such aliens are not released eral, the Secretary, or any court, life,’’ after ‘‘section 2331 of this title)),’’; into the community; and (C) by striking ‘‘20 years’’ and inserting until such background and security checks (C) remove such aliens from the United ‘‘imprisoned not more than 40 years’’; as the Secretary may in his discretion re- States after the completion of their sen- (D) by striking ‘‘10 years’’ and inserting quire have been completed to the satisfac- tences. tion of the Secretary.’’. ‘‘imprisoned not more than 20 years’’; and (2) EXPANSION.—Not later than 5 years (E) by striking ‘‘15 years’’ and inserting SEC. 206. RELEASE OF ALIENS FROM NON- after the date of the enactment of this Act, ‘‘imprisoned not more than 30 years’’; and CONTIGUOUS COUNTRIES. the Secretary shall expand the Institutional Section 236(a)(2) of the Immigration and (2) in subsection (b), by striking ‘‘5 years’’ Removal Program to every State. Nationality Act (8 U.S.C. 1226(a)(2)) is and inserting ‘‘10 years’’. (3) STATE PARTICIPATION.—The appropriate amended to read as follows: SEC. 303. INCREASED CRIMINAL PENALTIES FOR officials of each State in which the Sec- ‘‘(2) may release the alien on bond of not CERTAIN CRIMES. retary is operating the Institutional Re- less than $5,000 with security approved by, (1) IN GENERAL.—Title 18, United States moval Program should— and containing conditions prescribed by, the Code, is amended by inserting after chapter (A) cooperate with Federal officials car- Secretary of Homeland Security; but’’. 51 the following: rying out the Institutional Removal Pro- SEC. 207. COUNTRIES THAT DO NOT ACCEPT RE- ‘‘CHAPTER 52—ILLEGAL ALIENS TURN OF NATIONALS. gram; Section 243(d) of the Immigration and Na- ‘‘SEC. 1131. ENHANCED PENALTIES FOR CERTAIN (B) expeditiously and systematically iden- tionality Act (8 U.S.C. 1253(d)) is amended— CRIMES COMMITTED BY ILLEGAL tify criminal aliens in the prison and jail ALIENS. (1) by striking ‘‘On being notified’’ and in- populations of the State; and ‘‘(a) Any alien unlawfully present in the serting the following: (C) promptly convey the information de- United States, who commits, or conspires or ‘‘(1) IN GENERAL.—Upon notification’’; and scribed in subparagraph (B) to the appro- attempts to commit, a crime of violence or a (2) by striking ‘‘Attorney General’’ each priate officials carrying out the Institutional place it appears and inserting ‘‘Secretary of drug trafficking offense (as defined in sec- Removal Program. Homeland Security’’; and tion 924), shall be fined under this title and (b) REPORT TO CONGRESS.—Not later than 2 (3) by adding at the end the following: sentenced to not less than 5 years in prison. years after of the date of the enactment of ‘‘(b) If an alien who violates subsection (a) ‘‘(2) DENIAL OF ADMISSION.—The Secretary this Act, the Secretary shall submit a report of Homeland Security, after making a deter- was previously ordered removed under the to Congress on the participation of the mination that the government of a foreign Immigration and Nationality Act (8 U.S.C. States in the Institutional Removal Pro- country has denied or unreasonably delayed 1101 et seq.) on the grounds of having com- gram. accepting an alien who is a citizen, subject, mitted a crime, the alien shall be sentenced (c) AUTHORIZATION OF APPROPRIATIONS.— national, or resident of that country after to not less than 15 years in prison. There are authorized to be appropriated the alien has been ordered removed, and ‘‘(c) A sentence of imprisonment imposed $50,000,000 to carry out the expanded Institu- after consultation with the Secretary of under this section shall run consecutively to tional Removal Program authorized under State, may deny admission to any citizen, any other sentence of imprisonment imposed subsection (a). for any other crime.’’. subject, national or resident of that country SEC. 402. AUTHORIZATION FOR DETENTION until the country accepts the alien that was (2) CLERICAL AMENDMENT.—The table of AFTER COMPLETION OF STATE OR ordered removed.’’. chapters at the beginning of part I of title 18, LOCAL PRISON SENTENCE. United States Code, is amended by inserting TITLE III—PENALTIES (a) IN GENERAL.—Law enforcement officers after the item relating to chapter 51 the fol- of a State or political subdivision of a State SEC. 301. INCREASED CRIMINAL PENALTIES FOR lowing: ALIEN SMUGGLING. are authorized to— Section 274(a) of the Immigration and Na- 52. Illegal aliens ...... 1131 (1) hold an illegal alien for a period of up tionality Act (8 U.S.C. 1324(a)) is amended— SEC. 304. INCREASED CRIMINAL PENALTIES FOR to 14 days after the alien has completed the (1) in paragraph (1)(B)— CRIMINAL STREET GANGS. alien’s State or local prison sentence in (A) in clause (i), by striking ‘‘10 years’’ and (a) INADMISSIBILITY.—Section 212(a)(2) of order to effectuate the transfer of the alien inserting ‘‘15 years’’; the Immigration and Nationality Act (8 to Federal custody when the alien is remov- (B) in clause (ii), by striking ‘‘5 years’’ and U.S.C. 1182(a)(2)) is amended— able or not lawfully present in the United inserting ‘‘10 years’’; and (1) by redesignating subparagraph (F) as States; or (C) in clause (iii), by striking ‘‘20 years’’ subparagraph (J); and (2) issue a detainer that would allow aliens and inserting ‘‘40 years’’; (2) by inserting after subparagraph (E) the who have served a State or local prison sen- (2) in paragraph (2)— following: tence to be detained by an appropriate prison (A) in subparagraph (A), by striking ‘‘one ‘‘(F) ALIENS WHO ARE MEMBERS OF CRIMINAL until personnel from the Bureau of Immigra- year, or both; or’’ and inserting ‘‘3 years, or STREET GANGS.—Any alien who is determined tion and Customs Enforcement can take the both’’; by a court to be a member of a criminal alien into Federal custody. (B) in subparagraph (B)— street gang (as defined in section 521(a) of (b) REIMBURSEMENT.— (i) in clause (i), by adding at the end the title 18, United States Code) is inadmis- (1) IN GENERAL.—The Secretary shall reim- following: ‘‘be fined under title 18, United sible.’’. burse a State or a political subdivision of a States Code, and imprisoned not less than 5 (b) DEPORTABILITY.—Section 237(a)(2) of the State for all reasonable expenses incurred by years nor more than 25 years;’’; Immigration and Nationality Act (8 U.S.C. the State or the political subdivision for the (ii) in clause (ii), by striking ‘‘or’’ at the 1227(a)(2)) is amended by adding at the end detention of an alien as described in sub- end and inserting the following: ‘‘be fined the following: section (a). under title 18, United States Code, and im- ‘‘(F) ALIENS WHO ARE MEMBERS OF CRIMINAL (2) COST COMPUTATION.—The amount of re- prisoned not less than 3 years nor more than STREET GANGS.—Any alien who is determined imbursement provided for costs incurred car- 20 years; or’’; and by a court to be a member of a criminal rying out subsection (a) shall be determined (iii) in clause (iii), by adding at the end the street gang (as defined in section 521(a) of pursuant to a formula determined by the following: ‘‘be fined under title 18, United title 18, United States Code) is deportable.’’. Secretary. States Code, and imprisoned not more than (c) TEMPORARY PROTECTED STATUS.—Sec- (c) TECHNOLOGY USAGE.—Technology such 15 years; or’’; and tion 244(c)(2)(B) of the Immigration and Na- as videoconferencing shall be used to the (C) by striking the matter following clause tionality Act (8 U.S.C. 1254a(c)(2)(B)) is maximum extent possible in order to make (iii) and inserting the following: amended— the Institutional Removal Program avail- ‘‘(C) in the case of a third or subsequent of- (1) in clause (i), by striking ‘‘or’’ at the able in remote locations. Mobile access to fense described in subparagraph (B) and for end; Federal databases of aliens and live scan any other violation, shall be fined under title (2) in clause (ii), by striking the period at technology shall be used to the maximum ex- 18, United States Code, and imprisoned not the end and inserting ‘‘; or’’; and tent practicable in order to make these re- less than 5 years nor more than 15 years.’’; (3) by adding at the end the following: sources available to State and local law en- (3) in paragraph (3)(A), by striking ‘‘5 ‘‘(iii) the alien is determined by a court to forcement agencies in remote locations. years’’ and inserting ‘‘10 years’’; and be a member of a criminal street gang (as de- (d) AUTHORIZATION OF APPROPRIATIONS.— (4) in paragraph (4), by striking ‘‘10 years’’ fined in section 521(a) of title 18, United There are authorized to be appropriated such and inserting ‘‘20 years’’. States Code).’’. sums as may be necessary to reimburse a

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00034 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.153 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13181 State or political subdivision of a State for of our resources in this country were ASLO, for all of his extensive knowl- the detention of an illegal alien pursuant to targeted at the Southern border. It edge and assistance that helped craft subsection (b). used to be that we had ports of entry at the legislation. SEC. 403. USE OF THE NATIONAL CRIME INFOR- the Northern border where, at night, The bill creates a commission to MATION CENTER DATABASE TO TRACK VIOLATIONS OF IMMIGRA- the only barrier was an orange rubber study the Nation’s policies for inland TION LAW. cone in the middle of the road. The po- waters—a category that would include (a) PROVISION OF INFORMATION TO THE NA- lite people crossing at night actually all lakes, streams, rivers, ground- TIONAL CRIME INFORMATION CENTER.— stopped and removed the cone before waters, estuaries, and fresh- and salt (1) IN GENERAL.—Not later than 1 year after they came across the border. Those water wetlands. The stewardship of the date of enactment of this Act, the Sec- retary shall provide the National Crime In- who were not so polite would run over these resources is essential to human formation Center of the Department of Jus- it at 60 miles an hour. health, the ecosystem, the economy, tice with such information as the Director In 2001, before the September 11 at- agriculture, energy production, and the may have related to— tacks, I proposed something called the transportation sector. (A) any alien against whom a final order of Northern Border Initiative. That bill The National Academy of Sciences, removal has been issued; added hundreds of Customs officers to NAS, issued a report in 2001 describing (B) any alien who is subject to a voluntary the Northern border, and it became that water resources of the United departure agreement that has become in- law. I also worked to replace the or- States will be subjected to more in- valid under section 240B(a)(2) of the Immi- tense and a broader array of pressures gration and Nationality Act (8 U.S.C. 1229c); ange cones with hardened gates. But and we clearly have to do much more. in the 21st century. It found that U.S. (C) any alien whose visa has been revoked. The legislation we are introducing Federal policies and research lack the (2) REQUIREMENT TO PROVIDE AND USE IN- today, which Senator DOMENICI has de- coordination necessary to respond to FORMATION.—The information described in scribed in detail, would devote signifi- increasing future demands. An inland paragraph (1) shall be provided to the Na- cant new resources to our border secu- waters policy commission should be tional Crime Information Center, and the rity. Among other things, this legisla- viewed as an attempt to make sure our Center shall enter the information into the tion would authorize the hiring of an Nation’s clean water laws are achiev- Immigration Violators File of the National additional 1,000 Customs and Border ing what Congress mandated. Water Crime Information Center database if the name and date of birth are available for the Protection inspectors and Immigration policies have been very contentious in individual, regardless of whether the alien and Customs Enforcement officers a many parts of the Nation and have of- received notice of a final order of removal or year for the next five years. It would tentimes pitted people and their liveli- the alien has already been removed. authorize the Department of Homeland hoods against preservation concerns. (3) REMOVAL OF INFORMATION.—Should an Security to work with States to use Only by developing greater water re- individual be granted cancellation of re- National Guard and a volunteer force search and coordinating a comprehen- moval under section 240A of the Immigration of retired law enforcement officers as sive national policy will the conflict and Nationality Act (8 U.S.C. 1229b), or resources to help monitor the borders. between anthropogenic needs and granted permission to legally enter the United States pursuant to the Immigration And it would have the Federal Govern- water preservation be overcome. and Nationality Act after a voluntary depar- ment reimburse State governments for Mr. Chairman, in April of this year, ture under section 240B of the Immigration the cost of detaining undocumented the GAO published a report with find- and Nationality Act (8 U.S.C. 1229c), infor- aliens while decisions are made regard- ings that the administration is not ad- mation entered into the National Crime In- ing possible deportation. dressing the study of water resources, formation Center in accordance with para- This bipartisan proposal is not about agriculture, energy, biological diver- graph (1) of this section shall be promptly re- immigration. It’s about border secu- sity and other areas in relation to cli- moved. rity. We need to do a better job of se- mate change as mandated under the (b) INCLUSION OF INFORMATION IN THE NA- TIONAL CRIME INFORMATION CENTER DATA- curing our borders, and we need to do Global Change Research Act. None of BASE.—Section 534(a) of title 28, United so on an urgent basis. We hope our col- those topics has been addressed in 21 States Code, is amended— leagues will join us, on a bipartisan studies that the Bush administration (1) in paragraph (3), by striking ‘‘and’’ at basis, in supporting this legislation. plans to publish by September 2007, the the end; GAO report found, even though fairly (2) by redesignating paragraph (4) as para- By Ms. SNOWE (for herself and robust climate models are now making graph (5); and Ms. CANTWELL): predictions about changes in rainfall (3) by inserting after paragraph (3) the fol- S. 2050. A bill to establish a commis- globally and nationally as the climate lowing new paragraph: sion on inland waters policy; to the ‘‘(4) acquire, collect, classify, and preserve changes. Water policy currently has no records of violations of the immigration laws Committee on Commerce, Science, and intelligent mechanism for using this of the United States, regardless of whether Transportation. information. The GAO report points the alien has received notice of the violation I rise today to introduce legislation out that a comprehensive study of the or the alien has already been removed; and’’. that creates a national commission on Nation’s water resources is needed. Mr. DORGAN. Mr. President, I am island waters policy to support the The bill authorizes an appropriation pleased to join Senator DOMENICI in in- long-term sustainability of our water of $8.5 million until expended. By com- troducing the Border Security and resources. A 2001 National Academy of parison, the U.S. Commission on Ocean Modernization Act of 2005. Sciences report found that U.S. Federal Policy appropriation was set at a total Senator DOMENICI and I represent policies and research lack the coordi- of up to $6 million for fiscal years 2001 border States, but the bill we are intro- nation necessary to respond to increas- and 2002. ducing today is not one of merely re- ing future demands. The overarching I hope my colleagues will take a gional importance. Border security is goal of this legislation is to rec- close look at this legislation and see an issue that affects our country as a ommend actions that will better co- the great value in supporting the long- whole. We cannot have homeland secu- ordinate and improve the Federal Gov- term sustainability of our Nation’s rity without strong and effective bor- ernment’s water management policies, water resources. der security. similar to the U.S. Commission on I thank the Chair. The Administration has signaled that Ocean Policy, PL 106–256. it wants to have a vigorous debate on My legislation is supported by the By Mr. AKAKA (for himself and border security and immigration issue American Society of Limnology and Mr. INOUYE): early next year. Our bill does not at- Oceanography, ASLO, and the Council S. 2051. A bill to extend eligibility for tempt to change immigration law, but of Scientific Society Presidents, CSSP, certain Federal benefits to citizens of it squarely addresses the border secu- representing 1.4 million scientists and the Freely Associated States; to the rity issue. science educators. I especially want to Committee on Finance. I began working on border security thank Dr. Peter Jumars of the School Mr. AKAKA. Mr. President, I rise long before the attacks of September of Marine Sciences at University of today to introduce legislation with my 11, 2001. The Northern border is over Maine at Orono and Darling Marine senior colleague from Hawaii, Senator 4,000 miles long. In the past, almost all Center and immediate past president of DAN INOUYE, to provide certain Federal

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00035 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.153 S17NOPT2 S13182 CONGRESSIONAL RECORD — SENATE November 17, 2005 public benefits for citizens of the Free- bursement of these costs. It is time for President, the Food Stamp Program ly Associated State, FAS, who are re- the Federal Government to take up serves as the first line of defense siding in the United States. The bill some of the financial responsibility against hunger. It is the cornerstone of would provide eligibility for non- that until now has been carried by the the Federal food assistance program emergency Medicaid, Food Stamps, State of Hawaii, CNMI, Guam, and and provides crucial support to needy Temporary Assistance to Needy Fami- American Samoa by restoring public households and those making the tran- lies, TANF, and Supplemental Security benefits to FAS citizens. sition from welfare to work. We have Income, SSI, to FAS citizens residing This bill would restore eligibility of partially addressed the complicated in the United States. FAS citizens for nonemergency Med- issue of alien eligibility for public ben- Citizens from the FAS are from the icaid. FAS citizens lost many of their efits such as food stamps, but again, I Republic of the Marshall Islands, RMI, public benefits as a result of the Per- must say it is just partial. Not only Federated States of Micronesia, FSM, sonal Responsibility and Work Oppor- should all legal immigrants receive and the Republic of Palau, which are tunity, PRWORA, Act of 1996, including these benefits, but so should citizens of jurisdictions that have a unique polit- Medicaid coverage. FAS citizens were the FAS. Exclusion of FAS citizens ical relationship with the United previously eligible for Medicaid as from Federal, State, or local public States. The Compact of Free Associa- aliens permanently residing under benefits or programs is an unintended tion established these nations as sov- color of law in the United States. and misguided consequence of the wel- ereign states responsible for their own After the enactment of welfare re- fare reform law. We allow certain legal foreign policies. However, the FAS re- form, the State of Hawaii could no immigrants eligibility in the program. main dependent upon the United States longer claim Federal matching funds Yet FAS citizens, who are not consid- for military protection and economic for services rendered to FAS citizens. ered immigrants but who are required assistance. Yet the State of Hawaii, Guam, Amer- to up for the Selective Service if they Under the compact, the United ican Samoa, and the CNMI have con- are residing in the United States are States has the right to reject the stra- tinued to meet the health care needs of ineligible to receiving food stamps. tegic use of, or military access to, the FAS citizens. The State of Hawaii has This bill corrects this inequity. FAS by other countries, which is often used its resources to provide Medicaid Mr. President, I ask unanimous con- referred to as the ‘‘right of strategic services to FAS citizens. sent that the text of the bill be printed denial.’’ In addition, the U.S. may In 2003 alone, the State spent ap- in the RECORD. I also ask unanimous block FAS government policies that it proximately $9.77 million to provide consent that a letter of support I re- deems inconsistent with its duty to de- Medicaid services without receiving ceived last week from Director Lillian fend the FAS, which is referred to as any federal matching funds. This rep- Koller of the State of Hawaii, Depart- the ‘‘defense veto.’’ The compact also resents a dramatic increase from $6.75 ment of Human Services be printed in states that the United States has ex- million in State fiscal year 2002. Fur- the RECORD. I look forward to working with my clusive military base rights in the thermore, the trend in the need for colleagues to enact this measure which FAS. health care services among FAS citi- is of critical importance to my State of In exchange for these prerogatives, zens continues to rise. During fiscal Hawaii, which has borne the costs of the United States is required to sup- year 2004, the number of individuals these benefits for FAS citizens living port the FAS economically, with the served in the State of Hawaii’s Med- goal of producing self-sufficiency, and in Hawaii for the past 19 years. icaid program grew from 3,291 to 4,818 There being no objection, the mate- FAS citizens are allowed free entry people based on the average monthly rials were ordered to be printed in the into the United States as non- enrollment. This is an increase of 46 RECORD, as follows: immigrants for the purposes of edu- percent. S. 2051 cation, medical treatment, and em- This bill would also provide eligi- Be it enacted by the Senate and House of Rep- ployment. Many FAS citizens reside in bility for FAS citizens residing in the resentatives of the United States of America in the State of Hawaii. Since 1997, when United States to participate in the Congress assembled, Hawaii began reporting its impact Temporary Assistance for Needy Fami- SECTION 1. EXCEPTION FOR CITIZENS OF FREE- costs, the State has identified more lies and Supplemental Security Income LY ASSOCIATED STATES. than $140 million in costs associated programs. According to Hawaii’s attor- (a) IN GENERAL.—Section 402(a)(2) of the with FAS citizens. In 2002, the State of ney general, financial assistance in the Personal Responsibility and Work Oppor- Hawaii expended more than $32 million form of the Temporary Assistance to tunity Reconciliation Act of 1996 (8 U.S.C. 1612(a)(2)) is amended by adding at the end in assistance to FAS citizens. P.L. 108– Other Needy Families, TAONF, Pro- the following: 188, the Compact of Free Association gram, a State program, provided $5.1 ‘‘(M) EXCEPTION FOR CITIZENS OF FREELY Amendments Act of 2003, provides $30 million to FAS citizens in State fiscal ASSOCIATED STATES.—With respect to eligi- million in annual funding for compact year 2003. This continues an upward bility for benefits for the specified Federal impact assistance to be shared between trend from $4.5 million in State fiscal programs described in paragraph (3), para- the State of Hawaii, Guam, the Com- year 2002. This total includes funds graph (1) shall not apply to any individual monwealth of the Northern Mariana Is- that go to the General Assistance Pro- who lawfully resides in the United States lands, CNMI, and American Samoa. gram, which supports individuals and (including territories and possessions of the United States) in accordance with— While this funding is a positive step couples with little or no income and ‘‘(i) section 141 of the Compact of Free As- forward, it does not begin to reimburse who have a temporary, incapacitating sociation between the Government of the the affected jurisdictions for the costs medical condition; the aged, blind, and United States and the Government of the associated with FAS citizens. disabled program for FAS citizens with Federated States of Micronesia, approved by This legislation would provide assist- little or no income who are not eligible Congress in the Compact of Free Association ance to states and territories that for federally-funded Supplemental Se- Amendments Act of 2003; shoulder the majority of the costs asso- curity Income; and the State’s TAONF ‘‘(ii) section 141 of the Compact of Free As- ciated with the compact. The Federal Program that assists other needy fami- sociation between the Government of the Government must provide appropriate United States and the Government of the Re- lies who are not eligible for federal- public of the Marshall Islands, approved by resources to help States meet the needs funding under the Temporary Assist- Congress in the Compact of Free Association of the FAS citizens—an obligation ance to Needy Families program. The Amendments Act of 2003; or based on a Federal commitment. It is financial assistance that the State of ‘‘(iii) section 141 of the Compact of Free unconscionable for a State or territory Hawaii provides to FAS citizens in the Association between the Government of the to shoulder the entire financial burden form of TAONF is a great support to United States and the Government of Palau, of providing necessary educational, those families attempting to achieve approved by Congress in Public Law 99–658 medical, and social services to individ- economic stability, but it has a signifi- (100 Stat. 3672).’’. (b) MEDICAID AND TANF EXCEPTIONS.—Sec- uals who are residing in that State or cant financial impact on the State’s tion 402(b)(2) of the Personal Responsibility territory when the obligation is that of budget. and Work Opportunity Reconciliation Act of the Federal Government. For that rea- The bill would also provide eligibility 1996 (8 U.S.C. 1612(b)(2)) is amended by adding son, we are seeking to provide reim- for the Food Stamp Program. Mr. at the end the following:

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00036 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.162 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13183

‘‘(G) MEDICAID AND TANF EXCEPTIONS FOR Allowing Compact migrants to be served S. RES. 319 CITIZENS OF FREELY ASSOCIATED STATES.— with Federal funds under the TANF, SSI, Whereas on October 8, 2005, a magnitude 7.6 With respect to eligibility for benefits for Food Stamps, and Medicaid programs would earthquake struck Pakistan, India, and Af- the programs defined in subparagraphs (A) tremendously assist the State of Hawaii. I ghanistan; and (C) of paragraph (3) (relating to tem- appreciate your leadership in this area and Whereas the epicenter of the earthquake porary assistance for needy families and look forward to continuing to work with you was located near Muzaffarabad, the capital medicaid), paragraph (1) shall not apply to on your legislative efforts to assist Compact of Pakistani-administered Kashmir, and ap- any individual who lawfully resides in the migrants in Hawaii. proximately 60 miles north-northeast of United States (including territories and pos- Sincerely, Islamabad, with aftershocks and landslides sessions of the United States) in accordance LILLIAN B. KOLLER, Esq. continuing to affect the area; with a Compact of Free Association referred Director. Whereas the most affected areas are the to in subsection (a)(2)(M).’’. North West Frontier Province, Northern (c) QUALIFIED ALIEN.—Section 431(b) of the f Punjab, Pakistani-administered Kashmir, Personal Responsibility and Work Oppor- and Indian-administered Kashmir; tunity Reconciliation Act of 1996 (8 U.S.C. SUBMITTED RESOLUTIONS Whereas more than 75,000 people have died, 1641(b)) is amended— nearly 70,000 are injured, and approximately (1) in paragraph (6), by striking ‘‘or’’ at the 2,900,000 people are homeless as a result of end; SENATE RESOLUTION 318—DESIG- the earthquake, and, according to the Execu- (2) in paragraph (7), by striking the period NATING NOVEMBER 27, 2005, AS tive Director of the United Nations Chil- at the end and inserting ‘‘; or’’; and ‘‘DRIVE SAFER SUNDAY’’ dren’s Fund (UNICEF), 17,000 of the dead are (3) by adding at the end the following: children; ‘‘(8) an individual who lawfully resides in Mr. CHAMBLISS (for himself and Mr. Whereas the United States has pledged a the United States (including territories and ISAKSON) submitted the following reso- total of $156,000,000 to provide assistance in possessions of the United States) in accord- lution; which was referred to the Com- the affected countries, with $50,000,000 to be ance with a Compact of Free Association re- mittee on the Judiciary: used for humanitarian relief, $50,000,000 to be ferred to in section 402(a)(2)(M).’’. used for reconstruction, and $56,000,000 to be (d) CONFORMING AMENDMENT.—Section 1108 S. RES. 318 used to support Department of Defense relief of the Social Security Act (42 U.S.C. 1308) is Whereas motor vehicle travel is the pri- operations; amended— mary means of transportation in the United Whereas the total amount of humanitarian (1) in subsection (f), in the matter pre- States; assistance committed to Pakistan by the ceding paragraph (1), by striking ‘‘subsection Whereas everyone on the roads and high- United States Agency for International De- (g)’’ and inserting ‘‘subsections (g) and (h)’’; ways needs to drive more safely to reduce velopment is more than $40,000,000; and deaths and injuries resulting from motor ve- Whereas the Department of Defense has de- (2) by adding at the end the following: hicle accidents; ployed approximately 875 members of the ‘‘(h) The limitations of subsections (f) and Whereas the death of almost 43,000 people a Armed Forces and 31 helicopters to aid in the (g) shall not apply with respect to medical year in more than 6 million highway crashes earthquake relief efforts; assistance provided to an individual de- in America has been called an epidemic by Whereas since October 8, 2005, United scribed in section 431(b)(8) of the Personal Transportation Secretary Norman Mineta; States helicopters have flown more than Responsibility and Work Opportunity Rec- Whereas according to the National High- 1,000 missions, evacuated approximately 3,400 onciliation Act of 1996.’’. way Transportation Safety Administration, people, and delivered nearly 5,600,000 pounds (e) EFFECTIVE DATE.—The amendments wearing a seat belt saved 15,434 lives in 2004; of supplies; made by this Act take effect on the date of and Whereas the delivery of humanitarian as- enactment of this Act and apply to benefits Whereas the Sunday after Thanksgiving is sistance to the affected areas is difficult due and assistance provided on or after that the busiest highway traffic day of the year: to the mountainous terrain, cold weather, date. Now, therefore, be it and damaged or collapsed infrastructure; Resolved, That the Senate— Whereas Secretary of State Condoleezza STATE OF HAWAII, (1) encourages— Rice, during her October 12, 2005, visit to DEPARTMENT OF HUMAN SERVICES, (A) high schools, colleges, universities, ad- Pakistan, said the United States would sup- Honolulu, HI, November 9, 2005. ministrators, teachers, primary schools, and port the efforts of the Government of Paki- Sen. DANIEL K. AKAKA, secondary schools to launch campus-wide stan over the long-term to provide assistance U.S. Senate, Hart Senate Office Building, educational campaigns to urge students to to the victims of the earthquake and rebuild Washington, DC. be careful about safety when driving; areas of the country devastated by the earth- DEAR SENATOR AKAKA, I am writing in sup- (B) national trucking firms to alert their quake; port of your legislation to reinstate eligi- drivers to be especially focused on driving Whereas the cost of rebuilding the affected bility for Compact migrants from the Freely safely during the heaviest traffic day of the areas could be in excess of $1,000,000,000; and Associated States for various Federal pro- year, and to publicize the importance of the Whereas the recovery and reconstruction grams, including Temporary Assistance for day using Citizen’s band (CB) radios and in of the areas devastated by the earthquake Needy Families (TANF), Supplemental Secu- truck stops across the Nation; will require the concerted leadership of the rity Income (SSI), Food Stamps, and Med- (C) clergy to remind their members to United States working with the governments icaid. As you know, ‘‘Compact migrants’’ re- travel safely when attending services and of the affected countries and the inter- fers to those who have relocated to Hawaii gatherings; national community: Now, therefore, be it from the Republic of Palau, the Federated (D) law enforcement personnel to remind Resolved, That the Senate— States of Micronesia, and the Republic of the drivers and passengers to drive particularly (1) commends the members of the United Marshall Islands. As you know, a high per- safely on the Sunday after Thanksgiving; States Armed Forces and civilian employees centage of the Compact migrant population and of the Department of State and the United are poorly educated and live in poverty, and (E) everyone to use the Sunday after States Agency for International Develop- are thus part of the additional demand on Thanksgiving as an opportunity to educate ment for taking swift action to assist the the already strained social support systems themselves about highway safety; and victims of the earthquake in South Asia that of the State. (2) designates November 27, 2005, as ‘‘Drive occurred on October 8, 2005; The Department of Human Services is the (2) commends the international relief ef- Safer Sunday’’. lead agency that administers social safety fort that includes the work of individual net programs for individuals and families in f countries, numerous international organiza- Hawaii. The amount of State resources that tions, and various relief and nongovern- is being expended to care for Compact mi- SENATE RESOLUTION 319—COM- mental entities; grants has been steadily increasing as the MENDING RELIEF EFFORTS IN (3) commends the Governments of Paki- number of migrants continues to grow. The RESPONSE TO THE EARTHQUAKE stan and India for their cooperation in the costs to the State cannot be measured in the IN SOUTH ASIA AND URGING A common cause of saving lives and providing numbers of migrants alone. What is not re- humanitarian relief to people on both sides flected in the numbers of migrants alone, is COMMITMENT BY THE UNITED of the Line of Control; that many of these migrants come to Hawaii STATES AND THE INTER- (4) encourages further cooperation between with serious medical conditions that require NATIONAL COMMUNITY TO HELP Pakistan and India on relief operations and costly intensive and extensive services. In REBUILD CRITICAL INFRASTRUC- efforts to fortify and expand peace and sta- 2004, the Department of Human Services TURE IN THE AFFECTED AREAS bility in the region as they cope with the im- alone spent over $26.6 million to provide pact of the earthquake during the winter of services to over 10,800 migrants in our finan- Ms. MIKULSKI submitted the fol- 2005 and the spring of 2006 and seek to reha- cial assistance, medical assistance, voca- lowing resolution; which was referred bilitate the lives of those affected; tional rehabilitation, and youth services pro- to the Committee on Foreign Rela- (5) urges the United States and the world grams. tions: community to reaffirm their commitment to

VerDate Aug 31 2005 01:49 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00037 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.164 S17NOPT2 S13184 CONGRESSIONAL RECORD — SENATE November 17, 2005 additional generous support for relief and eign Operations Act to help meet the health center patients enrolled in Medicaid long-term reconstruction efforts in areas af- immediate, emergency need for med- compared to 12 percent nationally; fected by the earthquake; and ical care and shelter. The nearly 3 mil- Whereas in 1989, Congress established the services of the Federally-qualified health (6) urges continued attention by inter- lion Pakistanis left homeless by the national donors and relief agencies to the center (FQHC) program as a guaranteed ben- needs of vulnerable populations in the earthquake are already facing snow efit under Medicaid to protect the valuable stricken countries, particularly the thou- and freezing rain. Conservative esti- resources intended to assist health centers in sands of children who have been left mates suggest another 80,000 people caring for the uninsured; parentless and homeless by the disaster. could die from exposure in the next few Whereas health centers have doubled the Ms. MIKULSKI. Mr. President, today months without a massive effort to number of uninsured people served since 1989, a growth rate more than twice that of the I am submitting a resolution com- provide thousands of heated tents. uninsured population of the United States; mending relief efforts in response to Those people can not afford to wait for Whereas health centers provided 17 percent the earthquake in South Asia and urg- the next supplemental appropriations of all Medicaid and State Health Insurance ing a commitment by the United bill—we must act now. Program office visits in 2001; States and the international commu- The United States should also engage Whereas Medicaid on average contributes nity to help rebuild critical infrastruc- 36 percent of a health center’s budget, with with the international community to the remainder provided by Federal grants, ture in the affected areas. boost relief and recovery efforts. The State and local governments, Medicare, pri- On October 8, 2005, a devastating United Nations has already responded, vate contributions, private insurance, and magnitude 7.6 earthquake hit remote convening a donors’ conference to orga- patient fees; mountainous regions of northern Af- nize international relief efforts. Eco- Whereas the cost of treating health center ghanistan, Pakistan and India. More nomic institutions like the World Bank Medicaid patients is 30 to 34 percent less than 75,000 people have died, nearly than the cost of treating those that receive and the Paris Club can assist long-term care elsewhere, and similarly, 26 to 40 per- 70,000 have been injured and 2.8 million recovery efforts by re-examining their cent lower for prescription drug costs, 35 per- remain homeless. On a bipartisan basis, debt policy toward the affected coun- cent lower for diabetics, and 20 percent lower the President and members of Congress tries. And members of NATO and the for asthmatics; joined the world community in express- European Union must step-up their Whereas health center Medicaid patients ing our sympathy and pledging our as- support for relief and recovery. NATO are 22 percent less likely to be hospitalized sistance to help those suffering in the for conditions that were potentially avoid- in particular has unique assets that able than those obtaining care elsewhere; face of this terrible disaster. can make a difference today for people Whereas a bipartisan majority of Congress But expressions of sympathy are not on the ground in South Asia. in 2000 established a prospective payment enough. The United States must set an I also believe the United States system (PPS) to ensure that Federally-quali- example and lead the world in the hu- should make a long-term investment in fied health centers receive sufficient Med- manitarian effort of recovery and re- rebuilding the areas devastated by the icaid funding, thereby striking a balance be- tween protecting the Federal investment in building. That’s why I supported the earthquake. We have strong partner- initial pledge of $156 million in human- health centers and providing State flexi- ships with the nations of South Asia, bility in designing the payment system for itarian aid from the United States. and we have strong affection for their these centers; The Department of Defense, the people. We must commit to work with Whereas the prospective payment system State Department and the U.S. Agency our friends for as long as it takes to has allowed States to appropriately predict for International Development help them rebuild their infrastructure, and budget the cost of health center Med- icaid expenditures; (USAID) have taken the lead in making with a particular emphasis on boosting good on that pledge. USAID has pro- Whereas the prospective payment system medical resources for a health care sys- has allowed health centers to provide and ex- vided more than $50.1 million in assist- tem now overwhelmed by caring for the pand primary care services to more people in ance to Pakistan and more than weak and injured. need, while promoting efficient operation of $600,000 to India. The Defense Depart- The people and governments of Paki- and ensuring adequate Medicaid reimburse- ment has so far spent about $56 million stan, India and Afghanistan must know ment for these centers; Whereas without the assurance of suffi- on relief efforts, including sending that the United States will be an un- more than 1,000 troops into Pakistan to cient Medicaid funding under the prospective wavering partner in their recovery and payment system, health centers would be provide urgent medical care, delivering reconstruction. Our U.S. military and forced to cross-subsidize Medicaid underpay- much-needed supplies and clearing the employees of the State Department ments with Federal grant dollars intended to roads and opening routes for ground and USAID are working hard to extend care for the uninsured; transportation so more help can reach support to our friends in this terrible Whereas if the PPS were eliminated or changed, entire communities could be left those most in need. time of need. We thank them for their The American private sector has also without any access to primary and preven- service and pledge that we, too, will do tive health care services, thus undoing dec- pitched in. U.S. charities have raised our part. ades of investment by Congress in providing more than $21 million to support earth- a health care safety net; quake relief efforts. Non-government f Whereas health centers provide cost-effec- organizations like Catholic Relief SENATE CONCURRENT RESOLU- tive, high-quality health care to the poor of Services, Mercy Corps and Save the TION 65—RECOGNIZING THE BEN- the Nation and the medically underserved, including the working poor, the uninsured, Children all have a presence in Paki- EFITS AND IMPORTANCE OF stan and are providing aid and relief. and many high-risk and vulnerable popu- FEDERALLY-QUALIFIED HEALTH lations; and At President Bush’s request, five major CENTERS AND THEIR MEDICAID Whereas health centers act as a vital safe- American corporations are encouraging PROSPECTIVE PAYMENT SYSTEM ty net in the health delivery system of the additional private donations. General Nation, meeting escalating health needs, and Electric, Pfizer, Citigroup, Xerox and Mr. BURR (for himself, Mr. OBAMA, reducing health disparities: Now, therefore, UPS are coordinating a nationwide Mr. BINGAMAN, Mr. BOND, Mr. KERRY, be it fund raising effort through the South Mr. SMITH, Mr. SALAZAR, Mr. SCHUMER, Resolved by the Senate (the House of Rep- resentatives concurring), That— Asia Earthquake Relief Fund. To date, Mr. DURBIN, Ms. COLLINS, and Ms. SNOWE) submitted the following con- (1) it is the sense of Congress that the Med- more than $46 million has been donated icaid prospective payment system for the by American corporations. current resolution; which was referred to the Committee on Finance: Federally-qualified health center program is As Americans, we can all be proud of critical to ensuring that both Medicaid re- these efforts to help the people of S. CON. RES. 65 cipients and the uninsured population of the South Asia survive, recover and re- Whereas community, migrant, public hous- Nation have access to quality affordable pri- build. I applaud President Bush and his ing, and homeless health centers form the mary and preventive care services; and administration for acting quickly to backbone of the health care safety net of the (2) Congress recognizes the critical role of United States, providing health care to near- health centers as an essential source of provide relief and support. But I know ly 6,000,000 of the 53,000,000 people enrolled in health care for millions of Medicaid recipi- that, together, we can do better. the Medicaid Program nationwide; ents and uninsured Americans and supports That’s why I support the immediate Whereas health center patients are more continuation of the prospective payment sys- reprogramming by USAID of assistance likely than the general population to be en- tem in helping to maintain this system of funds for Pakistan in the FY 2006 For- rolled in Medicaid, with 36 percent of all health care.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00038 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.166 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13185 Mr. OBAMA. Mr. President, today, SENATE CONCURRENT RESOLU- amendment intended to be proposed by him Senator BURR and I are introducing a TION 66—AFFIRMING THAT THE to the bill S. 2020, supra; which was ordered INTENT OF CONGRESS IN PASS- to lie on the table. resolution that reaffirms the impor- SA 2600. Mr. SHELBY proposed an amend- tance of the Medicaid prospective pay- ING THE NATIONAL WILDLIFE ment to the bill S. 467, to extend the applica- ment system for federally qualified REFUGE SYSTEM IMPROVEMENT bility of the Terrorism Risk Insurance Act of health centers. ACT OF 1997 WAS TO ALLOW 2002. HUNTING AND FISHING ON PUB- SA 2601. Mr. NELSON of Florida (for him- Federally qualified health centers— LIC LAND WITHIN THE NA- self, Mr. DORGAN, Mr. LEAHY, Mr. SCHUMER, community, migrant, public housing, TIONAL WILDLIFE REFUGE SYS- Mr. DAYTON, Ms. STABENOW, Mr. KOHL, Mrs. and homeless health centers—form the TEM AND DECLARING THAT THE MURRAY, Mr. OBAMA, Mrs. CLINTON, Ms. PURPOSE OF RESERVING CER- LANDRIEU, Mr. HARKIN, and Mr. DURBIN) sub- backbone of the Nation’s health care mitted an amendment intended to be pro- safety net. FQHC’s provide cost-effec- TAIN LAND AS PUBLIC LAND IS posed by him to the bill S. 2020, to provide tive, high-quality health care to the TO MAKE THE LAND AVAILABLE for reconciliation pursuant to section 202(b) Nation’s poor and medically under- TO THE PUBLIC FOR REASON- of the concurrent resolution on the budget served, including the working poor, the ABLE USES for fiscal year 2006. Mr. VITTER submitted the following SA 2602. Mr. CONRAD proposed an amend- uninsured, and many high-risk and vul- ment to the bill S. 2020, supra. nerable populations. concurrent resolution; which was re- SA 2603. Mr. PRYOR submitted an amend- ferred to the Committee on Energy and Federally qualified health centers ment intended to be proposed by him to the Natural Resources: bill S. 2020, supra; which was ordered to lie serve nearly 1 of 5 low-income children. S. CON. RES. 66 on the table. Two-thirds of health center patients Whereas hunting and fishing have a long SA 2604. Mrs. CLINTON (for herself and Mr. are members of racial and ethnic mi- and distinguished history in the United OBAMA) submitted an amendment intended nority groups. And over 675,000 home- States; to be proposed by her to the bill S. 2020, Whereas hunting and fishing remain an im- supra; which was ordered to lie on the table. less persons receive care at health cen- portant part of the lifestyle and culture of SA 2605. Mr. OBAMA (for himself, Mr. ters every year. people from many different areas of the COBURN, Mr. LAUTENBERG, Ms. SNOWE, Mr. FQHC’s play a particularly critical country and from all walks of life; JOHNSON, and Mr. ENSIGN) submitted an Whereas sportsmen and sportswomen have amendment intended to be proposed by him role in serving patients enrolled in worked for decades to ensure that public to the bill S. 2020, supra. Medicaid. Health centers provide care land and other land that is used for hunting SA 2606. Mr. KERRY (for himself and Mr. to nearly 6 million of the 53 million and fishing is cared for, protected, and pre- WYDEN) submitted an amendment intended people enrolled in the Medicaid Pro- served; to be proposed by him to the bill S. 2020, Whereas the land that makes up the Na- supra; which was ordered to lie on the table. gram nationwide. Thirty-six percent of tional Wildlife Refuge System has been wide- SA 2607. Mr. SUNUNU submitted an all FQHC patients are Medicaid bene- ly used for hunting, fishing, and other sport- amendment intended to be proposed by him ficiaries compared to 12 percent na- ing purposes; to the bill S. 2020, supra; which was ordered Whereas in 1997, Congress passed the Na- tionally. Notably, the cost of treating to lie on the table. tional Wildlife Refuge System Improvement SA 2608. Ms. MURKOWSKI (for herself, Mr. Medicaid patients at FQHCs is about Act of 1997 (Public Law 105–57; 111 Stat. 1252), JOHNSON, and Mr. BINGAMAN) submitted an one-third less than the cost for those which clearly and directly stated that hunt- amendment intended to be proposed by her receiving care elsewhere, with drug ing and fishing, as wildlife-dependent rec- to the bill S. 2020, supra; which was ordered reational activities, could be considered costs alone about 25 percent lower. to lie on the table. compatible uses of public land, including SA 2609. Mrs. FEINSTEIN (for herself, Mr. In 2000, a bipartisan majority of the land within the National Wildlife Refuge SUNUNU, Mr. GREGG, Mr. WYDEN, Ms. CANT- Congress established a prospective pay- System; and WELL, Mr. FEINGOLD, Mr. BURR, Mr. MCCAIN, Whereas the National Wildlife Refuge Sys- ment system, or PPS, to ensure that Mr. KERRY, Ms. COLLINS, and Mrs. CLINTON) tem Improvement Act of 1997 (Public Law proposed an amendment to the bill S. 2020, FQHC’s receive fair Medicaid reim- 105–57; 111 Stat. 1252) passed by a vote of 419– supra. bursement. This system strikes a bal- 1, demonstrating the nonpartisan nature of SA 2610. Mrs. FEINSTEIN (for herself and the legislation and the tremendous amount ance between protecting Federal in- Mr. KERRY) proposed an amendment to the of support the legislation enjoyed: Now, vestment in such health centers and al- bill S. 2020, supra. therefore, be it SA 2611. Mr. SCHUMER (for himself, Mr. lowing State flexibility in designing Resolved by the Senate (the House of Rep- LAUTENBERG, Mrs. FEINSTEIN, Mr. FEINGOLD, resentatives concurring), That— the payment system for these centers. Mrs. CLINTON, Mr. KERRY, Mr. LIEBERMAN, (1) in passing the National Wildlife Refuge The PPS allows health centers to pro- Mr. SALAZAR, Mrs. BOXER, Ms. STABENOW, System Improvement Act of 1997 (Public Law Ms. MIKULSKI, Mr. KOHL, and Mr. KENNEDY) vide and expand primary care services 105–57; 111 Stat. 1252), Congress demonstrated submitted an amendment intended to be pro- to more people in need, promotes effi- its clear intent to allow hunting and fishing posed by him to the bill S. 2020, supra; which on the public land within the National Wild- cient operation of FQHC’s, and ensures was ordered to lie on the table. life Refuge System; they receive adequate Medicaid reim- SA 2612. Ms. CANTWELL (for herself, Mr. (2) the intent of Congress has not changed BAYH, Mr. LIEBERMAN, Mr. SCHUMER, Mrs. bursement. in any way since the date of enactment of BOXER, Mr. CARPER, Mrs. CLINTON, Mr. that Act, and any assumption to the con- Today, PPS has allowed health cen- SALAZAR, Mr. KOHL, Mrs. MURRAY, Ms. trary is misguided and misinterprets the ters to provide quality health care to STABENOW, and Mrs. FEINSTEIN) proposed an clear intent of Congress; and nearly 15 million people nationally, amendment to the bill S. 2020, supra (3) the general purpose of reserving certain SA 2613. Mr. KENNEDY (for himself, Mr. while also delivering significant cost land as public land, including the land with- BINGAMAN, Mr. LEVIN, Mr. DURBIN, and Ms. savings to the Medicaid Program. Con- in the National Wildlife Refuge System, is to MIKULSKI) submitted an amendment in- gress should recognize the critical role make the land available to the public for tended to be proposed by him to the bill S. of such health centers as the primary reasonable uses, including hunting, fishing, 2020, supra; which was ordered to lie on the other wildlife-dependent sports, and other table. source of care for millions of Medicaid outdoor purposes. recipients and uninsured Americans SA 2614. Mr. PRYOR submitted an amend- f ment intended to be proposed by him to the and support continuation of the pro- AMENDMENTS SUBMITTED AND bill S. 2020, supra; which was ordered to lie spective payment system. on the table. PROPOSED SA 2615. Ms. COLLINS submitted an SA 2598. Mr. LAUTENBERG submitted an amendment intended to be proposed by her amendment intended to be proposed by him to the bill S. 2020, supra; which was ordered to the bill S. 2020, to provide for reconcili- to lie on the table. ation pursuant to section 202(b) of the con- SA 2616. Mr. KERRY (for himself and Mr. current resolution on the budget for fiscal OBAMA) submitted an amendment intended year 2006; which was ordered to lie on the to be proposed by him to the bill S. 2020, table. supra. SA 2599. Mr. CONRAD (for himself, Mr. SA 2617. Mr. SANTORUM submitted an DORGAN, and Mr. SMITH) submitted an amendment intended to be proposed by him

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00039 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.126 S17NOPT2 S13186 CONGRESSIONAL RECORD — SENATE November 17, 2005 to the bill S. 2020, supra; which was ordered 2020, supra; which was ordered to lie on the to the bill S. 2020, supra; which was ordered to lie on the table. table. to lie on the table. SA 2618. Mr. SANTORUM submitted an SA 2638. Mr. BUNNING submitted an SA 2660. Mr. DODD (for himself and Ms. MI- amendment intended to be proposed by him amendment intended to be proposed by him KULSKI) submitted an amendment intended to the bill S. 2020, supra; which was ordered to the bill S. 2020, supra; which was ordered to be proposed by him to the bill S. 2020, to lie on the table. to lie on the table. supra; which was ordered to lie on the table. SA 2619. Mrs. HUTCHISON submitted an SA 2639. Mr. ROCKEFELLER submitted an SA 2661. Mr. DAYTON submitted an amendment intended to be proposed by her amendment intended to be proposed by him amendment intended to be proposed by him to the bill S. 2020, supra; which was ordered to the bill S. 2020, supra; which was ordered to the bill S. 2020, supra; which was ordered to lie on the table. to lie on the table. to lie on the table. SA 2620. Ms. SNOWE (for herself and Mr. SA 2640. Mr. ROCKEFELLER submitted an SA 2662. Ms. COLLINS submitted an SCHUMER) submitted an amendment intended amendment intended to be proposed by him amendment intended to be proposed by her to be proposed by her to the bill S. 2020, to the bill S. 2020, supra; which was ordered to the bill S. 2020, supra; which was ordered supra; which was ordered to lie on the table. to lie on the table. to lie on the table. SA 2621. Ms. SNOWE submitted an amend- SA 2641. Mr. BINGAMAN submitted an SA 2663. Mr. HATCH submitted an amend- ment intended to be proposed by her to the amendment intended to be proposed by him ment intended to be proposed by him to the bill S. 2020, supra; which was ordered to lie to the bill S. 2020, supra; which was ordered bill S. 2020, supra; which was ordered to lie on the table. to lie on the table. on the table. SA 2622. Ms. MURKOWSKI (for herself and SA 2642. Mr. BINGAMAN (for himself, Mr. SA 2664. Mr. LEVIN submitted an amend- Mr. STEVENS) submitted an amendment in- KERRY, and Ms SNOWE) submitted an amend- ment intended to be proposed by him to the tended to be proposed by her to the bill S. ment intended to be proposed by him to the bill S. 2020, supra; which was ordered to lie 2020, supra; which was ordered to lie on the bill S. 2020, supra. on the table. table. SA 2643. Ms. LANDRIEU submitted an SA 2665. Mr. HARKIN (for himself and Mr. amendment intended to be proposed by her SA 2623. Mr. DURBIN (for himself and Mr. OBAMA) submitted an amendment intended OBAMA) submitted an amendment intended to the bill S. 2020, supra; which was ordered to be proposed by him to the bill S. 2020, to be proposed by him to the bill S. 2020, to lie on the table. supra. supra. SA 2644. Ms. LANDRIEU submitted an SA 2666. Mr. PRYOR (for himself and Mr. amendment intended to be proposed by her SA 2624. Mr. LEAHY (for himself, Mr. BEN- COLEMAN) submitted an amendment intended to the bill S. 2020, supra; which was ordered NETT, Mr. DOMENICI, Mr. SCHUMER, Mr. KEN- to be proposed by him to the bill S. 2020, to lie on the table. NEDY, Mr. BINGAMAN, Mr. LIEBERMAN, Mr. supra; which was ordered to lie on the table. SA 2645. Mr. COLEMAN (for himself and JOHNSON, Mr. WARNER, Mr. SANTORUM, and SA 2667. Ms. SNOWE (for herself, Mr. Mr. PRYOR) submitted an amendment in- Mr. COLEMAN) submitted an amendment in- BINGAMAN, Ms. COLLINS, and Mr. REED) pro- tended to be proposed by him to the bill S. tended to be proposed by him to the bill S. posed an amendment to the bill S. 2020, 2020, supra; which was ordered to lie on the 2020, supra; which was ordered to lie on the supra. table. table. SA 2668. Mr. DORGAN submitted an SA 2646. Ms. MURKOWSKI submitted an SA 2625. Mr. NELSON of Nebraska (for amendment intended to be proposed by him amendment intended to be proposed by her himself, Mr. DEWINE, and Ms. COLLINS) pro- to the bill S. 2020, supra; which was ordered to the bill S. 2020, supra; which was ordered posed an amendment to the bill S. 2020, to lie on the table. to lie on the table. supra. SA 2647. Mr. GRASSLEY (for himself and SA 2669. Ms. LANDRIEU (for herself and SA 2626. Mr. REED (for himself, Mr. KEN- Mr. VITTER) proposed an amendment to the Mr. BAUCUS) proposed an amendment to the NEDY, Mr. SCHUMER, Mr. KOHL, Mr. ROCKE- bill S. 2020, supra. bill S. 2020, supra. FELLER, Mr. KERRY, Mr. CARPER, Mr. LEAHY, SA 2648. Mr. ROBERTS submitted an SA 2670. Mr. GRASSLEY (for himself and Mr. DAYTON, Mr. LIEBERMAN, and Ms. amendment intended to be proposed by him Mr. BAUCUS) proposed an amendment to the STABENOW) proposed an amendment to the to the bill S. 2020, supra; which was ordered bill S. 2020, supra. bill S. 2020, supra. to lie on the table. SA 2671. Mr. FRIST (for Mr. ENZI) proposed SA 2627. Mr. GRAHAM submitted an SA 2649. Mr. MARTINEZ (for himself and an amendment to the bill S. 1418, to enhance amendment intended to be proposed by him Mr. NELSON, of Florida) submitted an amend- the adoption of a nationwide inter operable to the bill S. 2020, supra; which was ordered ment intended to be proposed by him to the health information technology system and to lie on the table. bill S. 2020, supra; which was ordered to lie to improve the quality and reduce the costs SA 2628. Mr. LEVIN (for himself, Mr. COLE- on the table. of health care in the United States. MAN, and Mr. OBAMA) submitted an amend- SA 2650. Mr. FEINGOLD (for himself, Mr. f ment intended to be proposed by him to the CONRAD, Mr. CHAFEE, Mr. OBAMA, and Mr. bill S. 2020, supra; which was ordered to lie SALAZAR) proposed an amendment to the bill TEXT OF AMENDMENTS on the table. S. 2020, supra. SA 2598. Mr. LAUTENBERG sub- SA 2629. Mr. DAYTON (for himself and Mr. SA 2651. Mr. SUNUNU proposed an amend- SALAZAR) submitted an amendment intended mitted an amendment intended to be ment to the bill S. 2020, supra. proposed by him to the bill S. 2020, to to be proposed by him to the bill S. 2020, SA 2652. Mrs. LINCOLN (for herself, Ms. supra. SNOWE, Mr. OBAMA, and Mr. ROCKEFELLER) provide for reconciliation pursuant to SA 2630. Mr. SCHUMER (for himself and submitted an amendment intended to be pro- section 202(b) of the concurrent resolu- Mr. WYDEN) submitted an amendment in- posed by her to the bill S. 2020, supra. tion on the budget for fiscal year 2006; tended to be proposed by him to the bill S. SA 2653. Mr. BAUCUS (for Mr. REID (for which was ordered to lie on the table; 2020, supra; which was ordered to lie on the himself, Mr. KERRY, Mr. LAUTENBERG, Ms. as follows: table. SNOWE, Mr. SALAZAR, Mr. BINGAMAN, Mr. At the end of title IV, insert the following: SA 2631. Ms. LANDRIEU submitted an JEFFORDS, Mr. BAYH, Mrs. CLINTON, Mr. HAR- SEC. ll. COMPUTATION OF LIMITS ON IRA AND amendment intended to be proposed by her KIN, Mrs. FEINSTEIN, and Ms. COLLINS)) pro- ROTH IRA CONTRIBUTIONS. to the bill S. 2020, supra; which was ordered posed an amendment to the bill S. 2020, (a) CERTAIN WAGE REPLACEMENT INCOME to lie on the table. supra. SA 2632. Mr. LOTT (for himself and Mr. SA 2654. Mr. GRASSLEY proposed an TREATED AS COMPENSATION.— BAUCUS) submitted an amendment intended amendment to the bill S. 2020, supra. (1) WAGE REPLACEMENT INCOME.—Section to be proposed by him to the bill S. 2020, SA 2655. Mr. CRAIG (for himself and Mr. 219(f) (relating to other definitions and spe- supra; which was ordered to lie on the table. ROCKEFELLER) submitted an amendment in- cial rules) is amended by adding at the end SA 2633. Mr. LOTT submitted an amend- tended to be proposed by him to the bill S. the following new paragraph: ment intended to be proposed by him to the 2020, supra. ‘‘(8) TREATMENT OF CERTAIN WAGE REPLACE- bill S. 2020, supra. SA 2656. Ms. SNOWE (for herself and Ms. MENT INCOME AS COMPENSATION.— SA 2634. Mrs. BOXER (for herself and Mr. COLLINS) submitted an amendment intended ‘‘(A) IN GENERAL.—Notwithstanding para- SCHUMER) submitted an amendment intended to be proposed by her to the bill S. 2020, graph (1), applicable wage replacement in- to be proposed by her to the bill S. 2020, supra; which was ordered to lie on the table. come not otherwise treated as compensation supra. SA 2657. Mr. ROCKEFELLER (for himself, shall be treated as compensation for pur- SA 2635. Mr. SCHUMER (for himself and Mr. HATCH, Mr. BOND, Ms. MIKULSKI, Mr. poses of this section. Mrs. FEINSTEIN) proposed an amendment to LOTT, Ms. SNOWE, and Mrs. FEINSTEIN) sub- ‘‘(B) APPLICABLE WAGE REPLACEMENT IN- the bill S. 2020, supra. mitted an amendment intended to be pro- COME.—For purposes of this paragraph, the SA 2636. Mr. INHOFE submitted an amend- posed by him to the bill S. 2020, supra; which term ‘applicable wage replacement income’ ment intended to be proposed by him to the was ordered to lie on the table. means any amount received by an indi- bill S. 2020, supra; which was ordered to lie SA 2658. Mr. DAYTON submitted an vidual— on the table. amendment intended to be proposed by him ‘‘(i) as the result of the individual having SA 2637. Mr. COLEMAN (for himself and to the bill S. 2020, supra. become disabled, Mr. PRYOR) submitted an amendment in- SA 2659. Mr. LAUTENBERG submitted an ‘‘(ii) as unemployment compensation (as tended to be proposed by him to the bill S. amendment intended to be proposed by him defined in section 85(b)),

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00040 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.158 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13187 ‘‘(iii) under workmen’s compensation acts, graph (2) and by redesignating paragraph (3) on the budget for fiscal year 2006; as or as paragraph (2). follows: ‘‘(iv) which constitutes wage replacement (b) EFFECTIVE DATE.—The amendments Strike all after the enacting clause and in- income under regulations prescribed by the made by subsection (a) shall apply to taxable sert the following: Secretary.’’ years beginning after December 31, 2005. (2) CERTAIN EXCLUDABLE AMOUNTS MAY BE SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; TABLE OF CONTENTS. TAKEN INTO ACCOUNT FOR PURPOSES OF ROTH SA 2600. Mr. SHELBY proposed an (a) SHORT TITLE.—This Act may be cited as IRAS.—Section 408A(c)(2) (relating to con- amendment to the bill S. 467, to extend the ‘‘Fiscal Responsibility Act of 2005’’. tribution limit) is amended by adding at the the applicability of the Terrorism Risk end the following new flush sentence: (b) AMENDMENT OF 1986 CODE.—Except as Insurance Act of 2002; as follows: otherwise expressly provided, whenever in ‘‘In determining the maximum amount Modify section 3(c)(2) of the bill to read as this Act an amendment or repeal is ex- under subparagraph (A), subsections (b)(1)(B) follows: pressed in terms of an amendment to, or re- and (c) of section 219 shall be applied by tak- (2) CONFORMING AMENDMENT.—Section peal of, a section or other provision, the ref- ing into account compensation described in 102(12)(A) of the Terrorism Risk Insurance erence shall be considered to be made to a section 219(f)(8) without regard to whether it Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2326) section or other provision of the Internal is includible in gross income.’’ is amended by striking ‘‘surety insurance’’ Revenue Code of 1986. (3) EFFECTIVE DATE.—The amendments and inserting ‘‘directors and officers liability (c) TABLE OF CONTENTS.—The table of con- made by this subsection shall apply to tax- insurance’’. tents for this Act is as follows: able years beginning after December 31, 2004. (b) COMPUTATION OF MAXIMUM IRA DEDUC- Sec. 1. Short title; amendment of 1986 Code; Mr. NELSON of Florida (for TION FOR ROTH IRAS USING COMPENSATION SA 2601. table of contents. FROM 2 PRECEDING TAXABLE YEARS.— himself, Mr. DORGAN, Mr. LEAHY, Mr. TITLE I—TAX BENEFITS FOR AREAS AF- (1) IN GENERAL.—Section 408A(c) (relating SCHUMER, Mr. DAYTON, Ms. STABENOW, FECTED BY HURRICANES KATRINA, to treatment of contributions) is amended by Mr. KOHL, Mrs. MURRAY, Mr. OBAMA, RITA, AND WILMA adding at the end the following new para- Mrs. CLINTON, Ms. LANDRIEU, Mr. HAR- Subtitle A—Gulf Recovery Zone Benefits graph: KIN, and Mr. DURBIN) submitted an Sec. 101. Gulf Recovery Zone benefits. ‘‘(8) COMPENSATION FROM PRECEDING 2 amendment intended to be proposed by Sec. 102. Expansion of Hope Scholarship and YEARS MAY BE TAKEN INTO ACCOUNT.— him to the bill S. 2020, to provide for Lifetime Learning Credit for ‘‘(A) IN GENERAL.—A taxpayer may elect students in the Gulf Recovery for purposes of paragraph (2) to take into ac- reconciliation pursuant to section Zone. count any unused compensation from the 2 202(b) of the concurrent resolution on Sec. 103. Extension of special rules for mort- taxable years immediately preceding the the budget for fiscal year 2006; as fol- gage revenue bonds. taxable year. lows: Subtitle B—Tax Benefits Related to ‘‘(B) UNUSED COMPENSATION.—For purposes At the end of title IV, insert the following: of this paragraph, the term ‘unused com- Hurricanes Rita and Wilma pensation’ means with respect to an indi- SEC. ll. PROTECTION FOR MEDICARE BENE- Sec. 111. Extension of certain emergency tax FICIARIES WHO ENROLL IN THE vidual for any taxable year the compensa- PRESCRIPTION DRUG BENEFIT DUR- relief for Hurricane Katrina to tion includible in the individual’s gross in- ING 2006. Hurricanes Rita and Wilma. come for the taxable year reduced by the (a) EXTENDED PERIOD OF OPEN ENROLLMENT TITLE II—EXTENSION OF EXPIRING sum of— DURING ALL OF 2006 WITHOUT LATE ENROLL- PROVISIONS ‘‘(i) the amount allowed as a deduction MENT PENALTY.—Section 1851(e)(3)(B) of the Sec. 201. Extension and increase in min- under 219(a) to such individual for such tax- Social Security Act (42 U.S.C. 1395w– imum tax relief to individuals. able year, 21(e)(3)(B)) is amended— Sec. 202. Allowance of nonrefundable per- ‘‘(ii) the amount of any designated non- (1) in clause (iii), by striking ‘‘May 15, sonal credits against regular deductible contribution (as defined in sec- 2006’’ and inserting ‘‘December 31, 2006’’; and and minimum tax liability. tion 408(o)) on behalf of such individual for (2) by adding at the end the following new Sec. 203. Election to deduct State and local such taxable year, sentence: sales taxes in lieu of State and ‘‘(iii) the amount of any contribution on ‘‘An individual making an election during local income taxes. behalf of such individual to a Roth IRA the period beginning on November 15, 2006, Sec. 204. Tuition deduction. under this section for such taxable year, and and ending on December 15, 2006, shall speci- Sec. 205. Extension and modification of re- ‘‘(iv) the amount of compensation includ- fy whether the election is to be effective search credit. ible in such individual’s gross income for with respect to 2006 or with respect to 2007 Sec. 206. Extension and modifications to such taxable year taken into account under (or both).’’. work opportunity credit and section 219(c) in determining the limitation (b) ONE-TIME CHANGE OF PLAN ENROLLMENT welfare-to-work credit. under section 219 or paragraph (2) for the in- FOR MEDICARE PRESCRIPTION DRUG BENEFIT Sec. 207. Qualified zone academy bonds. dividual’s spouse. DURING ALL OF 2006.— Sec. 208. Deduction for certain expenses of ‘‘(C) APPLICATION TO SPECIAL RULE FOR (1) IN GENERAL.—Section 1851(e) of the So- school teachers. MARRIED INDIVIDUALS.—Under rules pre- cial Security Act (42 U.S.C. 1395w–21(e)) is Sec. 209. Tax incentives for investment in scribed by the Secretary, in applying section amended— the District of Columbia. 219(c) for any taxable year for purposes of ap- (A) in paragraph (2)(B)— Sec. 210. Indian employment tax credit. plying paragraph (2)(A), unused compensa- (i) in the heading, by striking ‘‘FOR FIRST 6 Sec. 211. Accelerated depreciation for busi- tion of an individual or an individual’s MONTHS’’; ness property on Indian res- spouse for the 2 taxable years immediately (ii) in clause (i)— ervation. preceding the taxable year may be taken (I) by striking ‘‘the first 6 months of 2006’’ Sec. 212. Extension and expansion of chari- into account.’’ and inserting ‘‘2006’’; and table contribution allowed for (2) EFFECTIVE DATE.—The amendment (II) by striking ‘‘the first 6 months during scientific property used for re- made by this subsection shall apply to tax- 2006’’ and inserting ‘‘2006’’; and search and for computer tech- able years beginning after December 31, 2004, (iii) in clause (ii), by inserting ‘‘(other than nology and equipment used for but unused compensation for taxable years during 2006)’’ after ‘‘paragraph (3)’’; and educational purposes. beginning before January 1, 2005, may be (B) in paragraph (4), by striking ‘‘2006’’ and Sec. 213. Expensing of brownfields remedi- taken into account for taxable years begin- inserting ‘‘2007’’ each place it appears. ation costs. ning after December 31, 2004. (2) CONFORMING AMENDMENT.—Section Sec. 214. Extension of full credit for quali- fied electric vehicles. Mr. CONRAD (for himself, 1860D–1(b)(1)(B)(iii) of the Social Security SA 2599. Act (42 U.S.C. 1395w–101(b)(1)(B)(iii)) is Sec. 215. Fifteen-year straight-line cost re- Mr. DORGAN, and Mr. SMITH) submitted amended by striking ‘‘subparagraphs (B) and covery for qualified leasehold an amendment intended to be proposed (C) of paragraph (2)’’ and inserting ‘‘para- improvements and qualified by him to the bill S. 2020, to provide for graph (2)(C)’’. restaurant improvements. reconciliation pursuant to section (c) EFFECTIVE DATE.—The amendments Sec. 216. Application of EGTRRA sunset to 202(b) of the concurrent resolution on made by this section shall take effect as if this title. the budget for fiscal year 2006; which included in the enactment of the Medicare TITLE III—REVENUE PROVISIONS was ordered to lie on the table; as fol- Prescription Drug, Improvement, and Mod- Subtitle A—Provisions Relating to Tax lows: ernization Act of 2003 (Public Law 108–173). Shelters At the end of title IV, add the following: Sec. 301. Clarification of economic substance SA 2602. Mr. CONRAD proposed an SEC. ll. EXTENSION OF FULL CREDIT FOR doctrine. QUALIFIED ELECTRIC VEHICLES. amendment to the bill S. 2020, to pro- Sec. 302. Penalty for understatements at- (A) IN GENERAL.—Section 30(b) (relating to vide for reconciliation pursuant to sec- tributable to transactions lack- limitations) is amended by striking para- tion 202(b) of the concurrent resolution ing economic substance, etc.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00041 Fmt 0624 Sfmt 0655 E:\CR\FM\A17NO6.167 S17NOPT2 S13188 CONGRESSIONAL RECORD — SENATE November 17, 2005 Sec. 303. Denial of deduction for interest on Subtitle E—Additional Provisions ‘‘(II) which is nonresidential real property underpayments attributable to Sec. 351. Modification of individual esti- or residential rental property, noneconomic substance trans- mated tax safe harbor. ‘‘(ii) substantially all of the use of which is actions. Sec. 352. Loan and redemption requirements in the Gulf Recovery Zone and is in the ac- Sec. 304. Modifications of effective dates of on pooled financing require- tive conduct of a trade or business by the leasing provisions of the Amer- ments. taxpayer in such Zone, ican Jobs Creation Act of 2004. Sec. 353. Reporting of interest on tax-ex- ‘‘(iii) the original use of which in the Gulf Sec. 305. Revaluation of LIFO inventories of empt bonds. Recovery Zone commences with the taxpayer large integrated oil companies. TITLE I—TAX BENEFITS FOR AREAS AF- after August 27, 2005, Sec. 306. Modification of effective date of ex- FECTED BY HURRICANES KATRINA, ‘‘(iv) which is acquired by the taxpayer by ception from suspension rules RITA, AND WILMA purchase (as defined in section 179(d)) after for certain listed and reportable August 27, 2005, but only if no written bind- Subtitle A—Gulf Recovery Zone Benefits transactions. ing contract for the acquisition was in effect Sec. 307. Doubling of certain penalties, fines, SEC. 101. GULF RECOVERY ZONE BENEFITS. before August 28, 2005, and and interest on underpayments (a) IN GENERAL.—Chapter 1 is amended by ‘‘(v) which is placed in service by the tax- related to certain offshore fi- adding at the end the following new sub- payer on or before the termination date. nancial arrangements. chapter: The term ‘termination date’ means Decem- Sec. 308. Penalty for aiding and abetting the ‘‘Subchapter Z—Hurricane Relief Benefits ber 31, 2007 (December 31, 2008, in the case of understatement of tax liability. ‘‘Sec. 1400N. Definitions. nonresidential real property and residential Subtitle B—Provisions to Close Corporate ‘‘Sec. 1400O. Tax benefits for Gulf Recovery rental property). and Individual Loopholes Zone. ‘‘(B) EXCEPTIONS.— Sec. 311. Tax treatment of inverted entities. ‘‘SEC. 1400N. DEFINITIONS. ‘‘(i) ALTERNATIVE DEPRECIATION PROP- Sec. 312. Grant of Treasury regulatory au- ‘‘For purposes of this subchapter— ERTY.—The term ‘qualified Gulf Recovery thority to address foreign tax ‘‘(1) GULF RECOVERY ZONE.—The term ‘Gulf Zone property’ shall not include any prop- credit transactions involving Recovery Zone’ means that portion of the erty described in section 168(k)(2)(D)(i). inappropriate separation of for- Hurricane Katrina disaster area determined ‘‘(ii) TAX-EXEMPT BOND-FINANCED PROP- eign taxes from related foreign by the President to warrant individual or in- ERTY.—Such term shall not include any prop- income. dividual and public assistance from the Fed- erty any portion of which is financed with Sec. 313. Treatment of contingent payment eral Government under the Robert T. Staf- the proceeds of any obligation the interest convertible debt instruments. ford Disaster Relief and Emergency Assist- on which is exempt from tax under section Sec. 314. Application of earnings stripping ance Act by reason of Hurricane Katrina. 103. rules to partners which are cor- ‘‘(2) HURRICANE KATRINA DISASTER AREA.— ‘‘(iii) QUALIFIED REVITALIZATION BUILD- porations. The term ‘Hurricane Katrina disaster area’ INGS.—Such term shall not include any Sec. 315. Denial of deduction for certain means an area with respect to which a major qualified revitalization building with respect fines, penalties, and other disaster has been declared by the President to which the taxpayer has elected the appli- amounts. before September 14, 2005, under section 401 cation of paragraph (1) or (2) of section Sec. 316. Disallowance of deduction for puni- of such Act by reason of Hurricane Katrina. 1400I(a). tive damages. ‘‘(3) RITA ZONE.—The term ‘Rita Zone’ ‘‘(iv) ELECTION OUT.—For purposes of this Sec. 317. Limitation of employer deduction means that portion of the Hurricane Rita subsection, rules similar to the rules of sec- for certain entertainment ex- disaster area determined by the President to tion 168(k)(2)(D)(iii) shall apply. penses. warrant individual or individual and public ‘‘(C) SPECIAL RULES.—For purposes of this Sec. 318. Imposition of mark-to-market tax assistance from the Federal Government subsection, rules similar to the rules of sec- on individuals who expatriate. under such Act by reason of Hurricane Rita. tion 168(k)(2)(E) shall apply, except that— Sec. 319. Modification of exclusion for citi- ‘‘(4) HURRICANE RITA DISASTER AREA.—The ‘‘(i) clause (i) thereof shall be applied by zens living abroad. term ‘Hurricane Rita disaster area’ means an substituting ‘after August 27, 2005, and before Sec. 320. Limitation on annual amounts area with respect to which a major disaster the termination date (as defined in section which may be deferred under has been declared by the President before Oc- 1400O(a)(2))’ for ‘after September 10, 2001, and nonqualified deferred com- tober 6, 2005, under section 401 of such Act by before January 1, 2005’, pensation arrangements. reason of Hurricane Rita. ‘‘(ii) clauses (ii), (iii), and (iv) thereof shall Sec. 321. Increase in age of minor children ‘‘(5) WILMA ZONE.—The term ‘Wilma Zone’ be applied by substituting ‘August 27, 2005’ whose unearned income is taxed means that portion of the Hurricane Wilma for ‘September 10, 2001’ each place it appears, as if parent’s income. disaster area determined by the President to and Subtitle C—Oil and Gas Provisions warrant individual or individual and public ‘‘(iii) clause (iv) thereof shall be applied by Sec. 331. Extension of superfund taxes. assistance from the Federal Government substituting ‘qualified Gulf Recovery Zone Sec. 332. Modifications of foreign tax credit under such Act by reason of Hurricane property’ for ‘qualified property’. rules applicable to dual capac- Wilma. ‘‘(D) ALLOWANCE AGAINST ALTERNATIVE MIN- ity taxpayers. ‘‘(6) HURRICANE WILMA DISASTER AREA.—The IMUM TAX.—For purposes of this subsection, Sec. 333. Rules relating to foreign oil and term ‘Hurricane Wilma disaster area’ means rules similar to the rules of section gas income. an area with respect to which a major dis- 168(k)(2)(G) shall apply. Sec. 334. Modification of credit for pro- aster has been declared by the President be- ‘‘(3) RECAPTURE.—For purposes of this sub- ducing fuel from a nonconven- fore October 25, 2005, under section 401 of section, rules similar to the rules under sec- tional source. such Act by reason of Hurricane Wilma. tion 179(d)(10) shall apply with respect to any Sec. 335. Elimination of amortization of geo- ‘‘SEC. 1400O. TAX BENEFITS FOR GULF RECOVERY qualified Gulf Recovery Zone property which logical and geophysical expend- ZONE. ceases to be qualified Gulf Recovery Zone itures for major integrated oil ‘‘(a) SPECIAL ALLOWANCE FOR CERTAIN property. companies. PROPERTY ACQUIRED AFTER AUGUST 27, ‘‘(b) INCREASE IN EXPENSING UNDER SECTION Subtitle D—Tax Administration Provisions 2005.— 179.— Sec. 341. Imposition of withholding on cer- ‘‘(1) ADDITIONAL ALLOWANCE.—In the case of ‘‘(1) IN GENERAL.—For purposes of section tain payments made by govern- any qualified Gulf Recovery Zone property— 179— ment entities. ‘‘(A) the depreciation deduction provided ‘‘(A) the $100,000 amount in section 179(b)(1) Sec. 342. Increase in certain criminal pen- by section 167(a) for the taxable year in for the taxable year shall be increased by the alties. which such property is placed in service shall lesser of— Sec. 343. Repeal of suspension of interest include an allowance equal to 50 percent of ‘‘(i) $100,000, or and certain penalties where the adjusted basis of such property, and ‘‘(ii) the cost of section 179 property (as de- Secretary fails to contact tax- ‘‘(B) the adjusted basis of the qualified fined in section 179(d)) which is qualified payer. Gulf Recovery Zone property shall be re- Gulf Recovery Zone property placed in serv- Sec. 344. Increase in penalty for bad checks duced by the amount of such deduction be- ice during the taxable year, and and money orders. fore computing the amount otherwise allow- ‘‘(B) the $400,000 amount in section 179(b)(2) Sec. 345. Frivolous tax submissions. able as a depreciation deduction under this for the taxable year shall be increased by the Sec. 346. Partial payments required with chapter for such taxable year and any subse- lesser of— submission of offers-in-com- quent taxable year. ‘‘(i) $600,000, or promise. ‘‘(2) QUALIFIED GULF RECOVERY ZONE PROP- ‘‘(ii) the cost of section 179 property (as so Sec. 347. Waiver of user fee for installment ERTY.—For purposes of this subsection— defined) which is qualified Gulf Recovery agreements using automated ‘‘(A) IN GENERAL.—The term ‘qualified Gulf Zone property placed in service during the withdrawals. Recovery Zone property’ means property— taxable year. Sec. 348. Termination of installment agree- ‘‘(i)(I) which is described in section ‘‘(2) QUALIFIED GULF RECOVERY ZONE PROP- ments. 168(k)(2)(A)(i), or ERTY.—For purposes of this subsection, the

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00042 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.168 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13189 term ‘qualified Gulf Recovery Zone property’ ‘‘(A) the chief executive officer of the ‘‘(I) shall be treated as a difficult develop- has the meaning given such term by sub- issuer of the bond designates the advance re- ment area designated under subclause (I) of section (a)(2). funding bond for purposes of this subsection, section 42(d)(5)(C)(iii), and ‘‘(3) COORDINATION WITH EMPOWERMENT and ‘‘(II) shall not be taken into account for ZONES AND RENEWAL COMMUNITIES.—For pur- ‘‘(B) the requirements of paragraph (3) are purposes of applying the limitation under poses of sections 1397A and 1400J, qualified met. subclause (II) of such section, and Gulf Recovery Zone property shall not be ‘‘(2) BONDS DESCRIBED.—A bond is described ‘‘(ii) subsection (b)(2)(B) thereof shall be treated as qualified zone property or quali- in this paragraph if such bond was out- applied with respect to any such property fied renewal property for any taxable year, standing on August 27, 2005, and is— placed in service in the Gulf Recovery Zone unless the taxpayer elects not to have this ‘‘(A) a State or local bond (as defined in by substituting ‘91 percent’ and ‘39 percent’ subsection apply to all such qualified Gulf section 103(c)(1)) other than a private activ- for ‘70 percent’ and ‘30 percent’, respectively. Recovery Zone property placed in service by ity bond (as defined in section 141(a)) issued ‘‘(B) APPLICATION.—Subparagraph (A) shall the taxpayer during the taxable year. by the State of Alabama, Louisiana, or Mis- apply only to— ‘‘(4) RECAPTURE.—Rules similar to the sissippi (or any political subdivision there- ‘‘(i) housing credit dollar amounts allo- rules under section 179(d)(10) shall apply with of), or cated during the period beginning on Janu- respect to any qualified Gulf Recovery Zone ‘‘(B) a qualified 501(c)(3) bond (as defined in ary 1, 2006, and ending on December 31, 2008, property which ceases to be Gulf Recovery section 145(a)) issued by or on behalf of any and Zone property. such State or political subdivision. ‘‘(ii) buildings placed in service during ‘‘(c) TAX-EXEMPT BOND FINANCING.— ‘‘(3) ADDITIONAL REQUIREMENTS.—The re- such period to the extent that paragraph (1) ‘‘(1) IN GENERAL.—For purposes of this quirements of this paragraph are met with of section 42(h) does not apply to any build- title, any qualified Gulf Recovery Zone Bond ing by reason of paragraph (4) thereof, but shall be treated as a qualified bond. respect to any advance refunding of a bond described in paragraph (2) if— only with respect to bonds issued after De- ‘‘(2) QUALIFIED GULF RECOVERY ZONE ‘‘(A) no advance refundings of such bond cember 31, 2005. BOND.—For purposes of this subsection, the ‘‘(f) TREATMENT OF REPRESENTATIONS RE- term ‘qualified Gulf Recovery Zone Bond’ would be allowed under any provision of law after August 27, 2005, GARDING INCOME ELIGIBILITY FOR PURPOSES means any bond issued as part of an issue OF QUALIFIED RESIDENTIAL RENTAL PROJECT ‘‘(B) the advance refunding bond is the if— REQUIREMENTS.—For purposes of determining only other outstanding bond with respect to ‘‘(A) except as provided in paragraph (4), if any residential rental project meets the such bond meets the applicable requirements the refunded bond, and requirements of section 142(d)(1) and if any of part IV of subchapter B of this chapter, ‘‘(C) the requirements of section 148 are certification with respect to such project ‘‘(B) such bond is issued by the State of met with respect to all bonds issued under meets the requirements under section Alabama, Louisiana, or Mississippi (or any this subsection. 142(d)(7), the operator of the project may rely political subdivision thereof), ‘‘(e) LOW-INCOME HOUSING CREDIT.— on the representations of any individual ap- ‘‘(C) the Governor of such State designates ‘‘(1) INCREASE IN STATE HOUSING CREDIT plying for tenancy in such project that such such bond for purposes of this section, and CEILING.— individual’s income will not exceed the ap- ‘‘(D) such bond is issued after the date of ‘‘(A) IN GENERAL.—In the case of the State plicable income limits of section 142(d)(1) the enactment of this section and before of Alabama, Louisiana, or Mississippi— upon commencement of the individual’s ten- January 1, 2011. ‘‘(i) the amount otherwise determined ancy if such tenancy begins during the 6- ‘‘(3) LIMITATION ON AGGREGATE AMOUNT OF under subclause (I) of section 42(h)(3)(C)(ii) month period beginning on and after the BONDS DESIGNATED.—The maximum aggre- for each calendar year beginning after 2005 date such individual was displaced by reason gate face amount of bonds which may be des- and before 2010 shall be increased by an of Hurricane Katrina. ignated under this subsection shall not ex- ‘‘(g) APPLICATION OF NEW MARKETS TAX amount equal to 3 times the dollar amount ceed the product of $2,500 multiplied by the CREDIT TO INVESTMENTS IN COMMUNITY DE- otherwise specified for such calendar year portion of the State population which is in VELOPMENT ENTITIES SERVING GULF RECOV- under such subclause multiplied by the State the Gulf Recovery Zone (as determined on ERY ZONE.—For purposes of section 45D— population located in the Gulf Recovery the basis of the most recent census estimate ‘‘(1) a qualified community development Zone (as determined on the basis of the most of resident population released by the Bu- entity shall be eligible for an allocation reau of Census before August 28, 2005). recent census estimate of resident popu- under subsection (f)(2) thereof of the increase lation released by the Bureau of Census be- ‘‘(4) SPECIAL RULES.—In applying this title in the new markets tax credit limitation de- to any qualified Gulf Recovery Zone Bond, fore August 28, 2005), and scribed in paragraph (2) only if a significant the following modifications shall apply: ‘‘(ii) the unused State housing credit ceil- mission of such entity is the recovery and re- ‘‘(A) Section 143 (relating to mortgage rev- ing for such State for any calendar year development of the Gulf Recovery Zone, enue bonds: qualified mortgage bond and under section 42(h)(3)(C)(i) shall be deter- ‘‘(2) the new markets tax credit limitation qualified veterans’ mortgage bond) shall be mined without regard to the amount of the otherwise determined under subsection (f)(1) applied— increase determined under clause (i). thereof shall be increased by an amount ‘‘(i) by treating any residence in the Gulf ‘‘(B) ELECTIVE CARRYFORWARD OF UNUSED equal to— Recovery Zone as a targeted area residence, INCREASED CEILING.— ‘‘(A) $300,000,000 for 2005 and 2006, to be al- ‘‘(ii) by applying subsection (f)(3) without ‘‘(i) IN GENERAL.—If the amount deter- located among qualified community develop- regard to subparagraph (A) thereof, and mined under section 42(h)(3)(C)(ii)(I), as in- ment entities to make qualified low-income ‘‘(iii) by substituting ‘$150,000’ for ‘$15,000’ creased under subparagraph (A)(i), for any community investments within the Gulf Re- in subsection (k)(4) thereof. calendar year for any State described in sub- covery Zone, and ‘‘(B) Section 146 (relating to volume cap) paragraph (A) exceeds the aggregate housing ‘‘(B) $400,000,000 for 2007, to be so allocated, shall not apply. credit dollar amount allocated during such and ‘‘(C) Section 57(a)(5) shall not apply. calendar year by such State, such State may ‘‘(3) subsection (f)(3) thereof shall be ap- ‘‘(5) SEPARATE ISSUE TREATMENT OF POR- elect to treat as a carryforward to the fol- plied separately with respect to the amount TIONS OF AN ISSUE.—This subsection shall not lowing calendar year an amount equal to of the increase under paragraph (2). apply to the portion of an issue which (if lesser of— ‘‘(h) TREATMENT OF NET OPERATING LOSSES issued as a separate issue) would be treated ‘‘(I) the amount of such excess, or ATTRIBUTABLE TO GULF RECOVERY ZONE as a qualified bond or as a bond that is not ‘‘(II) the amount by which the amount de- LOSSES.— a private activity bond (determined without termined under section 42(h)(3)(C)(ii)(I) for ‘‘(1) IN GENERAL.—If a portion of any net regard to paragraph (1)), if the issuer elects such calendar year was increased under sub- operating loss of the taxpayer for any tax- to so treat such portion. paragraph (A)(i)). able year is a qualified Gulf Recovery Zone ‘‘(d) ADVANCE REFUNDINGS OF CERTAIN TAX- ‘‘(ii) USE OF CARRYFORWARD.—If any State loss, the following rules shall apply: EXEMPT BONDS.— elects a carryforward under clause (i), any ‘‘(A) EXTENSION OF CARRYBACK PERIOD.— ‘‘(1) IN GENERAL.—With respect to a bond housing credit dollar amount allocated by Section 172(b)(1) shall be applied with respect described in paragraph (2) issued as part of such State during the calendar year fol- to such portion— an issue 90 percent (95 percent in the case of lowing the calendar year in which the ‘‘(i) by substituting ‘5 taxable years’ for ‘2 a bond described in paragraph (2)(B)) or more carryforward arose shall not be considered so taxable years’ in subparagraph (A)(i), and of the net proceeds (as defined in section allocated for purposes of section 42(h)(3)(C) ‘‘(ii) by not taking such portion into ac- 150(a)(3)) of which were used to finance facili- and section 42(h)(3)(D) to the extent such count in determining any eligible loss of the ties located within the Gulf Recovery Zone housing credit dollar amount does not exceed taxpayer under subparagraph (F) for the tax- (or property which is functionally related the amount of the carryforward elected. able year. and subordinate to facilities located within ‘‘(2) DIFFICULT DEVELOPMENT AREA.— ‘‘(B) SUSPENSION OF 90 PERCENT AMT LIMITA- the Gulf Recovery Zone), one additional ad- ‘‘(A) IN GENERAL.—For purposes of section TION.—Section 56(d)(1) shall be applied by in- vanced refunding after the date of the enact- 42— creasing the amount determined under sub- ment of this section and before January 1, ‘‘(i) in the case of property placed in serv- paragraph (A)(ii)(I) thereof by the sum of the 2007, shall be allowed under the applicable ice during 2006, 2007, or 2008, the Gulf Recov- carrybacks and carryovers of any net oper- rules of section 149(d) if— ery Zone— ating loss attributable to such portion.

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‘‘(2) QUALIFIED GULF RECOVERY ZONE LOSS.— ‘‘(A) section 165(i) shall be applied by sub- tion 194(b)(1) shall be increased by the lesser For purposes of paragraph (1), the term stituting ‘the fifth taxable year immediately of— ‘qualified Gulf Recovery Zone loss’ means preceding’ for ‘the taxable year immediately ‘‘(A) the limitation which would (but for the lesser of— preceding’, this subsection) apply under such subpara- ‘‘(A) the amount of the net operating loss ‘‘(B) an application for a tentative graph, or for the taxable year, or carryback adjustment of the tax for any ‘‘(B) the amount of reforestation expendi- ‘‘(B) the aggregate amount of the following prior taxable year affected by the applica- tures (as defined in section 194(c)(3)) paid or deductions for such taxable year: tion of subparagraph (A) may be made under incurred by the taxpayer with respect to ‘‘(i) Any deduction for any qualified Gulf section 6411, and such qualified timber property during the Recovery Zone casualty loss. ‘‘(C) section 6611 shall not apply to any specified portion of the taxable year. ‘‘(ii) Any deduction for moving expenses overpayment attributable to such loss. ‘‘(2) 5 YEAR NOL CARRYBACK OF CERTAIN TIM- paid or incurred after August 27, 2005, and be- ‘‘(2) ELIGIBLE PUBLIC UTILITY PROPERTY BER LOSSES.—For purposes of determining fore January 1, 2008, and allowable under this LOSS.—For purposes of this subsection— farming loss under section 172(i), income and chapter to any taxpayer in connection with ‘‘(A) IN GENERAL.—The term ‘eligible pub- deductions which are allocable to the speci- the employment of any individual— lic utility property loss’ means any loss with fied portion of the taxable year and which ‘‘(I) whose principal place of abode was lo- respect to public utility property located in are attributable to qualified timber property cated in the Gulf Recovery Zone before Au- the Gulf Recovery Zone and attributable to any portion of which is located in the Gulf gust 28, 2005, Hurricane Katrina. Recovery Zone, in that portion of the Rita ‘‘(II) who was unable to remain in such ‘‘(B) PUBLIC UTILITY PROPERTY.—The term Zone which is not part of the Gulf Recovery abode as the result of Hurricane Katrina, and ‘public utility property’ has the meaning Zone, or in the Wilma Zone shall be treated ‘‘(III) whose principal place of employment given such term by section 168(i)(10) without as attributable to farming businesses. with the taxpayer after such expense is lo- regard to the matter following subparagraph ‘‘(3) RULES NOT APPLICABLE TO CERTAIN EN- cated in the Gulf Recovery Zone. (D) thereof. TITIES.—Paragraphs (1) and (2) shall not For purposes of this clause, the term ‘mov- ‘‘(3) WAIVER OF LIMITATIONS.—If refund or apply to any taxpayer which— ing expenses’ has the meaning given such credit of any overpayment of tax resulting ‘‘(A) is a corporation the stock of which is term by section 217(b), except that the tax- from the application of paragraph (1) is pre- publicly traded on an established securities payer’s former residence and new residence vented at any time before the close of the 1- market, or may be the same residence if the initial year period beginning on the date of the en- ‘‘(B) is a real estate investment trust. vacating of the residence was as the result of actment of this section by the operation of ‘‘(4) RULES NOT APPLICABLE TO LARGE TIM- Hurricane Katrina. any law or rule of law (including res judi- BER PRODUCERS.—Paragraphs (1) and (2) shall ‘‘(iii) Any deduction for expenses paid or cata), such refund or credit may nevertheless not apply with respect to any qualified tim- incurred after August 27, 2005, and before be made or allowed if claim therefor is filed ber property unless— January 1, 2008, and allowable under this before the close of such period. ‘‘(A) such property was held by the tax- chapter to temporarily house any employee ‘‘(j) SPECIAL RULE FOR GULF RECOVERY payer— of the taxpayer whose principal place of em- ZONE PUBLIC UTILITY CASUALTY LOSSES.— ‘‘(i) on August 28, 2005, in the case of quali- ployment is in the Gulf Recovery Zone. ‘‘(1) IN GENERAL.—The amount described in fied timber property any portion of which is ‘‘(iv) Any deduction for depreciation (or section 172(f)(1)(A) for any taxable year shall located in the Gulf Recovery Zone, amortization in lieu of depreciation) allow- be increased by the amount of the Gulf Re- ‘‘(ii) on September 23, 2005, in the case of able under this chapter with respect to any covery Zone public utility casualty loss for qualified timber property (other than prop- qualified Gulf Recovery Zone property (as such year. erty described in subclause (I)) any portion defined in subsection (a)(2)) for the taxable ‘‘(2) GULF RECOVERY ZONE PUBLIC UTILITY of which is located in that portion of the year such property is placed in service. CASUALTY LOSS.—For purposes of this sub- Rita Zone which is not part of the Gulf Re- ‘‘(v) Any deduction for repair expenses (in- section, the term ‘Gulf Recovery Zone public covery Zone, or cluding expenses for removal of debris) al- utility casualty loss’ means any casualty ‘‘(iii) on October 23, 2005, in the case of lowable under this chapter paid or incurred loss of public utility property (as defined in qualified timber property (other than prop- after August 27, 2005, and before January 1, section 168(i)(10)) located in the Gulf Recov- erty described in subclause (I) or (II)) any 2008, with respect to any damage attrib- ery Zone if— portion of which is located in the Wilma utable to Hurricane Katrina and in connec- ‘‘(A) such loss is allowed as a deduction Zone, and tion with property which is located in the under section 165 for the taxable year, ‘‘(B) such taxpayer held not more than 500 Gulf Recovery Zone. ‘‘(B) such loss is attributable to Hurricane acres of qualified timber property on such ‘‘(3) QUALIFIED GULF RECOVERY ZONE CAS- Katrina, and date. UALTY LOSS.— ‘‘(C) the taxpayer elects the application of ‘‘(5) DEFINITIONS.—For purposes of this sub- ‘‘(A) IN GENERAL.—For purposes of para- this subsection with respect to such loss. section— graph (2)(B)(i), the term ‘qualified Gulf Re- ‘‘(3) REDUCTION FOR GAINS FROM INVOLUN- ‘‘(A) SPECIFIED PORTION.—The term ‘speci- covery Zone casualty loss’ means any un- TARY CONVERSION.—The amount of Gulf Re- fied portion’ means— compensated section 1231 loss (as defined in covery Zone public utility casualty loss ‘‘(i) in the case of qualified timber prop- section 1231(a)(3)(B)) of property located in which would (but for this paragraph) be erty located in the Gulf Recovery Zone, that the Gulf Recovery Zone if— taken into account under paragraph (1) for portion of the taxable year which is on or ‘‘(i) such loss is allowed as a deduction any taxable year shall be reduced by the after August 28, 2005, and before January 1, under section 165 for the taxable year, and amount of any gain recognized by the tax- 2007, ‘‘(ii) such loss is attributable to Hurricane payer for such year from the involuntary ‘‘(ii) in the case of qualified timber prop- Katrina. conversion by reason of Hurricane Katrina of erty located in the Rita Zone and no part of ‘‘(B) REDUCTION FOR GAINS FROM INVOLUN- public utility property (as so defined) lo- which is located in the Gulf Recovery Zone, TARY CONVERSION.—The amount of qualified cated in the Gulf Recovery Zone. that portion of the taxable year which is on Gulf Recovery Zone casualty loss which ‘‘(4) COORDINATION WITH GENERAL DISASTER or after September 23, 2005, and before Janu- would (but for this subparagraph) be taken LOSS RULES.—Subsection (h) and section ary 1, 2007, and into account under subparagraph (A) for any 165(i) shall not apply to any Gulf Recovery ‘‘(iii) in the case of qualified timber prop- taxable year shall be reduced by the amount Zone public utility casualty loss to the ex- erty located in the Wilma Zone, that portion of any gain recognized by the taxpayer for tent such loss is taken into account under of the taxable year which is on or after Octo- such year from the involuntary conversion paragraph (1). ber 23, 2005, and before January 1, 2007. by reason of Hurricane Katrina of property ‘‘(5) ELECTION.—Any election under para- ‘‘(B) QUALIFIED TIMBER PROPERTY.—The located in the Gulf Recovery Zone. graph (2)(C) shall be made in such manner as term ‘qualified timber property’ has the ‘‘(C) COORDINATION WITH GENERAL DISASTER may be prescribed by the Secretary and shall meaning given such term in section 194(c)(1). LOSS RULES.—Subsection (j) and section 165(i) be made by the due date (including exten- ‘‘(l) EXPENSING FOR CERTAIN DEMOLITION shall not apply to any qualified Gulf Recov- sions of time) for filing the taxpayer’s return AND CLEAN-UP COSTS.— ery Zone casualty loss to the extent such for the taxable year of the loss. Such elec- ‘‘(1) IN GENERAL.—A taxpayer may elect to loss is taken into account under this sub- tion, once made for any taxable year, shall treat 50 percent of any qualified Gulf Recov- section. be irrevocable for such taxable year. ery Zone clean-up cost as an expense which ‘‘(4) SPECIAL RULES.—For purposes of para- ‘‘(k) SPECIAL RULES FOR SMALL TIMBER is not chargeable to capital account. Any graph (1), rules similar to the rules of para- PRODUCERS.— cost so treated shall be allowed as a deduc- graphs (2) and (3) of section 172(i) shall apply ‘‘(1) INCREASED EXPENSING FOR QUALIFIED tion for the taxable year in which such cost with respect to such portion. TIMBER PROPERTY.—In the case of qualified is paid or incurred. ‘‘(i) TREATMENT OF PUBLIC UTILITY PROP- timber property any portion of which is lo- ‘‘(2) GULF RECOVERY ZONE CLEAN-UP COST.— ERTY DISASTER LOSSES.— cated in the Gulf Recovery Zone, in that por- For purposes of this subsection, the term ‘‘(1) IN GENERAL.—Upon the election of the tion of the Rita Zone which is not part of the ‘Gulf Recovery Zone clean-up cost’ means taxpayer, in the case of any eligible public Gulf Recovery Zone, or in the Wilma Zone, any amount paid or incurred during the pe- utility property loss— the limitation under subparagraph (B) of sec- riod beginning on August 28, 2005, and ending

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SPECIAL RULES FOR MORTGAGE amount of the contribution, the qualified bris from, or the demolition of structures on, REVENUE BONDS. hurricane distribution shall be treated as a real property which is located in the Gulf ‘‘(a) IN GENERAL.—In the case of financing distribution described in section 408(d)(3) and Recovery Zone and which is— provided with respect to residences in the as having been transferred to the eligible re- ‘‘(A) held by the taxpayer for use in a trade Gulf Recovery Zone, the Rita Zone, or the tirement plan in a direct trustee to trustee or business or for the production of income, Wilma Zone, section 143 shall be applied— transfer within 60 days of the distribution. or ‘‘(1) by treating any residence in the Gulf ‘‘(4) DEFINITIONS.—For purposes of this sub- ‘‘(B) property described in section 1221(a)(1) Recovery Zone, the Rita Zone, or the Wilma section— in the hands of the taxpayer. Zone as a targeted area residence, ‘‘(A) QUALIFIED HURRICANE DISTRIBUTION.— ‘‘(2) by applying subsection (f)(3) without For purposes of the preceding sentence, Except as provided in paragraph (2), the term regard to subparagraph (A) thereof, and ‘qualified hurricane distribution’ means— amounts paid or incurred shall be taken into ‘‘(3) by substituting ‘$150,000’ for ‘$15,000’ in account only to the extent that such amount ‘‘(i) any distribution from an eligible re- subsection (k)(4) thereof. tirement plan made on or after August 25, would (but for paragraph (1)) be chargeable ‘‘(b) APPLICATION.—Subsection (a) shall not 2005, and before January 1, 2007, to an indi- to capital account. apply to financing provided after December vidual whose principal place of abode on Au- ‘‘(m) EXTENSION OF EXPENSING FOR ENVI- 31, 2010. gust 28, 2005, is located in the Hurricane RONMENTAL REMEDIATION COSTS.—With re- ‘‘SEC. 1400Q. SPECIAL RULES FOR USE OF RE- spect to any qualified environmental remedi- TIREMENT FUNDS. Katrina disaster area and who has sustained ation expenditure (as defined in section ‘‘(a) TAX-FAVORED WITHDRAWALS FROM RE- an economic loss by reason of Hurricane 198(b)) paid or incurred on or after August 28, TIREMENT PLANS.— Katrina, 2005, in connection with a qualified contami- ‘‘(1) IN GENERAL.—Section 72(t) shall not ‘‘(ii) any distribution (which is not de- nated site located in the Gulf Recovery Zone, apply to any qualified hurricane distribu- scribed in clause (i)) from an eligible retire- section 198 (relating to expensing of environ- tion. ment plan made on or after September 23, mental remediation costs) shall be applied— ‘‘(2) AGGREGATE DOLLAR LIMITATION.— 2005, and before January 1, 2007, to an indi- ‘‘(1) by substituting ‘December 31, 2007’ for ‘‘(A) IN GENERAL.—For purposes of this sub- vidual whose principal place of abode on Sep- ‘December 31, 2006’ in subsection (h) thereof, section, the aggregate amount of distribu- tember 23, 2005, is located in the Hurricane and tions received by an individual which may be Rita disaster area and who has sustained an ‘‘(2) except as provided in section 198(d)(2), treated as qualified hurricane distributions economic loss by reason of Hurricane Rita, by treating petroleum products (as defined in for any taxable year shall not exceed the ex- and section 4612(a)(3)) as a hazardous substance. cess (if any) of— ‘‘(iii) any distribution (which is not de- scribed in clause (i) or (ii)) from an eligible ‘‘(n) GULF RECOVERY ZONE.—For purposes ‘‘(i) $100,000, over of this section, the term ‘Gulf Recovery ‘‘(ii) the aggregate amounts treated as retirement plan made on or after October 23, Zone’ means an area— qualified hurricane distributions received by 2005, and before January 1, 2007, to an indi- ‘‘(1) with respect to which a major disaster such individual for all prior taxable years. vidual whose principal place of abode on Oc- has been declared by the President under ‘‘(B) TREATMENT OF PLAN DISTRIBUTIONS.— tober 23, 2005, is located in the Hurricane section 401 of the Robert T. Stafford Disaster If a distribution to an individual would Wilma disaster area and who has sustained Relief and Emergency Assistance Act as a re- (without regard to subparagraph (A)) be a an economic loss by reason of Hurricane sult of Hurricane Katrina, and qualified hurricane distribution, a plan shall Wilma. ‘‘(2) which is determined by the President not be treated as violating any requirement ‘‘(B) ELIGIBLE RETIREMENT PLAN.—The term to warrant individual assistance, or indi- of this title merely because the plan treats ‘eligible retirement plan’ shall have the vidual and public assistance, from the Fed- such distribution as a qualified hurricane meaning given such term by section eral Government under such Act.’’ distribution, unless the aggregate amount of 402(c)(8)(B). ‘‘(5) INCOME INCLUSION SPREAD OVER 3-YEAR (b) CLERICAL AMENDMENTS.—The table of such distributions from all plans maintained PERIOD.— subchapters for chapter 1 is amended by add- by the employer (and any member of any ‘‘(A) IN GENERAL.—In the case of any quali- ing at the end the following new item: controlled group which includes the em- ployer) to such individual exceeds $100,000. fied hurricane distribution, unless the tax- ‘‘SUBCHAPTER Z—HURRICANE RELIEF ‘‘(C) CONTROLLED GROUP.—For purposes of payer elects not to have this paragraph BENEFITS.’’. subparagraph (B), the term ‘controlled apply for any taxable year, any amount re- SEC. 102. EXPANSION OF HOPE SCHOLARSHIP group’ means any group treated as a single quired to be included in gross income for AND LIFETIME LEARNING CREDIT employer under subsection (b), (c), (m), or (o) such taxable year shall be so included rat- FOR STUDENTS IN THE GULF RE- ably over the 3-taxable year period beginning COVERY ZONE. of section 414. with such taxable year. In the case of an individual who attends an ‘‘(3) AMOUNT DISTRIBUTED MAY BE REPAID.— ‘‘(A) IN GENERAL.—Any individual who re- ‘‘(B) SPECIAL RULE.—For purposes of sub- eligible educational institution (as defined in paragraph (A), rules similar to the rules of section 25A(f)(2) of the Internal Revenue ceives a qualified hurricane distribution may, at any time during the 3-year period subparagraph (E) of section 408A(d)(3) shall Code of 1986) located in the Gulf Recovery apply. Zone (as defined in section 1400N(1) of such beginning on the day after the date on which ‘‘(6) SPECIAL RULES.— Code) for any taxable year beginning during such distribution was received, make one or ‘‘(A) EXEMPTION OF DISTRIBUTIONS FROM 2005 or 2006— more contributions in an aggregate amount TRUSTEE TO TRUSTEE TRANSFER AND WITH- (1) in applying section 25A of the Internal not to exceed the amount of such distribu- tion to an eligible retirement plan of which HOLDING RULES.—For purposes of sections Revenue Code of 1986, the term ‘‘qualified 401(a)(31), 402(f), and 3405, qualified hurricane tuition and related expenses’’ shall include such individual is a beneficiary and to which a rollover contribution of such distribution distributions shall not be treated as eligible any costs which are qualified higher edu- rollover distributions. cation expenses (as defined in section could be made under section 402(c), 403(a)(4), ‘‘(B) QUALIFIED HURRICANE DISTRIBUTIONS 529(e)(3) of such Code), 403(b)(8), 408(d)(3), or 457(e)(16), as the case TREATED AS MEETING PLAN DISTRIBUTION RE- (2) each of the dollar amounts in effect may be. QUIREMENTS.—For purposes this title, a under of subparagraphs (A) and (B) of section ‘‘(B) TREATMENT OF REPAYMENTS OF DIS- TRIBUTIONS FROM ELIGIBLE RETIREMENT PLANS qualified hurricane distribution shall be 25A(b)(1) of such Code shall be twice the treated as meeting the requirements of sec- amount otherwise in effect before the appli- OTHER THAN IRAS.—For purposes of this title, if a contribution is made pursuant to sub- tions 401(k)(2)(B)(i), 403(b)(7)(A)(ii), 403(b)(11), cation of this subsection, and and 457(d)(1)(A). (3) section 25A(c)(1) of such Code shall be paragraph (A) with respect to a qualified applied by substituting ‘‘40 percent’’ for ‘‘20 hurricane distribution from an eligible re- ‘‘(b) RECONTRIBUTIONS OF WITHDRAWALS percent’’. tirement plan other than an individual re- FOR HOME PURCHASES.— tirement plan, then the taxpayer shall, to ‘‘(1) RECONTRIBUTIONS.— SEC. 103. EXTENSION OF SPECIAL RULES FOR the extent of the amount of the contribu- ‘‘(A) IN GENERAL.—Any individual who re- MORTGAGE REVENUE BONDS. tion, be treated as having received the quali- ceived a qualified distribution may, during Section 404(d) of the Katrina Emergency fied hurricane distribution in an eligible the applicable period, make one or more con- Tax Relief Act of 2005 is amended by striking rollover distribution (as defined in section tributions in an aggregate amount not to ex- ‘‘December 31, 2007’’ and inserting ‘‘Decem- 402(c)(4)) and as having transferred the ceed the amount of such qualified distribu- ber 31, 2010’’. amount to the eligible retirement plan in a tion to an eligible retirement plan (as de- Subtitle B—Tax Benefits Related to direct trustee to trustee transfer within 60 fined in section 402(c)(8)(B)) of which such in- Hurricanes Rita and Wilma days of the distribution. dividual is a beneficiary and to which a roll- SEC. 111. EXTENSION OF CERTAIN EMERGENCY ‘‘(C) TREATMENT OF REPAYMENTS FOR DIS- over contribution of such distribution could TAX RELIEF FOR HURRICANE TRIBUTIONS FROM IRAS.—For purposes of this be made under section 402(c), 403(a)(4), KATRINA TO HURRICANES RITA AND title, if a contribution is made pursuant to 403(b)(8), or 408(d)(3), as the case may be. WILMA. subparagraph (A) with respect to a qualified ‘‘(B) TREATMENT OF REPAYMENTS.—Rules (a) IN GENERAL.—Subchapter Z of chapter hurricane distribution from an individual re- similar to the rules of subparagraphs (B) and 1, as added by this Act, is amended by adding tirement plan (as defined by section (C) of subsection (a)(3) shall apply for pur- at the end the following new sections: 7701(a)(37)), then, to the extent of the poses of this subsection.

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‘‘(2) QUALIFIED DISTRIBUTION.—For purposes 2006, such due date shall be delayed for 1 ‘‘(i) which conducted an active trade or of this subsection— year, business on August 28, 2005, in the Gulf Re- ‘‘(A) IN GENERAL.—The term ‘qualified dis- ‘‘(B) any subsequent repayments with re- covery Zone, and tribution’ means any qualified Katrina dis- spect to any such loan shall be appropriately ‘‘(ii) with respect to whom the trade or tribution, any qualified Rita distribution, adjusted to reflect the delay in the due date business described in clause (i) is inoperable and any qualified Wilma distribution. under paragraph (1) and any interest accru- on any day after August 28, 2005, and before ‘‘(B) QUALIFIED KATRINA DISTRIBUTION.— ing during such delay, and January 1, 2006, as a result of damage sus- The term ‘qualified Katrina distribution’ ‘‘(C) in determining the 5-year period and tained by reason of Hurricane Katrina. means any distribution— the term of a loan under subparagraph (B) or ‘‘(B) ELIGIBLE EMPLOYEE.—The term ‘eligi- ‘‘(i) described in section 401(k)(2)(B)(i)(IV), (C) of section 72(p)(2), the period described in ble employee’ means with respect to an eligi- 403(b)(7)(A)(ii) (but only to the extent such subparagraph (A) shall be disregarded. ble employer an employee whose principal distribution relates to financial hardship), ‘‘(3) QUALIFIED INDIVIDUAL.—For purposes place of employment on August 28, 2005, with 403(b)(11)(B), or 72(t)(2)(F), of this subsection— such eligible employer was in the Gulf Re- ‘‘(ii) received after February 28, 2005, and ‘‘(A) IN GENERAL.—The term ‘qualified indi- covery Zone. before August 29, 2005, and vidual’ means any qualified Hurricane ‘‘(C) QUALIFIED WAGES.—The term ‘quali- ‘‘(iii) which was to be used to purchase or Katrina individual, any qualified Hurricane fied wages’ means wages (as defined in sec- construct a principal residence in the Hurri- Rita individual, and any qualified Hurricane tion 51(c)(1), but without regard to section cane Katrina disaster area, but which was Wilma individual. 3306(b)(2)(B)) paid or incurred by an eligible not so purchased or constructed on account ‘‘(B) QUALIFIED HURRICANE KATRINA INDI- employer with respect to an eligible em- of Hurricane Katrina. VIDUAL.—The term ‘qualified Hurricane ployee on any day after August 28, 2005, and ‘‘(C) QUALIFIED RITA DISTRIBUTION.—The Katrina individual’ means an individual before January 1, 2006, which occurs during term ‘qualified Rita distribution’ means any whose principal place of abode on August 28, the period— distribution (other than a qualified Katrina 2005, is located in the Hurricane Katrina dis- ‘‘(i) beginning on the date on which the distribution)— aster area and who has sustained an eco- trade or business described in subparagraph ‘‘(i) described in section 401(k)(2)(B)(i)(IV), nomic loss by reason of Hurricane Katrina. (A) first became inoperable at the principal 403(b)(7)(A)(ii) (but only to the extent such ‘‘(C) QUALIFIED HURRICANE RITA INDI- place of employment of the employee imme- distribution relates to financial hardship), VIDUAL.—The term ‘qualified Hurricane Rita diately before Hurricane Katrina, and 403(b)(11)(B), or 72(t)(2)(F), individual’ means an individual (other than a ‘‘(ii) ending on the date on which such ‘‘(ii) received after February 28, 2005, and qualified Hurricane Katrina individual) trade or business has resumed significant op- before September 24, 2005, and whose principal place of abode on September erations at such principal place of employ- ‘‘(iii) which was to be used to purchase or 23, 2005, is located in the Hurricane Rita dis- ment. construct a principal residence in the Hurri- aster area and who has sustained an eco- Such term shall include wages paid without cane Rita disaster area, but which was not so nomic loss by reason of Hurricane Rita. regard to whether the employee performs no purchased or constructed on account of Hur- ‘‘(D) QUALIFIED HURRICANE WILMA INDI- services, performs services at a different ricane Rita. VIDUAL.—The term ‘qualified Hurricane place of employment than such principal UALIFIED WILMA DISTRIBUTION.—The ‘‘(D) Q Wilma individual’ means an individual place of employment, or performs services at term ‘qualified Wilma distribution’ means (other than a qualified Hurricane Katrina in- such principal place of employment before any distribution (other than a qualified dividual or a qualified Hurricane Rita indi- significant operations have resumed. Katrina distribution or a qualified Rita dis- vidual) whose principal place of abode on Oc- ‘‘(3) CERTAIN RULES TO APPLY.—For pur- tribution)— tober 23, 2005, is located in the Hurricane poses of this subsection, rules similar to the ‘‘(i) described in section 401(k)(2)(B)(i)(IV), Wilma disaster area and who has sustained rules of sections 51(i)(1), 52, and 280C(a) shall 403(b)(7)(A)(ii) (but only to the extent such an economic loss by reason of Hurricane apply. distribution relates to financial hardship), Wilma. ‘‘(4) EMPLOYEE NOT TAKEN INTO ACCOUNT 403(b)(11)(B), or 72(t)(2)(F), ‘‘(4) APPLICABLE PERIOD; QUALIFIED BEGIN- MORE THAN ONCE.—An employee shall not be ‘‘(ii) received after February 28, 2005, and NING DATE.—For purposes of this sub- treated as an eligible employee for purposes before October 24, 2005, and of this subsection for any period with respect ‘‘(iii) which was to be used to purchase or section— ‘‘(A) HURRICANE KATRINA.—In the case of to any employer if such employer is allowed construct a principal residence in the Hurri- a credit under section 51 with respect to such cane Wilma disaster area, but which was not any qualified Hurricane Katrina individual— ‘‘(i) the applicable period is the period be- employee for such period. so purchased or constructed on account of ‘‘(b) EMPLOYEE RETENTION CREDIT FOR EM- ginning on September 24, 2005, and ending on Hurricane Wilma. PLOYERS AFFECTED BY HURRICANE RITA.— December 31, 2006, and ‘‘(3) APPLICABLE PERIOD.—For purposes of ‘‘(1) IN GENERAL.—For purposes of section ‘‘(ii) the qualified beginning date is August this subsection, the term ‘applicable period’ 38, in the case of an eligible employer, the 25, 2005. means— Hurricane Rita employee retention credit for ‘‘(B) HURRICANE RITA.—In the case of any ‘‘(A) with respect to any qualified Katrina any taxable year is an amount equal to 40 qualified Hurricane Rita individual— distribution, the period beginning on August percent of the qualified wages with respect ‘‘(i) the applicable period is the period be- 25, 2005, and ending on February 28, 2006, to each eligible employee of such employer ginning on the date of the enactment of this ‘‘(B) with respect to any qualified Rita dis- for such taxable year. For purposes of the tribution, the period beginning on September subsection and ending on December 31, 2006, preceding sentence, the amount of qualified 23, 2005, and ending on February 28, 2006, and and wages which may be taken into account with ‘‘(C) with respect to any qualified Wilma ‘‘(ii) the qualified beginning date is Sep- respect to any individual shall not exceed distribution, the period beginning on October tember 23, 2005. $6,000. ‘‘(C) HURRICANE WILMA.—In the case of any 23, 2005, and ending on February 28, 2006. ‘‘(2) DEFINITIONS.—For purposes of this sub- ‘‘(c) LOANS FROM QUALIFIED PLANS.— qualified Hurricane Wilma individual— section— ‘‘(1) INCREASE IN LIMIT ON LOANS NOT TREAT- ‘‘(i) the applicable period is the period be- ‘‘(A) ELIGIBLE EMPLOYER.—The term ‘eligi- ED AS DISTRIBUTIONS.—In the case of any loan ginning on the date of the enactment of this ble employer’ means any employer— from a qualified employer plan (as defined subsection and ending on December 31, 2006, ‘‘(i) which conducted an active trade or under section 72(p)(4)) to a qualified indi- and business on September 23, 2005, in the Rita vidual made during the applicable period— ‘‘(ii) the qualified beginning date is Octo- Zone, and ‘‘(A) clause (i) of section 72(p)(2)(A) shall be ber 23, 2005. ‘‘(ii) with respect to whom the trade or applied by substituting ‘$100,000’ for ‘$50,000’, ‘‘SEC. 1400R. EMPLOYMENT RELIEF. business described in clause (i) is inoperable and ‘‘(a) EMPLOYEE RETENTION CREDIT FOR EM- on any day after September 23, 2005, and be- ‘‘(B) clause (ii) of such section shall be ap- PLOYERS AFFECTED BY HURRICANE KATRINA.— fore January 1, 2006, as a result of damage plied by substituting ‘the present value of ‘‘(1) IN GENERAL.—For purposes of section sustained by reason of Hurricane Rita. the nonforfeitable accrued benefit of the em- 38, in the case of an eligible employer, the ‘‘(B) ELIGIBLE EMPLOYEE.—The term ‘eligi- ployee under the plan’ for ‘one-half of the Hurricane Katrina employee retention credit ble employee’ means with respect to an eligi- present value of the nonforfeitable accrued for any taxable year is an amount equal to 40 ble employer an employee whose principal benefit of the employee under the plan’. percent of the qualified wages with respect place of employment on September 23, 2005, ‘‘(2) DELAY OF REPAYMENT.—In the case of a to each eligible employee of such employer with such eligible employer was in the Rita qualified individual with an outstanding loan for such taxable year. For purposes of the Zone. on or after the qualified beginning date from preceding sentence, the amount of qualified ‘‘(C) QUALIFIED WAGES.—The term ‘quali- a qualified employer plan (as defined in sec- wages which may be taken into account with fied wages’ means wages (as defined in sec- tion 72(p)(4))— respect to any individual shall not exceed tion 51(c)(1), but without regard to section ‘‘(A) if the due date pursuant to subpara- $6,000. 3306(b)(2)(B)) paid or incurred by an eligible graph (B) or (C) of section 72(p)(2) for any re- ‘‘(2) DEFINITIONS.—For purposes of this sub- employer with respect to an eligible em- payment with respect to such loan occurs section— ployee on any day after September 23, 2005, during the period beginning on the qualified ‘‘(A) ELIGIBLE EMPLOYER.—The term ‘eligi- and before January 1, 2006, which occurs dur- beginning date and ending on December 31, ble employer’ means any employer— ing the period—

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‘‘(i) beginning on the date on which the ‘‘(4) EMPLOYEE NOT TAKEN INTO ACCOUNT ‘‘(C) APPLICATION OF ELECTION TO PARTNER- trade or business described in subparagraph MORE THAN ONCE.—An employee shall not be SHIPS AND S CORPORATIONS.—In the case of a (A) first became inoperable at the principal treated as an eligible employee for purposes partnership or S corporation, the election place of employment of the employee imme- of this subsection for any period with respect under subparagraph (A)(iii) shall be made diately before Hurricane Rita, and to any employer if such employer is allowed separately by each partner or shareholder. ‘‘(ii) ending on the date on which such a credit under subsection (a) or section 51 ‘‘(b) SUSPENSION OF CERTAIN LIMITATIONS trade or business has resumed significant op- with respect to such employee for such pe- ON PERSONAL CASUALTY LOSSES.—Paragraphs erations at such principal place of employ- riod. (1) and (2)(A) of section 165(h) shall not apply ment. ‘‘SEC. 1400S. ADDITIONAL TAX RELIEF PROVI- to losses described in section 165(c)(3)— Such term shall include wages paid without SIONS. ‘‘(1) which arise in the Hurricane Katrina regard to whether the employee performs no ‘‘(a) TEMPORARY SUSPENSION OF LIMITA- disaster area on or after August 25, 2005, and services, performs services at a different TIONS ON CHARITABLE CONTRIBUTIONS.— which are attributable to Hurricane Katrina, place of employment than such principal ‘‘(1) IN GENERAL.—Except as otherwise pro- ‘‘(2) which arise in the Hurricane Rita dis- place of employment, or performs services at vided in paragraph (2), section 170(b) shall aster area on or after September 23, 2005, and such principal place of employment before not apply to qualified contributions and such which are attributable to Hurricane Rita, or significant operations have resumed. contributions shall not be taken into ac- ‘‘(3) which arise in the Hurricane Wilma count for purposes of applying subsections ‘‘(3) CERTAIN RULES TO APPLY.—For pur- disaster area on or after October 23, 2005, and poses of this subsection, rules similar to the (b) and (d) of section 170 to other contribu- which are attributable to Hurricane Wilma. rules of sections 51(i)(1), 52, and 280C(a) shall tions. In the case of any other losses, section apply. ‘‘(2) TREATMENT OF EXCESS CONTRIBU- 165(h)(2)(A) shall be applied without regard TIONS.—For purposes of section 170— ‘‘(4) EMPLOYEE NOT TAKEN INTO ACCOUNT to the losses referred to in the preceding sen- ‘‘(A) INDIVIDUALS.—In the case of an indi- MORE THAN ONCE.—An employee shall not be tence.’’. vidual— treated as an eligible employee for purposes (b) CONFORMING AMENDMENTS.— ‘‘(i) LIMITATION.—Any qualified contribu- of this subsection for any period with respect (1) Subsection (b) of section 38 is amended tion shall be allowed only to the extent that to any employer if such employer is allowed by striking ‘‘and’’ at the end of paragraph the aggregate of such contributions does not a credit under subsection (a) or section 51 (25), by striking the period at the end of exceed the excess of the taxpayer’s contribu- with respect to such employee for such pe- paragraph (26) and inserting a comma, and tion base (as defined in subparagraph (F) of riod. by adding at the end the following new para- section 170(b)(1)) over the amount of all ‘‘(c) EMPLOYEE RETENTION CREDIT FOR EM- graphs: other charitable contributions allowed under PLOYERS AFFECTED BY HURRICANE WILMA.— ‘‘(27) the Hurricane Katrina employee re- section 170(b)(1). ‘‘(1) IN GENERAL.—For purposes of section tention credit determined under section ‘‘(ii) CARRYOVER.—If the aggregate amount 38, in the case of an eligible employer, the 1400R(a), of qualified contributions made in the con- Hurricane Wilma employee retention credit ‘‘(28) the Hurricane Rita employee reten- tribution year (within the meaning of sec- for any taxable year is an amount equal to 40 tion credit determined under section tion 170(d)(1)) exceeds the limitation of percent of the qualified wages with respect 1400R(b), and clause (i), such excess shall be added to the to each eligible employee of such employer ‘‘(29) the Hurricane Wilma employee reten- excess described in the portion of subpara- for such taxable year. For purposes of the tion credit determined under section graph (A) of such section which precedes preceding sentence, the amount of qualified clause (i) thereof for purposes of applying 1400R(c).’’. wages which may be taken into account with such section. (2) The table of sections for subchapter Z of respect to any individual shall not exceed chapter 1 is amended by adding at the end ‘‘(B) CORPORATIONS.—In the case of a cor- $6,000. poration— the following new items: ‘‘(2) DEFINITIONS.—For purposes of this sub- ‘‘(i) LIMITATION.—Any qualified contribu- ‘‘Sec. 1400P. Special rules for mortgage section— tion shall be allowed only to the extent that revenue bonds. ‘‘(A) ELIGIBLE EMPLOYER.—The term ‘eligi- the aggregate of such contributions does not ‘‘Sec. 1400Q. Special rules for use of re- ble employer’ means any employer— exceed the excess of the taxpayer’s taxable tirement funds. ‘‘(i) which conducted an active trade or income (as determined under paragraph (2) of ‘‘Sec. 140RQ. Employment relief. business on October 23, 2005, in the Wilma section 170(b)) over the amount of all other ‘‘Sec. 1400S. Additional tax relief provi- Zone, and charitable contributions allowed under such sions.’’. ‘‘(ii) with respect to whom the trade or paragraph. (3) The following provisions of the Katrina business described in clause (i) is inoperable ‘‘(ii) CARRYOVER.—Rules similar to the Emergency Tax Relief Act of 2005 are hereby on any day after October 23, 2005, and before rules of subparagraph (A)(ii) shall apply for repealed: January 1, 2006, as a result of damage sus- purposes of this subparagraph. (A) Title I. tained by reason of Hurricane Wilma. ‘‘(3) EXCEPTION TO OVERALL LIMITATION ON (B) Sections 202, 301, and 402. ‘‘(B) ELIGIBLE EMPLOYEE.—The term ‘eligi- ITEMIZED DEDUCTIONS.—So much of any de- TITLE II—EXTENSION OF EXPIRING ble employee’ means with respect to an eligi- duction allowed under section 170 as does not PROVISIONS ble employer an employee whose principal exceed the qualified contributions paid dur- place of employment on October 23, 2005, SEC. 201. EXTENSION AND INCREASE IN MIN- ing the taxable year shall not be treated as IMUM TAX RELIEF TO INDIVIDUALS. with such eligible employer was in the an itemized deduction for purposes of section (a) IN GENERAL.—Section 55(d)(1) is amend- Wilma Zone. 68. ed— ‘‘(C) QUALIFIED WAGES.—The term ‘quali- ‘‘(4) QUALIFIED CONTRIBUTIONS.— (1) by striking ‘‘$58,000’’ and all that fol- fied wages’ means wages (as defined in sec- ‘‘(A) IN GENERAL.—For purposes of this sub- lows through ‘‘2005’’ in subparagraph (A) and tion 51(c)(1), but without regard to section section, the term ‘qualified contribution’ inserting ‘‘$62,550 in the case of taxable years 3306(b)(2)(B)) paid or incurred by an eligible means any charitable contribution (as de- beginning in 2006’’, and employer with respect to an eligible em- fined in section 170(c)) if— (2) by striking ‘‘$40,250’’ and all that fol- ployee on any day after October 23, 2005, and ‘‘(i) such contribution is paid during the lows through ‘‘2005’’ in subparagraph (B) and before January 1, 2006, which occurs during period beginning on August 28, 2005, and end- inserting ‘‘$42,500 in the case of taxable years the period— ing on December 31, 2005, in cash to an orga- beginning in 2006’’. ‘‘(i) beginning on the date on which the nization described in section 170(b)(1)(A) (b) EFFECTIVE DATE.—The amendments trade or business described in subparagraph (other than an organization described in sec- made by this section shall apply to taxable (A) first became inoperable at the principal tion 509(a)(3)), years beginning after December 31, 2005. place of employment of the employee imme- ‘‘(ii) in the case of a contribution paid by diately before Hurricane Wilma, and SEC. 202. ALLOWANCE OF NONREFUNDABLE PER- a corporation, such contribution is for relief SONAL CREDITS AGAINST REGULAR ‘‘(ii) ending on the date on which such efforts related to Hurricane Katrina, Hurri- AND MINIMUM TAX LIABILITY. trade or business has resumed significant op- cane Rita, or Hurricane Wilma, and (a) IN GENERAL.—Paragraph (2) of section erations at such principal place of employ- ‘‘(iii) the taxpayer has elected the applica- 26(a) is amended— ment. tion of this subsection with respect to such (1) by striking ‘‘2005’’ in the heading and in- Such term shall include wages paid without contribution. serting ‘‘2006’’, and regard to whether the employee performs no ‘‘(B) EXCEPTION.—Such term shall not in- (2) by striking ‘‘or 2005’’ and inserting services, performs services at a different clude a contribution if the contribution is ‘‘2005, or 2006’’. place of employment than such principal for establishment of a new, or maintenance (b) CONFORMING PROVISIONS.— place of employment, or performs services at in an existing, segregated fund or account (1) Section 30B(g) is amended by adding at such principal place of employment before with respect to which the donor (or any per- the end the following new paragraph: significant operations have resumed. son appointed or designated by such donor) ‘‘(3) SPECIAL RULE FOR 2006.—For purposes ‘‘(3) CERTAIN RULES TO APPLY.—For pur- has, or reasonably expects to have, advisory of any taxable year beginning during 2006, poses of this subsection, rules similar to the privileges with respect to distributions or in- the credit allowed under subsection (a) (after rules of sections 51(i)(1), 52, and 280C(a) shall vestments by reason of the donor’s status as the application of paragraph (1)) shall not ex- apply. a donor. ceed the excess of—

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‘‘(A) the sum of the regular tax liability ‘‘(i) TAXPAYERS TO WHICH SUBPARAGRAPH ‘‘(ii) as having his principal place of abode (as defined in section 26(b)) plus the tax im- APPLIES.—The credit under this paragraph within an empowerment zone, enterprise posed by section 55, over shall be determined under this subparagraph community, or renewal community. ‘‘(B) the sum of the credits allowable under if the taxpayer has no qualified research ex- ‘‘(B) INDIVIDUAL MUST CONTINUE TO RESIDE subpart A and this subpart (other than this penses in any 1 of the 3 taxable years pre- IN ZONE OR COMMUNITY.—In the case of a des- section and section 30C).’’. ceding the taxable year for which the credit ignated community resident, the term (2) Section 30C(d) is amended by adding at is being determined. ‘qualified wages’ shall not include wages the end the following new paragraph: ‘‘(ii) CREDIT RATE.—The credit determined paid or incurred for services performed while ‘‘(3) SPECIAL RULE FOR 2006.—For purposes under this subparagraph shall be equal to 6 the individual’s principal place of abode is of any taxable year beginning during 2006, percent of the qualified research expenses for outside an empowerment zone, enterprise the credit allowed under subsection (a) (after the taxable year. community, or renewal community.’’ the application of paragraph (1)) shall not ex- ‘‘(C) ELECTION.—An election under this (2) CONFORMING AMENDMENT.—Subpara- ceed the excess of— paragraph shall apply to the taxable year for graph (D) of section 51(d)(1) is amended to ‘‘(A) the sum of the regular tax liability which made and all succeeding taxable years read as follows: (as defined in section 26(b)) plus the tax im- unless revoked with the consent of the Sec- ‘‘(D) a designated community resident,’’. posed by section 55, over retary. An election under this paragraph (e) CONSOLIDATION OF WORK OPPORTUNITY ‘‘(B) the sum of the credits allowable under may not be made for any taxable year to CREDIT WITH WELFARE-TO-WORK CREDIT.— subpart A and this subpart (other than this which an election under paragraph (4) ap- (1) IN GENERAL.—Paragraph (1) of section section).’’. plies.’’. 51(d) is amended by striking ‘‘or’’ at the end (3) Section 904(h) is amended by striking (2) COORDINATION WITH ELECTION OF ALTER- of subparagraph (G), by striking the period ‘‘or 2005’’ and inserting ‘‘2005, or 2006’’. NATIVE INCREMENTAL CREDIT.— at the end of subparagraph (H) and inserting (4) The amendments made by sections (A) IN GENERAL.—Section 41(c)(4)(B) (relat- ‘‘, or’’, and by adding at the end the fol- 201(b), 202(f), and 618(b) of the Economic ing to election) is amended by adding at the lowing new subparagraph: Growth and Tax Relief Reconciliation Act of end the following: ‘‘An election under this ‘‘(I) a long-term family assistance recipi- 2001 shall not apply to taxable years begin- paragraph may not be made for any taxable ent.’’ ning during 2006. year to which an election under paragraph (2) LONG-TERM FAMILY ASSISTANCE RECIPI- (5) applies.’’. ENT.—Subsection (d) of section 51 is amended SEC. 203. ELECTION TO DEDUCT STATE AND by redesignating paragraphs (10) through (12) LOCAL SALES TAXES IN LIEU OF (B) TRANSITION RULE.—In the case of an STATE AND LOCAL INCOME TAXES. election under section 41(c)(4) of the Internal as paragraphs (11) through (13), respectively, Section 164(b)(5)(I) is amended by striking Revenue Code of 1986 which applies to the and by inserting after paragraph (9) the fol- ‘‘2006’’ and inserting ‘‘2007’’. taxable year which includes the date of the lowing new paragraph: enactment of this Act, such election shall be ‘‘(10) LONG-TERM FAMILY ASSISTANCE RECIPI- SEC. 204. TUITION DEDUCTION. treated as revoked with the consent of the ENT.—The term ‘long-term family assistance (a) IN GENERAL.—Section 222(e) is amended Secretary of the Treasury if the taxpayer recipient’ means any individual who is cer- by striking ‘‘2005’’ and inserting ‘‘2006’’. makes an election under section 41(c)(5) of tified by the designated local agency— (b) CONFORMING AMENDMENTS.—Section such Code (as added by subsection (a)) for ‘‘(A) as being a member of a family receiv- 222(b)(2)(B) is amended— such year. ing assistance under a IV–A program (as de- (1) by striking ‘‘a taxable year beginning in (3) EFFECTIVE DATE.—The amendments fined in paragraph (2)(B)) for at least the 18- 2004 or 2005’’ and inserting ‘‘any taxable year made by this subsection shall apply to tax- month period ending on the hiring date, beginning after 2003’’, and able years ending after the date of the enact- ‘‘(B)(i) as being a member of a family re- (2) by striking ‘‘2004 AND 2005’’ and inserting ment of this Act. ceiving such assistance for 18 months begin- ‘‘AFTER 2003’’. (d) EXPANSION OF CREDIT TO EXPENSES OF ning after August 5, 1997, and SEC. 205. EXTENSION AND MODIFICATION OF RE- GENERAL COLLABORATIVE RESEARCH CON- ‘‘(ii) as having a hiring date which is not SEARCH CREDIT. SORTIA.— more than 2 years after the end of the ear- (a) EXTENSION.— (1) IN GENERAL.—Section 41 is amended— liest such 18-month period, or (1) IN GENERAL.—Section 41(h)(1)(B) is (A) by striking ‘‘an energy research con- ‘‘(C)(i) as being a member of a family amended by striking ‘‘2005’’ and inserting sortium’’ in subsections (a)(3) and (b)(3)(C)(i) which ceased to be eligible for such assist- ‘‘2006’’. and inserting ‘‘a research consortium’’, ance by reason of any limitation imposed by (2) CONFORMING AMENDMENT.—Section (B) by striking ‘‘energy’’ each place it ap- Federal or State law on the maximum period 45C(b)(1)(D) is amended by striking ‘‘2005’’ pears in subsection (f)(6)(A), such assistance is payable to a family, and and inserting ‘‘2006’’. (C) by inserting ‘‘or 501(c)(6)’’ after ‘‘sec- ‘‘(ii) as having a hiring date which is not (b) INCREASE IN RATES OF ALTERNATIVE IN- tion 501(c)(3)’’ in subsection (f)(6)(A)(i)(I), more than 2 years after the date of such ces- CREMENTAL CREDIT.— and sation.’’ (1) IN GENERAL.—Subparagraph (A) of sec- (D) by striking ‘‘ENERGY RESEARCH’’ in the (3) INCREASED CREDIT FOR EMPLOYMENT OF tion 41(c)(4) (relating to election of alter- heading for subsection (f)(6)(A) and inserting LONG-TERM FAMILY ASSISTANCE RECIPIENTS.— native incremental credit) is amended— ‘‘RESEARCH’’ . Section 51 is amended by inserting after sub- (A) by striking ‘‘2.65 percent’’ and insert- (2) EFFECTIVE DATE.—The amendments section (d) the following new subsection: ing ‘‘3 percent’’, made by this section shall apply to amounts ‘‘(e) CREDIT FOR SECOND-YEAR WAGES FOR (B) by striking ‘‘3.2 percent’’ and inserting paid or incurred after the date of the enact- EMPLOYMENT OF LONG-TERM FAMILY ASSIST- ‘‘4 percent’’, and ment of this Act, in taxable years ending ANCE RECIPIENTS.— (C) by striking ‘‘3.75 percent’’ and inserting after such date. ‘‘(1) IN GENERAL.—With respect to the em- ‘‘5 percent’’. SEC. 206. EXTENSION AND MODIFICATIONS TO ployment of a long-term family assistance (2) EFFECTIVE DATE.—The amendments WORK OPPORTUNITY CREDIT AND recipient— made by this subsection shall apply to tax- WELFARE-TO-WORK CREDIT. ‘‘(A) the amount of the work opportunity able years ending after the date of the enact- (a) IN GENERAL.—Section 51(c)(4)(B) is credit determined under this section for the ment of this Act. amended by striking ‘‘2005’’ and inserting taxable year shall include 50 percent of the ‘‘2006’’. (c) ALTERNATIVE SIMPLIFIED CREDIT FOR qualified second-year wages for such year, (b) ELIGIBILITY OF EX-FELONS DETERMINED QUALIFIED RESEARCH EXPENSES.— and WITHOUT REGARD TO FAMILY INCOME.—Para- (1) IN GENERAL.—Subsection (c) of section ‘‘(B) in lieu of applying subsection (b)(3), graph (4) of section 51(d) is amended by add- 41 (relating to base amount) is amended by ing ‘‘and’’ at the end of subparagraph (A), by the amount of the qualified first-year wages, redesignating paragraphs (5) and (6) as para- striking ‘‘, and’’ at the end of subparagraph and the amount of qualified second-year graphs (6) and (7), respectively, and by in- (B) and inserting a period, and by striking wages, which may be taken into account serting after paragraph (4) the following new all that follows subparagraph (B). with respect to such a recipient shall not ex- paragraph: (c) INCREASE IN MAXIMUM AGE FOR ELIGI- ceed $10,000 per year. ‘‘(5) ELECTION OF ALTERNATIVE SIMPLIFIED BILITY OF FOOD STAMP RECIPIENTS.—Clause ‘‘(2) QUALIFIED SECOND-YEAR WAGES.—For CREDIT.— (i) of section 51(d)(8)(A) is amended by strik- purposes of this subsection, the term ‘quali- ‘‘(A) IN GENERAL.—At the election of the ing ‘‘25’’ and inserting ‘‘40’’. fied second-year wages’ means qualified taxpayer, the credit determined under sub- (d) INCREASE IN MAXIMUM AGE FOR DES- wages— section (a)(1) shall be equal to 12 percent of IGNATED COMMUNITY RESIDENTS.— ‘‘(A) which are paid to a long-term family so much of the qualified research expenses (1) IN GENERAL.—Paragraph (5) of section assistance recipient, and for the taxable year as exceeds 50 percent of 51(d) is amended to read as follows: ‘‘(B) which are attributable to service ren- the average qualified research expenses for ‘‘(5) DESIGNATED COMMUNITY RESIDENTS.— dered during the 1-year period beginning on the 3 taxable years preceding the taxable ‘‘(A) IN GENERAL.—The term ‘designated the day after the last day of the 1-year pe- year for which the credit is being deter- community resident’ means any individual riod with respect to such recipient deter- mined. who is certified by the designated local agen- mined under subsection (b)(2). ‘‘(B) SPECIAL RULE IN CASE OF NO QUALIFIED cy— ‘‘(3) SPECIAL RULES FOR AGRICULTURAL AND RESEARCH EXPENSES IN ANY OF 3 PRECEDING ‘‘(i) as having attained age 18 but not age RAILWAY LABOR.—If such recipient is an em- TAXABLE YEARS.— 40 on the hiring date, and ployee to whom subparagraph (A) or (B) of

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subsection (h)(1) applies, rules similar to the (3) CONFORMING AMENDMENTS.—Subpara- ‘‘(ii) SPECIAL RULE WHERE TAXPAYER RELIES rules of such subparagraphs shall apply ex- graph (D) of section 170(e)(6) is amended by ON PROFIT POTENTIAL.—A transaction shall cept that— inserting ‘‘or assembled’’ after ‘‘con- not be treated as having economic substance ‘‘(A) such subparagraph (A) shall be applied structed’’ and ‘‘or assembling’’ after ‘‘con- by reason of having a potential for profit un- by substituting ‘$10,000’ for ‘$6,000’, and struction’’. less— ‘‘(B) such subparagraph (B) shall be applied (c) EFFECTIVE DATE.—The amendments ‘‘(I) the present value of the reasonably ex- by substituting ‘$833.33’ for ‘$500’.’’ made by this section shall apply to taxable pected pre-tax profit from the transaction is (4) REPEAL OF SEPARATE WELFARE-TO-WORK years beginning after December 31, 2005. substantial in relation to the present value CREDIT.— SEC. 213. EXPENSING OF BROWNFIELDS REMEDI- of the expected net tax benefits that would (A) IN GENERAL.—Section 51A is hereby re- ATION COSTS. be allowed if the transaction were respected, pealed. (a) EXTENSION.—Subsection (h) of section and (B) CLERICAL AMENDMENT.—The table of 198 is amended by striking ‘‘2005’’ and insert- ‘‘(II) the reasonably expected pre-tax profit sections for subpart F of part IV of sub- ing ‘‘2006’’. from the transaction exceeds a risk-free rate chapter A of chapter 1 is amended by strik- (b) EXPANSION.— of return. ing the item relating to section 51A. (1) IN GENERAL.—Section 198(d)(1) (defining ‘‘(C) TREATMENT OF FEES AND FOREIGN (f) EFFECTIVE DATE.—The amendments hazardous substance) is amended by striking TAXES.—Fees and other transaction expenses made by this section shall apply to individ- ‘‘and’’ at the end of subparagraph (A), by and foreign taxes shall be taken into account uals who begin work for the employer after striking the period at the end of subpara- as expenses in determining pre-tax profit December 31, 2005. graph (B) and inserting ‘‘, and’’, and by add- under subparagraph (B)(ii). ‘‘(2) SPECIAL RULES FOR TRANSACTIONS WITH SEC. 207. QUALIFIED ZONE ACADEMY BONDS. ing at the end the following new subpara- TAX-INDIFFERENT PARTIES.— Paragraph (1) of section 1397E(e) is amend- graph: ‘‘(A) SPECIAL RULES FOR FINANCING TRANS- ed by striking ‘‘and 2005’’ and inserting ‘‘2005, ‘‘(C) any petroleum product (as defined in ACTIONS.—The form of a transaction which is and 2006’’. section 4612(a)(3)).’’. in substance the borrowing of money or the SEC. 208. DEDUCTION FOR CERTAIN EXPENSES (2) EFFECTIVE DATE.—The amendments made by this subsection shall apply to ex- acquisition of financial capital directly or OF SCHOOL TEACHERS. indirectly from a tax-indifferent party shall penditures paid or incurred after December Subparagraph (D) of section 62(a)(2) is not be respected if the present value of the 31, 2005. amended by striking ‘‘or 2005’’ and inserting deductions to be claimed with respect to the ‘‘2005, or 2006’’. SEC. 214. EXTENSION OF FULL CREDIT FOR transaction is substantially in excess of the SEC. 209. TAX INCENTIVES FOR INVESTMENT IN QUALIFIED ELECTRIC VEHICLES. present value of the anticipated economic re- THE DISTRICT OF COLUMBIA. (a) IN GENERAL.—Section 30(b) (relating to turns of the person lending the money or (a) DESIGNATION OF ZONE.—Subsection (f) of limitations) is amended by striking para- providing the financial capital. A public of- section 1400 is amended by striking ‘‘2005’’ graph (2) and by redesignating paragraph (3) fering shall be treated as a borrowing, or an both places it appears and inserting ‘‘2006’’. as paragraph (2). acquisition of financial capital, from a tax- (b) TAX-EXEMPT ECONOMIC DEVELOPMENT SEC. 215. FIFTEEN-YEAR STRAIGHT-LINE COST indifferent party if it is reasonably expected BONDS.—Subsection (b) of section 1400A is RECOVERY FOR QUALIFIED LEASE- that at least 50 percent of the offering will be amended by striking ‘‘2005’’ and inserting HOLD IMPROVEMENTS AND QUALI- placed with tax-indifferent parties. FIED RESTAURANT IMPROVEMENTS. ‘‘2006’’. ‘‘(B) ARTIFICIAL INCOME SHIFTING AND BASIS Clauses (iv) and (v) of section 168(e)(3)(E) (c) ZERO PERCENT CAPITAL GAINS RATE.— ADJUSTMENTS.—The form of a transaction are each amended by striking ‘‘2006’’ and in- (1) IN GENERAL.—Subsection (b) of section with a tax-indifferent party shall not be re- 1400B is amended by striking ‘‘2006’’ each serting ‘‘2007’’. spected if— place it appears and inserting ‘‘2007’’. SEC. 216. APPLICATION OF EGTRRA SUNSET TO ‘‘(i) it results in an allocation of income or (2) CONFORMING AMENDMENTS.— THIS TITLE. gain to the tax-indifferent party in excess of (A) Section 1400B(e)(2) is amended— Each amendment made by this title shall such party’s economic income or gain, or (i) by striking ‘‘2010’’ and inserting ‘‘2011’’, be subject to title IX of the Economic ‘‘(ii) it results in a basis adjustment or and Growth and Tax Relief Reconciliation Act of shifting of basis on account of overstating (ii) by striking ‘‘2010’’ in the heading and 2001 to the same extent and in the same man- the income or gain of the tax-indifferent inserting ‘‘2011’’. ner as the provision of such Act to which party. (B) Section 1400B(g)(2) is amended by strik- such amendment relates. ‘‘(3) DEFINITIONS AND SPECIAL RULES.—For ing ‘‘2010’’ and inserting ‘‘2011’’. TITLE III—REVENUE PROVISIONS purposes of this subsection— (C) Section 1400F(d) is amended by striking Subtitle A—Provisions Relating to Tax ‘‘(A) ECONOMIC SUBSTANCE DOCTRINE.—The ‘‘2010’’ and inserting ‘‘2011’’. Shelters term ‘economic substance doctrine’ means (d) FIRST-TIME HOMEBUYER CREDIT.—Sub- the common law doctrine under which tax section (i) of section 1400C is amended by SEC. 301. CLARIFICATION OF ECONOMIC SUB- benefits under subtitle A with respect to a STANCE DOCTRINE. striking ‘‘2006’’ and inserting ‘‘2007’’. transaction are not allowable if the trans- (a) IN GENERAL.—Section 7701 is amended SEC. 210. INDIAN EMPLOYMENT TAX CREDIT. action does not have economic substance or by redesignating subsection (o) as subsection lacks a business purpose. Section 45A(f) is amended by striking (p) and by inserting after subsection (n) the ‘‘(B) TAX-INDIFFERENT PARTY.—The term ‘‘2005’’ and inserting ‘‘2006’’. following new subsection: ‘tax-indifferent party’ means any person or SEC. 211. ACCELERATED DEPRECIATION FOR ‘‘(o) CLARIFICATION OF ECONOMIC SUBSTANCE entity not subject to tax imposed by subtitle BUSINESS PROPERTY ON INDIAN DOCTRINE; ETC.— A. A person shall be treated as a tax-indif- RESERVATION. ‘‘(1) GENERAL RULES.— ferent party with respect to a transaction if Section 168(j)(8) is amended by striking ‘‘(A) IN GENERAL.—In any case in which a the items taken into account with respect to ‘‘2005’’ and inserting ‘‘2006’’. court determines that the economic sub- the transaction have no substantial impact SEC. 212. EXTENSION AND EXPANSION OF CHARI- stance doctrine is relevant for purposes of on such person’s liability under subtitle A. TABLE CONTRIBUTION ALLOWED this title to a transaction (or series of trans- ‘‘(C) EXCEPTION FOR PERSONAL TRANS- FOR SCIENTIFIC PROPERTY USED actions), such transaction (or series of trans- ACTIONS OF INDIVIDUALS.—In the case of an FOR RESEARCH AND FOR COM- actions) shall have economic substance only PUTER TECHNOLOGY AND EQUIP- individual, this subsection shall apply only MENT USED FOR EDUCATIONAL if the requirements of this paragraph are to transactions entered into in connection PURPOSES. met. with a trade or business or an activity en- (a) SCIENTIFIC PROPERTY USED FOR RE- ‘‘(B) DEFINITION OF ECONOMIC SUBSTANCE.— gaged in for the production of income. SEARCH.— For purposes of subparagraph (A)— ‘‘(D) TREATMENT OF LESSORS.—In applying (1) IN GENERAL.—Clause (ii) of section ‘‘(i) IN GENERAL.—A transaction has eco- paragraph (1)(B)(ii) to the lessor of tangible 170(e)(4)(B) (defining qualified research con- nomic substance only if— property subject to a lease— tributions) is amended by inserting ‘‘or as- ‘‘(I) the transaction changes in a meaning- ‘‘(i) the expected net tax benefits with re- sembled’’ after ‘‘constructed’’. ful way (apart from Federal tax effects) the spect to the leased property shall not include (2) CONFORMING AMENDMENT.—Clause (iii) of taxpayer’s economic position, and the benefits of— section 170(e)(4)(B) is amended by inserting ‘‘(II) the taxpayer has a substantial nontax ‘‘(I) depreciation, ‘‘or assembling’’ after ‘‘construction’’. purpose for entering into such transaction ‘‘(II) any tax credit, or (b) COMPUTER TECHNOLOGY AND EQUIPMENT and the transaction is a reasonable means of ‘‘(III) any other deduction as provided in FOR EDUCATIONAL PURPOSES.— accomplishing such purpose. guidance by the Secretary, and (1) IN GENERAL.—Clause (ii) of section In applying subclause (II), a purpose of ‘‘(ii) subclause (II) of paragraph (1)(B)(ii) 170(e)(6)(B) is amended by inserting ‘‘or as- achieving a financial accounting benefit shall be disregarded in determining whether sembled’’ after ‘‘constructed’’ and ‘‘or assem- shall not be taken into account in deter- any of such benefits are allowable. bling’’ after ‘‘construction’’. mining whether a transaction has a substan- ‘‘(4) OTHER COMMON LAW DOCTRINES NOT AF- (2) SPECIAL RULE EXTENDED.—Section tial nontax purpose if the origin of such fi- FECTED.—Except as specifically provided in 170(e)(6)(G) is amended by striking ‘‘2005’’ nancial accounting benefit is a reduction of this subsection, the provisions of this sub- and inserting ‘‘2006’’. income tax. section shall not be construed as altering or

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supplanting any other rule of law, and the (b) COORDINATION WITH OTHER UNDERSTATE- SEC. 304. MODIFICATIONS OF EFFECTIVE DATES requirements of this subsection shall be con- MENTS AND PENALTIES.— OF LEASING PROVISIONS OF THE strued as being in addition to any such other (1) The second sentence of section AMERICAN JOBS CREATION ACT OF rule of law. 6662(d)(2)(A) is amended by inserting ‘‘and 2004. ‘‘(5) REGULATIONS.—The Secretary shall without regard to items with respect to (a) IN GENERAL.—Section 849(b) of the prescribe such regulations as may be nec- which a penalty is imposed by section 6662B’’ American Jobs Creation Act of 2004 is essary or appropriate to carry out the pur- before the period at the end. amended by striking paragraphs (1) and (2), poses of this subsection. Such regulations (2) Subsection (e) of section 6662A is by redesignating paragraphs (3) and (4) as may include exemptions from the applica- amended— paragraphs (1) and (2), respectively, and by tion of this subsection.’’. (A) in paragraph (1), by inserting ‘‘and non- adding at the end the following new para- (b) EFFECTIVE DATE.—The amendments economic substance transaction understate- graph: made by this section shall apply to trans- ments’’ after ‘‘reportable transaction under- ‘‘(3) LEASES TO FOREIGN ENTITIES.—In the actions entered into after the date of the en- statements’’ both places it appears, case of tax-exempt use property leased to a actment of this Act. (B) in paragraph (2)(A), by inserting ‘‘and a tax-exempt entity which is a foreign person SEC. 302. PENALTY FOR UNDERSTATEMENTS AT- noneconomic substance transaction under- or entity, the amendments made by this part TRIBUTABLE TO TRANSACTIONS statement’’ after ‘‘reportable transaction un- shall apply to taxable years beginning after LACKING ECONOMIC SUBSTANCE, derstatement’’, December 31, 2004, with respect to leases en- ETC. (C) in paragraph (2)(B), by inserting ‘‘6662B tered into on or before March 12, 2004.’’. (a) IN GENERAL.—Subchapter A of chapter or’’ before ‘‘6663’’, (b) EFFECTIVE DATE.—The amendments 68 is amended by inserting after section (D) in paragraph (2)(C)(i), by inserting ‘‘or made by this section shall take effect as if 6662A the following new section: section 6662B’’ before the period at the end, included in the enactment of the American ‘‘SEC. 6662B. PENALTY FOR UNDERSTATEMENTS (E) in paragraph (2)(C)(ii), by inserting Jobs Creation Act of 2004. ATTRIBUTABLE TO TRANSACTIONS ‘‘and section 6662B’’ after ‘‘This section’’, LACKING ECONOMIC SUBSTANCE, SEC. 305. REVALUATION OF LIFO INVENTORIES ETC. (F) in paragraph (3), by inserting ‘‘or non- OF LARGE INTEGRATED OIL COMPA- NIES. ‘‘(a) IMPOSITION OF PENALTY.—If a taxpayer economic substance transaction understate- has an noneconomic substance transaction ment’’ after ‘‘reportable transaction under- (a) GENERAL RULE.—Notwithstanding any understatement for any taxable year, there statement’’, and other provision of law, if a taxpayer is an ap- shall be added to the tax an amount equal to (G) by adding at the end the following new plicable integrated oil company for its last 40 percent of the amount of such understate- paragraph: taxable year ending in calendar year 2005, ment. ‘‘(4) NONECONOMIC SUBSTANCE TRANSACTION the taxpayer shall— ‘‘(b) REDUCTION OF PENALTY FOR DISCLOSED UNDERSTATEMENT.—For purposes of this sub- (1) increase, effective as of the close of TRANSACTIONS.—Subsection (a) shall be ap- section, the term ‘noneconomic substance such taxable year, the value of each historic plied by substituting ‘20 percent’ for ‘40 per- transaction understatement’ has the mean- LIFO layer of inventories of crude oil, nat- cent’ with respect to the portion of any non- ing given such term by section 6662B(c).’’. ural gas, or any other petroleum product economic substance transaction understate- (3) Subsection (e) of section 6707A is (within the meaning of section 4611) by the ment with respect to which the relevant amended— layer adjustment amount, and facts affecting the tax treatment of the item (A) by striking ‘‘or’’ at the end of subpara- (2) decrease its cost of goods sold for such are adequately disclosed in the return or a graph (B), and taxable year by the aggregate amount of the statement attached to the return. (B) by striking subparagraph (C) and in- increases under paragraph (1). ‘‘(c) NONECONOMIC SUBSTANCE TRANSACTION serting the following new subparagraphs: If the aggregate amount of the increases UNDERSTATEMENT.—For purposes of this sec- ‘‘(C) is required to pay a penalty under sec- tion— under paragraph (1) exceed the taxpayer’s tion 6662B with respect to any noneconomic cost of goods sold for such taxable year, the ‘‘(1) IN GENERAL.—The term ‘noneconomic substance transaction, or taxpayer’s gross income for such taxable substance transaction understatement’ ‘‘(D) is required to pay a penalty under sec- means any amount which would be an under- year shall be increased by the amount of tion 6662(h) with respect to any transaction such excess. statement under section 6662A(b)(1) if section and would (but for section 6662A(e)(2)(C)) 6662A were applied by taking into account (b) LAYER ADJUSTMENT AMOUNT.—For pur- have been subject to penalty under section poses of this section— items attributable to noneconomic sub- 6662A at a rate prescribed under section stance transactions rather than items to (1) IN GENERAL.—The term ‘‘layer adjust- 6662A(c) or under section 6662B,’’. ment amount’’ means, with respect to any which section 6662A would apply without re- (c) CLERICAL AMENDMENT.—The table of historic LIFO layer, the product of— gard to this paragraph. sections for part II of subchapter A of chap- (A) $18.75, and ‘‘(2) NONECONOMIC SUBSTANCE TRANS- ter 68 is amended by inserting after the item (B) the number of barrels of crude oil (or in ACTION.—The term ‘noneconomic substance relating to section 6662A the following new the case of natural gas or other petroleum transaction’ means any transaction if— item: ‘‘(A) there is a lack of economic substance products, the number of barrel-of-oil equiva- ‘‘Sec. 6662B. Penalty for understatements lents) represented by the layer. (within the meaning of section 7701(o)(1)) for attributable to transactions the transaction giving rise to the claimed (2) BARREL-OF-OIL EQUIVALENT.—The term lacking economic substance, ‘‘barrel-of-oil equivalent’’ has the meaning benefit or the transaction was not respected etc.’’. under section 7701(o)(2), or given such term by section 29(d)(5) (as in ef- (d) EFFECTIVE DATE.—The amendments fect before its redesignation by the Energy ‘‘(B) the transaction fails to meet the re- made by this section shall apply to trans- quirements of any similar rule of law. Tax Incentives Act of 2005). actions entered into after the date of the en- (c) APPLICATION OF REQUIREMENT.— ‘‘(d) RULES APPLICABLE TO COMPROMISE OF actment of this Act. PENALTY.— (1) NO CHANGE IN METHOD OF ACCOUNTING.— SEC. 303. DENIAL OF DEDUCTION FOR INTEREST ‘‘(1) IN GENERAL.—If the 1st letter of pro- Any adjustment required by this section ON UNDERPAYMENTS ATTRIB- shall not be treated as a change in method of posed deficiency which allows the taxpayer UTABLE TO NONECONOMIC SUB- an opportunity for administrative review in STANCE TRANSACTIONS. accounting. the Internal Revenue Service Office of Ap- (a) IN GENERAL.—Section 163(m) (relating (2) UNDERPAYMENTS OF ESTIMATED TAX.—No peals has been sent with respect to a penalty to interest on unpaid taxes attributable to addition to the tax shall be made under sec- to which this section applies, only the Com- nondisclosed reportable transactions) is tion 6655 of the Internal Revenue Code of 1986 missioner of Internal Revenue may com- amended— (relating to failure by corporation to pay es- promise all or any portion of such penalty. (1) by striking ‘‘attributable’’ and all that timated tax) with respect to any under- ‘‘(2) APPLICABLE RULES.—The rules of para- follows and inserting the following: ‘‘attrib- payment of an installment required to be graphs (2) and (3) of section 6707A(d) shall utable to— paid with respect to the taxable year de- apply for purposes of paragraph (1). ‘‘(1) the portion of any reportable trans- scribed in subsection (a) to the extent such ‘‘(e) COORDINATION WITH OTHER PEN- action understatement (as defined in section underpayment was created or increased by ALTIES.—Except as otherwise provided in this 6662A(b)) with respect to which the require- this section. part, the penalty imposed by this section ment of section 6664(d)(2)(A) is not met, or (d) APPLICABLE INTEGRATED OIL COM- shall be in addition to any other penalty im- ‘‘(2) any noneconomic substance trans- PANY.—For purposes of this section, the term posed by this title. action understatement (as defined in section ‘‘applicable integrated oil company’’ means ‘‘(f) CROSS REFERENCES.— 6662B(c)).’’, and an integrated oil company (as defined in sec- ‘‘(1) For coordination of penalty with un- (2) by inserting ‘‘AND NONECONOMIC SUB- tion 291(b)(4) of the Internal Revenue Code of derstatements under section STANCE TRANSACTIONS’’ in the heading there- 1986) which— 6662 and other special rules, see of after ‘‘TRANSACTIONS’’. (1) had gross receipts in excess of section 6662A(e) (b) EFFECTIVE DATE.—The amendments $1,000,000,000 for its last taxable year ending ‘‘(2) For reporting of penalty imposed made by this section shall apply to trans- during calendar year 2005, and under this section to the Secu- actions after the date of the enactment of (2) uses the last-in, first-out (LIFO) meth- rities and Exchange Commis- this Act in taxable years ending after such od of accounting with respect to its crude oil sion, see section 6707A(e)’’. date. inventories for such taxable year.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00050 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.169 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13197 For purposes of paragraph (1), all persons (ii) has neither signed a closing agreement not exceed 100 percent of the gross income treated as a single employer under sub- pursuant to the Voluntary Offshore Compli- derived (or to be derived) from such aid, as- sections (a) and (b) of section 52 of the Inter- ance Initiative established by the Depart- sistance, procurement, or advice provided by nal Revenue Code of 1986 shall be treated as ment of the Treasury under Revenue Proce- the person or persons subject to such pen- 1 person and, in the case of a short taxable dure 2003-11 nor voluntarily disclosed its par- alty. year, the rule under section 448(c)(3)(B) shall ticipation in such arrangement by notifying ‘‘(2) CALCULATION OF PENALTY.—The pen- apply. the Internal Revenue Service of such ar- alty amount determined under paragraph (1) SEC. 306. MODIFICATION OF EFFECTIVE DATE OF rangement prior to the issue being raised by shall be calculated with respect to each in- EXCEPTION FROM SUSPENSION the Internal Revenue Service during an ex- stance of aid, assistance, procurement, or ad- RULES FOR CERTAIN LISTED AND amination. vice described in subsection (a), each in- REPORTABLE TRANSACTIONS. (B) AUTHORITY TO WAIVE.—The Secretary of stance in which income was derived by the (a) IN GENERAL.—Paragraph (2) of section the Treasury or the Secretary’s delegate person or persons subject to such penalty, 903(d) of the American Jobs Creation Act of may waive the application of paragraph (1) and each person who made such an under- 2004 is amended to read as follows: to any taxpayer if the Secretary or the Sec- statement of the liability for tax. ‘‘(2) EXCEPTION FOR REPORTABLE OR LISTED retary’s delegate determines that the use of ‘‘(3) LIABILITY FOR PENALTY.—If more than TRANSACTIONS.— such offshore payment mechanisms is inci- 1 person is liable under subsection (a) with ‘‘(A) IN GENERAL.—The amendments made dental to the transaction and, in addition, in respect to providing such aid, assistance, by subsection (c) shall apply with respect to the case of a trade or business, such use is procurement, or advice, all such persons interest accruing after October 3, 2004. conducted in the ordinary course of the type shall be jointly and severally liable for the ‘‘(B) SPECIAL RULE FOR CERTAIN LISTED AND of trade or business of the taxpayer. penalty under such subsection.’’. REPORTABLE TRANSACTIONS.— (C) ISSUES RAISED.—For purposes of sub- (c) PENALTY NOT DEDUCTIBLE.—Section 6701 ‘‘(i) IN GENERAL.—Except as provided in paragraph (A)(ii), an item shall be treated as is amended by adding at the end the fol- clause (ii), the amendments made by sub- an issue raised during an examination if the lowing new subsection: section (c) shall also apply with respect to individual examining the return— ‘‘(g) PENALTY NOT DEDUCTIBLE.—The pay- interest accruing on or before October 3, (i) communicates to the taxpayer knowl- ment of any penalty imposed under this sec- 2004. edge about the specific item, or tion or the payment of any amount to settle ‘‘(ii) PARTICIPANTS IN SETTLEMENT INITIA- (ii) has made a request to the taxpayer for or avoid the imposition of such penalty shall TIVES.—Clause (i) shall not apply to any information and the taxpayer could not not be deductible by the person who is sub- transaction if, as of January 23, 2006— make a complete response to that request ject to such penalty or who makes such pay- ‘‘(I) the taxpayer is participating in a set- without giving the examiner knowledge of ment.’’. tlement initiative described in Internal Rev- the specific item. enue Service Announcement 2005-80 with re- (b) DEFINITIONS AND RULES.—For purposes (d) EFFECTIVE DATE.—The amendments spect to such transaction, or of this section— made by this section shall apply to activities ‘‘(II) the taxpayer has entered into a set- (1) APPLICABLE PENALTY.—The term ‘‘appli- after the date of the enactment of this Act. tlement agreement pursuant to such an ini- cable penalty’’ means any penalty, addition Subtitle B—Provisions to Close Corporate tiative. to tax, or fine imposed under chapter 68 of and Individual Loopholes ‘‘(iii) TERMINATION OF EXCEPTION.—Clause the Internal Revenue Code of 1986. (ii)(I) shall not apply to any taxpayer if, (2) FEES AND EXPENSES.—The Secretary of SEC. 311. TAX TREATMENT OF INVERTED ENTI- after January 23, 2006, the taxpayer with- the Treasury may retain and use an amount TIES. draws from, or terminates, participation in not in excess of 25 percent of all additional (a) IN GENERAL.—Section 7874 is amended— the initiative or the Secretary of the Treas- interest, penalties, additions to tax, and (1) by striking ‘‘March 4, 2003’’ in sub- ury or the Secretary’s delegate determines fines collected under this section to be used section (a)(2)(B)(i) and in the matter fol- that a settlement agreement will not be for enforcement and collection activities of lowing subsection (a)(2)(B)(iii) and inserting reached pursuant to the initiative within a the Internal Revenue Service. The Secretary ‘‘March 20, 2002’’, reasonable period of time.’’. shall keep adequate records regarding (2) by striking ‘‘at least 60 percent’’ in sub- (b) EFFECTIVE DATE.—The amendment amounts so retained and used. The amount section (a)(2)(B)(ii) and inserting ‘‘more than made by this section shall take effect as if credited as paid by any taxpayer shall be de- 50 percent’’, included in the provisions of the American termined without regard to this paragraph. (3) by striking ‘‘80 percent’’ in subsection Jobs Creation Act of 2004 to which it relates. (c) REPORT BY SECRETARY.—The Secretary (b) and inserting ‘‘at least 80 percent’’, SEC. 307. DOUBLING OF CERTAIN PENALTIES, shall each year conduct a study and report to (4) by striking ‘‘60 percent’’ in subsection FINES, AND INTEREST ON UNDER- Congress on the implementation of this sec- (b) and inserting ‘‘more than 50 percent’’, PAYMENTS RELATED TO CERTAIN tion during the preceding year, including (5) by adding at the end of subsection (a)(2) OFFSHORE FINANCIAL ARRANGE- statistics on the number of taxpayers af- the following new sentence: ‘‘Except as pro- MENTS. fected by such implementation and the vided in regulations, an acquisition of prop- (a) DETERMINATION OF PENALTY.— amount of interest and applicable penalties erties of a domestic corporation shall not be (1) IN GENERAL.—Notwithstanding any asserted, waived, and assessed during such other provision of law, in the case of an ap- treated as described in subparagraph (B) if preceding year. plicable taxpayer— none of the corporation’s stock was readily (d) EFFECTIVE DATE.—The provisions of (A) the determination as to whether any tradeable on an established securities mar- this section shall apply to interest, pen- ket at any time during the 4-year period end- interest or applicable penalty is to be im- alties, additions to tax, and fines with re- posed with respect to any arrangement de- ing on the date of the acquisition.’’, and spect to any taxable year if, as of the date of (6) by redesignating subsection (g) as sub- scribed in paragraph (2), or to any under- the enactment of this Act, the assessment of payment of Federal income tax attributable section (h) and by inserting after subsection any tax, penalty, or interest with respect to (f) the following new subsection: to items arising in connection with any such such taxable year is not prevented by the op- ‘‘(g) SPECIAL RULES APPLICABLE TO EXPA- arrangement, shall be made without regard eration of any law or rule of law. to the rules of subsections (b), (c), and (d) of TRIATED ENTITIES.— SEC. 308. PENALTY FOR AIDING AND ABETTING ‘‘(1) INCREASES IN ACCURACY-RELATED PEN- section 6664 of the Internal Revenue Code of THE UNDERSTATEMENT OF TAX LI- ALTIES.—In the case of any underpayment of 1986, and ABILITY. tax of an expatriated entity— (B) if any such interest or applicable pen- (a) IN GENERAL.—Section 6701(a) (relating alty is imposed, the amount of such interest to imposition of penalty) is amended— ‘‘(A) section 6662(a) shall be applied with or penalty shall be equal to twice that deter- (1) by inserting ‘‘the tax liability or’’ after respect to such underpayment by sub- mined without regard to this section. ‘‘respect to,’’ in paragraph (1), stituting ‘30 percent’ for ‘20 percent’, and (2) APPLICABLE TAXPAYER.—For purposes of (2) by inserting ‘‘aid, assistance, procure- ‘‘(B) if such underpayment is attributable this subsection— ment, or advice with respect to such’’ before to one or more gross valuation understate- (A) IN GENERAL.—The term ‘‘applicable ‘‘portion’’ both places it appears in para- ments, the increase in the rate of penalty taxpayer’’ means a taxpayer which— graphs (2) and (3), and under section 6662(h) shall be to 50 percent (i) has underreported its United States in- (3) by inserting ‘‘instance of aid, assist- rather than 40 percent. come tax liability with respect to any item ance, procurement, or advice or each such’’ ‘‘(2) MODIFICATIONS OF LIMITATION ON INTER- which directly or indirectly involves— before ‘‘document’’ in the matter following EST DEDUCTION.—In the case of an expatri- (I) any financial arrangement which in any paragraph (3). ated entity, section 163(j) shall be applied— manner relies on the use of offshore payment (b) AMOUNT OF PENALTY.—Subsection (b) of ‘‘(A) without regard to paragraph (2)(A)(ii) mechanisms (including credit, debit, or section 6701 (relating to penalties for aiding thereof, and charge cards) issued by banks or other enti- and abetting understatement of tax liability) ‘‘(B) by substituting ‘25 percent’ for ‘50 per- ties in foreign jurisdictions, or is amended to read as follows: cent’ each place it appears in paragraph (II) any offshore financial arrangement (in- ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF (2)(B) thereof.’’. cluding any arrangement with foreign banks, PENALTY; LIABILITY FOR PENALTY.— (b) EFFECTIVE DATE.—The amendments financial institutions, corporations, partner- ‘‘(1) AMOUNT OF PENALTY.—The amount of made by this section shall apply to taxable ships, trusts, or other entities), and the penalty imposed by subsection (a) shall years ending after March 20, 2002.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00051 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.169 S17NOPT2 S13198 CONGRESSIONAL RECORD — SENATE November 17, 2005

SEC. 312. GRANT OF TREASURY REGULATORY AU- ship shall be treated as interest paid or ac- (b) REPORTING OF DEDUCTIBLE AMOUNTS.— THORITY TO ADDRESS FOREIGN TAX crued by such corporation, and (1) IN GENERAL.—Subpart B of part III of CREDIT TRANSACTIONS INVOLVING ‘‘(C) such corporation’s share of the liabil- subchapter A of chapter 61 is amended by in- INAPPROPRIATE SEPARATION OF ities of such partnership shall be treated as serting after section 6050T the following new FOREIGN TAXES FROM RELATED FOREIGN INCOME. liabilities of such corporation.’’. section: (b) ADDITIONAL REGULATORY AUTHORITY.— (a) IN GENERAL.—Section 901 (relating to ‘‘SEC. 6050U. INFORMATION WITH RESPECT TO taxes of foreign countries and of possessions Section 163(j)(9) (relating to regulations), as CERTAIN FINES, PENALTIES, AND of United States) is amended by redesig- redesignated by subsection (a), is amended OTHER AMOUNTS. by striking ‘‘and’’ at the end of subparagraph nating subsection (m) as subsection (n) and ‘‘(a) REQUIREMENT OF REPORTING.— (B), by striking the period at the end of sub- by inserting after subsection (l) the fol- ‘‘(1) IN GENERAL.—The appropriate official paragraph (C) and inserting ‘‘, and’’, and by lowing new subsection: of any government or entity which is de- adding at the end the following new subpara- ‘‘(m) REGULATIONS.—The Secretary may scribed in section 162(f)(4) which is involved graph: prescribe regulations disallowing a credit in a suit or agreement described in para- ‘‘(D) regulations providing for the realloca- under subsection (a) for all or a portion of graph (2) shall make a return in such form as tion of shares of partnership indebtedness, or any foreign tax, or allocating a foreign tax determined by the Secretary setting forth— distributive shares of the partnership’s inter- among 2 or more persons, in cases where the ‘‘(A) the amount required to be paid as a est income or interest expense, as may be ap- foreign tax is imposed on any person in re- result of the suit or agreement to which propriate to carry out the purposes of this spect of income of another person or in other paragraph (1) of section 162(f) applies, subsection.’’. cases involving the inappropriate separation ‘‘(B) any amount required to be paid as a (c) EFFECTIVE DATE.—The amendments of the foreign tax from the related foreign result of the suit or agreement which con- made by this section shall apply to taxable income.’’. stitutes restitution or remediation of prop- years beginning on or after the date of the (b) EFFECTIVE DATE.—The amendments erty, and enactment of this Act. made by this section shall apply to trans- ‘‘(C) any amount required to be paid as a actions entered into after the date of the en- SEC. 315. DENIAL OF DEDUCTION FOR CERTAIN result of the suit or agreement for the pur- actment of this Act. FINES, PENALTIES, AND OTHER pose of coming into compliance with any law AMOUNTS. SEC. 313. TREATMENT OF CONTINGENT PAYMENT which was violated or involved in the inves- (a) IN GENERAL.—Subsection (f) of section CONVERTIBLE DEBT INSTRUMENTS. tigation or inquiry. 162 (relating to trade or business expenses) is (a) IN GENERAL.—Section 1275(d) (relating ‘‘(2) SUIT OR AGREEMENT DESCRIBED.— amended to read as follows: to regulation authority) is amended— ‘‘(A) IN GENERAL.—A suit or agreement is ‘‘(f) FINES, PENALTIES, AND OTHER (1) by striking ‘‘The Secretary’’ and insert- described in this paragraph if— AMOUNTS.— ing the following: ‘‘(i) it is— ‘‘(1) IN GENERAL.—Except as provided in ‘‘(1) IN GENERAL.—The Secretary’’, and ‘‘(I) a suit with respect to a violation of paragraph (2), no deduction otherwise allow- (2) by adding at the end the following new any law over which the government or entity able shall be allowed under this chapter for paragraph: has authority and with respect to which any amount paid or incurred (whether by ‘‘(2) TREATMENT OF CONTINGENT PAYMENT there has been a court order, or suit, agreement, or otherwise) to, or at the CONVERTIBLE DEBT.— ‘‘(II) an agreement which is entered into direction of, a government or entity de- ‘‘(A) IN GENERAL.—In the case of a debt in- with respect to a violation of any law over scribed in paragraph (4) in relation to the strument which— which the government or entity has author- violation of any law or the investigation or ‘‘(i) is convertible into stock of the issuing ity, or with respect to an investigation or in- inquiry by such government or entity into corporation, into stock or debt of a related quiry by the government or entity into the the potential violation of any law. party (within the meaning of section 267(b) potential violation of any law over which ‘‘(2) EXCEPTION FOR AMOUNTS CONSTITUTING or 707(b)(1)), or into cash or other property in such government or entity has authority, RESTITUTION OR PAID TO COME INTO COMPLI- an amount equal to the approximate value of and ANCE WITH LAW.—Paragraph (1) shall not such stock or debt, and ‘‘(ii) the aggregate amount involved in all apply to any amount which— ‘‘(ii) provides for contingent payments, court orders and agreements with respect to ‘‘(A) the taxpayer establishes— any regulations which require original issue the violation, investigation, or inquiry is ‘‘(i) constitutes restitution (including re- discount to be determined by reference to $600 or more. mediation of property) for damage or harm the comparable yield of a noncontingent ‘‘(B) ADJUSTMENT OF REPORTING THRESH- caused by or which may be caused by the fixed-rate debt instrument shall be applied OLD.—The Secretary may adjust the $600 violation of any law or the potential viola- as if the regulations require that such com- amount in subparagraph (A)(ii) as necessary tion of any law, or parable yield be determined by reference to a in order to ensure the efficient administra- ‘‘(ii) is paid to come into compliance with noncontingent fixed-rate debt instrument tion of the internal revenue laws. any law which was violated or involved in which is convertible into stock. ‘‘(3) TIME OF FILING.—The return required the investigation or inquiry, and ‘‘(B) SPECIAL RULE.—For purposes of sub- under this subsection shall be filed not later ‘‘(B) is identified as restitution or as an paragraph (A), the comparable yield shall be than— amount paid to come into compliance with determined without taking into account the ‘‘(A) 30 days after the date on which a the law, as the case may be, in the court yield resulting from the conversion of a debt court order is issued with respect to the suit order or settlement agreement. instrument into stock.’’. or the date the agreement is entered into, as (b) CROSS REFERENCE.—Section 163(e)(6) Identification pursuant to subparagraph (B) the case may be, or (relating to cross references) is amended by alone shall not satisfy the requirement ‘‘(B) the date specified Secretary. under subparagraph (A). This paragraph adding at the end the following: ‘‘(b) STATEMENTS TO BE FURNISHED TO INDI- shall not apply to any amount paid or in- ‘‘For the treatment of contingent payment VIDUALS INVOLVED IN THE SETTLEMENT.— curred as reimbursement to the government convertible debt, see section 1275(d)(2).’’. Every person required to make a return or entity for the costs of any investigation (c) EFFECTIVE DATE.—The amendments under subsection (a) shall furnish to each or litigation. made by this section shall apply to debt in- person who is a party to the suit or agree- ‘‘(3) EXCEPTION FOR AMOUNTS PAID OR IN- struments issued on or after the date of the ment a written statement showing— CURRED AS THE RESULT OF CERTAIN COURT OR- enactment of this Act. ‘‘(1) the name of the government or entity, DERS.—Paragraph (1) shall not apply to any SEC. 314. APPLICATION OF EARNINGS STRIPPING and amount paid or incurred by order of a court RULES TO PARTNERS WHICH ARE ‘‘(2) the information supplied to the Sec- CORPORATIONS. in a suit in which no government or entity retary under subsection (a)(1). (a) IN GENERAL.—Section 163(j) (relating to described in paragraph (4) is a party. limitation on deduction for interest on cer- ‘‘(4) CERTAIN NONGOVERNMENTAL REGU- The written statement required under the tain indebtedness) is amended by redesig- LATORY ENTITIES.—An entity is described in preceding sentence shall be furnished to the nating paragraph (8) as paragraph (9) and by this paragraph if it is— person at the same time the government or inserting after paragraph (7) the following ‘‘(A) a nongovernmental entity which exer- entity provides the Secretary with the infor- new paragraph: cises self-regulatory powers (including im- mation required under subsection (a). ‘‘(8) TREATMENT OF CORPORATE PARTNERS.— posing sanctions) in connection with a quali- ‘‘(c) APPROPRIATE OFFICIAL DEFINED.—For Except to the extent provided by regula- fied board or exchange (as defined in section purposes of this section, the term ‘appro- tions, in applying this subsection to a cor- 1256(g)(7)), or priate official’ means the officer or employee poration which owns (directly or indirectly) ‘‘(B) to the extent provided in regulations, having control of the suit, investigation, or an interest in a partnership— a nongovernmental entity which exercises inquiry or the person appropriately des- ‘‘(A) such corporation’s distributive share self-regulatory powers (including imposing ignated for purposes of this section.’’. of interest income paid or accrued to such sanctions) as part of performing an essential (2) CONFORMING AMENDMENT.—The table of partnership shall be treated as interest in- governmental function. sections for subpart B of part III of sub- come paid or accrued to such corporation, ‘‘(5) EXCEPTION FOR TAXES DUE.—Paragraph chapter A of chapter 61 is amended by insert- ‘‘(B) such corporation’s distributive share (1) shall not apply to any amount paid or in- ing after the item relating to section 6050T of interest paid or accrued by such partner- curred as taxes due.’’. the following new item:

VerDate Aug 31 2005 02:02 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00052 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.170 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13199 ‘‘Sec. 6050U. Information with respect to ‘‘to the extent that the expenses are includ- ment or collection of any tax which may be certain fines, penalties, and ible in the gross income’’ and inserting ‘‘to imposed by reason of this paragraph, and other amounts.’’. the extent that the expenses do not exceed ‘‘(iii) complies with such other require- (c) EFFECTIVE DATE.—The amendments the amount of the expenses which are includ- ments as the Secretary may prescribe. made by this section shall apply to amounts ible in the gross income’’. ‘‘(C) ELECTION.—An election under sub- paid or incurred on or after the date of the (c) EFFECTIVE DATE.—The amendments paragraph (A) shall apply to all property to enactment of this Act, except that such made by this section shall apply to expenses which this section would apply but for the amendments shall not apply to amounts paid incurred after the date of the enactment of election and, once made, shall be irrev- or incurred under any binding order or agree- this Act. ocable. Such election shall also apply to ment entered into before such date. Such ex- SEC. 318. IMPOSITION OF MARK-TO-MARKET TAX property the basis of which is determined in ception shall not apply to an order or agree- ON INDIVIDUALS WHO EXPATRIATE. whole or in part by reference to the property ment requiring court approval unless the ap- (a) IN GENERAL.—Subpart A of part II of with respect to which the election was made. subchapter N of chapter 1 is amended by in- proval was obtained before such date. ‘‘(b) ELECTION TO DEFER TAX.— SEC. 316. DISALLOWANCE OF DEDUCTION FOR serting after section 877 the following new section: ‘‘(1) IN GENERAL.—If the taxpayer elects the PUNITIVE DAMAGES. application of this subsection with respect to (a) DISALLOWANCE OF DEDUCTION.— ‘‘SEC. 877A. TAX RESPONSIBILITIES OF EXPATRIA- TION. any property treated as sold by reason of (1) IN GENERAL.—Section 162(g) (relating to subsection (a), the payment of the additional treble damage payments under the antitrust ‘‘(a) GENERAL RULES.—For purposes of this subtitle— tax attributable to such property shall be laws) is amended— postponed until the due date of the return ‘‘(1) MARK TO MARKET.—Except as provided (A) by redesignating paragraphs (1) and (2) for the taxable year in which such property as subparagraphs (A) and (B), respectively, in subsections (d) and (f), all property of a is disposed of (or, in the case of property dis- (B) by striking ‘‘If’’ and inserting: covered expatriate to whom this section ap- posed of in a transaction in which gain is not ‘‘(1) TREBLE DAMAGES.—If’’, and plies shall be treated as sold on the day be- recognized in whole or in part, until such (C) by adding at the end the following new fore the expatriation date for its fair market other date as the Secretary may prescribe). paragraph: value. ‘‘(2) DETERMINATION OF TAX WITH RESPECT ‘‘(2) PUNITIVE DAMAGES.—No deduction ‘‘(2) RECOGNITION OF GAIN OR LOSS.—In the TO PROPERTY.—For purposes of paragraph (1), shall be allowed under this chapter for any case of any sale under paragraph (1)— the additional tax attributable to any prop- amount paid or incurred for punitive dam- ‘‘(A) notwithstanding any other provision erty is an amount which bears the same ages in connection with any judgment in, or of this title, any gain arising from such sale ratio to the additional tax imposed by this settlement of, any action. This paragraph shall be taken into account for the taxable chapter for the taxable year solely by reason shall not apply to punitive damages de- year of the sale, and of subsection (a) as the gain taken into ac- scribed in section 104(c).’’. ‘‘(B) any loss arising from such sale shall count under subsection (a) with respect to (2) CONFORMING AMENDMENT.—The heading be taken into account for the taxable year of such property bears to the total gain taken for section 162(g) is amended by inserting the sale to the extent otherwise provided by into account under subsection (a) with re- ‘‘OR PUNITIVE DAMAGES’’ after ‘‘LAWS’’. this title, except that section 1091 shall not spect to all property to which subsection (a) (b) INCLUSION IN INCOME OF PUNITIVE DAM- apply to any such loss. applies. AGES PAID BY INSURER OR OTHERWISE.— Proper adjustment shall be made in the ‘‘(3) TERMINATION OF POSTPONEMENT.—No (1) IN GENERAL.—Part II of subchapter B of amount of any gain or loss subsequently re- tax may be postponed under this subsection chapter 1 (relating to items specifically in- alized for gain or loss taken into account later than the due date for the return of tax cluded in gross income) is amended by add- under the preceding sentence. imposed by this chapter for the taxable year ing at the end the following new section: ‘‘(3) EXCLUSION FOR CERTAIN GAIN.— which includes the date of death of the expa- ‘‘SEC. 91. PUNITIVE DAMAGES COMPENSATED BY ‘‘(A) IN GENERAL.—The amount which, but triate (or, if earlier, the time that the secu- INSURANCE OR OTHERWISE. for this paragraph, would be includible in the rity provided with respect to the property ‘‘Gross income shall include any amount gross income of any individual by reason of fails to meet the requirements of paragraph paid to or on behalf of a taxpayer as insur- this section shall be reduced (but not below (4), unless the taxpayer corrects such failure ance or otherwise by reason of the taxpayer’s zero) by $600,000. For purposes of this para- within the time specified by the Secretary). liability (or agreement) to pay punitive dam- graph, allocable expatriation gain taken into ‘‘(4) SECURITY.— ages.’’. account under subsection (f)(2) shall be ‘‘(A) IN GENERAL.—No election may be (2) REPORTING REQUIREMENTS.—Section 6041 treated in the same manner as an amount re- made under paragraph (1) with respect to (relating to information at source) is amend- quired to be includible in gross income. any property unless adequate security is pro- ed by adding at the end the following new ‘‘(B) COST-OF-LIVING ADJUSTMENT.— vided to the Secretary with respect to such subsection: ‘‘(i) IN GENERAL.—In the case of an expa- property. ‘‘(f) SECTION TO APPLY TO PUNITIVE DAM- triation date occurring in any calendar year ‘‘(B) ADEQUATE SECURITY.—For purposes of AGES COMPENSATION.—This section shall after 2005, the $600,000 amount under sub- subparagraph (A), security with respect to apply to payments by a person to or on be- paragraph (A) shall be increased by an any property shall be treated as adequate se- half of another person as insurance or other- amount equal to— curity if— wise by reason of the other person’s liability ‘‘(I) such dollar amount, multiplied by ‘‘(i) it is a bond in an amount equal to the (or agreement) to pay punitive damages.’’. ‘‘(II) the cost-of-living adjustment deter- deferred tax amount under paragraph (2) for (3) CONFORMING AMENDMENT.—The table of mined under section 1(f)(3) for such calendar the property, or sections for part II of subchapter B of chap- year, determined by substituting ‘calendar ‘‘(ii) the taxpayer otherwise establishes to ter 1 is amended by adding at the end the fol- year 2004’ for ‘calendar year 1992’ in subpara- the satisfaction of the Secretary that the se- lowing new item: graph (B) thereof. curity is adequate. ‘‘Sec. 91. Punitive damages compensated by ‘‘(ii) ROUNDING RULES.—If any amount after ‘‘(5) WAIVER OF CERTAIN RIGHTS.—No elec- insurance or otherwise.’’. adjustment under clause (i) is not a multiple tion may be made under paragraph (1) unless of $1,000, such amount shall be rounded to (c) EFFECTIVE DATE.—The amendments the taxpayer consents to the waiver of any the next lower multiple of $1,000. made by this section shall apply to damages right under any treaty of the United States ‘‘(4) ELECTION TO CONTINUE TO BE TAXED AS paid or incurred on or after the date of the which would preclude assessment or collec- UNITED STATES CITIZEN.— enactment of this Act. tion of any tax imposed by reason of this sec- ‘‘(A) IN GENERAL.—If a covered expatriate SEC. 317. LIMITATION OF EMPLOYER DEDUCTION tion. elects the application of this paragraph— FOR CERTAIN ENTERTAINMENT EX- ‘‘(6) ELECTIONS.—An election under para- ‘‘(i) this section (other than this paragraph PENSES. graph (1) shall only apply to property de- (a) IN GENERAL.—Paragraph (2) of section and subsection (i)) shall not apply to the ex- scribed in the election and, once made, is ir- 274(e) (relating to expenses treated as com- patriate, but revocable. An election may be made under pensation) is amended to read as follows: ‘‘(ii) in the case of property to which this paragraph (1) with respect to an interest in a ‘‘(2) EXPENSES TREATED AS COMPENSATION.— section would apply but for such election, trust with respect to which gain is required Expenses for goods, services, and facilities, the expatriate shall be subject to tax under to be recognized under subsection (f)(1). to the extent that the expenses do not exceed this title in the same manner as if the indi- ‘‘(7) INTEREST.—For purposes of section vidual were a United States citizen. the amount of the expenses which are treat- 6601— ‘‘(B) REQUIREMENTS.—Subparagraph (A) ed by the taxpayer, with respect to the re- ‘‘(A) the last date for the payment of tax shall not apply to an individual unless the cipient of the entertainment, amusement, or shall be determined without regard to the individual— recreation, as compensation to an employee election under this subsection, and ‘‘(i) provides security for payment of tax in on the taxpayer’s return of tax under this ‘‘(B) section 6621(a)(2) shall be applied by such form and manner, and in such amount, chapter and as wages to such employee for substituting ‘5 percentage points’ for ‘3 per- as the Secretary may require, purposes of chapter 24 (relating to with- centage points’ in subparagraph (B) thereof. holding of income tax at source on wages).’’. ‘‘(ii) consents to the waiver of any right of (b) PERSONS NOT EMPLOYEES.—Paragraph the individual under any treaty of the ‘‘(c) COVERED EXPATRIATE.—For purposes (9) of section 274(e) is amended by striking United States which would preclude assess- of this section—

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‘‘(1) IN GENERAL.—Except as provided in ‘‘(A) any United States citizen who relin- ‘‘(i) paragraph (1) and subsection (a) shall paragraph (2), the term ‘covered expatriate’ quishes citizenship, and not apply, and means an expatriate. ‘‘(B) any long-term resident of the United ‘‘(ii) in addition to any other tax imposed ‘‘(2) EXCEPTIONS.—An individual shall not States who— by this title, there is hereby imposed on each be treated as a covered expatriate if— ‘‘(i) ceases to be a lawful permanent resi- distribution with respect to such interest a ‘‘(A) the individual— dent of the United States (within the mean- tax in the amount determined under sub- ‘‘(i) became at birth a citizen of the United ing of section 7701(b)(6)), or paragraph (B). States and a citizen of another country and, ‘‘(ii) commences to be treated as a resident ‘‘(B) AMOUNT OF TAX.—The amount of tax as of the expatriation date, continues to be a of a foreign country under the provisions of under subparagraph (A)(ii) shall be equal to citizen of, and is taxed as a resident of, such a tax treaty between the United States and the lesser of— other country, and the foreign country and who does not waive ‘‘(i) the highest rate of tax imposed by sec- ‘‘(ii) has not been a resident of the United the benefits of such treaty applicable to resi- tion 1(e) for the taxable year which includes States (as defined in section 7701(b)(1)(A)(ii)) dents of the foreign country. the day before the expatriation date, multi- during the 5 taxable years ending with the ‘‘(2) EXPATRIATION DATE.—The term ‘expa- plied by the amount of the distribution, or taxable year during which the expatriation triation date’ means— ‘‘(ii) the balance in the deferred tax ac- date occurs, or ‘‘(A) the date an individual relinquishes count immediately before the distribution ‘‘(B)(i) the individual’s relinquishment of United States citizenship, or determined without regard to any increases United States citizenship occurs before such ‘‘(B) in the case of a long-term resident of under subparagraph (C)(ii) after the 30th day individual attains age 18 1/2, and the United States, the date of the event de- preceding the distribution. ‘‘(ii) the individual has been a resident of scribed in clause (i) or (ii) of paragraph ‘‘(C) DEFERRED TAX ACCOUNT.—For purposes the United States (as so defined) for not (1)(B). of subparagraph (B)(ii)— ‘‘(3) RELINQUISHMENT OF CITIZENSHIP.—A more than 5 taxable years before the date of ‘‘(i) OPENING BALANCE.—The opening bal- relinquishment. citizen shall be treated as relinquishing ance in a deferred tax account with respect ‘‘(d) EXEMPT PROPERTY; SPECIAL RULES FOR United States citizenship on the earliest of— to any trust interest is an amount equal to PENSION PLANS.— ‘‘(A) the date the individual renounces the tax which would have been imposed on ‘‘(1) EXEMPT PROPERTY.—This section shall such individual’s United States nationality the allocable expatriation gain with respect not apply to the following: before a diplomatic or consular officer of the to the trust interest if such gain had been in- ‘‘(A) UNITED STATES REAL PROPERTY INTER- United States pursuant to paragraph (5) of cluded in gross income under subsection (a). section 349(a) of the Immigration and Na- ESTS.—Any United States real property in- ‘‘(ii) INCREASE FOR INTEREST.—The balance terest (as defined in section 897(c)(1)), other tionality Act (8 U.S.C. 1481(a)(5)), in the deferred tax account shall be in- than stock of a United States real property ‘‘(B) the date the individual furnishes to creased by the amount of interest deter- holding corporation which does not, on the the United States Department of State a mined (on the balance in the account at the day before the expatriation date, meet the signed statement of voluntary relinquish- time the interest accrues), for periods after requirements of section 897(c)(2). ment of United States nationality con- the 90th day after the expatriation date, by ‘‘(B) SPECIFIED PROPERTY.—Any property firming the performance of an act of expa- using the rates and method applicable under or interest in property not described in sub- triation specified in paragraph (1), (2), (3), or section 6621 for underpayments of tax for paragraph (A) which the Secretary specifies (4) of section 349(a) of the Immigration and such periods, except that section 6621(a)(2) in regulations. Nationality Act (8 U.S.C. 1481(a)(1)–(4)), shall be applied by substituting ‘5 percentage ‘‘(2) SPECIAL RULES FOR CERTAIN RETIRE- ‘‘(C) the date the United States Depart- points’ for ‘3 percentage points’ in subpara- MENT PLANS.— ment of State issues to the individual a cer- graph (B) thereof. tificate of loss of nationality, or ‘‘(A) IN GENERAL.—If a covered expatriate ‘‘(iii) DECREASE FOR TAXES PREVIOUSLY ‘‘(D) the date a court of the United States holds on the day before the expatriation date PAID.—The balance in the tax deferred ac- any interest in a retirement plan to which cancels a naturalized citizen’s certificate of count shall be reduced— this paragraph applies— naturalization. ‘‘(I) by the amount of taxes imposed by ‘‘(i) such interest shall not be treated as Subparagraph (A) or (B) shall not apply to subparagraph (A) on any distribution to the sold for purposes of subsection (a)(1), but any individual unless the renunciation or person holding the trust interest, and ‘‘(ii) an amount equal to the present value voluntary relinquishment is subsequently ‘‘(II) in the case of a person holding a non- of the expatriate’s nonforfeitable accrued approved by the issuance to the individual of vested interest, to the extent provided in benefit shall be treated as having been re- a certificate of loss of nationality by the regulations, by the amount of taxes imposed ceived by such individual on such date as a United States Department of State. by subparagraph (A) on distributions from distribution under the plan. ‘‘(4) LONG-TERM RESIDENT.—The term ‘long- the trust with respect to nonvested interests ‘‘(B) TREATMENT OF SUBSEQUENT DISTRIBU- term resident’ has the meaning given to such not held by such person. TIONS.—In the case of any distribution on or term by section 877(e)(2). ‘‘(D) ALLOCABLE EXPATRIATION GAIN.—For after the expatriation date to or on behalf of ‘‘(f) SPECIAL RULES APPLICABLE TO BENE- purposes of this paragraph, the allocable ex- the covered expatriate from a plan from FICIARIES’ INTERESTS IN TRUST.— patriation gain with respect to any bene- which the expatriate was treated as receiv- ‘‘(1) IN GENERAL.—Except as provided in ficiary’s interest in a trust is the amount of ing a distribution under subparagraph (A), paragraph (2), if an individual is determined gain which would be allocable to such bene- the amount otherwise includible in gross in- under paragraph (3) to hold an interest in a ficiary’s vested and nonvested interests in come by reason of the subsequent distribu- trust on the day before the expatriation the trust if the beneficiary held directly all tion shall be reduced by the excess of the date— assets allocable to such interests. amount includible in gross income under ‘‘(A) the individual shall not be treated as ‘‘(E) TAX DEDUCTED AND WITHHELD.— subparagraph (A) over any portion of such having sold such interest, ‘‘(i) IN GENERAL.—The tax imposed by sub- amount to which this subparagraph pre- ‘‘(B) such interest shall be treated as a sep- paragraph (A)(ii) shall be deducted and with- viously applied. arate share in the trust, and held by the trustees from the distribution to ‘‘(C) TREATMENT OF SUBSEQUENT DISTRIBU- ‘‘(C)(i) such separate share shall be treated which it relates. TIONS BY PLAN.—For purposes of this title, a as a separate trust consisting of the assets ‘‘(ii) EXCEPTION WHERE FAILURE TO WAIVE retirement plan to which this paragraph ap- allocable to such share, TREATY RIGHTS.—If an amount may not be plies, and any person acting on the plan’s be- ‘‘(ii) the separate trust shall be treated as deducted and withheld under clause (i) by half, shall treat any subsequent distribution having sold its assets on the day before the reason of the distributee failing to waive any described in subparagraph (B) in the same expatriation date for their fair market value treaty right with respect to such distribu- manner as such distribution would be treat- and as having distributed all of its assets to tion— ed without regard to this paragraph. the individual as of such time, and ‘‘(I) the tax imposed by subparagraph ‘‘(D) APPLICABLE PLANS.—This paragraph ‘‘(iii) the individual shall be treated as (A)(ii) shall be imposed on the trust and each shall apply to— having recontributed the assets to the sepa- trustee shall be personally liable for the ‘‘(i) any qualified retirement plan (as de- rate trust. amount of such tax, and fined in section 4974(c)), Subsection (a)(2) shall apply to any income, ‘‘(II) any other beneficiary of the trust ‘‘(ii) an eligible deferred compensation gain, or loss of the individual arising from a shall be entitled to recover from the dis- plan (as defined in section 457(b)) of an eligi- distribution described in subparagraph tributee the amount of such tax imposed on ble employer described in section (C)(ii). In determining the amount of such the other beneficiary. 457(e)(1)(A), and distribution, proper adjustments shall be ‘‘(F) DISPOSITION.—If a trust ceases to be a ‘‘(iii) to the extent provided in regulations, made for liabilities of the trust allocable to qualified trust at any time, a covered expa- any foreign pension plan or similar retire- an individual’s share in the trust. triate disposes of an interest in a qualified ment arrangements or programs. ‘‘(2) SPECIAL RULES FOR INTERESTS IN QUALI- trust, or a covered expatriate holding an in- ‘‘(e) DEFINITIONS.—For purposes of this sec- FIED TRUSTS.— terest in a qualified trust dies, then, in lieu tion— ‘‘(A) IN GENERAL.—If the trust interest de- of the tax imposed by subparagraph (A)(ii), ‘‘(1) EXPATRIATE.—The term ‘expatriate’ scribed in paragraph (1) is an interest in a there is hereby imposed a tax equal to the means— qualified trust— lesser of—

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00054 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.170 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13201 ‘‘(i) the tax determined under paragraph (1) year, there is hereby imposed, immediately posed by chapter 11 of the estate of the cov- as if the day before the expatriation date before the expatriation date, a tax in an ered expatriate, or were the date of such cessation, disposition, amount equal to the amount of tax which ‘‘(B) no such return was timely filed but no or death, whichever is applicable, or would be imposed if the taxable year were a such return would have been required to be ‘‘(ii) the balance in the tax deferred ac- short taxable year ending on the expatria- filed even if the covered expatriate were a count immediately before such date. tion date. citizen or long-term resident of the United Such tax shall be imposed on the trust and ‘‘(2) DUE DATE.—The due date for any tax States.’’. each trustee shall be personally liable for the imposed by paragraph (1) shall be the 90th (c) DEFINITION OF TERMINATION OF UNITED amount of such tax and any other bene- day after the expatriation date. STATES CITIZENSHIP.—Section 7701(a) is ficiary of the trust shall be entitled to re- ‘‘(3) TREATMENT OF TAX.—Any tax paid amended by adding at the end the following cover from the covered expatriate or the es- under paragraph (1) shall be treated as a pay- new paragraph: tate the amount of such tax imposed on the ment of the tax imposed by this chapter for ‘‘(49) TERMINATION OF UNITED STATES CITI- other beneficiary. the taxable year to which subsection (a) ap- ZENSHIP.— ‘‘(G) DEFINITIONS AND SPECIAL RULES.—For plies. ‘‘(A) IN GENERAL.—An individual shall not purposes of this paragraph— ‘‘(4) DEFERRAL OF TAX.—The provisions of cease to be treated as a United States citizen ‘‘(i) QUALIFIED TRUST.—The term ‘qualified subsection (b) shall apply to the tax imposed before the date on which the individual’s trust’ means a trust which is described in by this subsection to the extent attributable citizenship is treated as relinquished under section 7701(a)(30)(E). to gain includible in gross income by reason section 877A(e)(3). ‘‘(ii) VESTED INTEREST.—The term ‘vested of this section. ‘‘(B) DUAL CITIZENS.—Under regulations ‘‘(i) SPECIAL LIENS FOR DEFERRED TAX interest’ means any interest which, as of the prescribed by the Secretary, subparagraph AMOUNTS.— day before the expatriation date, is vested in (A) shall not apply to an individual who be- ‘‘(1) IMPOSITION OF LIEN.— the beneficiary. came at birth a citizen of the United States ‘‘(A) IN GENERAL.—If a covered expatriate ‘‘(iii) NONVESTED INTEREST.—The term and a citizen of another country.’’. makes an election under subsection (a)(4) or ‘nonvested interest’ means, with respect to (d) INELIGIBILITY FOR VISA OR ADMISSION TO (b) which results in the deferral of any tax any beneficiary, any interest in a trust UNITED STATES.— imposed by reason of subsection (a), the de- which is not a vested interest. Such interest (1) IN GENERAL.—Section 212(a)(10)(E) of the ferred amount (including any interest, addi- shall be determined by assuming the max- Immigration and Nationality Act (8 U.S.C. tional amount, addition to tax, assessable imum exercise of discretion in favor of the 1182(a)(10)(E)) is amended to read as follows: penalty, and costs attributable to the de- beneficiary and the occurrence of all contin- ‘‘(E) FORMER CITIZENS NOT IN COMPLIANCE ferred amount) shall be a lien in favor of the gencies in favor of the beneficiary. WITH EXPATRIATION REVENUE PROVISIONS.— United States on all property of the expa- ‘‘(iv) ADJUSTMENTS.—The Secretary may Any alien who is a former citizen of the triate located in the United States (without provide for such adjustments to the bases of United States who relinquishes United regard to whether this section applies to the assets in a trust or a deferred tax account, States citizenship (within the meaning of property). and the timing of such adjustments, in order section 877A(e)(3) of the Internal Revenue ‘‘(B) DEFERRED AMOUNT.—For purposes of to ensure that gain is taxed only once. Code of 1986) and who is not in compliance this subsection, the deferred amount is the ‘‘(v) COORDINATION WITH RETIREMENT PLAN with section 877A of such Code (relating to amount of the increase in the covered expa- RULES.—This subsection shall not apply to expatriation).’’. triate’s income tax which, but for the elec- an interest in a trust which is part of a re- (2) AVAILABILITY OF INFORMATION.— tion under subsection (a)(4) or (b), would tirement plan to which subsection (d)(2) ap- (A) IN GENERAL.—Section 6103(l) (relating have occurred by reason of this section for plies. to disclosure of returns and return informa- the taxable year including the expatriation ‘‘(3) DETERMINATION OF BENEFICIARIES’ IN- tion for purposes other than tax administra- date. TEREST IN TRUST.— tion) is amended by adding at the end the ‘‘(2) PERIOD OF LIEN.—The lien imposed by ‘‘(A) DETERMINATIONS UNDER PARAGRAPH following new paragraph: this subsection shall arise on the expatria- (1).—For purposes of paragraph (1), a bene- ‘‘(21) DISCLOSURE TO DENY VISA OR ADMIS- tion date and continue until— ficiary’s interest in a trust shall be based SION TO CERTAIN EXPATRIATES.—Upon written ‘‘(A) the liability for tax by reason of this upon all relevant facts and circumstances, request of the Attorney General or the At- section is satisfied or has become unenforce- including the terms of the trust instrument torney General’s delegate, the Secretary able by reason of lapse of time, or and any letter of wishes or similar docu- shall disclose whether an individual is in ‘‘(B) it is established to the satisfaction of ment, historical patterns of trust distribu- compliance with section 877A (and if not in the Secretary that no further tax liability tions, and the existence of and functions per- compliance, any items of noncompliance) to may arise by reason of this section. formed by a trust protector or any similar officers and employees of the Federal agency ‘‘(3) CERTAIN RULES APPLY.—The rules set adviser. responsible for administering section forth in paragraphs (1), (3), and (4) of section ‘‘(B) OTHER DETERMINATIONS.—For purposes 212(a)(10)(E) of the Immigration and Nation- 6324A(d) shall apply with respect to the lien of this section— ality Act solely for the purpose of, and to the imposed by this subsection as if it were a ‘‘(i) CONSTRUCTIVE OWNERSHIP.—If a bene- extent necessary in, administering such sec- lien imposed by section 6324A. ficiary of a trust is a corporation, partner- tion 212(a)(10)(E).’’. ‘‘(j) REGULATIONS.—The Secretary shall (B) SAFEGUARDS.—Section 6103(p)(4) (relat- ship, trust, or estate, the shareholders, part- prescribe such regulations as may be nec- ing to safeguards) is amended by striking ‘‘or ners, or beneficiaries shall be deemed to be essary or appropriate to carry out the pur- (20)’’ each place it appears and inserting the trust beneficiaries for purposes of this poses of this section.’’. ‘‘(20), or (21)’’. section. (b) INCLUSION IN INCOME OF GIFTS AND BE- (3) EFFECTIVE DATES.—The amendments ‘‘(ii) TAXPAYER RETURN POSITION.—A tax- QUESTS RECEIVED BY UNITED STATES CITIZENS payer shall clearly indicate on its income AND RESIDENTS FROM EXPATRIATES.—Section made by this subsection shall apply to indi- tax return— 102 (relating to gifts, etc. not included in viduals who relinquish United States citizen- ‘‘(I) the methodology used to determine gross income) is amended by adding at the ship on or after the date of the enactment of that taxpayer’s trust interest under this sec- end the following new subsection: this Act. tion, and ‘‘(d) GIFTS AND INHERITANCES FROM COV- (e) CONFORMING AMENDMENTS.— ‘‘(II) if the taxpayer knows (or has reason ERED EXPATRIATES.— (1) Section 877 is amended by adding at the to know) that any other beneficiary of such ‘‘(1) IN GENERAL.—Subsection (a) shall not end the following new subsection: trust is using a different methodology to de- exclude from gross income the value of any ‘‘(h) APPLICATION.—This section shall not termine such beneficiary’s trust interest property acquired by gift, bequest, devise, or apply to an expatriate (as defined in section under this section. inheritance from a covered expatriate after 877A(e)) whose expatriation date (as so de- ‘‘(g) TERMINATION OF DEFERRALS, ETC.—In the expatriation date. For purposes of this fined) occurs on or after the date of the en- the case of any covered expatriate, notwith- subsection, any term used in this subsection actment of this subsection.’’. standing any other provision of this title— which is also used in section 877A shall have (2) Section 2107 is amended by adding at ‘‘(1) any period during which recognition of the same meaning as when used in section the end the following new subsection: income or gain is deferred shall terminate on 877A. ‘‘(f) APPLICATION.—This section shall not the day before the expatriation date, and ‘‘(2) EXCEPTIONS FOR TRANSFERS OTHERWISE apply to any expatriate subject to section ‘‘(2) any extension of time for payment of SUBJECT TO ESTATE OR GIFT TAX.—Paragraph 877A.’’. tax shall cease to apply on the day before the (1) shall not apply to any property if either— (3) Section 2501(a)(3) is amended by adding expatriation date and the unpaid portion of ‘‘(A) the gift, bequest, devise, or inherit- at the end the following new subparagraph: such tax shall be due and payable at the time ance is— ‘‘(C) APPLICATION.—This paragraph shall and in the manner prescribed by the Sec- ‘‘(i) shown on a timely filed return of tax not apply to any expatriate subject to sec- retary. imposed by chapter 12 as a taxable gift by tion 877A.’’. ‘‘(h) IMPOSITION OF TENTATIVE TAX.— the covered expatriate, or (4) Section 6039G(a) is amended by insert- ‘‘(1) IN GENERAL.—If an individual is re- ‘‘(ii) included in the gross estate of the ing ‘‘or 877A’’ after ‘‘section 877(b)’’. quired to include any amount in gross in- covered expatriate for purposes of chapter 11 (5) The second sentence of section 6039G(d) come under subsection (a) for any taxable and shown on a timely filed return of tax im- is amended by inserting ‘‘or who relinquishes

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United States citizenship (within the mean- ‘‘(f) DETERMINATION OF TAX LIABILITY ON qualified deferred compensation plan are ing of section 877A(e)(3))’’ after ‘‘section NONEXCLUDED AMOUNTS.—If any amount is properly allocable to such amount, 877(a))’’. excluded from the gross income of a taxpayer then any increase in value in, or earnings (f) CLERICAL AMENDMENT.—The table of under subsection (a) for any taxable year, with respect to, such portion for the taxable sections for subpart A of part II of sub- then, notwithstanding section 1 or 55— year or any succeeding taxable year shall be chapter N of chapter 1 is amended by insert- ‘‘(1) the tax imposed by section 1 on the included in gross income of the participant ing after the item relating to section 877 the taxpayer for such taxable year shall be equal for such taxable year or succeeding taxable following new item: to the excess (if any) of— year. ‘‘Sec. 877A. Tax responsibilities of expatria- ‘‘(A) the tax which would be imposed by ‘‘(3) APPLICABLE DOLLAR AMOUNT.—For pur- tion.’’. section 1 for the taxable year if the tax- poses of this subsection— (g) EFFECTIVE DATE.— payer’s taxable income were equal to the ‘‘(A) IN GENERAL.—The term ‘applicable (1) IN GENERAL.—Except as provided in this sum of— dollar amount’ means, with respect to any subsection, the amendments made by this ‘‘(i) the taxpayer’s taxable income for the participant, the lesser of— section shall apply to expatriates (within the taxable year (determined without regard to ‘‘(i) the average annual compensation meaning of section 877A(e) of the Internal this subsection), plus which— Revenue Code of 1986, as added by this sec- ‘‘(ii) the amount excluded under subsection ‘‘(I) was payable during the base period to tion) whose expatriation date (as so defined) (a) for the taxable year, over the participant by the employer described in occurs on or after the date of the enactment ‘‘(B) the tax which would be imposed by paragraph (1)(A), and of this Act. section 1 for the taxable year if the tax- ‘‘(II) was includible in the participant’s (2) GIFTS AND BEQUESTS.—Section 102(d) of payer’s taxable income were equal to the gross income for taxable years in the base the Internal Revenue Code of 1986 (as added amount excluded under subsection (a) for the period, or by subsection (b)) shall apply to gifts and be- taxable year, and ‘‘(ii) $1,000,000. quests received on or after the date of the ‘‘(2) the tax imposed by section 55 for such ‘‘(B) BASE PERIOD.—The term ‘base period’ enactment of this Act, from an individual or taxable year shall be equal to the excess (if means, with respect to any computation the estate of an individual whose expatria- any) of— year, the 5-taxable year period ending with tion date (as so defined) occurs after such ‘‘(A) the amount which would be the ten- the taxable year preceding the taxable year date. tative minimum tax under section 55 for the in which the election described in subsection (3) DUE DATE FOR TENTATIVE TAX.—The due taxable year if the taxpayer’s alternative (a)(4)(B) is made by the participant to have date under section 877A(h)(2) of the Internal minimum taxable income were equal to the compensation for services performed in the Revenue Code of 1986, as added by this sec- sum of— computation year deferred under a non- tion, shall in no event occur before the 90th ‘‘(i) the taxpayer’s alternative minimum qualified deferred compensation plan, except day after the date of the enactment of this taxable income for the taxable year (deter- that if the election is made after the begin- Act. mined without regard to this subsection), ning of the computation year, such period SEC. 319. MODIFICATION OF EXCLUSION FOR plus shall be the 5-taxable year period ending CITIZENS LIVING ABROAD. ‘‘(ii) the amount excluded under subsection with the taxable year preceding the com- (a) INFLATION ADJUSTMENT OF FOREIGN (a) for the taxable year, over putation year. For purposes of this subpara- EARNED INCOME LIMITATION.—Clause (ii) of ‘‘(B) the sum of— graph, the term ‘computation year’ means section 911(b)(2)(D) (relating to inflation ad- ‘‘(i) the amount which would be the ten- justment) is amended— any taxable year of the participant for which tative minimum tax under section 55 for the the limitation under paragraph (1) is being (1) by striking ‘‘2007’’ and inserting ‘‘2005’’, taxable year if the taxpayer’s alternative and determined.’’. minimum taxable income were equal to the ONFORMING AMENDMENTS.—Sections (2) by striking ‘‘2006’’ in subclause (II) and (b) C amount excluded under subsection (a) for the 6041(g)(1) and 6051(a)(13) are each amended by inserting ‘‘2004’’. taxable year, plus (b) MODIFICATION OF HOUSING COST striking ‘‘409A(d)’’ and inserting ‘‘409A(e)’’. ‘‘(ii) the amount which would be the reg- (c) EFFECTIVE DATE.—The amendments AMOUNT.— ular tax for the taxable year if the tax im- made by this section shall apply to taxable (1) MINIMUM AMOUNT.—Clause (i) of section posed by section 1 were the tax computed 911(c)(1)(B) is amended to read as follows: years beginning after December 31, 2005, ex- under paragraph (1). ‘‘(i) 16 percent of the amount (computed on cept that taxable years beginning on or be- a daily basis) in effect under subsection For purposes of this subsection, the amount fore such date shall be taken into account in (b)(2)(D) for the calendar year in which such excluded under subsection (a) shall be re- determining the average annual compensa- taxable year begins, multiplied by’’. duced by the aggregate amount of any deduc- tion of a participant during any base period for purposes of section 409A(c)(2) of the Inter- (2) MAXIMUM AMOUNT OF EXCLUSION.— tions or exclusions disallowed under sub- nal Revenue Code of 1986 (as added by such (A) IN GENERAL.—Subparagraph (A) of sec- section (d)(6) with respect to such excluded tion 911(c)(1) is amended by inserting ‘‘to the amount.’’. amendments). extent such expenses do not exceed the (d) EFFECTIVE DATE.—The amendments SEC. 321. INCREASE IN AGE OF MINOR CHILDREN amount determined under paragraph (2)’’ made by this section shall apply to taxable WHOSE UNEARNED INCOME IS TAXED AS IF PARENT’S INCOME. after ‘‘the taxable year’’. years beginning after December 31, 2005. (a) IN GENERAL.—Section 1(g)(2)(A) (relat- (B) LIMITATION.—Subsection (c) of section SEC. 320. LIMITATION ON ANNUAL AMOUNTS ing to child to whom subsection applies) is 911 is amended by redesignating paragraphs WHICH MAY BE DEFERRED UNDER amended by striking ‘‘age 14’’ and inserting (2) and (3) as paragraphs (3) and (4), respec- NONQUALIFIED DEFERRED COM- ‘‘age 18’’. tively, and by inserting after paragraph (1) PENSATION ARRANGEMENTS. (b) TREATMENT OF DISTRIBUTIONS FROM the following new paragraph: (a) IN GENERAL.—Section 409A (relating to inclusion of gross income under nonqualified QUALIFIED DISABILITY TRUSTS.—Section ‘‘(2) LIMITATION.—The amount determined 1(g)(4) (relating to net unearned income) is under this paragraph is an amount equal to deferred compensation plans) is amended by redesignating subsections (c), (d), and (e) as amended by adding at the end the following the product of— new subparagraph: ‘‘(A) 30 percent of the amount (computed subsections (d), (e), and (f), respectively, and ‘‘(C) TREATMENT OF DISTRIBUTIONS FROM on a daily basis) in effect under subsection by inserting after subsection (b) the fol- lowing new subsection: QUALIFIED DISABILITY TRUSTS.—For purposes (b)(2)(D) for the calendar year in which the of this subsection, in the case of any child taxable year of the individual begins, multi- ‘‘(c) ANNUAL LIMITATION ON AGGREGATE DE- FERRED AMOUNTS.— who is a beneficiary of a qualified disability plied by trust (as defined in section 642(b)(2)(C)(ii)), ‘‘(B) the number of days of such taxable ‘‘(1) LIMITATION.—If the aggregate amount of compensation which— any amount included in the income of such year within the applicable period described child under sections 652 and 662 during a tax- in subparagraph (A) or (B) of subsection ‘‘(A) is deferred for any taxable year with respect to a participant under 1 or more non- able year shall be considered earned income (d)(1).’’. of such child for such taxable year.’’. (C) CONFORMING AMENDMENTS.— qualified deferred compensation plans main- (c) EFFECTIVE DATE.—The amendments (i) Section 911(d)(4) is amended by striking tained by the same employer, and ‘‘(B) is not otherwise includible in gross in- made by this section shall apply to taxable ‘‘and (c)(1)(B)(ii)’’ and inserting ‘‘, years beginning after December 31, 2005. (c)(1)(B)(ii), and (c)(2)(B)’’ come of the participant for the taxable year, (ii) Section 911(d)(7) is amended by striking exceeds the applicable dollar amount for the Subtitle C—Oil and Gas Provisions ‘‘subsection (c)(3)’’ and inserting ‘‘subsection taxable year, then such excess shall be in- SEC. 331. EXTENSION OF SUPERFUND TAXES. (c)(4)’’. cluded in the participant’s gross income for (a) EXCISE TAXES.—Section 4611(e) is (c) RATES OF TAX APPLICABLE TO NON- the taxable year. amended to read as follows: EXCLUDED INCOME.—Section 911 (relating to ‘‘(2) INCLUSION OF EARNINGS.—If— ‘‘(e) APPLICATION OF HAZARDOUS SUBSTANCE exclusion of certain income of citizens and ‘‘(A) an amount is includible under para- SUPERFUND FINANCING RATE.—The Hazardous residents of the United States living abroad) graph (1) in the gross income of a participant Substance Superfund financing rate under is amended by redesignating subsection (f) as for any taxable year, and this section shall apply after December 31, subsection (g) and by inserting after sub- ‘‘(B) any portion of any assets set aside in 1986, and before January 1, 1996, and after De- section (e) the following new subsection: a trust or other arrangement under a non- cember 31, 2005, and before January 1, 2015.’’

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(b) CORPORATE ENVIRONMENTAL INCOME SEC. 333. RULES RELATING TO FOREIGN OIL AND taxes were unused taxes under such section TAX.—Section 59A(e) is amended to read as GAS INCOME. 904(c) with respect to foreign oil and gas ex- follows: (a) SEPARATE BASKET FOR FOREIGN TAX traction income. ‘‘(e) APPLICATION OF TAX.—The tax imposed CREDIT.— (iii) LOSSES.—The amendment made by by this section shall apply to taxable years (1) SEPARATE BASKET.— paragraph (3)(C) shall not apply to foreign oil beginning after December 31, 1986, and before (A) YEARS BEFORE 2007.—Paragraph (1) of and gas extraction losses arising in taxable January 1, 1996, and to taxable years begin- section 904(d) (relating to separate applica- years beginning on or before the date of the ning after December 31, 2005, and before Jan- tion of section with respect to certain cat- enactment of this Act. egories of income), as in effect for years be- uary 1, 2015.’’ (b) ELIMINATION OF DEFERRAL FOR FOREIGN ginning before 2007, is amended by striking (c) EFFECTIVE DATES.— OIL AND GAS EXTRACTION INCOME.— ‘‘and’’ at the end of subparagraph (H), by re- (1) EXCISE TAXES.—The amendments made (1) GENERAL RULE.—Paragraph (1) of sec- by subsection (a) shall take effect on the designating subparagraph (I) as subpara- tion 954(g) (defining foreign base company oil date of the enactment of this Act. graph (J), and by inserting after subpara- related income) is amended to read as fol- graph (H) the following new subparagraph: (2) INCOME TAX.—The amendment made by lows: ‘‘(I) foreign oil and gas income, and’’. subsection (b) shall apply to taxable years ‘‘(1) IN GENERAL.—Except as otherwise pro- (B) 2007 AND AFTER.—Paragraph (1) of sec- beginning after December 31, 2005. vided in this subsection, the term ‘foreign oil tion 904(d), as in effect for years beginning and gas income’ means any income of a kind SEC. 332. MODIFICATIONS OF FOREIGN TAX after 2006, is amended by striking ‘‘and’’ at CREDIT RULES APPLICABLE TO which would be taken into account in deter- the end of subparagraph (A), by striking the DUAL CAPACITY TAXPAYERS. mining the amount of— period at the end of subparagraph (B) and in- (a) IN GENERAL.—Section 901 (relating to ‘‘(A) foreign oil and gas extraction income serting ‘‘, and’’, and by adding at the end the credit for taxes of foreign countries and of (as defined in section 907(c)), or following: possessions of the United States) is amended ‘‘(C) foreign oil and gas income.’’ ‘‘(B) foreign oil related income (as defined by redesignating subsection (m) as sub- in section 907(c)).’’ (2) DEFINITION.— section (n) and by inserting after subsection (2) CONFORMING AMENDMENTS.— (A) YEARS BEFORE 2007.—Paragraph (2) of (l) the following new subsection: section 904(d), as in effect for years begin- (A) Subsections (a)(5), (b)(5), and (b)(6) of ‘‘(m) SPECIAL RULES RELATING TO DUAL ning before 2007, is amended by redesignating section 954, and section 952(c)(1)(B)(ii)(I), are CAPACITY TAXPAYERS.— subparagraphs (H) and (I) as subparagraphs each amended by striking ‘‘base company oil ‘‘(1) GENERAL RULE.—Notwithstanding any (I) and (J), respectively, and by inserting related income’’ each place it appears (in- other provision of this chapter, any amount after subparagraph (G) the following new cluding in the heading of subsection (b)(8)) paid or accrued by a dual capacity taxpayer subparagraph: and inserting ‘‘oil and gas income’’. to a foreign country or possession of the ‘‘(H) FOREIGN OIL AND GAS INCOME.—The (B) Subsection (b)(4) of section 954 is United States for any period shall not be term ‘foreign oil and gas income’ has the amended by striking ‘‘base company oil-re- considered a tax— meaning given such term by section 954(g).’’ lated income’’ and inserting ‘‘oil and gas in- ‘‘(A) if, for such period, the foreign country (B) 2007 AND AFTER.—Section 904(d)(2), as in come’’. or possession does not impose a generally ap- effect for years after 2006, is amended by re- (C) The subsection heading for subsection plicable income tax, or designating subparagraphs (J) and (K) as (g) of section 954 is amended by striking ‘‘(B) to the extent such amount exceeds the subparagraphs (K) and (L) and by inserting ‘‘FOREIGN BASE COMPANY OIL RELATED IN- amount (determined in accordance with reg- after subparagraph (I) the following: COME’’ and inserting ‘‘FOREIGN OIL AND GAS ulations) which— ‘‘(J) FOREIGN OIL AND GAS INCOME.—For INCOME’’. ‘‘(i) is paid by such dual capacity taxpayer purposes of this section— (D) Subparagraph (A) of section 954(g)(2) is pursuant to the generally applicable income ‘‘(i) IN GENERAL.—The term ‘foreign oil and amended by striking ‘‘foreign base company tax imposed by the country or possession, or gas income’ has the meaning given such oil related income’’ and inserting ‘‘foreign ‘‘(ii) would be paid if the generally applica- term by section 954(g). oil and gas income’’. ble income tax imposed by the country or ‘‘(ii) COORDINATION.—Passive category in- (3) EFFECTIVE DATE.—The amendments possession were applicable to such dual ca- come and general category income shall not made by this subsection shall apply to tax- pacity taxpayer. include foreign oil and gas income (as so de- able years of foreign corporations beginning Nothing in this paragraph shall be construed fined).’’ after the date of the enactment of this Act, to imply the proper treatment of any such (3) CONFORMING AMENDMENTS.— and to taxable years of United States share- amount not in excess of the amount deter- (A) Section 904(d)(3)(F)(i) is amended by holders ending with or within such taxable mined under subparagraph (B). striking ‘‘or (E)’’ and inserting ‘‘(E), or (I)’’. years of foreign corporations. ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- (B) Section 907(a) is hereby repealed. SEC. 334. MODIFICATION OF CREDIT FOR PRO- poses of this subsection, the term ‘dual ca- (C) Section 907(c)(4) is hereby repealed. DUCING FUEL FROM A NONCONVEN- pacity taxpayer’ means, with respect to any (D) Section 907(f) is hereby repealed. TIONAL SOURCE. foreign country or possession of the United (4) EFFECTIVE DATES.— (a) TAXABLE YEARS ENDING BEFORE 2006.— States, a person who— (A) IN GENERAL.—The amendments made (1) MODIFICATION OF PHASEOUT.— ‘‘(A) is subject to a levy of such country or by this section shall apply to taxable years (A) IN GENERAL.—Section 29(b)(1)(A) is possession, and beginning after the date of the enactment of amended by inserting ‘‘the calendar year ‘‘(B) receives (or will receive) directly or this Act. preceding’’ before ‘‘the calendar year’’. indirectly a specific economic benefit (as de- (B) YEARS AFTER 2006.—The amendments (B) CONFORMING AMENDMENTS.—Section termined in accordance with regulations) made by paragraphs (1)(B) and (2)(B) shall 29(b)((2) is amended— from such country or possession. apply to taxable years beginning after De- (i) by striking ‘‘The’’ and inserting ‘‘With ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— cember 31, 2006. respect to any calendar year, the’’, and For purposes of this subsection— (C) TRANSITIONAL RULES.— (ii) by striking ‘‘for the calendar year in ‘‘(A) IN GENERAL.—The term ‘generally ap- (i) SEPARATE BASKET TREATMENT.—Any which the sale occurs’’ and inserting ‘‘for plicable income tax’ means an income tax taxes paid or accrued in a taxable year be- such calendar year’’. (or a series of income taxes) which is gen- ginning on or before the date of the enact- (2) NO INFLATION ADJUSTMENT FOR THE erally imposed under the laws of a foreign ment of this Act, with respect to income CREDIT AMOUNT IN 2005.—Section 29(b)(2), as country or possession on income derived which was described in subparagraph (I) of amended by paragraph (1), is amended by from the conduct of a trade or business with- section 904(d)(1) of such Code (as in effect on adding at the end the following new sen- in such country or possession. the day before the date of the enactment of tence: ‘‘This paragraph shall not apply with ‘‘(B) EXCEPTIONS.—Such term shall not in- this Act), shall be treated as taxes paid or respect to the $3 amount in subsection (a) for clude a tax unless it has substantial applica- accrued with respect to foreign oil and gas calendar year 2005 and the amount in effect tion, by its terms and in practice, to— income to the extent the taxpayer estab- under subsection (a) for sales in such cal- ‘‘(i) persons who are not dual capacity tax- lishes to the satisfaction of the Secretary of endar year shall be the amount which was in payers, and the Treasury that such taxes were paid or ac- effect for sales in calendar year 2004.’’. ‘‘(ii) persons who are citizens or residents crued with respect to foreign oil and gas in- (b) TAXABLE YEARS ENDING AFTER 2005.— of the foreign country or possession.’’ come. (1) MODIFICATION OF PHASEOUT.— (b) EFFECTIVE DATE.— (ii) CARRYOVERS.—Any unused oil and gas (A) IN GENERAL.—Section 45K(b)(1)(A) is (1) IN GENERAL.—The amendments made by extraction taxes which under section 907(f) of amended by inserting ‘‘the calendar year this section shall apply to taxes paid or ac- such Code (as so in effect) would have been preceding’’ before ‘‘the calendar year’’. crued in taxable years beginning after the allowable as a carryover to the taxpayer’s (B) CONFORMING AMENDMENTS.—Section date of the enactment of this Act. first taxable year beginning after the date of 45K(b)((2) is amended— (2) CONTRARY TREATY OBLIGATIONS the enactment of this Act (without regard to (i) by striking ‘‘The’’ and inserting ‘‘With UPHELD.—The amendments made by this sec- the limitation of paragraph (2) of such sec- respect to any calendar year, the’’, and tion shall not apply to the extent contrary tion 907(f) for first taxable year) shall be al- (ii) by striking ‘‘for the calendar year in to any treaty obligation of the United lowed as carryovers under section 904(c) of which the sale occurs’’ and inserting ‘‘for States. such Code in the same manner as if such such calendar year’’.

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(2) NO INFLATION ADJUSTMENT FOR THE purposes of so much of subtitle F (except sec- (h) and (i) as subsections (g) and (h), respec- CREDIT AMOUNT IN 2005, 2006, AND 2007.—Section tion 7205) as relates to this chapter, pay- tively. 45K(b)(2), as amended by paragraph (1), is ments to any person of any payment for (b) EFFECTIVE DATE.—The amendments amended by adding at the end the following goods and services which is subject to with- made by this section shall apply to returns new sentence: ‘‘This paragraph shall not holding shall be treated as if such payments of tax filed after December 31, 2005. apply with respect to the $3 amount in sub- were wages paid by an employer to an em- SEC. 344. INCREASE IN PENALTY FOR BAD section (a) for calendar years 2005, 2006, and ployee.’’. CHECKS AND MONEY ORDERS. 2007 and the amount in effect under sub- (b) EFFECTIVE DATE.—The amendment (a) IN GENERAL.—Section 6657 (relating to section (a) for sales in each such calendar made by this section shall apply to payments bad checks) is amended— year shall be the amount which was in effect made after December 31, 2005. (1) by striking ‘‘$750’’ and inserting for sales in calendar year 2004.’’. SEC. 342. INCREASE IN CERTAIN CRIMINAL PEN- ‘‘$1,250’’, and (3) TREATMENT OF COKE AND COKE GAS.— ALTIES. (2) by striking ‘‘$15’’ and inserting ‘‘$25’’. (A) NONAPPLICATION OF PHASEOUT.—Section (a) IN GENERAL.—Section 7206 (relating to (b) EFFECTIVE DATE.—The amendments 45K(g)(2) is amended by adding at the end the fraud and false statements) is amended— made by this section apply to checks or following new subparagraph: (1) by striking ‘‘Any person who—’’ and in- money orders received after the date of the ‘‘(D) NONAPPLICATION OF PHASEOUT.—Sub- serting ‘‘(a) IN GENERAL.—Any person who— enactment of this Act. section (b)(1) shall not apply.’’. ’’, and SEC. 345. FRIVOLOUS TAX SUBMISSIONS. (B) APPLICATION OF INFLATION ADJUST- (2) by adding at the end the following new (a) CIVIL PENALTIES.—Section 6702 is MENT .—Section 45K(g)(2)(B) is amended by subsection: amended to read as follows: ‘‘(b) INCREASE IN MONETARY LIMITATION FOR inserting ‘‘and the last sentence of sub- ‘‘SEC. 6702. FRIVOLOUS TAX SUBMISSIONS. UNDERPAYMENT OR OVERPAYMENT OF TAX DUE section (b)(2) shall not apply.’’. ‘‘(a) CIVIL PENALTY FOR FRIVOLOUS TAX RE- TO FRAUD.—If any portion of any under- (C) CLARIFICATION OF QUALIFYING FACIL- TURNS.—A person shall pay a penalty of payment (as defined in section 6664(a)) or ITY.—Section 45K(g)(1) is amended by insert- $5,000 if— overpayment (as defined in section 6401(a)) of ing ‘‘(other than from petroleum based prod- ‘‘(1) such person files what purports to be a tax required to be shown on a return is at- ucts)’’ after ‘‘coke or coke gas’’. return of a tax imposed by this title but tributable to fraudulent action described in (c) EFFECTIVE DATE.—The amendments which— made by this section shall apply to fuel sold subsection (a), the applicable dollar amount ‘‘(A) does not contain information on after December 31, 2004. under subsection (a) shall in no event be less which the substantial correctness of the self- than an amount equal to such portion. A rule SEC. 335. ELIMINATION OF AMORTIZATION OF assessment may be judged, or GEOLOGICAL AND GEOPHYSICAL EX- similar to the rule under section 6663(b) shall ‘‘(B) contains information that on its face PENDITURES FOR MAJOR INTE- apply for purposes of determining the por- indicates that the self-assessment is substan- GRATED OIL COMPANIES. tion so attributable.’’. tially incorrect; and (a) IN GENERAL.—Section 167(h) is amended (b) INCREASE IN PENALTIES.— ‘‘(2) the conduct referred to in paragraph by adding at the end the following new para- (1) ATTEMPT TO EVADE OR DEFEAT TAX.— graph: Section 7201 is amended— (1)— ‘‘(5) NONAPPLICATION TO MAJOR INTEGRATED (A) by striking ‘‘$100,000’’ and inserting ‘‘(A) is based on a position which the Sec- OIL COMPANIES.—This subsection shall not ‘‘$500,000’’, retary has identified as frivolous under sub- apply with respect to any expenses paid or (B) by striking ‘‘$500,000’’ and inserting section (c), or incurred for any taxable year by any inte- ‘‘$1,000,000’’, and ‘‘(B) reflects a desire to delay or impede grated oil company (as defined in section (C) by striking ‘‘5 years’’ and inserting ‘‘10 the administration of Federal tax laws. ‘‘(b) CIVIL PENALTY FOR SPECIFIED FRIVO- 291(b)(4)) which has an average daily world- years’’. LOUS SUBMISSIONS.— wide production of crude oil of at least (2) WILLFUL FAILURE TO FILE RETURN, SUP- ‘‘(1) IMPOSITION OF PENALTY.—Except as 500,000 barrels for such taxable year.’’. PLY INFORMATION, OR PAY TAX.—Section 7203 provided in paragraph (3), any person who (b) EFFECTIVE DATE.—The amendment is amended— submits a specified frivolous submission made by this section shall take effect as if (A) in the first sentence— shall pay a penalty of $5,000. included in the amendment made by section (i) by striking ‘‘Any person’’ and inserting 1329(a) of the Energy Policy Act of 2005. ‘‘(2) SPECIFIED FRIVOLOUS SUBMISSION.—For the following: purposes of this section— Subtitle D—Tax Administration Provisions ‘‘(a) IN GENERAL.—Any person’’, and SEC. 341. IMPOSITION OF WITHHOLDING ON CER- (ii) by striking ‘‘$25,000’’ and inserting ‘‘(A) SPECIFIED FRIVOLOUS SUBMISSION.— TAIN PAYMENTS MADE BY GOVERN- ‘‘$50,000’’, The term ‘specified frivolous submission’ MENT ENTITIES. (B) in the third sentence, by striking ‘‘sec- means a specified submission if any portion (a) IN GENERAL.—Section 3402 is amended tion’’ and inserting ‘‘subsection’’, and of such submission— by adding at the end the following new sub- (C) by adding at the end the following new ‘‘(i) is based on a position which the Sec- section: subsection: retary has identified as frivolous under sub- ‘‘(t) EXTENSION OF WITHHOLDING TO CERTAIN ‘‘(b) AGGRAVATED FAILURE TO FILE.— section (c), or PAYMENTS MADE BY GOVERNMENT ENTITIES.— ‘‘(1) IN GENERAL.—In the case of any failure ‘‘(ii) reflects a desire to delay or impede ‘‘(1) GENERAL RULE.—The Government of described in paragraph (2), the first sentence the administration of Federal tax laws. the United States, every State, every polit- of subsection (a) shall be applied by sub- ‘‘(B) SPECIFIED SUBMISSION.—The term ical subdivision thereof, and every instru- stituting— ‘specified submission’ means— mentality of the foregoing (including multi- ‘‘(A) ‘felony’ for ‘misdemeanor’, ‘‘(i) a request for a hearing under— State agencies) making any payment for ‘‘(B) ‘$500,000 ($1,000,000’ for ‘$25,000 ‘‘(I) section 6320 (relating to notice and op- goods and services which is subject to with- ($100,000’, and portunity for hearing upon filing of notice of holding shall deduct and withhold form such ‘‘(C) ‘10 years’ for ‘1 year’. lien), or payment a tax in an amount equal to 3 per- ‘‘(2) FAILURE DESCRIBED.—A failure de- ‘‘(II) section 6330 (relating to notice and cent of such payment. scribed in this paragraph is a failure to make opportunity for hearing before levy), and ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not a return described in subsection (a) for a pe- ‘‘(ii) an application under— apply to any payment— riod of 3 or more consecutive taxable ‘‘(I) section 6159 (relating to agreements ‘‘(A) except as provided in subparagraph years.’’. for payment of tax liability in installments), (B), which is subject to withholding under (3) FRAUD AND FALSE STATEMENTS.—Section ‘‘(II) section 7122 (relating to com- any other provision of this chapter or chap- 7206(a) (as redesignated by subsection (a)) is promises), or ter 3, amended— ‘‘(III) section 7811 (relating to taxpayer as- ‘‘(B) which is subject to withholding under (A) by striking ‘‘$100,000’’ and inserting sistance orders). section 3406 and from which amounts are ‘‘$500,000’’, ‘‘(3) OPPORTUNITY TO WITHDRAW SUBMIS- being withheld under such section, (B) by striking ‘‘$500,000’’ and inserting SION.—If the Secretary provides a person ‘‘(C) of interest, ‘‘$1,000,000’’, and with notice that a submission is a specified ‘‘(D) for real property, (C) by striking ‘‘3 years’’ and inserting ‘‘5 frivolous submission and such person with- ‘‘(E) to any tax-exempt entity, foreign gov- years’’. draws such submission within 30 days after ernment, or other entity subject to the re- (c) EFFECTIVE DATE.—The amendments such notice, the penalty imposed under para- quirements of paragraph (1), made by this section shall apply to actions, graph (1) shall not apply with respect to such ‘‘(F) made pursuant to a classified or con- and failures to act, occurring after the date submission. fidential contract (as defined in section of the enactment of this Act. ‘‘(c) LISTING OF FRIVOLOUS POSITIONS.—The 6050M(e)(3)), and SEC. 343. REPEAL OF SUSPENSION OF INTEREST Secretary shall prescribe (and periodically ‘‘(G) made by a political subdivision of a AND CERTAIN PENALTIES WHERE revise) a list of positions which the Sec- State (or any instrumentality thereof) which SECRETARY FAILS TO CONTACT TAX- retary has identified as being frivolous for makes less than $100,000,000 of such payments PAYER. purposes of this subsection. The Secretary annually. (a) IN GENERAL.—Section 6404 (relating to shall not include in such list any position ‘‘(3) COORDINATION WITH OTHER SECTIONS.— abatements) is amended by striking sub- that the Secretary determines meets the re- For purposes of sections 3403 and 3404 and for section (g) and by redesignating subsections quirement of section 6662(d)(2)(B)(ii)(II).

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‘‘(d) REDUCTION OF PENALTY.—The Sec- (d), and (e) as subsections (d), (e), and (f), re- SEC. 347. WAIVER OF USER FEE FOR INSTALL- retary may reduce the amount of any pen- spectively, and by inserting after subsection MENT AGREEMENTS USING AUTO- alty imposed under this section if the Sec- (b) the following new subsection: MATED WITHDRAWALS. retary determines that such reduction would ‘‘(c) RULES FOR SUBMISSION OF OFFERS-IN- (a) IN GENERAL.—Section 6159 (relating to promote compliance with and administra- COMPROMISE.— agreements for payment of tax liability in tion of the Federal tax laws. ‘‘(1) PARTIAL PAYMENT REQUIRED WITH SUB- installments) is amended by redesignating ‘‘(e) PENALTIES IN ADDITION TO OTHER PEN- MISSION.— subsection (e) as subsection (f) and by insert- ALTIES.—The penalties imposed by this sec- ‘‘(A) LUMP-SUM OFFERS.— ing after subsection (d) the following: tion shall be in addition to any other penalty ‘‘(i) IN GENERAL.—The submission of any ‘‘(e) WAIVER OF USER FEES FOR INSTALL- provided by law.’’. lump-sum offer-in-compromise shall be ac- MENT AGREEMENTS USING AUTOMATED WITH- (b) TREATMENT OF FRIVOLOUS REQUESTS companied by the payment of 20 percent of DRAWALS.—In the case of a taxpayer who en- FOR HEARINGS BEFORE LEVY.— amount of such offer. ters into an installment agreement in which (1) FRIVOLOUS REQUESTS DISREGARDED.— ‘‘(ii) LUMP-SUM OFFER-IN-COMPROMISE.—For automated installment payments are agreed Section 6330 (relating to notice and oppor- purposes of this section, the term ‘lump-sum to, the Secretary shall waive the fee (if any) tunity for hearing before levy) is amended by offer-in-compromise’ means any offer of pay- for entering into the installment agree- adding at the end the following new sub- ments made in 5 or fewer installments. ment.’’. section: ‘‘(B) PERIODIC PAYMENT OFFERS.—The sub- (b) EFFECTIVE DATE.—The amendments ‘‘(g) FRIVOLOUS REQUESTS FOR HEARING, mission of any periodic payment offer-in- made by this section shall apply to agree- ETC.—Notwithstanding any other provision compromise shall be accompanied by the ments entered into on or after the date of this section, if the Secretary determines payment of the amount of the first proposed which is 180 days after the date of the enact- that any portion of a request for a hearing installment and each proposed installment ment of this Act. under this section or section 6320 meets the due during the period such offer is being SEC. 348. TERMINATION OF INSTALLMENT requirement of clause (i) or (ii) of section evaluated for acceptance and has not been AGREEMENTS. 6702(b)(2)(A), then the Secretary may treat rejected by the Secretary. Any failure to (a) IN GENERAL.—Section 6159(b)(4) (relat- such portion as if it were never submitted make a payment required under the pre- ing to failure to pay an installment or any and such portion shall not be subject to any ceding sentence shall be deemed a with- other tax liability when due or to provide re- further administrative or judicial review.’’. drawal of the offer-in-compromise. quested financial information) is amended by (2) PRECLUSION FROM RAISING FRIVOLOUS ‘‘(2) RULES OF APPLICATION.— striking ‘‘or’’ at the end of subparagraph (B), ISSUES AT HEARING.—Section 6330(c)(4) is ‘‘(A) USE OF PAYMENT.—The application of by redesignating subparagraph (C) as sub- amended— any payment made under this subsection to paragraph (E), and by inserting after sub- (A) by striking ‘‘(A)’’ and inserting the assessed tax or other amounts imposed paragraph (B) the following: ‘‘(A)(i)’’; under this title with respect to such tax may ‘‘(C) to make a Federal tax deposit under (B) by striking ‘‘(B)’’ and inserting ‘‘(ii)’’; be specified by the taxpayer. section 6302 at the time such deposit is re- (C) by striking the period at the end of the ‘‘(B) NO USER FEE IMPOSED.—Any user fee quired to be made, first sentence and inserting ‘‘; or’’; and which would otherwise be imposed under this ‘‘(D) to file a return of tax imposed under (D) by inserting after subparagraph (A)(ii) section shall not be imposed on any offer-in- this title by its due date (including exten- (as so redesignated) the following: compromise accompanied by a payment re- sions), or’’. ‘‘(B) the issue meets the requirement of quired under this subsection. (b) CONFORMING AMENDMENT.—The heading clause (i) or (ii) of section 6702(b)(2)(A).’’. ‘‘(C) WAIVER AUTHORITY.—The Secretary for section 6159(b)(4) is amended by striking (3) STATEMENT OF GROUNDS.—Section may issue regulations waiving any payment ‘‘FAILURE TO PAY AN INSTALLMENT OR ANY 6330(b)(1) is amended by striking ‘‘under sub- required under paragraph (1) in a manner OTHER TAX LIABILITY WHEN DUE OR TO PROVIDE section (a)(3)(B)’’ and inserting ‘‘in writing consistent with the practices established in REQUESTED FINANCIAL INFORMATION’’ and in- under subsection (a)(3)(B) and states the accordance with the requirements under sub- serting ‘‘FAILURE TO MAKE PAYMENTS OR DE- grounds for the requested hearing’’. section (d)(3).’’. POSITS OR FILE RETURNS WHEN DUE OR TO PRO- (c) TREATMENT OF FRIVOLOUS REQUESTS (b) ADDITIONAL RULES RELATING TO TREAT- VIDE REQUESTED FINANCIAL INFORMATION’’. FOR HEARINGS UPON FILING OF NOTICE OF MENT OF OFFERS.— (c) EFFECTIVE DATE.—The amendments LIEN.—Section 6320 is amended— (1) UNPROCESSABLE OFFER IF PAYMENT RE- made by this section shall apply to failures (1) in subsection (b)(1), by striking ‘‘under QUIREMENTS ARE NOT MET.—Paragraph (3) of occurring on or after the date of the enact- subsection (a)(3)(B)’’ and inserting ‘‘in writ- section 7122(d) (relating to standards for ment of this Act. ing under subsection (a)(3)(B) and states the evaluation of offers), as redesignated by sub- Subtitle E—Additional Provisions grounds for the requested hearing’’, and section (a), is amended by striking ‘‘; and’’ at (2) in subsection (c), by striking ‘‘and (e)’’ SEC. 351. MODIFICATION OF INDIVIDUAL ESTI- the end of subparagraph (A) and inserting a MATED TAX SAFE HARBOR. and inserting ‘‘(e), and (g)’’. comma, by striking the period at the end of (a) IN GENERAL.—The table contained in (d) TREATMENT OF FRIVOLOUS APPLICATIONS subparagraph (B) and inserting ‘‘, and’’, and section 6654(d)(1)(C) is amended by striking FOR OFFERS-IN-COMPROMISE AND INSTALL- by adding at the end the following new sub- ‘‘2002 or thereafter’’ and inserting ‘‘2002, 2003, MENT AGREEMENTS.—Section 7122 is amended paragraph: 2004, or 2005’’ and by adding at the end the by adding at the end the following new sub- ‘‘(C) any offer-in-compromise which does following new items: section: not meet the requirements of subsection (c) ‘‘(e) FRIVOLOUS SUBMISSIONS, ETC.—Not- shall be returned to the taxpayer as ‘‘2006 ...... 111 withstanding any other provision of this sec- unprocessable.’’. 2007 or thereafter ...... 110’’. tion, if the Secretary determines that any (2) DEEMED ACCEPTANCE OF OFFER NOT RE- (b) EFFECTIVE DATE.—The amendments portion of an application for an offer-in-com- JECTED WITHIN CERTAIN PERIOD.—Section 7122, made by this section shall apply with respect promise or installment agreement submitted as amended by subsection (a), is amended by to any installment payment for taxable under this section or section 6159 meets the adding at the end the following new sub- years beginning after December 31, 2005. requirement of clause (i) or (ii) of section section: 6702(b)(2)(A), then the Secretary may treat SEC. 352. LOAN AND REDEMPTION REQUIRE- ‘‘(g) DEEMED ACCEPTANCE OF OFFER NOT MENTS ON POOLED FINANCING RE- such portion as if it were never submitted REJECTED WITHIN CERTAIN PERIOD.—Any QUIREMENTS. and such portion shall not be subject to any offer-in-compromise submitted under this (a) STRENGTHENED REASONABLE EXPECTA- further administrative or judicial review.’’. section shall be deemed to be accepted by TION REQUIREMENT.—Subparagraph (A) of (e) CLERICAL AMENDMENT.—The table of the Secretary if such offer is not rejected by section 149(f)(2) (relating to reasonable ex- sections for part I of subchapter B of chapter the Secretary before the date which is 24 pectation requirement) is amended to read 68 is amended by striking the item relating months after the date of the submission of as follows: to section 6702 and inserting the following such offer (12 months for offers-in-com- ‘‘(A) IN GENERAL.—The requirements of new item: promise submitted after the date which is 5 this paragraph are met with respect to an ‘‘Sec. 6702. Frivolous tax submissions.’’. years after the date of the enactment of this issue if the issuer reasonably expects that— (f) EFFECTIVE DATE.—The amendments subsection). For purposes of the preceding ‘‘(i) as of the close of the 1-year period be- made by this section shall apply to submis- sentence, any period during which any tax li- ginning on the date of issuance of the issue, sions made and issues raised after the date ability which is the subject of such offer-in- at least 50 percent of the net proceeds of the on which the Secretary first prescribes a list compromise is in dispute in any judicial pro- issue (as of the close of such period) will under section 6702(c) of the Internal Revenue ceeding shall not be taken in to account in have been used directly or indirectly to Code of 1986, as amended by subsection (a). determining the expiration of the 24-month make or finance loans to ultimate borrowers, SEC. 346. PARTIAL PAYMENTS REQUIRED WITH period (or 12-month period, if applicable).’’. and SUBMISSION OF OFFERS-IN-COM- (c) EFFECTIVE DATE.—The amendments ‘‘(ii) as of the close of the 3-year period be- PROMISE. made by this section shall apply to offers-in- ginning on such date of issuance, at least 95 (a) IN GENERAL.—Section 7122 (relating to compromise submitted on and after the date percent of the net proceeds of the issue (as of compromises), as amended by this Act, is which is 60 days after the date of the enact- the close of such period) will have been so amended by redesignating subsections (c), ment of this Act. used.’’.

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(b) WRITTEN LOAN COMMITMENT AND RE- SEC. ll. DEFINITION OF CONVENTION OR ASSO- ards, and the establishment and operation of DEMPTION REQUIREMENTS.—Section 149(f) (re- CIATION OF CHURCHES. management and resident education pro- lating to treatment of certain pooled financ- (a) IN GENERAL.—Section 7701 (relating to grams, but only if such measures are evalu- ing bonds) is amended by redesignating para- definitions) is amended by redesignating sub- ated and completed by a certified lead abate- graphs (4) and (5) as paragraphs (6) and (7), section (o) as subsection (p) and by inserting ment supervisor using accepted methods, are respectively, and by inserting after para- after subsection (n) the following new sub- conducted by a qualified contractor, and graph (3) the following new paragraphs: section: have an expected useful life of more than 10 ‘‘(4) WRITTEN LOAN COMMITMENT REQUIRE- ‘‘(o) CONVENTION OR ASSOCIATION OF years, MENT.— CHURCHES.—For purposes of this title, any ‘‘(iv) the cost for a certified lead abate- ‘‘(A) IN GENERAL.—The requirement of this organization which is otherwise a convention ment supervisor, those working under the paragraph is met with respect to an issue if or association of churches shall not fail to so supervision of such supervisor, or a qualified the issuer receives prior to issuance written qualify merely because the membership of contractor to perform all preparation, clean- loan commitments identifying the ultimate such organization includes individuals as up, disposal, and clearance testing activities potential borrowers of at least 50 percent of well as churches or because individuals have associated with the lead abatement measures the net proceeds of such issue. voting rights in such organization.’’. or interim lead control measures, and ‘‘(B) EXCEPTION.—Subparagraph (A) shall (b) EFFECTIVE DATE.—The amendment ‘‘(v) costs incurred by or on behalf of any not apply with respect to any issuer which is made by this section shall apply to taxable occupant of such dwelling unit for any relo- a State (or an integral part of a State) years ending after December 31, 2005. cation which is necessary to achieve occu- issuing pooled financing bonds to make or fi- pant protection (as defined under section nance loans to subordinate governmental SA 2604. Mrs. CLINTON (for herself 35.1345 of title 24, Code of Federal Regula- units of such State or to State-created enti- and Mr. OBAMA) submitted an amend- tions). ties providing financing for water-infrastruc- ment intended to be proposed by her to ‘‘(B) LIMITATION.—The term ‘lead hazard ture projects through the federally-spon- the bill S. 2020, to provide for reconcili- reduction activity cost’ does not include any sored State revolving fund program. cost to the extent such cost is funded by any ation pursuant to section 202(b) of the grant, contract, or otherwise by another per- ‘‘(5) REDEMPTION REQUIREMENT.—The re- concurrent resolution on the budget for quirement of this paragraph is met if to the son (or any governmental agency). extent that less than the percentage of the fiscal year 2006; which was ordered to ‘‘(2) ELIGIBLE DWELLING UNIT.— proceeds of an issue required to be used lie on the table; as follows: ‘‘(A) IN GENERAL.—The term ‘eligible dwell- under clause (i) or (ii) of paragraph (2)(A) is At the end of title IV, add the following: ing unit’ means, with respect to any taxable used by the close of the period identified in year, any dwelling unit— SEC. ll. HOME LEAD HAZARD REDUCTION AC- ‘‘(i) placed in service before 1960, such clause, the issuer uses an amount of TIVITY TAX CREDIT. ‘‘(ii) located in the United States, proceeds equal to the excess of— (a) IN GENERAL.—Subpart B of part IV of ‘‘(iii) in which resides, for a total period of ‘‘(A) the amount required to be used under subchapter A of chapter 1 (relating to foreign not less than 50 percent of the taxable year, such clause, over tax credit, etc.) is amended by adding at the at least 1 child who has not attained the age ‘‘(B) the amount actually used by the close end the following new section: of 6 years or 1 woman of child-bearing age, of such period, ‘‘SEC. 30D. HOME LEAD HAZARD REDUCTION AC- and to redeem outstanding bonds within 90 days TIVITY. ‘‘(iv) each of the residents of which during after the end of such period.’’. ‘‘(a) ALLOWANCE OF CREDIT.—There shall be such taxable year has an adjusted gross in- (c) ELIMINATION OF DISREGARD OF POOLED allowed as a credit against the tax imposed come of less than 185 percent of the poverty BONDS IN DETERMINING ELIGIBILITY FOR by this chapter for the taxable year an line (as determined for such taxable year in SMALL ISSUER EXCEPTION TO ARBITRAGE RE- amount equal to 50 percent of the lead haz- accordance with criteria established by the BATE.—Section 148(f)(4)(D)(ii) (relating to ag- ard reduction activity cost paid or incurred Director of the Office of Management and gregation of issuers) is amended by striking by the taxpayer during the taxable year for Budget). subclause (II) and by redesignating sub- each eligible dwelling unit. ‘‘(B) DWELLING UNIT.—The term ‘dwelling clauses (III) and (IV) as subclauses (II) and ‘‘(b) LIMITATION.—The amount of the credit unit’ has the meaning given such term by (III), respectively. allowed under subsection (a) for any eligible section 280A(f)(1). (d) CONFORMING AMENDMENTS.— dwelling unit for any taxable year shall not ‘‘(3) LEAD-BASED PAINT HAZARD.—The term (1) Section 149(f)(1) is amended by striking exceed— ‘lead-based paint hazard’ has the meaning ‘‘paragraphs (2) and (3)’’ and inserting ‘‘para- ‘‘(1) either— given such term by section 745.61 of title 40, graphs (2), (3), (4), and (5)’’. ‘‘(A) $3,000 in the case of lead hazard reduc- Code of Federal Regulations. (2) Section 149(f)(7)(B), as redesignated by tion activity cost including lead abatement ‘‘(4) CERTIFIED LEAD ABATEMENT SUPER- subsection (b), is amended by striking ‘‘para- measures described in clauses (i), (ii), (iv) VISOR.—The term ‘certified lead abatement graph (4)(A)’’ and inserting ‘‘paragraph and (v) of subsection (c)(1)(A), or supervisor’ means an individual certified by (6)(A)’’. ‘‘(B) $1,000 in the case of lead hazard reduc- the Environmental Protection Agency pursu- (3) Section 54(l)(2) is amended by striking tion activity cost including interim lead ant to section 745.226 of title 40, Code of Fed- ‘‘section 149(f)(4)(A)’’ and inserting ‘‘section control measures described in clauses (i), eral Regulations, or an appropriate State 149(f)(6)(A)’’. (iii), (iv), and (v) of subsection (c)(1)(A), re- agency pursuant to section 745.325 of title 40, (e) EFFECTIVE DATE.—The amendments duced by Code of Federal Regulations. made by this section shall apply to bonds ‘‘(2) the aggregate lead hazard reduction ‘‘(5) CERTIFIED INSPECTOR.—The term ‘cer- issued after the date of the enactment of this activity cost taken into account under sub- tified inspector’ means an inspector certified Act. section (a) with respect to such unit for all by the Environmental Protection Agency preceding taxable years. pursuant to section 745.226 of title 40, Code of SEC. 353. REPORTING OF INTEREST ON TAX-EX- EMPT BONDS. ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For Federal Regulations, or an appropriate State purposes of this section: agency pursuant to section 745.325 of title 40, (a) IN GENERAL.—Section 6049(b)(2) (relat- ‘‘(1) LEAD HAZARD REDUCTION ACTIVITY Code of Federal Regulations. ing to exceptions) is amended by striking COST.— ‘‘(6) CERTIFIED RISK ASSESSOR.—The term subparagraph (B) and by redesignating sub- ‘‘(A) IN GENERAL.—The term ‘lead hazard ‘certified risk assessor’ means a risk assessor paragraphs (C) and (D) as subparagraphs (B) reduction activity cost’ means, with respect certified by the Environmental Protection and (C), respectively. to any eligible dwelling unit— Agency pursuant to section 745.226 of title 40, (b) CONFORMING AMENDMENT.—Section ‘‘(i) the cost for a certified risk assessor to Code of Federal Regulations, or an appro- 6049(b)(2)(C), as redesignated by subsection conduct an assessment to determine the priate State agency pursuant to section (a), is amended by striking ‘‘subparagraph presence of a lead-based paint hazard, 745.325 of title 40, Code of Federal Regula- (C)’’ and inserting ‘‘subparagraph (B)’’. ‘‘(ii) the cost for performing lead abate- tions. FFECTIVE ATE (c) E D .—The amendments ment measures by a certified lead abatement ‘‘(7) QUALIFIED CONTRACTOR.—The term made by this section shall apply to interest supervisor, including the removal of paint ‘qualified contractor’ means any contractor earned after December 31, 2005. and dust, the permanent enclosure or encap- who has successfully completed a training sulation of lead-based paint, the replacement course on lead safe work practices which has SA 2603. Mr. PRYOR submitted an of painted surfaces, windows, or fixtures, or been approved by the Department of Housing amendment intended to be proposed by the removal or permanent covering of soil and Urban Development and the Environ- him to the bill S. 2020, to provide for when lead-based paint hazards are present in mental Protection Agency. reconciliation pursuant to section such paint, dust, or soil, ‘‘(8) DOCUMENTATION REQUIRED FOR CREDIT 202(b) of the concurrent resolution on ‘‘(iii) the cost for performing interim lead ALLOWANCE.—No credit shall be allowed the budget for fiscal year 2006; which control measures to reduce exposure or like- under subsection (a) with respect to any eli- ly exposure to lead-based paint hazards, in- gible dwelling unit for any taxable year un- was ordered to lie on the table; as fol- cluding specialized cleaning, repairs, mainte- less— lows: nance, painting, temporary containment, on- ‘‘(A) after lead hazard reduction activity is At the end of title IV, add the following: going monitoring of lead-based paint haz- complete, a certified inspector or certified

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00060 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.171 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13207 risk assessor provides written documenta- SEC. ll. MODIFICATION OF EXCLUSION FOR ‘‘(ii) the amount excluded under subsection tion to the taxpayer that includes— CITIZENS LIVING ABROAD. (a) for the taxable year, over ‘‘(i) evidence that— (a) INFLATION ADJUSTMENT OF FOREIGN ‘‘(B) the sum of— ‘‘(I) the eligible dwelling unit passes the EARNED INCOME LIMITATION.—Clause (ii) of ‘‘(i) the amount which would be the ten- clearance examinations required by the De- section 911(b)(2)(D) (relating to inflation ad- tative minimum tax under section 55 for the partment of Housing and Urban Development justment) is amended— taxable year if the taxpayer’s alternative under part 35 of title 40, Code of Federal Reg- (1) by striking ‘‘2007’’ and inserting ‘‘2005’’, minimum taxable income were equal to the ulations, and amount excluded under subsection (a) for the ‘‘(II) the eligible dwelling unit does not (2) by striking ‘‘2006’’ in subclause (II) and taxable year, plus contain lead dust hazards (as defined by sec- inserting ‘‘2004’’. ‘‘(ii) the amount which would be the reg- (b) MODIFICATION OF HOUSING COST tion 745.227(e)(8)(viii) of such title 40), or ular tax for the taxable year if the tax im- AMOUNT.— ‘‘(III) the eligible dwelling unit meets lead posed by section 1 were the tax computed (1) MINIMUM AMOUNT.—Clause (i) of section hazard evaluation criteria established under under paragraph (1). 911(c)(1)(B) is amended to read as follows: an authorized State or local program, and ‘‘(i) 16 percent of the amount (computed on For purposes of this subsection, the amount ‘‘(ii) documentation showing that the lead a daily basis) in effect under subsection excluded under subsection (a) shall be re- hazard reduction activity meets the require- (b)(2)(D) for the calendar year in which such duced by the aggregate amount of any deduc- ments of this section, and taxable year begins, multiplied by’’. tions or exclusions disallowed under sub- ‘‘(B) the taxpayer files with the appro- (2) MAXIMUM AMOUNT OF EXCLUSION.— section (d)(6) with respect to such excluded priate State agency and attaches to the tax (A) IN GENERAL.—Subparagraph (A) of sec- amount.’’. return for the taxable year— tion 911(c)(1) is amended by inserting ‘‘to the (d) EFFECTIVE DATE.—The amendments ‘‘(i) the documentation described in sub- extent such expenses do not exceed the made by this section shall apply to taxable paragraph (A), amount determined under paragraph (2)’’ years beginning after December 31, 2005. ‘‘(ii) documentation of the lead hazard re- after ‘‘the taxable year’’. duction activity costs paid or incurred dur- (B) LIMITATION.—Subsection (c) of section SA 2605. Mr. OBAMA (for himself, ing the taxable year with respect to the eli- 911 is amended by redesignating paragraphs Mr. COBURN, Mr. LAUTENBERG, Ms. gible dwelling unit, and (2) and (3) as paragraphs (3) and (4), respec- ‘‘(iii) a statement certifying that the tively, and by inserting after paragraph (1) SNOWE, Mr. JOHNSON, and Mr. ENSIGN) dwelling unit qualifies as an eligible dwell- the following new paragraph: submitted an amendment intended to ing unit for such taxable year. ‘‘(2) LIMITATION.—The amount determined be proposed by him to the bill S. 2020, ‘‘(9) BASIS REDUCTION.—The basis of any under this paragraph is an amount equal to to provide for reconciliation pursuant property for which a credit is allowable the product of— to section 202(b) of the concurrent reso- under subsection (a) shall be reduced by the ‘‘(A) 30 percent of the amount (computed amount of such credit (determined without lution on the budget for fiscal year on a daily basis) in effect under subsection 2006; as follows: regard to subsection (d)). (b)(2)(D) for the calendar year in which the ‘‘(10) NO DOUBLE BENEFIT.—Any deduction taxable year of the individual begins, multi- At the appropriate place, insert the fol- allowable for costs taken into account in plied by lowing: computing the amount of the credit for lead- ‘‘(B) the number of days of such taxable SEC. ll. SENSE OF THE SENATE ON USE OF NO- based paint abatement shall be reduced by year within the applicable period described BID CONTRACTING BY FEDERAL the amount of such credit attributable to in subparagraph (A) or (B) of subsection EMERGENCY MANAGEMENT AGEN- such costs. (d)(1).’’. CY. ‘‘(d) LIMITATION BASED ON AMOUNT OF (C) CONFORMING AMENDMENTS.— (a) FINDINGS.—The Senate finds that— TAX.—The credit allowed under subsection (i) Section 911(d)(4) is amended by striking (1) on September 8, 2005, the Federal Emer- (a) for the taxable year shall not exceed the ‘‘and (c)(1)(B)(ii)’’ and inserting ‘‘, gency Management Agency announced that excess of— (c)(1)(B)(ii), and (c)(2)(B)’’ it had awarded 4 contracts for emergency ‘‘(1) the sum of the regular tax liability (as (ii) Section 911(d)(7) is amended by striking housing relief following Hurricane Katrina defined in section 26(b)) plus the tax imposed ‘‘subsection (c)(3)’’ and inserting ‘‘subsection to The Shaw Group of Baton Rouge, Lou- by section 55, over (c)(4)’’. isiana, Fluor Corporation of Aliso Viejo, ‘‘(2) the sum of the credits allowable under (c) RATES OF TAX APPLICABLE TO NON- California, Bechtel National of San Fran- subpart A and sections 27, 29, 30, 30A, 30B, EXCLUDED INCOME.—Section 911 (relating to cisco, California, and CH2M Hill of Denver, and 30C for the taxable year. exclusion of certain income of citizens and Colorado; ‘‘(e) CARRYFORWARD ALLOWED.— residents of the United States living abroad) (2) these contracts were awarded with no ‘‘(1) IN GENERAL.—If the credit amount al- is amended by redesignating subsection (f) as competition from other capable firms, and lowable under subsection (a) for a taxable subsection (g) and by inserting after sub- up to $100,000,000 in taxpayer funds were au- section (e) the following new subsection: year exceeds the amount of the limitation thorized for each of these contracts; ‘‘(f) DETERMINATION OF TAX LIABILITY ON under subsection (d) for such taxable year (3) in the midst of concerns about abusive NONEXCLUDED AMOUNTS.—If any amount is (referred to as the ‘unused credit year’ in and irresponsible spending of taxpayer funds, this subsection), such excess shall be allowed excluded from the gross income of a taxpayer under subsection (a) for any taxable year, the Federal Emergency Management Agency as a credit carryforward for each of the 20 pledged to re-bid these noncompetitive con- taxable years following the unused credit then, notwithstanding section 1 or 55— ‘‘(1) the tax imposed by section 1 on the tracts, with Acting Under Secretary of year. Emergency Preparedness and Response, R. ‘‘(2) RULES.—Rules similar to the rules of taxpayer for such taxable year shall be equal to the excess (if any) of— David Paulison, stating before the Com- section 39 shall apply with respect to the mittee on Homeland Security and Govern- credit carryforward under paragraph (1).’’. ‘‘(A) the tax which would be imposed by section 1 for the taxable year if the tax- ment Affairs of the Senate that ‘‘[a]ll of (b) CONFORMING AMENDMENTS.— these no-bid contracts, we are going to go (1) Section 1016(a) of the Internal Revenue payer’s taxable income were equal to the sum of— back and re-bid’’; Code of 1986 is amended by striking ‘‘and’’ in (4) the Federal Emergency Management paragraph (36), by striking the period and in- ‘‘(i) the taxpayer’s taxable income for the taxable year (determined without regard to Agency has yet to reopen these 4 contracts serting ‘‘, and’’ in paragraph (37), and by in- to competitive bidding, and declared on No- serting at the end the following new para- this subsection), plus ‘‘(ii) the amount excluded under subsection vember 11, 2005, that these contracts would graph: not be reopened for bidding until February ‘‘(38) in the case of an eligible dwelling (a) for the taxable year, over ‘‘(B) the tax which would be imposed by 2006; unit with respect to which a credit for any (5) by February 2006, the majority of the lead hazard reduction activity cost was al- section 1 for the taxable year if the tax- payer’s taxable income were equal to the contracts will have been completed and the lowed under section 30D, to the extent pro- majority of taxpayer funds will have been vided in section 30D(c)(9).’’. amount excluded under subsection (a) for the taxable year, and spent; (2) The table of sections for subpart B of ‘‘(2) the tax imposed by section 55 for such (6) large and politically-connected firms part IV of subchapter A of chapter 1 of such taxable year shall be equal to the excess (if continue to benefit from no-bid and limited- Code is amended by inserting after the item any) of— competition contracts, and contracts are not relating to section 30C the following new ‘‘(A) the amount which would be the ten- being awarded to capable, local companies; item: tative minimum tax under section 55 for the (7) according to an analysis in the Wash- ‘‘Sec. 30D. Home lead hazard reduction ac- taxable year if the taxpayer’s alternative ington Post, companies outside the States tivity.’’. minimum taxable income were equal to the most affected by Hurricane Katrina have re- (c) EFFECTIVE DATE.—The amendments sum of— ceived more than 90 percent of the Federal made by this section shall apply to lead haz- ‘‘(i) the taxpayer’s alternative minimum contracts for recovery and reconstruction; ard reduction activity costs incurred after taxable income for the taxable year (deter- (8) the monitoring of Federal contracting December 31, 2005, in taxable years ending mined without regard to this subsection), practices remains difficult, with a report by after that date. plus the San Jose Mercury News stating ‘‘The

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00061 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.172 S17NOPT2 S13208 CONGRESSIONAL RECORD — SENATE November 17, 2005

database of contracts is incomplete. Infor- ‘‘(2) LIMITATION.—The amount determined 2004, or 2005’’ and by adding at the end the mation released by Federal agencies is spot- under this paragraph is an amount equal to following new items: ty and sporadic. And disclosure of many no- the product of— ‘‘2006 ...... 121.1 bid contracts isn’t required by law’’; and ‘‘(A) 30 percent of the amount (computed 2007 or thereafter ...... 110’’. (9)(A) there is currently no Chief Financial on a daily basis) in effect under subsection (b) EFFECTIVE DATE.—The amendments Officer charged with monitoring the flow of (b)(2)(D) for the calendar year in which the made by this section shall apply with respect all funds to the affected areas; and taxable year of the individual begins, multi- to any installment payment for taxable (B) the task of financial management is plied by years beginning after December 31, 2005. spread across disparate Federal departments ‘‘(B) the number of days of such taxable and agencies with inadequate oversight of year within the applicable period described SA 2607. Mr. SUNUNU submitted an taxpayer funds. in subparagraph (A) or (B) of subsection amendment intended to be proposed by (b) SENSE OF THE SENATE.—It is the sense (d)(1).’’. of the Senate that the Federal Emergency (C) CONFORMING AMENDMENTS.— him to the bill S. 2020, to provide for Management Agency should— (i) Section 911(d)(4) is amended by striking reconciliation pursuant to section (1) immediately rebid noncompetitive con- ‘‘and (c)(1)(B)(ii)’’ and inserting ‘‘, 202(b) of the concurrent resolution on tracts entered into following Hurricane (c)(1)(B)(ii), and (c)(2)(B)’’ the budget for fiscal year 2006; which Katrina, consistent with the commitment of (ii) Section 911(d)(7) is amended by striking was ordered to lie on the table; as fol- the Agency made on October 6, 2005, before ‘‘subsection (c)(3)’’ and inserting ‘‘subsection lows: millions of taxpayer dollars are wasted on ir- (c)(4)’’. At the appropriate place, insert the fol- responsible and inefficient spending; (c) RATES OF TAX APPLICABLE TO NON- lowing: (2)(A) immediately implement the planned EXCLUDED INCOME.—Section 911 (relating to competitive contracting strategy of the exclusion of certain income of citizens and SEC. lll. REPEAL OF STATE AND LOCAL TAX Agency for recovery work in all current and EXEMPTION FOR FANNIE MAE AND residents of the United States living abroad) FREDDIE MAC. future reconstruction efforts; and is amended by redesignating subsection (f) as (a) FANNIE MAE.—Section 309(c) of the Fed- (B) in carrying out that strategy, should subsection (g) and by inserting after sub- eral National Mortgage Association Charter prioritize local and small disadvantaged section (e) the following new subsection: Act (12 U.S.C. 1723a(c)) is amended to read as businesses in the contracting and subcon- ‘‘(f) DETERMINATION OF TAX LIABILITY ON follows: tracting process; and NONEXCLUDED AMOUNTS.—If any amount is ‘‘(c) [Repealed.]’’. (3) immediately after the awarding of a excluded from the gross income of a taxpayer (b) FREDDIE MAC.—Section 303(e) of the contract, publicly disclose the amount and under subsection (a) for any taxable year, Federal Home Loan Mortgage Corporation competitive or noncompetitive nature of the then, notwithstanding section 1 or 55— Act (12 U.S.C. 1452(e)) is amended to read as contract. ‘‘(1) the tax imposed by section 1 on the follows: taxpayer for such taxable year shall be equal ‘‘(e) [Repealed.]’’. SA 2606. Mr. KERRY (for himself and to the excess (if any) of— Mr. WYDEN) submitted an amendment ‘‘(A) the tax which would be imposed by SA 2608. Ms. MURKOWSKI (for her- intended to be proposed by him to the section 1 for the taxable year if the tax- self, Mr. JOHNSON, and Mr. BINGAMAN) bill S. 2020, to provide for reconcili- payer’s taxable income were equal to the submitted an amendment intended to ation pursuant to section 202(b) of the sum of— be proposed by her to the bill S. 2020, to concurrent resolution on the budget for ‘‘(i) the taxpayer’s taxable income for the provide for reconciliation pursuant to fiscal year 2006; which was ordered to taxable year (determined without regard to this subsection), plus section 202(b) of the concurrent resolu- lie on the table; as follows: ‘‘(ii) the amount excluded under subsection tion on the budget for fiscal year 2006; On page 235, between lines 13 and 14, insert (a) for the taxable year, over the following: which was ordered to lie on the table; ‘‘(B) the tax which would be imposed by as follows: SEC. lll. EXTENSION AND INCREASE IN MIN- section 1 for the taxable year if the tax- IMUM TAX RELIEF TO INDIVIDUALS. payer’s taxable income were equal to the On page 235, between lines 13 and 14, insert (a) IN GENERAL.—Section 55(d)(1) is amend- amount excluded under subsection (a) for the the following: ed— taxable year, and SEC. ll. CHARITABLE CONTRIBUTIONS OF (1) by striking ‘‘$58,000’’ and all that fol- ‘‘(2) the tax imposed by section 55 for such FOOD INVENTORY TO INDIAN TRIBES. lows through ‘‘2005’’ in subparagraph (A) and taxable year shall be equal to the excess (if inserting ‘‘$62,550 in the case of taxable years any) of— (a) IN GENERAL.—Section 170(e)(3) of the In- beginning in 2006’’, and ‘‘(A) the amount which would be the ten- ternal Revenue Code of 1986 (relating to spe- (2) by striking ‘‘$40,250’’ and all that fol- tative minimum tax under section 55 for the cial rule for contributions of inventory and lows through ‘‘2005’’ in subparagraph (B) and taxable year if the taxpayer’s alternative other property) is amended by redesignating inserting ‘‘$42,500 in the case of taxable years minimum taxable income were equal to the subparagraph (D) as subparagraph (E) and by beginning in 2006’’. sum of— inserting after subparagraph (C) the fol- (b) EFFECTIVE DATE.—The amendments ‘‘(i) the taxpayer’s alternative minimum lowing new subparagraph: made by this section shall apply to taxable taxable income for the taxable year (deter- ‘‘(D) SPECIAL RULE FOR FOOD CONTRIBUTIONS years beginning after December 31, 2005. mined without regard to this subsection), TO INDIAN TRIBES.— SEC. lll. MODIFICATION OF EXCLUSION FOR plus ‘‘(i) IN GENERAL.—For purposes of this CITIZENS LIVING ABROAD. ‘‘(ii) the amount excluded under subsection paragraph, in the case of a charitable con- (a) INFLATION ADJUSTMENT OF FOREIGN (a) for the taxable year, over tribution of food which is apparently whole- EARNED INCOME LIMITATION.—Clause (ii) of ‘‘(B) the sum of— some food (as defined in subparagraph section 911(b)(2)(D) (relating to inflation ad- (C)(iii)), an Indian tribe (as defined in section justment) is amended— ‘‘(i) the amount which would be the ten- tative minimum tax under section 55 for the 7871(c)(3)(E)(ii)) shall be treated as an organi- (1) by striking ‘‘2007’’ and inserting ‘‘2005’’, zation eligible to be a donee under subpara- and taxable year if the taxpayer’s alternative minimum taxable income were equal to the graph (A). (2) by striking ‘‘2006’’ in subclause (II) and ‘‘(ii) USE OF PROPERTY.—For purposes of inserting ‘‘2004’’. amount excluded under subsection (a) for the taxable year, plus subparagraph (A)(i), if the use of the prop- (b) MODIFICATION OF HOUSING COST erty donated is related to the exercise of an AMOUNT.— ‘‘(ii) the amount which would be the reg- ular tax for the taxable year if the tax im- essential governmental function of the In- (1) MINIMUM AMOUNT.—Clause (i) of section dian tribal government (within the meaning 911(c)(1)(B) is amended to read as follows: posed by section 1 were the tax computed under paragraph (1). of section 7871), such use shall be treated as ‘‘(i) 16 percent of the amount (computed on related to the purpose or function consti- a daily basis) in effect under subsection For purposes of this subsection, the amount tuting the basis for the organization’s ex- (b)(2)(D) for the calendar year in which such excluded under subsection (a) shall be re- emption.’’. taxable year begins, multiplied by’’. duced by the aggregate amount of any deduc- (b) EFFECTIVE DATE.—The amendments (2) MAXIMUM AMOUNT OF EXCLUSION.— tions or exclusions disallowed under sub- made by this section shall apply to taxable (A) IN GENERAL.—Subparagraph (A) of sec- section (d)(6) with respect to such excluded years beginning after December 31, 2005. tion 911(c)(1) is amended by inserting ‘‘to the amount.’’. extent such expenses do not exceed the (d) EFFECTIVE DATE.—The amendments SA 2609. Mrs. FEINSTEIN (for her- made by this section shall apply to taxable amount determined under paragraph (2)’’ self, Mr. SUNUNU, Mr. GREGG, Mr. after ‘‘the taxable year’’. years beginning after December 31, 2005. WYDEN, Ms. CANTWELL, Mr. FEINGOLD, (B) LIMITATION.—Subsection (c) of section SEC. lll. MODIFICATION OF INDIVIDUAL ESTI- 911 is amended by redesignating paragraphs MATED TAX SAFE HARBOR. Mr. BURR, Mr. MCCAIN, Mr. KERRY, Ms. (2) and (3) as paragraphs (3) and (4), respec- (a) IN GENERAL.—The table contained in COLLINS, and Mrs. CLINTON) proposed tively, and by inserting after paragraph (1) section 6654(d)(1)(C) is amended by striking an amendment to the bill S. 2020, to the following new paragraph: ‘‘2002 or thereafter’’ and inserting ‘‘2002, 2003, provide for reconciliation pursuant to

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00062 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.172 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13209 section 202(b) of the concurrent resolu- ‘‘(i) the taxpayer’s adjusted net capital graph (A) that there will be no Federal budg- tion on the budget for fiscal year 2006; gain, determined after application of sub- et deficit for both of the fiscal years for as follows: paragraph (A) and by only taking into ac- which the estimate was made. count gain or loss properly allocable to the At the end of title IV, add the following: portion of the taxable year after December SA 2611. Mr. SCHUMER (for himself, SEC. ll. REPEAL OF CERTAIN TAX BENEFITS 31, 2005, or Mr. LAUTENBERG, Mrs. FEINSTEIN, Mr. RELATING TO OIL AND GAS WELLS ‘‘(ii) taxable income in excess of the min- INTANGIBLE DRILLING AND DEVEL- FEINGOLD, Mrs. CLINTON, Mr. KERRY, OPMENT COSTS. imum dollar amount to which the 39.6 rate Mr. LIEBERMAN, Mr. SALAZAR, Mrs. (a) IN GENERAL.—Section 263(c) (relating to applies under subsection (i) for the taxable BOXER, Ms. STABENOW, Ms. MIKULSKI, year.’’ intangible drilling and development costs) is Mr. KOHL, and Mr. KENNEDY) submitted amended by adding at the end the following (2) APPLICATION TO MINIMUM TAX.—Section 55(b)(3) is amended by adding at the end the an amendment intended to be proposed new sentence: ‘‘This subsection shall not by him to the bill S. 2020, to provide for apply with respect to wells (other than wells following new sentence: ‘‘The rules of section 1(h)(12) shall apply for purposes of this para- reconciliation pursuant to section drilled for any geothermal deposit (as so de- 202(b) of the concurrent resolution on fined)) of any integrated oil company (as de- graph.’’ fined in section 291(b)(4)) which has an aver- (3) EFFECTIVE DATES.— the budget for fiscal year 2006; which age daily worldwide production of crude oil (A) CAPITAL GAINS.—Section 1(h)(12)(B) of was ordered to lie on the table; as fol- of at least 500,000 barrels for the taxable year the Internal Revenue Code of 1986 (as added lows: in any taxable year beginning after Decem- by paragraph (1)) shall apply to taxable years At the end of title IV, insert the following: beginning after December 31, 2005. ber 31, 2005.’’. SEC. ll. SENSE OF THE SENATE REGARDING (b) EFFECTIVE DATE.—The amendment (B) DIVIDEND RATES.—Section 1(h)(12)(A) of THE FEDERAL TAX DEDUCTION FOR made by this section shall apply to taxable such Code (as added by paragraph (1)) shall STATE AND LOCAL TAXES. years beginning after December 31, 2005. apply to dividends received after December (a) FINDINGS.—The Senate finds the fol- 31, 2005. lowing: SA 2610. Mrs. FEINSTEIN (for herself (4) APPLICATION OF JGTRRA SUNSET.—The (1) No American should be unnecessarily or and Mr. KERRY) proposed an amend- amendment made by this subsection shall be excessively burdened with additional taxes. ment to the bill S. 2020, to provide for subject to section 303 of the Jobs and Growth (2) The Federal income tax has grown more Tax Relief Reconciliation Act of 2003 to the reconciliation pursuant to section complicated and unmanageable over time, same extent and in the same manner as the imposing burdensome administrative and 202(b) of the concurrent resolution on provision of such Act to which such amend- compliance costs on American taxpayers. the budget for fiscal year 2006; as fol- ment relates. (3) On January 7, 2005, President George W. lows: (c) REPEAL OF THE SCHEDULED PHASE OUT Bush created the President’s Advisory Panel At the end of the bill, insert the following: AND TERMINATION OF THE LIMITATIONS ON on Federal Tax Reform (the ‘‘Panel’’) via Ex- SEC. ll. REINSTATEMENT FOR MILLIONAIRES PERSONAL EXEMPTIONS AND ITEMIZED DEDUC- ecutive Order 13369. OF 39.6 PERCENT INCOME TAX RATE, TIONS.— (4) The Panel was tasked with providing PRE-MAY 2003 CAPITAL GAIN AND (1) REPEAL.— several options for Federal tax reform that DIVIDEND RATES, AND DEDUCTION (A) PERSONAL EXEMPTIONS.—Section 1(d)(3) would simplify Federal tax laws, retain pro- LIMITATIONS UNTIL BUDGET DEF- is amended by adding at the end the fol- gressivity, and promote long-run economic ICIT ELIMINATED. lowing: growth and job creation. (a) REPEAL OF TOP INCOME TAX RATE RE- ‘‘(6) REDUCTION OF PHASE OUT AND TERMI- (5) In its final report, released publicly on DUCTIONS.— NATION NOT TO APPLY.—Subparagraphs (E) November 1, 2005, the Panel recommended (1) IN GENERAL.—Section 1(i) (relating to and (F) shall not apply to a taxpayer whose the complete repeal of the Federal deduction rate reductions) is amended by redesignating adjusted gross income for the taxable year for State and local taxes, as a central compo- paragraph (3) as paragraph (4) and by insert- exceeds $1,000,000 ($500,000 in the case of a nent of both the ‘‘Simplified Income Tax ing after paragraph (2) the following new married individual filing a separate return).’’ Plan’’ and the ‘‘Growth and Investment Tax paragraph: (B) ITEMIZED DEDUCTIONS.—Section 68 is Plan’’. ‘‘(3) EXCEPTION FOR TAXPAYERS WITH TAX- amended by adding at the end the following: (6) State and local taxes have been deduct- ABLE INCOME OF $1,000,000, OR MORE.—Notwith- ‘‘(h) REDUCTION OF PHASE OUT AND TERMI- ible from the Federal income tax since the standing paragraph (2), in the case of taxable NATION NOT TO APPLY.—Subsections (f) and inception of the Federal income tax in 1913. years beginning in a calender year after 2005, (g) shall not apply to a taxpayer whose ad- (7) Eliminating the deduction for State and the last item in the fourth column of the justed gross income for the taxable year ex- local taxes would create a new form of dou- table under paragraph (2) shall be applied by ceeds $1,000,000 ($500,000 in the case of a mar- ble taxation at a time where efforts are substituting ‘39.6%’ for ‘35.0%’ with respect ried individual filing a separate return).’’ being made to reduce other forms of double to taxable income in excess of $1,000,000 (2) EFFECTIVE DATE.—The amendments taxation, since repeal would require millions ($500,000 in the case of taxpayers to whom made by this section shall apply to taxable of taxpayers to pay Federal taxes on income subsection (d) applies).’’. years beginning after December 31, 2005. that is also taxed at the State or local level. (2) EFFECTIVE DATE.—The amendment (3) APPLICATION OF EGTRRA SUNSET.—The (8) Congress has recently taken steps to ex- made by this subsection shall apply to tax- amendments made by this section shall be pand, rather than cut back, the State and able years beginning after December 31, 2005. subject to title IX of the Economic Growth local tax deduction, by reinstating a deduc- (3) APPLICATION OF EGTRRA SUNSET.—The and Tax Relief Reconciliation Act of 2001 to tion for State sales taxes for some taxpayers amendment made by this subsection shall be the same extent and in the same manner as (previously repealed as part of the Tax Re- subject to title IX of the Economic Growth the provision of such Act to which such form Act of 1986), as part of the American and Tax Relief Reconciliation Act of 2001 to amendment relates. Jobs Creation Act of 2004. the same extent and in the same manner as (d) SUNSET OF AMENDMENTS IF BUDGET DEF- (9) There is some concern, as noted by the the provision of such Act to which such ICIT ELIMINATED.— nonpartisan Urban-Brookings Tax Policy amendment relates. (1) IN GENERAL.—The amendments made by Center, that eliminating the deduction could (b) RESTORATION OF PRE-MAY 2003 TAX this section shall not apply to taxable years ‘‘lower support for public services and lead RATES ON CAPITAL GAINS AND DIVIDENDS FOR beginning after the first calendar year for to a ‘race to the bottom’ in terms of State INDIVIDUALS IN TOP RATE BRACKET.— which the certification described in para- and local expenditures as States compete to (1) IN GENERAL.—Section 1(h) is amended graph (2)(B) is made. have the lowest taxes in order to attract by adding at the end the following new para- (2) ESTIMATES AND CERTIFICATION.— higher-income households’’. graph: (A) IN GENERAL.—Not later than October 15 (10) The deduction for State and local taxes ‘‘(12) INCREASED RATES FOR INDIVIDUALS IN of each calendar year beginning after 2005, is not just a concern for a small minority of THE TOP RATE BRACKET.— the Director of the Office of Management taxpayers in the largest States, as 22 States ‘‘(A) DIVIDENDS.—In no event shall the and Budget, in consultation with the Sec- saw more than 1⁄3 of their taxpayers take the qualified dividend income of a taxpayer for retary of the Treasury, shall estimate— deduction in 2003, the latest year for which any taxable year exceed the excess (if any) (i) the Federal budget deficit for the fiscal data is available (Maryland, New Jersey, of— year ending in the calendar year, and Connecticut, Colorado, Oregon, Minnesota, ‘‘(i) the minimum dollar amount to which (ii) the Federal budget deficit for the fiscal Massachusetts, Virginia, Utah, California, the 39.6 rate applies under subsection (i) for year beginning in the calendar year (deter- Georgia, New York, Wisconsin, Arizona, the taxable year, over mined as if the amendments made by this Rhode Island, Michigan, Delaware, North ‘‘(ii) taxable income, reduced by adjusted section were not in effect for taxable years Carolina, Illinois, New Hampshire, Nevada, net capital gain (determined without regard beginning in the following calendar year). and Idaho (ranked in order of the percentage to this paragraph). (B) CERTIFICATION.—The Director of the Of- of taxpayers affected)). ‘‘(B) CAPITAL GAINS.—If a taxpayer has a fice of Management and Budget shall certify (11) In tax year 2003, 43,538,000 taxpayers in net capital gain for any taxable year, the to the President of the United States and to the United States took advantage of the Fed- taxpayer’s tax shall be increased by an the Congress the first calendar year for eral deduction for State and local taxes, de- amount equal to 5 percent of the lesser of— which the Director estimates under subpara- ducting a total of $315,690,000,000, thereby

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00063 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.173 S17NOPT2 S13210 CONGRESSIONAL RECORD — SENATE November 17, 2005 saving taxpayers in the United States ap- payers approximately $1,430,000,000 in Fed- gasoline, or petroleum distillates to the Fed- proximately $88,390,000,000 in Federal income eral income taxes. eral Trade Commission if— taxes, assuming an average marginal rate of (U) In South Carolina, 574,000 taxpayers de- (1) that person knew, or reasonably should 28 percent for taxpayers who itemize. ducted a total of $3,390,000,000, saving South have known, the information to be false or (12) In tax year 2003, the top 25 States Carolina taxpayers approximately misleading; ranked by the number of taxpayers affected $949,000,000 in Federal income taxes. (2) the information was required by law to represented 77 percent of the taxpayers af- (V) In Alabama, 538,000 taxpayers deducted be reported; and fected nationally, and took 85 percent of the a total of $2,090,000,000, saving Alabama tax- (3) the person intended the false or mis- total deductions for State and local taxes, as payers approximately $586,000,000 in Federal leading data to affect data compiled by that described in the following subparagraphs: income taxes. department or agency for statistical or ana- (A) In California, 5,807,000 taxpayers de- (W) In Kentucky, 515,000 taxpayers de- lytical purposes with respect to the market ducted a total of $54,920,000,000, saving Cali- ducted a total of $3,300,000,000, saving Ken- for crude oil, gasoline, or petroleum dis- fornia taxpayers approximately tucky taxpayers approximately $925,000,000 tillates. $15,380,000,000 in Federal income taxes. in Federal income taxes. (c) MARKET MANIPULATION.—It is unlawful (B) In New York, 3,228,000 taxpayers de- (X) In Oklahoma, 434,000 taxpayers de- for any person, directly or indirectly, to use ducted a total of $37,600,000,000, saving New ducted a total of $2,320,000,000, saving Okla- or employ, in connection with the purchase York taxpayers approximately $10,530,000,000 homa taxpayers approximately $650,000,000 in or sale of crude oil, gasoline, or petroleum in Federal income taxes. Federal income taxes. distillates at wholesale, any manipulative or (C) In Illinois, 1,994,000 taxpayers deducted (Y) In Iowa, 397,000 taxpayers deducted a deceptive device or contrivance, in con- a total of $13,720,000,000, saving Illinois tax- total of $2,510,000,000, saving Iowa taxpayers travention of such rules and regulations as payers approximately $3,840,000,000 in Fed- approximately $702,000,000 in Federal income the Commission may prescribe as necessary eral income taxes. taxes. or appropriate in the public interest or for (D) In Ohio, 1,809,000 taxpayers deducted a (b) SENSE OF THE SENATE.—It is the sense the protection of United States citizens. total of $12,720,000,000, saving Ohio taxpayers of the Senate that Congress should not re- SEC. ll. DECLARATION OF ENERGY EMER- approximately $3,560,000,000 in Federal in- peal or substantially alter the longstanding GENCY. come taxes. Federal tax deduction for State and local (a) IN GENERAL.—If the President finds (E) In New Jersey, 1,791,000 taxpayers de- taxes. that the health, safety, welfare, or economic ducted a total of $18,750,000,000, saving New well-being of the citizens of the United Jersey taxpayers approximately $5,250,000,000 SA 2612. Ms. CANTWELL (form her- States is at risk because of a shortage or im- in Federal income taxes. self, Mr. BAYH, Mr. LIEBERMAN, Mr. minent shortage of adequate supplies of (F) In Pennsylvania, 1,765,000 taxpayers de- crude oil, gasoline, or petroleum distillates SCHUMER, Mrs. BOXER, Mr. CARPER, ducted a total of $12,400,000,000, saving Penn- due to a disruption in the national distribu- sylvania taxpayers approximately Mrs. CLINTON, Mr. SALAZAR, Mr. KOHL, tion system for crude oil, gasoline, or petro- $3,470,000,000 in Federal income taxes. Mrs. MURRAY, Ms. STABENOW, and Mrs. leum distillates (including such a shortage (G) In Michigan, 1,627,000 taxpayers de- FEINSTEIN) submitted an amendment to related to a major disaster (as defined in sec- ducted a total of $10,350,000,000, saving Michi- the bill S. 2020, to provide for reconcili- tion 102(2) of the Robert T. Stafford Disaster gan taxpayers approximately $2,900,000,000 in ation pursuant to section 202(b) of the Relief and Emergency Assistance Act (42 Federal income taxes. concurrent resolution on the budget for U.S.C. 5122))), or significant pricing anoma- (H) In Georgia, 1,416,000 taxpayers deducted fiscal year 2006; as follows: lies in national energy markets for crude oil, a total of $8,720,000,000, saving Georgia tax- gasoline, or petroleum distillates, the Presi- At the end of the bill, insert the following: payers approximately $2,440,000,000 in Fed- dent may declare that a Federal energy eral income taxes. TITLE I—ENERGY EMERGENCY emergency exists. (I) In Virginia, 1,355,000 taxpayers deducted CONSUMER PROTECTION (b) SCOPE AND DURATION.—The declaration a total of $9,630,000,000, saving Virginia tax- SEC. ll. UNFAIR OR DECEPTIVE ACTS OR PRAC- shall apply to the Nation, a geographical re- payers approximately $2,700,000,000 in Fed- TICES IN COMMERCE RELATED TO gion, or 1 or more States, as determined by eral income taxes. GASOLINE AND PETROLEUM DIS- the President, but may not be in effect for a (J) In North Carolina, 1,304,000 taxpayers TILLATES. period of more than 45 days. deducted a total of $8,720,000,000, saving (a) SALES TO CONSUMERS AT UNCONSCION- (c) EXTENSIONS.—The President may— North Carolina taxpayers approximately ABLE PRICE.— (1) extend a declaration under subsection $2,440,000,000 in Federal income taxes. (1) IN GENERAL.—During any energy emer- (a) for a period of not more than 45 days; and (K) In Maryland, 1,260,000 taxpayers de- gency declared by the President under sec- (2) extend such a declaration more than ducted a total of $10,410,000,000, saving Mary- tion 3, it is unlawful for any person to sell once. land taxpayers approximately $2,920,000,000 crude oil, gasoline, or petroleum distillates SEC. ll. ENFORCEMENT UNDER FEDERAL in Federal income taxes. in, or for use in, the area to which that dec- TRADE COMMISSION ACT. (L) In Massachusetts, 1,216,000 taxpayers laration applies at a price that— (a) ENFORCEMENT BY COMMISSION.—This deducted a total of $10,840,000,000, saving (A) is unconscionably excessive; or Act shall be enforced by the Federal Trade Massachusetts taxpayers approximately (B) indicates the seller is taking unfair ad- Commission. In enforcing section 2(a) of this $3,040,000,000 in Federal income taxes. vantage of the circumstances to increase Act, the Commission shall give priority to (M) In Minnesota, 969,000 taxpayers de- prices unreasonably. enforcement actions concerning companies ducted a total of $7,060,000,000, saving Min- (2) FACTORS CONSIDERED.—In determining with total United States wholesale or retail nesota taxpayers approximately $1,980,000,000 whether a violation of paragraph (1) has oc- sales of crude oil, gasoline, and petroleum in Federal income taxes. curred, there shall be taken into account, distillates in excess of $500,000,000 per year (N) In Wisconsin, 961,000 taxpayers de- among other factors, whether— but shall not exclude enforcement actions ducted a total of $8,000,000,000, saving Wis- (A) the amount charged represents a gross against companies with total United States consin taxpayers approximately $2,240,000,000 disparity between the price of the crude oil, wholesale sales of $500,000,000 or less per in Federal income taxes. gasoline, or petroleum distillate sold and the year. (O) In Colorado, 856,000 taxpayers deducted price at which it was offered for sale in the (b) VIOLATION IS UNFAIR OR DECEPTIVE ACT a total of $4,570,000,000, saving Colorado tax- usual course of the seller’s business imme- OR PRACTICE.—The violation of any provision payers approximately $1,280,000,000 in Fed- diately prior to the energy emergency; or of this Act shall be treated as an unfair or eral income taxes. (B) the amount charged grossly exceeds the deceptive act or practice proscribed under a (P) In Arizona, 841,000 taxpayers deducted a price at which the same or similar crude oil, rule issued under section 18(a)(1)(B) of the total of $4,110,000,000, saving Arizona tax- gasoline, or petroleum distillate was readily Federal Trade Commission Act (15 U.S.C. payers approximately $1,150,000,000 in Fed- obtainable by other purchasers in the area to 57a(a)(1)(B)). eral income taxes. which the declaration applies. SEC. ll. ENFORCEMENT AT RETAIL LEVEL BY (Q) In Indiana, 832,000 taxpayers deducted a (3) MITIGATING FACTORS.—In determining STATE ATTORNEYS GENERAL. total of $4,530,000,000, saving Indiana tax- whether a violation of paragraph (1) has oc- (a) IN GENERAL.—A State, as parens payers approximately $1,270,000,000 in Fed- curred, there also shall be taken into ac- patriae, may bring a civil action on behalf of eral income taxes. count, among other factors, the price that its residents in an appropriate district court (R) In Missouri, 772,000 taxpayers deducted would reasonably equate supply and demand of the United States to enforce the provi- a total of $4,890,000,000, saving Missouri tax- in a competitive and freely functioning mar- sions of section 2(a) of this Act, or to impose payers approximately $1,370,000,000 in Fed- ket and whether the price at which the crude the civil penalties authorized by section 6 for eral income taxes. oil, gasoline, or petroleum distillate was sold violations of section 2(a), whenever the at- (S) In Connecticut, 713,000 taxpayers de- reasonably reflects additional costs, not torney general of the State has reason to be- ducted a total of $7,970,000,000, saving Con- within the control of the seller, that were lieve that the interests of the residents of necticut taxpayers approximately paid or incurred by the seller. the State have been or are being threatened $2,230,000,000 in Federal income taxes. (b) FALSE PRICING INFORMATION.—It is un- or adversely affected by a person engaged in (T) In Oregon, 641,000 taxpayers deducted a lawful for any person to report information retail sales of gasoline or petroleum dis- total of $5,100,000,000, saving Oregon tax- related to the wholesale price of crude oil, tillates to consumers for purposes other than

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00064 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.174 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13211 resale that violates this Act or a regulation lation to remedy the harm caused by the vio- SEC. ll. DEFINITION OF CONVENTION OR ASSO- under this Act. lation in a timely manner. CIATION OF CHURCHES. (b) NOTICE.—The State shall serve written (b) CRIMINAL PENALTY.—Violation of sec- Section 7701 (relating to definitions) is notice to the Commission of any civil action tion 2(a) of this Act is punishable by a fine amended by redesignating subsection (o) as under subsection (a) prior to initiating such of not more than $1,000,000, imprisonment for subsection (p) and by inserting after sub- civil action. The notice shall include a copy not more than 5 years, or both. section (n) the following new subsection: of the complaint to be filed to initiate such SEC. ll. EFFECT ON OTHER LAWS. ‘‘(o) CONVENTION OR ASSOCIATION OF civil action, except that if it is not feasible (a) OTHER AUTHORITY OF COMMISSION.— CHURCHES.—For purposes of this title, any for the State to provide such prior notice, Nothing in this Act shall be construed to organization which is otherwise a convention the State shall provide such notice imme- limit or affect in any way the Commission’s or association of churches shall not fail to so diately upon instituting such civil action. authority to bring enforcement actions or qualify merely because the membership of (c) AUTHORITY TO INTERVENE.—Upon re- take any other measure under the Federal such organization includes individuals as ceiving the notice required by subsection (b), Trade Commission Act (15 U.S.C. 41 et seq.) well as churches or because individuals have the Commission may intervene in such civil or any other provision of law. voting rights in such organization.’’. action and upon intervening— (b) STATE LAW.—Nothing in this Act pre- (1) be heard on all matters arising in such empts any State law. SA 2615. Ms. COLLINS submitted an civil action; and amendment intended to be proposed by (2) file petitions for appeal of a decision in SA 2613. Mr. KENNEDY (for himself, her to the bill S. 2020, to provide for such civil action. Mr. BINGAMAN, Mr. LEVIN, Mr. DURBIN, reconciliation pursuant to section (d) CONSTRUCTION.—For purposes of bring- ing any civil action under subsection (a), and Ms. MIKULSKI) submitted an 202(b) of the concurrent resolution on nothing in this section shall prevent the at- amendment intended to be proposed by the budget for fiscal year 2006; which torney general of a State from exercising the him to the bill S. 2020, to provide for was ordered to lie on the table; as fol- powers conferred on the attorney general by reconciliation pursuant to section lows: the laws of such State to conduct investiga- 202(b) of the concurrent resolution on At the end of subtitle F of title V, add the tions or to administer oaths or affirmations the budget for fiscal year 2006; which following: or to compel the attendance of witnesses or was ordered to lie on the table; as fol- the production of documentary and other SEC. ll. REPEAL OF EXPENSING OF INTAN- lows: GIBLE DRILLING AND DEVELOP- evidence. MENT COSTS FOR OIL AND GAS (e) VENUE; SERVICE OF PROCESS.—In a civil At the appropriate place, insert the fol- WELLS. lowing: action brought under subsection (a)— (a) IN GENERAL.—Section 263(c) (relating to (1) the venue shall be a judicial district in SEC. ll. EXPANSION OF HOPE SCHOLARSHIP intangible drilling and development costs) is which— CREDIT. amended by adding at the end the following (A) the defendant operates; (a) CREDIT ALLOWED FOR BOOKS AND ROOM new sentence: ‘‘This subsection shall not (B) the defendant was authorized to do AND BOARD.— apply with respect to wells (other than wells business; or (1) IN GENERAL.— drilled for any geothermal deposit (as so de- (C) where the defendant in the civil action (A) Subsection (b) of section 25A is amend- fined)) of any integrated oil company (as de- is found; ed by striking ‘‘qualified tuition and related fined in section 291(b)(4)) which has an aver- (2) process may be served without regard to expenses’’ each place it occurs and inserting age daily worldwide production of crude oil the territorial limits of the district or of the ‘‘qualified higher education expenses’’. of at least 500,000 barrels for the taxable year State in which the civil action is instituted; (B) Subsection (f) of section 25A is amend- in any taxable year beginning after Decem- and ed by adding at the end the following new ber 31, 2005.’’. (3) a person who participated with the de- paragraph: (b) CONFORMING AMENDMENTS.—Paragraphs fendant in an alleged violation that is being ‘‘(3) QUALIFIED HIGHER EDUCATION EX- (2) and (3) of section 291(b) are each amended litigated in the civil action may be joined in PENSES.—The term ‘qualified higher edu- by striking ‘‘section 263(c), 616(a),’’ and in- the civil action without regard to the resi- cation expenses’ has the meaning given such serting ‘‘section 616(a)’’. dence of the person. term under section 529(e)(3).’’. (c) EFFECTIVE DATE.—The amendments (f) LIMITATION ON STATE ACTION WHILE (2) CONFORMING AMENDMENTS.—Subsections made by this section shall apply to taxable FEDERAL ACTION IS PENDING.—If the Commis- (e) and (g) of section 25A are amended by in- years beginning after December 31, 2005. sion has instituted a civil action or an ad- serting ‘‘qualified higher education expenses ministrative action for violation of this Act, or’’ before ‘‘qualified’’ each place it appears. no State attorney general, or official or (b) EFFECTIVE DATE.—The amendments SA 2616. Mr. KERRY (for himself and agency of a State, may bring an action under made by this section shall apply to taxable Mr. OBAMA) submitted an amendment this subsection during the pendency of that years beginning after December 31, 2004. intended to be proposed by him to the action against any defendant named in the SEC. ll. MODIFICATIONS OF EFFECTIVE DATES bill S. 2020, to provide for reconcili- complaint of the Commission or the other OF LEASING PROVISIONS OF THE ation pursuant to section 202(b) of the agency for any violation of this Act alleged AMERICAN JOBS CREATION ACT OF concurrent resolution on the budget for in the complaint. 2004. fiscal year 2006; as follows: (g) ENFORCEMENT OF STATE LAW.—Nothing (a) IN GENERAL.—Section 849(b) of the contained in this section shall prohibit an American Jobs Creation Act of 2004 is On page 235, between lines 13 and 14, insert authorized State official from proceeding in amended by striking paragraphs (1) and (2), the following: State court to enforce a civil or criminal by redesignating paragraphs (3) and (4) as SEC. ll. ACCELERATION OF MARRIAGE PEN- statute of such State. paragraphs (1) and (2), respectively, and by ALTY RELIEF WITH RESPECT TO THE EARNED INCOME TAX CREDIT. SEC. ll. PENALTIES. adding at the end the following new para- (a) IN GENERAL.—Subparagraph (B) of sec- (a) CIVIL PENALTY.— graph: tion 32(b)(2) (relating to joint returns) is (1) IN GENERAL.—In addition to any penalty ‘‘(3) LEASES TO FOREIGN ENTITIES.—In the applicable under the Federal Trade Commis- case of tax-exempt use property leased to a amended— sion Act— tax-exempt entity which is a foreign person (1) in clause (ii) by striking ‘‘, 2006, and (A) any person who violates section 2(b) or or entity, the amendments made by this part 2007’’, and 2(c) of this Act is punishable by a civil pen- shall apply to taxable years beginning after (2) in clause (iii) by striking ‘‘2007’’ and in- alty of not more than $1,000,000; and December 31, 2004, with respect to leases en- serting ‘‘2005’’. (B) any person who violates section 2(a) of tered into on or before March 12, 2004.’’. (b) INFLATION AMOUNT.—Section this Act is punishable by a civil penalty of (b) EFFECTIVE DATE.—The amendments 32(j)(1)(B)(ii) is amended by striking ‘‘cal- not more than $3,000,000. made by this section shall take effect as if endar year 2007’’ and inserting ‘‘calendar (2) METHOD OF ASSESSMENT.—The penalties included in the enactment of the American year 2005’’. provided by paragraph (1) shall be assessed in Jobs Creation Act of 2004. (c) EFFECTIVE DATE.—The amendments the same manner as civil penalties imposed made by this section shall apply to taxable under section 5 of the Federal Trade Com- SA 2614. Mr. PRYOR submitted an years beginning after December 31, 2005. mission Act (15 U.S.C. 45). amendment intended to be proposed by SEC. ll. EXTENSION OF ELECTION TO INCLUDE (3) MULTIPLE OFFENSES; MITIGATING FAC- him to the bill S. 2020, to provide for COMBAT PAY IN EARNED INCOME. TORS.—In assessing the penalty provided by reconciliation pursuant to section (a) IN GENERAL.—Subclause (II) of section subsection (a)— 202(b) of the concurrent resolution on 32(c)(2)(B)(vi) (relating to earned income) is (A) each day of a continuing violation shall the budget for fiscal year 2006; which amended by striking ‘‘January 1, 2006’’ and be considered a separate violation; and inserting ‘‘January 1, 2008’’. was ordered to lie on the table; as fol- (B) the Commission shall take into consid- (b) EFFECTIVE DATE.—The amendment eration the seriousness of the violation and lows: made by this section shall apply to taxable the efforts of the person committing the vio- At the end of title IV, add the following: years beginning after December 31, 2005.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00065 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.174 S17NOPT2 S13212 CONGRESSIONAL RECORD — SENATE November 17, 2005

SEC. lll. MODIFICATIONS OF EFFECTIVE (A) IN GENERAL.—The term ‘‘eligible indi- (3) PARALLEL ACCOUNT.—The term ‘‘parallel DATES OF LEASING PROVISIONS OF vidual’’ means, with respect to any taxable account’’ means a separate, parallel indi- THE AMERICAN JOBS CREATION ACT year, an individual who— vidual or pooled account for all matching OF 2004. (i) has attained the age of 18 but not the funds and earnings dedicated to an Indi- (a) IN GENERAL.—Section 849(b) of the age of 61 as of the last day of such taxable vidual Development Account owner as part American Jobs Creation Act of 2004 is year, of a qualified individual development ac- amended by adding at the end the following (ii) is a citizen or lawful permanent resi- count program, the trustee of which is a new paragraph: dent (within the meaning of section 7701(b)(6) qualified financial institution. ‘‘(5) LEASES TO FOREIGN ENTITIES.—In the of the Internal Revenue Code of 1986) of the (4) QUALIFIED FINANCIAL INSTITUTION.— case of tax-exempt use property leased to a United States as of the last day of such tax- (A) IN GENERAL.—The term ‘‘qualified fi- tax-exempt entity which is a foreign person able year, nancial institution’’ means any person au- or entity, the amendments made by this part shall apply to taxable years beginning after (iii) was not a student (as defined in sec- thorized to be a trustee of any individual re- December 31, 2004, with respect to leases en- tion 151(c)(4) of such Code) for the imme- tirement account under section 408(a)(2) of tered into on or before March 12, 2004.’’. diately preceding taxable year, the Internal Revenue Code of 1986. (b) EFFECTIVE DATE.—The amendments (iv) is not an individual with respect to (B) RULE OF CONSTRUCTION.— made by this section shall take effect as if whom a deduction under section 151 of such (i) IN GENERAL.—Nothing in this paragraph included in the enactment of the American Code is allowable to another taxpayer for a shall be construed as preventing a person de- Jobs Creation Act of 2004. taxable year of the other taxpayer ending scribed in subparagraph (A) from collabo- during the immediately preceding taxable rating with 1 or more qualified nonprofit or- SA 2617. Mr. SANTORUM submitted year of the individual, ganizations or Indian tribes to carry out an an amendment intended to be proposed (v) is not a taxpayer described in sub- individual development account program es- by him to the bill S. 2020, to provide for section (c), (d), or (e) of section 6402 of such tablished under section 412. Code for the immediately preceding taxable (ii) QUALIFIED NONPROFIT ORGANIZATION.— reconciliation pursuant to section year, The term ‘‘qualified nonprofit organization’’ 202(b) of the concurrent resolution on (vi) is not a taxpayer described in section means— the budget for fiscal year 2006; which 1(d) of such Code for the immediately pre- (I) any organization described in section was ordered to lie on the table; as fol- ceding taxable year, and 501(c)(3) of the Internal Revenue Code of 1986 lows: (vii) is a taxpayer the modified adjusted and exempt from taxation under section At the end of title IV, insert the following: gross income of whom for the immediately 501(a) of such Code, SEC. ll. CLASSIFICATION OF AUTOMATIC FIRE preceding taxable year does not exceed— (II) any community development financial SPRINKLER SYSTEMS. (I) $20,000, in the case of a taxpayer de- institution certified by the Community De- (a) IN GENERAL.—Subparagraph (B) of sec- scribed in section 1(c) of such Code, velopment Financial Institution Fund, tion 168(e)(3) (relating to 5-year property) is (II) $30,000, in the case of a taxpayer de- (III) any credit union chartered under Fed- amended by striking ‘‘and’’ at the end of scribed in section 1(b) of such Code, and eral or State law, or clause (v), by striking the period at the end (III) $40,000, in the case of a taxpayer de- (IV) any public housing agency as defined of clause (vi) and inserting ‘‘, and ’’, and by scribed in section 1(a) of such Code. in section 3(b)(6) of the United States Hous- adding at the end the following: (B) INFLATION ADJUSTMENT.— ing Act of 1937 (42 U.S.C. 1437a(b)(6)). ‘‘(vii) any automatic fire sprinkler system (i) IN GENERAL.—In the case of any taxable (iii) INDIAN TRIBE.—The term ‘‘Indian placed in service after the date of the enact- year beginning after 2005, each dollar tribe’’ means any Indian tribe as defined in ment of this clause in a building structure amount referred to in subparagraph (A)(vii) section 4(12) of the Native American Housing which was placed in service before such date shall be increased by an amount equal to— Assistance and Self-Determination Act of of enactment.’’. (I) such dollar amount, multiplied by 1996 (25 U.S.C. 4103(12), and includes any trib- (b) ALTERNATIVE SYSTEM.—The table con- (II) the cost-of-living adjustment deter- ally designated housing entity (as defined in tained in section 168(g)(3)(B) (relating to spe- mined under section (1)(f)(3) of the Internal section 4(21) of such Act (25 U.S.C. 4103(21)), cial rule for certain property assigned to Revenue Code of 1986 for the calendar year in tribal subsidiary, subdivision, or other whol- classes) is amended by inserting after the which the taxable year begins, by sub- ly owned tribal entity. item relating to subparagraph (B)(iii) the stituting ‘‘2004’’ for ‘‘1992’’. (5) QUALIFIED INDIVIDUAL DEVELOPMENT AC- following: (ii) ROUNDING.—If any amount as adjusted COUNT PROGRAM.—The term ‘‘qualified indi- ‘‘(B)(vii) ...... 7’’. under clause (i) is not a multiple of $50, such vidual development account program’’ amount shall be rounded to the nearest mul- means a program established upon approval (c) DEFINITION OF AUTOMATIC FIRE SPRIN- tiple of $50. of the Secretary under section 412 after De- KLER SYSTEM.—Subsection (i) of section 168 (C) MODIFIED ADJUSTED GROSS INCOME.—For cember 31, 2006, under which— is amended by adding at the end the fol- purposes of subparagraph (A)(v), the term (A) Individual Development Accounts and lowing: ‘‘modified adjusted gross income’’ means ad- parallel accounts are held in trust by a ‘‘(18) AUTOMATED FIRE SPRINKLER SYSTEM.— justed gross income— qualified financial institution, and The term ‘automated fire sprinkler system’ (i) determined without regard to sections (B) additional activities determined by the means those sprinkler systems classified 86, 893, 911, 931, and 933 of the Internal Rev- Secretary, in consultation with the Sec- under one or more of the following publica- enue Code of 1986, and retary of Health and Human Services, as nec- tions of the National Fire Protection Asso- (ii) increased by the amount of interest re- essary to responsibly develop and administer ciation— ceived or accrued by the taxpayer during the accounts, including recruiting, providing fi- ‘‘(A) NFPA 13, Installation of Sprinkler taxable year which is exempt from tax. nancial education and other training to Ac- Systems, (2) INDIVIDUAL DEVELOPMENT ACCOUNT.—The count owners, and regular program moni- ‘‘(B) NFPA 13 D, Installation of Sprinkler term ‘‘Individual Development Account’’ toring, are carried out by the qualified finan- Systems in One and Two Family Dwellings means an account established for an eligible cial institution. and Manufactured Homes, and individual as part of a qualified individual (6) QUALIFIED EXPENSE DISTRIBUTION.— ‘‘(C) NFPA 13 R, Installation of Sprinkler development account program, but only if (A) IN GENERAL.—The term ‘‘qualified ex- Systems in Residential Occupancies up to the written governing instrument creating pense distribution’’ means any amount paid and Including Four Stories in Height.’’. the account meets the following require- (including through electronic payments) or (d) EFFECTIVE DATE.—The amendments ments: distributed out of an Individual Development made by this section shall apply to property (A) The owner of the account is the indi- Account or a parallel account established for placed in service after the date of the enact- vidual for whom the account was estab- an eligible individual if such amount— ment of this Act. lished. (i) is used exclusively to pay the qualified SA 2618. Mr. SANTORUM submitted (B) No contribution will be accepted unless expenses of the Individual Development Ac- it is in cash, and, except in the case of any count owner or such owner’s spouse or de- an amendment intended to be proposed qualified rollover, contributions will not be pendents, by him to the bill S. 2020, to provide for accepted for the taxable year in excess of (ii) is paid by the qualified financial insti- reconciliation pursuant to section $1,500 on behalf of any individual. tution— 202(b) of the concurrent resolution on (C) The trustee of the account is a quali- (I) except as otherwise provided in this the budget for fiscal year 2006; which fied financial institution. clause, directly to the unrelated third party was ordered to lie on the table; as fol- (D) The assets of the account will not be to whom the amount is due, lows: commingled with other property except in a (II) in the case of any qualified rollover, di- common trust fund or common investment rectly to another Individual Development At the end of title IV, insert the following: fund. Account and parallel account, or Subtitle B—Savings for Working Families (E) Except as provided in section 415(b), (III) in the case of a qualified final dis- SEC. 411. DEFINITIONS. any amount in the account may be paid out tribution, directly to the spouse, dependent, In this subtitle: only for the purpose of paying the qualified or other named beneficiary of the deceased (1) ELIGIBLE INDIVIDUAL.— expenses of the account owner. Account owner, and

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00066 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.174 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13213 (iii) is paid after the Account owner has apply to the Secretary for approval to estab- educators, shall, not later than January 1, completed a financial education course if re- lish 1 or more qualified individual develop- 2006, establish minimum quality standards quired under section 413(b). ment account programs which meet the re- for the contents of financial education (B) QUALIFIED EXPENSES.— quirements of this subtitle. courses and providers of such courses de- (i) IN GENERAL.—The term ‘‘qualified ex- (b) BASIC PROGRAM STRUCTURE.— scribed in paragraph (1) and a protocol to ex- penses’’ means any of the following expenses (1) IN GENERAL.—All qualified individual empt individuals from the requirement approved by the qualified financial institu- development account programs shall consist under paragraph (1) in the case of hardship, tion: of the following 2 components for each par- lack of need, the attainment of age 65, or a (I) Qualified higher education expenses. ticipant: qualified final distribution. (II) Qualified first-time homebuyer costs. (A) An Individual Development Account to (c) PROOF OF STATUS AS AN ELIGIBLE INDI- (III) Qualified business capitalization or which an eligible individual may contribute VIDUAL.—Federal income tax forms for the expansion costs. cash in accordance with section 413. immediately preceding taxable year and any (IV) Qualified rollovers. (B) A parallel account to which all match- other evidence of eligibility which may be (V) Qualified final distribution. ing funds shall be deposited in accordance required by a qualified financial institution (ii) QUALIFIED HIGHER EDUCATION EX- with section 414. shall be presented to such institution at the PENSES.— (2) TAILORED IDA PROGRAMS.—A qualified fi- time of the establishment of the Individual (I) IN GENERAL.—The term ‘‘qualified high- nancial institution may tailor its qualified Development Account and in any taxable er education expenses’’ has the meaning individual development account program to year in which contributions are made to the given such term by section 529(e)(3) of the In- allow matching funds to be spent on 1 or Account to qualify for matching funds under ternal Revenue Code of 1986, determined by more of the categories of qualified expenses. section 414(b)(1)(A). treating the Account owner, the owner’s (c) COORDINATION WITH PUBLIC HOUSING (d) SPECIAL RULE IN THE CASE OF MARRIED spouse, or one or more of the owner’s depend- AGENCY INDIVIDUAL SAVINGS ACCOUNTS.—Sec- INDIVIDUALS.—For purposes of this subtitle, ents as a designated beneficiary, and reduced tion 3(e)(2) of the United States Housing Act if, with respect to any taxable year, 2 mar- as provided in section 25A(g)(2) of such Code. of 1937 (42 U.S.C. 1437a(e)(2)) is amended by ried individuals file a Federal joint income (II) COORDINATION WITH OTHER BENEFITS.— inserting ‘‘or in any Individual Development tax return, then not more than 1 of such in- The amount of expenses which may be taken Account established under subtitle B of title dividuals may be treated as an eligible indi- into account for purposes of section 135, 529, IV of the Tax Relief Act of 2005’’ after ‘‘sub- vidual with respect to the succeeding taxable or 530 of such Code for any taxable year shall section’’. year. be reduced by the amount of any qualified (d) TAX TREATMENT OF PARALLEL AC- SEC. 414. DEPOSITS BY QUALIFIED INDIVIDUAL higher education expenses taken into ac- COUNTS.— count as qualified expense distributions dur- DEVELOPMENT ACCOUNT PRO- (1) IN GENERAL.—Chapter 77 (relating to GRAMS. ing such taxable year. miscellaneous provisions) is amended by add- (a) PARALLEL ACCOUNTS.—The qualified fi- (iii) QUALIFIED FIRST-TIME HOMEBUYER ing at the end the following new section: nancial institution shall deposit all match- COSTS.—The term ‘‘qualified first-time home- ‘‘SEC. 7529. TAX INCENTIVES FOR INDIVIDUAL DE- buyer costs’’ means qualified acquisition ing funds for each Individual Development VELOPMENT PARALLEL ACCOUNTS. Account into a parallel account at a quali- costs (as defined in section 72(t)(8)(C) of the ‘‘For purposes of this title— Internal Revenue Code of 1986) with respect fied financial institution. ‘‘(1) any account described in section to a principal residence (within the meaning (b) REGULAR DEPOSITS OF MATCHING 412(b)(1)(B) of the Tax Relief Act of 2005 shall of section 121 of such Code) for a qualified FUNDS.— be exempt from taxation, first-time homebuyer (as defined in section (1) IN GENERAL.—Subject to paragraph (2), ‘‘(2) except as provided in section 45G, no 72(t)(8)(D)(i) of such Code). the qualified financial institution shall de- item of income, expense, basis, gain, or loss (iv) QUALIFIED BUSINESS CAPITALIZATION OR posit into the parallel account with respect with respect to such an account may be EXPANSION COSTS.— to each eligible individual the following taken into account, and (I) IN GENERAL.—The term ‘‘qualified busi- amounts: ‘‘(3) any amount withdrawn from such an ness capitalization or expansion costs’’ (A) A dollar-for-dollar match for the first account shall not be includible in gross in- means qualified expenditures for the capital- $500 contributed by the eligible individual come.’’. ization or expansion of a qualified business into an Individual Development Account (2) CONFORMING AMENDMENT.—The table of pursuant to a qualified business plan. with respect to any taxable year of such in- sections for chapter 77 is amended by adding (II) QUALIFIED EXPENDITURES.—The term dividual. at the end the following new item: ‘‘qualified expenditures’’ means expenditures (B) Any matching funds provided by State, normally associated with starting or expand- ‘‘Sec. 7529. Tax incentives for individual de- local, or private sources in accordance with ing a business and included in a qualified velopment parallel accounts.’’. the matching ratio set by those sources. business plan, including costs for capital, (e) COORDINATION OF CERTAIN EXPENSES.— (2) TIMING OF DEPOSITS.—A deposit of the plant, and equipment, inventory expenses, Section 25A(g)(2) is amended by striking amounts described in paragraph (1) shall be and attorney and accounting fees. ‘‘and’’ at the end of subparagraph (C), by made into a parallel account— (III) QUALIFIED BUSINESS.—The term striking the period at the end of subpara- (A) in the case of amounts described in ‘‘qualified business’’ means any business graph (D) and inserting ‘‘, and’’, and by add- paragraph (1)(A), not later than 30 days after that does not contravene any law. ing at the end the following new subpara- the end of the calendar quarter during which (IV) QUALIFIED BUSINESS PLAN.—The term graph: the contribution described in such paragraph ‘‘qualified business plan’’ means a business ‘‘(D) a qualified expense distribution with was made, and plan which has been approved by the quali- respect to qualified higher education ex- (B) in the case of amounts described in fied financial institution and which meets penses from an Individual Development Ac- paragraph (1)(B), not later than 2 business such requirements as the Secretary may count or a parallel account under section days after such amounts were provided. specify. 415(a) of the Tax Relief Act of 2005.’’. (3) CROSS REFERENCE.—For allowance of tax credit for Individual Development Ac- (v) QUALIFIED ROLLOVERS.—The term SEC. 413. PROCEDURES FOR OPENING AND MAIN- ‘‘qualified rollover’’ means the complete dis- TAINING AN INDIVIDUAL DEVELOP- count subsidies, including matching funds, tribution of the amounts in an Individual MENT ACCOUNT AND QUALIFYING see section 45N of the Internal Revenue Code Development Account and parallel account FOR MATCHING FUNDS. of 1986, as added by section 419(a). to another Individual Development Account (a) OPENING AN ACCOUNT.—An eligible indi- (c) DEPOSIT OF MATCHING FUNDS INTO INDI- and parallel account established in another vidual may open an Individual Development VIDUAL DEVELOPMENT ACCOUNT OF INDIVIDUAL qualified financial institution for the benefit Account with a qualified financial institu- WHO HAS ATTAINED AGE 65.—In the case of an of the Account owner. tion upon certification that such individual Individual Development Account owner who (vi) QUALIFIED FINAL DISTRIBUTION.—The has never maintained any other Individual attains the age of 65, the qualified financial term ‘‘qualified final distribution’’ means, in Development Account (other than an Indi- institution shall deposit the funds in the par- the case of a deceased Account owner, the vidual Development Account to be termi- allel account with respect to such individual complete distribution of the amounts in the nated by a qualified rollover). into the Individual Development Account of Individual Development Account and par- (b) REQUIRED COMPLETION OF FINANCIAL such individual on the later of— allel account directly to the spouse, any de- EDUCATION COURSE.— (1) the day which is the 1-year anniversary pendent, or other named beneficiary of the (1) IN GENERAL.—Before becoming eligible of the deposit of such funds in the parallel deceased. to withdraw funds to pay for qualified ex- account, or (7) SECRETARY.—The term ‘‘Secretary’’ penses, owners of Individual Development (2) the first business day of the taxable means the Secretary of the Treasury. Accounts must complete 1 or more financial year of such individual following the taxable SEC. 412. STRUCTURE AND ADMINISTRATION OF education courses specified in the qualified year in which such individual attained age QUALIFIED INDIVIDUAL DEVELOP- individual development account program. 65. MENT ACCOUNT PROGRAMS. (2) STANDARD AND APPLICABILITY OF (d) UNIFORM ACCOUNTING REGULATIONS.—To (a) ESTABLISHMENT OF QUALIFIED INDI- COURSE.—The Secretary, in consultation ensure proper recordkeeping and determina- VIDUAL DEVELOPMENT ACCOUNT PROGRAMS.— with representatives of qualified individual tion of the tax credit under section 45N of Any qualified financial institution may development account programs and financial the Internal Revenue Code of 1986, as added

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00067 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.175 S17NOPT2 S13214 CONGRESSIONAL RECORD — SENATE November 17, 2005 by section 419(a), the Secretary shall pre- (1) the accounts described in subparagraphs problems encountered and how problems scribe regulations with respect to accounting (A) and (B) of section 412(b)(1) are operating were solved. for matching funds in the parallel accounts. pursuant to all the provisions of this Act, (3) USE OF ACCOUNTS IN RURAL AREAS EN- (e) REGULAR REPORTING OF ACCOUNTS.— and COURAGED.—The Secretary shall develop Any qualified financial institution shall re- (2) the qualified financial institution methods to encourage the use of Individual port the balances in any Individual Develop- agrees to implement an information system Development Accounts in rural areas. ment Account and parallel account of an in- necessary to monitor the cost and outcomes SEC. 418. AUTHORIZATION OF APPROPRIATIONS. dividual on not less than an annual basis to of the qualified individual development ac- (a) IN GENERAL.—There is authorized to be such individual. count program. appropriated to the Secretary $1,000,000 for SEC. 415. WITHDRAWAL PROCEDURES. (b) AUTHORITY TO TERMINATE QUALIFIED fiscal year 2007 and for each fiscal year (a) WITHDRAWALS FOR QUALIFIED EX- IDA PROGRAM.—If the Secretary determines through 2014, for the purposes of imple- PENSES.— that a qualified financial institution under menting this subtitle, including the report- (1) IN GENERAL.—An Individual Develop- this Act is not operating a qualified indi- ing, monitoring, and evaluation required ment Account owner may withdraw funds in vidual development account program in ac- under section 417, to remain available until order to pay qualified expense distributions cordance with the requirements of this Act expended. from such individual’s— (and has not implemented any corrective (b) GRANTS.—There is authorized to be ap- (A) Individual Development Account, but recommendations directed by the Secretary), propriated to the Secretary $20,000,000— only from funds which have been on deposit the Secretary shall terminate such institu- (1) to make grants to qualified nonprofit in such Account for at least 1 year, and tion’s authority to conduct the program. If organizations and Indian tribes to help de- (B) parallel account, but only— the Secretary is unable to identify a quali- fray the administrative costs associated with (i) from matching funds which have been fied financial institution to assume the au- the operation of individual development ac- on deposit in such parallel account for at thority to conduct such program, then any count programs, including the required fi- least 1 year, funds in a parallel account established for nancial education courses, and (ii) from earnings in such parallel account, the benefit of any individual under such pro- (2) to provide technical assistance to quali- after all matching funds described in clause gram shall be deposited into the Individual fied nonprofit organizations and Indian (i) have been withdrawn, and Development Account of such individual as tribes in meeting such program require- (iii) to the extent such withdrawal does not of the first day of such termination. ments. result in a remaining balance in such par- SEC. 417. REPORTING, MONITORING, AND EVAL- SEC. 419. MATCHING FUNDS FOR INDIVIDUAL DE- allel account which is less than the remain- UATION. VELOPMENT ACCOUNTS PROVIDED THROUGH A TAX CREDIT FOR ing balance in the Individual Development (a) RESPONSIBILITIES OF QUALIFIED FINAN- QUALIFIED FINANCIAL INSTITU- Account after such withdrawal. CIAL INSTITUTIONS.—Each qualified financial TIONS. (2) PROCEDURE.—Upon receipt of a with- institution that operates a qualified indi- (a) IN GENERAL.—Subpart D of part IV of drawal request which meets the require- vidual development account program under subchapter A of chapter 1 (relating to busi- ments of paragraph (1), the qualified finan- section 412 shall report annually to the Sec- ness related credits) is amended by adding at cial institution shall directly transfer the retary within 90 days after the end of each the end the following new section: funds electronically to the distributees de- calendar year on— ‘‘SEC. 45N. INDIVIDUAL DEVELOPMENT ACCOUNT scribed in section 411(6)(A)(ii). If a dis- (1) the number of individuals making con- INVESTMENT CREDIT. tributee is not equipped to receive funds tributions into Individual Development Ac- ‘‘(a) DETERMINATION OF AMOUNT.—For pur- electronically, the qualified financial insti- counts and the amounts contributed, poses of section 38, the individual develop- tution may issue such funds by paper check (2) the amounts contributed into Indi- ment account investment credit determined to the distributee. vidual Development Accounts by eligible in- under this section with respect to any eligi- (b) WITHDRAWALS FOR NONQUALIFIED EX- dividuals and the amounts deposited into ble entity for any taxable year is an amount PENSES.—An Individual Development Ac- parallel accounts for matching funds, equal to the individual development account count owner may withdraw any amount of (3) the amounts withdrawn from Individual investment provided by such eligible entity funds from the Individual Development Ac- Development Accounts and parallel ac- during the taxable year under an individual count for purposes other than to pay quali- counts, and the purposes for which such development account program established fied expense distributions, but if, after such amounts were withdrawn, under section 412 of the Tax Relief Act of withdrawal, the amount in the parallel ac- (4) the balances remaining in Individual 2005. count of such owner (excluding earnings on Development Accounts and parallel ac- ‘‘(b) APPLICABLE TAX.—For the purposes of matching funds) exceeds the amount remain- counts, and this section, the term ‘applicable tax’ means ing in such Individual Development Account, (5) such other information needed to help the excess (if any) of— then such owner shall forfeit from the par- the Secretary monitor the effectiveness of ‘‘(1) the tax imposed under this chapter allel account the lesser of such excess or the the qualified individual development account (other than the taxes imposed under the pro- amount withdrawn. program (provided in a non-individually- visions described in subparagraphs (C) (c) WITHDRAWALS FROM ACCOUNTS OF NON- identifiable manner). through (Q) of section 26(b)(2)), over ELIGIBLE INDIVIDUALS.—If the individual for (b) RESPONSIBILITIES OF THE SECRETARY.— ‘‘(2) the credits allowable under subpart B whose benefit an Individual Development Ac- (1) MONITORING PROTOCOL.—Not later than (other than this section) and subpart D of count is established ceases to be an eligible 12 months after the date of the enactment of this part. individual, such account shall remain an In- this Act, the Secretary, in consultation with ‘‘(c) INDIVIDUAL DEVELOPMENT ACCOUNT IN- dividual Development Account, but such in- the Secretary of Health and Human Services, VESTMENT.—For purposes of this section, the dividual shall not be eligible for any further shall develop and implement a protocol and term ‘individual development account in- matching funds under section 414(b)(1)(A) for process to monitor the cost and outcomes of vestment’ means, with respect to an indi- contributions which are made to the Ac- the qualified individual development account vidual development account program in any count during any taxable year when such in- programs established under section 412. taxable year, an amount equal to the sum dividual is not an eligible individual. (2) ANNUAL REPORTS.—For each year after of— (d) EFFECT OF PLEDGING ACCOUNT AS SECU- 2007, the Secretary shall submit a progress ‘‘(1) the aggregate amount of dollar-for- RITY.—If, during any taxable year of the indi- report to Congress on the status of such dollar matches under such program under vidual for whose benefit an Individual Devel- qualified individual development account section 414(b)(1)(A) of the Tax Relief Act of opment Account is established, that indi- programs. Such report shall, to the extent 2005 for such taxable year, plus vidual uses the Account, the individual’s data are available, include from a represent- ‘‘(2) $50 with respect to each Individual De- parallel account, or any portion thereof as ative sample of qualified individual develop- velopment Account maintained— security for a loan, the portion so used shall ment account programs information on— ‘‘(A) as of the end of such taxable year, but be treated as a withdrawal of such portion (A) the characteristics of participants, in- only if such taxable year is within the 7-tax- from the Individual Development Account cluding age, gender, race or ethnicity, mar- able-year period beginning with the taxable for purposes other than to pay qualified ex- ital status, number of children, employment year in which such Account is opened, and penses. status, and monthly income, ‘‘(B) with a balance of not less than $100 SEC. 416. CERTIFICATION AND TERMINATION OF (B) deposits, withdrawals, balances, uses of (other than the taxable year in which such QUALIFIED INDIVIDUAL DEVELOP- Individual Development Accounts, and par- Account is opened). MENT ACCOUNT PROGRAMS. ticipant characteristics, ‘‘(d) ELIGIBLE ENTITY.—For purposes of this (a) CERTIFICATION PROCEDURES.—Upon es- (C) the characteristics of qualified indi- section, except as provided in regulations, tablishing a qualified individual develop- vidual development account programs, in- the term ‘eligible entity’ means a qualified ment account program under section 412, a cluding match rate, economic education re- financial institution. qualified financial institution shall certify quirements, permissible uses of accounts, ‘‘(e) OTHER DEFINITIONS.—For purposes of to the Secretary at such time and in such staffing of programs in full time employees, this section, any term used in this section manner as may be prescribed by the Sec- and the total costs of programs, and and also in subtitle B of part IV of the Tax retary and accompanied by any documenta- (D) process information on program imple- Relief Act of 2005 shall have the meaning tion required by the Secretary, that— mentation and administration, especially on given such term in such subtitle.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00068 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.175 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13215 ‘‘(f) DENIAL OF DOUBLE BENEFIT.— (c) CONFORMING AMENDMENT.—The table of ment intended to be proposed by her to ‘‘(1) IN GENERAL.—No deduction or credit sections for subpart C of part IV of sub- the bill S. 2020, to provide for reconcili- (other than under this section) shall be al- chapter A of chapter 1 is amended by adding ation pursuant to section 202(b) of the lowed under this chapter with respect to any at the end the following new item: concurrent resolution on the budget for expense which— ‘‘Sec. 45N. Individual development account fiscal year 2006; which was ordered to ‘‘(A) is taken into account under sub- investment credit.’’. section (c)(1)(A) in determining the credit lie on the table; as follows: (d) REPORT REGARDING ACCOUNT MAINTE- At the end of title IV, add the following: under this section, or NANCE FEES.—The Secretary of the Treasury ‘‘(B) is attributable to the maintenance of SEC. ll. INTEREST DETERMINATIONS ON STU- shall study the adequacy of the amount spec- DENT LOANS. an Individual Development Account. ified in section 45N(c)(2) of the Internal Rev- ‘‘(2) DETERMINATION OF AMOUNT.—Solely for (a) IN GENERAL.—Section 221 (relating to enue Code of 1986 (as added by this section). interest on education loans) is amended by purposes of paragraph (1)(B), the amount at- Not later than December 31, 2010, the Sec- tributable to the maintenance of an Indi- redesignating subsection (f) as subsection (g) retary of the Treasury shall report the find- and by inserting after subsection (e) the fol- vidual Development Account shall be deemed ings of the study described in the preceding to be the dollar amount of the credit allowed lowing new subsection: sentence to Congress. ‘‘(f) DETERMINATION OF INTEREST PAID.—In under subsection (c)(l)(B) for each taxable (e) EFFECTIVE DATE.—The amendments the case of a qualified education loan made year such Individual Development Account made by this section shall apply to taxable after December 31, 2004, for purposes of this is maintained. years ending after December 31, 2006. section and notwithstanding any other pro- ‘‘(g) CREDIT MAY BE TRANSFERRED.— SEC. 420. ACCOUNT FUNDS DISREGARDED FOR vision of this title— ‘‘(1) IN GENERAL.—An eligible entity may PURPOSES OF CERTAIN MEANS- ‘‘(1) IN GENERAL.— transfer any credit allowable to the eligible TESTED FEDERAL PROGRAMS. ‘‘(A) TREATMENT AS INTEREST.—Any pay- entity under subsection (a) to any person Notwithstanding any other provision of ment on such loan shall be treated as a pay- other than to another eligible entity which Federal law (other than the Internal Rev- ment of interest to the extent of the balance, is exempt from tax under this title. The de- enue Code of 1986) that requires consider- immediately before such payment, in the ac- termination as to whether a credit is allow- ation of 1 or more financial circumstances of cumulated interest account with respect to able shall be made without regard to the tax- an individual, for the purpose of determining such loan. exempt status of the eligible entity. eligibility to receive, or the amount of, any ‘‘(B) EXCEPTION.—Subparagraph (A) shall ‘‘(2) CONSENT REQUIRED FOR REVOCATION.— assistance or benefit authorized by such pro- not apply to any payment of collection costs, Any transfer under paragraph (1) may be re- vision to be provided to or for the benefit of late fees, and penalties. voked only with the consent of the Sec- such individual, any amount (including earn- ‘‘(2) ACCUMULATED INTEREST ACCOUNT.— retary. ings thereon) in any Individual Development ‘‘(A) IN GENERAL.—The term ‘accumulated ‘‘(h) REGULATIONS.—The Secretary may Account of such individual and any match- interest account’ means an account which is prescribe such regulations as may be nec- ing deposit made on behalf of such individual adjusted in accordance with this paragraph. essary or appropriate to carry out this sec- (including earnings thereon) in any parallel ‘‘(B) INCREASES.—The balance in the accu- tion, including account shall be disregarded for such purpose mulated interest account shall be increased ‘‘(1) such regulations as necessary to in- with respect to any period during which such for any period by the sum of— sure that any credit described in subsection individual maintains or makes contributions ‘‘(i) the loan origination fees incurred by (g)(1) is claimed once and not retransferred into such Individual Development Account. the borrower in such period, by a transferee, and ‘‘(ii) the amount of stated interest on the ‘‘(2) regulations providing for a recapture SA 2619. Mrs. HUTCHISON submitted loan for such period, and of the credit allowed under this section (not- an amendment intended to be proposed ‘‘(iii) the amount of any fee imposed under withstanding any termination date described by her to the bill S. 2020, to provide for section 428(b)(1)(H) of the Higher Education in subsection (i)) in cases where there is a reconciliation pursuant to section Act of 1965 (20 U.S.C. 1078(b)(1)(H)). forfeiture under section 415(b) of the Tax Re- 202(b) of the concurrent resolution on ‘‘(C) DECREASES.—The balance in the accu- lief Act of 2005 in a subsequent taxable year mulated interest account shall be decreased of any amount which was taken into account the budget for fiscal year 2006; which was ordered to lie on the table; as fol- (but not below zero) by payments made on in determining the amount of such credit. the loan to the extent treated as interest ‘‘(i) APPLICATION OF SECTION.— lows: under this section. ‘‘(1) IN GENERAL.—This section shall apply On page 235, between lines 13 and 14, insert ‘‘(3) LOAN ORIGINATION FEES.— to any expenditure made in any taxable year the following: ‘‘(A) FEDERAL PROGRAMS.—The term ‘loan ending after December 31, 2006, and begin- SEC. ll. MODIFICATION OF BOND RULE. origination fee’ includes any fee imposed ning on or before January 1, 2014, with re- (a) IN GENERAL.—In the case of bonds under any of the following provisions of the spect to any Individual Development Ac- issued after the date of the enactment of this Higher Education Act of 1965: count which— Act and before August 31, 2009— ‘‘(i) Section 438(c) (20 U.S.C. 1087–1(c)). ‘‘(A) is opened before January 1, 2012, and (1) the requirement of paragraph (1) of sec- ‘‘(ii) Section 455(c) (20 U.S.C. 1087e(c)). ‘‘(B) as determined by the Secretary, when tion 648 of the Deficit Reduction Act of 1984 ‘‘(B) FEES FOR SERVICES OR PROPERTY EX- added to all of the previously opened Indi- (98 Stat. 941) shall be treated as met with re- CLUDED.—Except as provided under subpara- vidual Development Accounts, does not spect to the securities or obligations referred graph (A), the term ‘loan origination fee’ cause the total number of such Accounts to to in such section if such securities or obli- does not include any fee which is a fee for exceed 900,000. gations are held in a fund the annual dis- services or property. Notwithstanding the preceding sentence, tributions from which cannot exceed 7 per- ‘‘(4) STATED INTEREST.—The term ‘stated this section shall apply to amounts which cent of the average fair market value of the interest’ means, with respect to any period, are described in subsection (c)(1) and which assets held in such fund except to the extent the amount of interest determined for the are timely deposited into a parallel account distributions are necessary to pay debt serv- period based on the stated rate of interest during the 30-day period following the end of ice on the bond issue, applicable to the period (whether or not the the last taxable year beginning on or before (2) paragraph (3) of such section shall be interest is required to be paid in such pe- January 1, 2014. applied by substituting ‘‘distributions from’’ riod). ‘‘(2) DETERMINATION OF LIMITATION.—The for ‘‘the investment earnings of’’ both places ‘‘(5) ANTI-ABUSE RULE.—The Secretary may limitation on the number of Individual De- it appears, and prescribe rules to prevent the acceleration or velopment Accounts under paragraph (1)(B) (3) Paragraph (4) of such section shall be deceleration of additions to the accumulated shall be allocated by the Secretary among applied by substituting ‘‘March 1, 1985’’ for interest account where the loan origination eligible individuals as such individuals open ‘‘October 9, 1969’’. fees or stated interest do not properly reflect such Accounts under qualified individual de- (b) INCREASE IN MINIMUM PENALTY FOR BAD the substance of the loan.’’. velopment account programs, except that, in CHECKS AND MONEY ORDERS.— (b) INFORMATION RETURNS.— the case of 300,000 Accounts, such limitation (1) IN GENERAL.—Section 6657 (related to (1) INTEREST AND LOAN ORIGINATION FEE DE- shall be equally allocated among the bad checks), as amended by section 535, is FINED.—Subsection (e) of section 6050S (relat- States.’’. amended— ing to the general rule for form and manner (b) CREDIT TREATED AS BUSINESS CREDIT.— (A) by striking ‘‘$1,250’’ and inserting of returns) is amended by inserting before Section 38(b) (relating to current year busi- ‘‘$2,000’’, and the period at the end the following: ‘‘, and ness credit) is amended by striking ‘‘and’’ at (B) by striking ‘‘$25’’ and inserting ‘‘$40’’. the term ‘interest’ has the same meaning as the end of paragraph (25), by striking the pe- (2) EFFECTIVE DATE.—The amendments when used in section 221’’. riod at the end of paragraph (26) and insert- made by this subsection shall apply to (2) PRE-2005 LOANS.—The regulations under ing ‘‘, and’’, and by adding at the end the fol- checks or money orders received after the section 6050S of the Internal Revenue Code of lowing new paragraph: date of the enactment of this Act. 1986 which are applicable to loans made be- ‘‘(27) the individual development account fore September 1, 2004, shall also apply to investment credit determined under section SA 2620. Ms. SNOWE (for herself and loans made on or after such date which are 45J(a).’’. Mr. SCHUMER) submitted an amend- made before January 1, 2005.

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(c) EFFECTIVE DATE.—The amendments ‘‘(A) any eligible taxpayer (as defined in (1) in the section heading, by striking made by this section shall apply to taxable section 446(g)(2)), and ‘‘DOUBLING’’ and inserting ‘‘TRIPLING’’; years beginning after December 31, 2004. ‘‘(B) any taxpayer described in section and 448(b)(3).’’. (2) in subsection (a)(1)(B), by striking SA 2621. Ms. SNOWE submitted an (2) CONFORMING AMENDMENTS.— ‘‘twice’’ and inserting ‘‘3 times’’. amendment intended to be proposed by (A) Subpart D of part II of subchapter E of her to the bill S. 2020, to provide for chapter 1 is amended by striking section 474. SA 2623. Mr. DURBIN (for himself reconciliation pursuant to section (B) The table of sections for subpart D of and Mr. OBAMA) submitted an amend- 202(b) of the concurrent resolution on part II of subchapter E of chapter 1 is amend- ment intended to be proposed by him ed by striking the item relating to section to the bill S. 2020, to provide for rec- the budget for fiscal year 2006; which 474. was ordered to lie on the table; as fol- onciliation pursuant to section 202(b) (c) EFFECTIVE DATE AND SPECIAL RULES.— of the concurrent resolution on the lows: (1) IN GENERAL.—The amendments made by budget for fiscal year 2006; as follows: At the end of title IV, add the following: this section shall apply to taxable years be- At the end of title IV, insert the following: SEC. ll. CLARIFICATION OF CASH ACCOUNTING ginning after December 31, 2004. SEC. ll. REDUCED TAXES FOR PATRIOT EM- RULES FOR SMALL BUSINESS. (2) CHANGE IN METHOD OF ACCOUNTING.—In PLOYERS. (a) CASH ACCOUNTING PERMITTED.— the case of any taxpayer changing the tax- (a) IN GENERAL.—Subpart D of part IV of (1) IN GENERAL.—Section 446 (relating to payer’s method of accounting for any taxable year under the amendments made by this subchapter A of chapter 1 is amended by add- general rule for methods of accounting) is ing at the end the following new section: amended by adding at the end the following section— (A) such change shall be treated as initi- ‘‘SEC. 45N. REDUCTION IN TAX OF PATRIOT EM- new subsection: PLOYERS. ‘‘(g) CERTAIN SMALL BUSINESS TAXPAYERS ated by the taxpayer; (B) such change shall be treated as made ‘‘(a) IN GENERAL.—In the case of any tax- PERMITTED TO USE CASH ACCOUNTING METHOD able year beginning after December 31, 2005, WITHOUT LIMITATION.— with the consent of the Secretary of the Treasury; and and before January 1, 2011, with respect to ‘‘(1) IN GENERAL.—An eligible taxpayer which a taxpayer is certified by the Sec- shall not be required to use an accrual meth- (C) the net amount of the adjustments re- quired to be taken into account by the tax- retary as a Patriot employer, the Patriot od of accounting for any taxable year. employer credit determined under this sec- ‘‘(2) ELIGIBLE TAXPAYER.—For purposes of payer under section 481 of the Internal Rev- enue Code of 1986 shall be taken into account tion for purposes of section 38 shall be equal this subsection, a taxpayer is an eligible tax- to 1 percent of the taxable income of the tax- payer with respect to any taxable year if— over a period (not greater than 4 taxable years) beginning with such taxable year. payer which is properly allocable to all ‘‘(A) for all prior taxable years beginning trades or businesses with respect to which SEC. ll. INCLUSION OF HEAVY VEHICLES IN after December 31, 2004, the taxpayer (or any the taxpayer is certified as a Patriot em- predecessor) met the gross receipts test of LIMITATION ON DEPRECIATION OF CERTAIN LUXURY AUTOMOBILES. ployer for the taxable year. section 448(c), and (a) IN GENERAL.—Section 280F(d)(5)(A) (de- ‘‘(b) PATRIOT EMPLOYER.—For purposes of ‘‘(B) the taxpayer is not subject to section fining passenger automobile) is amended— subsection (a), the term ‘Patriot employer’ 447 or 448.’’. (1) by striking clause (ii) and inserting the means, with respect to any taxable year, any (2) EXPANSION OF GROSS RECEIPTS TEST.— following new clause: taxpayer which— (A) IN GENERAL.—Paragraph (3) of section ‘‘(ii)(I) which is rated at 6,000 pounds un- ‘‘(1) maintains its headquarters in the 448(b) (relating to entities with gross re- loaded gross vehicle weight or less, or United States if the taxpayer has ever been ceipts of not more than $5,000,000) is amended ‘‘(II) which is rated at more than 6,000 headquartered in the United States, by striking ‘‘$5,000,000’’ in the text and in the pounds but not more than 14,000 pounds gross ‘‘(2) pays at least 60 percent of each em- heading and inserting ‘‘$10,000,000’’. vehicle weight.’’, ployee’s health care premiums, (B) CONFORMING AMENDMENTS.—Section (2) by striking ‘‘clause (ii)’’ in the second ‘‘(3) if such taxpayer employs at least 50 448(c) is amended— sentence and inserting ‘‘clause (ii)(I)’’. employees on average during the taxable (i) by striking ‘‘$5,000,000’’ each place it ap- (b) CONFORMING AMENDMENT.—Section year— pears in the text and in the heading of para- 179(b) (relating to limitations) is amended by ‘‘(A) maintains or increases the number of graph (1) and inserting ‘‘$10,000,000’’, and striking paragraph (6). full-time workers in the United States rel- (ii) by adding at the end the following new (c) EFFECTIVE DATE.—The amendments ative to the number of full-time workers out- paragraph: made by this section shall apply to property side of United States, ‘‘(4) INFLATION ADJUSTMENT.—In the case of placed in service after the date of the enact- ‘‘(B) compensates each employee of the any taxable year beginning in a calendar ment of this Act. taxpayer at an hourly rate (or equivalent year after 2005, the dollar amount contained thereof) not less than an amount equal to in subsection (b)(3) and paragraph (1) of this SA 2622. Ms. MURKOWSKI (for her- the Federal poverty level for a family of subsection shall be increased by an amount self and Mr. STEVENS) submitted an three for the calendar year in which the tax- equal to— amendment intended to be proposed by able year begins divided by 2,080, ‘‘(A) such dollar amount, multiplied by her to the bill S. 2020, to provide for ‘‘(C) provides either a defined benefit plan ‘‘(B) the cost-of-living adjustment deter- or a defined contribution plan which fully mined under section 1(f)(3) for the calendar reconciliation pursuant to section 202(b) of the concurrent resolution on matches at least 5 percent of each employ- year in which the taxable year begins, by ee’s contributions to the plan, and substituting ‘calendar year 2004’ for ‘cal- the budget for fiscal year 2006; which ‘‘(D) provides full differential salary and endar year 1992’ in subparagraph (B) thereof. was ordered to lie on the table; as fol- insurance benefits for all National Guard and If any amount as adjusted under this sub- lows: Reserve employees who are called for active paragraph is not a multiple of $100,000, such At the end of title IV, add the following: duty, and amount shall be rounded to the nearest mul- SEC. ll. HYDROELECTRIC DEVELOPMENT IN- ‘‘(4) if such taxpayer employs less than 50 tiple of $100,000.’’. CENTIVES. employees on average during the taxable (b) CLARIFICATION OF INVENTORY RULES FOR (a) IN GENERAL.—Project numbers 1051, year, either— SMALL BUSINESS.— 10440, 11393, 11077, 11588, and 12379 of the Fed- ‘‘(A) compensates each employee of the (1) IN GENERAL.—Section 471 (relating to eral Energy Regulatory Commission shall be taxpayer at an hourly rate (or equivalent general rule for inventories) is amended by eligible for the maximum favorable treat- thereof) not less than an amount equal to redesignating subsection (c) as subsection (d) ment afforded under any Federal legislation the Federal poverty level for a family of 3 for and by inserting after subsection (b) the fol- or any amendments made by such legislation the calendar year in which the taxable year lowing new subsection: which promotes hydroelectric development begins divided by 2,080, or ‘‘(c) SMALL BUSINESS TAXPAYERS NOT RE- that is enacted during the 10-year period ‘‘(B) provides either a defined benefit plan QUIRED TO USE INVENTORIES.— that begins on the date that is 5 years prior or a defined contribution plan which fully ‘‘(1) IN GENERAL.—A qualified taxpayer to the date of enactment of this Act. matches at least 5 percent of each employ- shall not be required to use inventories (b) DEEMED QUALIFIED ENERGY RE- ee’s contributions to the plan.’’. under this section for a taxable year. SOURCES.—All power produced by the project (b) ALLOWANCE AS GENERAL BUSINESS CRED- ‘‘(2) TREATMENT OF TAXPAYERS NOT USING numbers specified in subsection (a) shall be IT.—Section 38(b) is amended by striking INVENTORIES.—If a qualified taxpayer does deemed to be qualified energy resources for ‘‘and’’ at the end of paragraph (25), by strik- not use inventories with respect to any prop- purposes of qualifying for any energy produc- ing the period at the end of paragraph (26) erty for any taxable year beginning after De- tion credit or similar benefit enacted for hy- and inserting ‘‘, and’’, and by adding at the cember 31, 2004, such property shall be treat- droelectric development within the 10-year end the following: ed as a material or supply which is not inci- period described in subsection (a). ‘‘(27) the Patriot employer credit deter- dental. (c) TRIPLE INTEREST AND PENALTIES FOR mined under section 45N.’’. ‘‘(3) QUALIFIED TAXPAYER.—For purposes of UNDERPAYMENTS RELATED TO CERTAIN OFF- (c) EFFECTIVE DATE.—The amendments this subsection, the term ‘qualified taxpayer’ SHORE FINANCIAL ARRANGEMENTS.—Section made by this section shall apply to taxable means— 532 of this Act is amended— years beginning after December 31, 2005.

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MODIFICATIONS OF FOREIGN TAX after 2006, is amended by striking ‘‘and’’ at which would be taken into account in deter- CREDIT RULES APPLICABLE TO the end of subparagraph (A), by striking the mining the amount of— DUAL CAPACITY TAXPAYERS. period at the end of subparagraph (B) and in- ‘‘(A) foreign oil and gas extraction income (a) IN GENERAL.—Section 901 (relating to serting ‘‘, and’’, and by adding at the end the (as defined in section 907(c)), or credit for taxes of foreign countries and of following: ‘‘(B) foreign oil related income (as defined possessions of the United States) is amended ‘‘(C) foreign oil and gas income.’’ in section 907(c)).’’ by redesignating subsection (m) as sub- (2) DEFINITION.— (2) CONFORMING AMENDMENTS.— section (n) and by inserting after subsection (A) YEARS BEFORE 2007.—Paragraph (2) of (A) Subsections (a)(5), (b)(5), and (b)(6) of (l) the following new subsection: section 904(d), as in effect for years begin- section 954, and section 952(c)(1)(B)(ii)(I), are ‘‘(m) SPECIAL RULES RELATING TO DUAL ning before 2007, is amended by redesignating each amended by striking ‘‘base company oil CAPACITY TAXPAYERS.— subparagraphs (H) and (I) as subparagraphs ‘‘(1) GENERAL RULE.—Notwithstanding any related income’’ each place it appears (in- (I) and (J), respectively, and by inserting other provision of this chapter, any amount cluding in the heading of subsection (b)(8)) after subparagraph (G) the following new paid or accrued by a dual capacity taxpayer and inserting ‘‘oil and gas income’’. subparagraph: to a foreign country or possession of the (B) Subsection (b)(4) of section 954 is ‘‘(H) FOREIGN OIL AND GAS INCOME.—The United States for any period shall not be amended by striking ‘‘base company oil-re- term ‘foreign oil and gas income’ has the considered a tax— lated income’’ and inserting ‘‘oil and gas in- meaning given such term by section 954(g).’’ ‘‘(A) if, for such period, the foreign country come’’. (B) 2007 AND AFTER.—Section 904(d)(2), as in or possession does not impose a generally ap- (C) The subsection heading for subsection effect for years after 2006, is amended by re- plicable income tax, or (g) of section 954 is amended by striking designating subparagraphs (J) and (K) as ‘‘(B) to the extent such amount exceeds the ‘‘FOREIGN BASE COMPANY OIL RELATED IN- subparagraphs (K) and (L) and by inserting amount (determined in accordance with reg- COME’’ and inserting ‘‘FOREIGN OIL AND GAS after subparagraph (I) the following: ulations) which— INCOME’’. ‘‘(J) FOREIGN OIL AND GAS INCOME.—For ‘‘(i) is paid by such dual capacity taxpayer (D) Subparagraph (A) of section 954(g)(2) is purposes of this section— pursuant to the generally applicable income amended by striking ‘‘foreign base company ‘‘(i) IN GENERAL.—The term ‘foreign oil and tax imposed by the country or possession, or oil related income’’ and inserting ‘‘foreign gas income’ has the meaning given such ‘‘(ii) would be paid if the generally applica- oil and gas income’’. term by section 954(g). ble income tax imposed by the country or (3) EFFECTIVE DATE.—The amendments ‘‘(ii) COORDINATION.—Passive category in- possession were applicable to such dual ca- made by this subsection shall apply to tax- come and general category income shall not pacity taxpayer. able years of foreign corporations beginning include foreign oil and gas income (as so de- Nothing in this paragraph shall be construed after the date of the enactment of this Act, fined).’’ and to taxable years of United States share- to imply the proper treatment of any such (3) CONFORMING AMENDMENTS.— amount not in excess of the amount deter- holders ending with or within such taxable (A) Section 904(d)(3)(F)(i) is amended by years of foreign corporations. mined under subparagraph (B). striking ‘‘or (E)’’ and inserting ‘‘(E), or (I)’’. ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- (B) Section 907(a) is hereby repealed. SEC. ll. MODIFICATION OF CREDIT FOR PRO- poses of this subsection, the term ‘dual ca- (C) Section 907(c)(4) is hereby repealed. DUCING FUEL FROM A NONCONVEN- TIONAL SOURCE. pacity taxpayer’ means, with respect to any (D) Section 907(f) is hereby repealed. AXABLE EARS NDING EFORE foreign country or possession of the United (4) EFFECTIVE DATES.— (a) T Y E B 2006.— States, a person who— (A) IN GENERAL.—The amendments made (1) MODIFICATION OF PHASEOUT.— ‘‘(A) is subject to a levy of such country or by this section shall apply to taxable years (A) IN GENERAL.—Section 29(b)(1)(A) is possession, and beginning after the date of the enactment of amended by inserting ‘‘the calendar year ‘‘(B) receives (or will receive) directly or this Act. preceding’’ before ‘‘the calendar year’’. indirectly a specific economic benefit (as de- (B) YEARS AFTER 2006.—The amendments (B) CONFORMING AMENDMENTS.—Section termined in accordance with regulations) made by paragraphs (1)(B) and (2)(B) shall 29(b)((2) is amended— from such country or possession. apply to taxable years beginning after De- (i) by striking ‘‘The’’ and inserting ‘‘With ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— cember 31, 2006. respect to any calendar year, the’’, and For purposes of this subsection— (C) TRANSITIONAL RULES.— (ii) by striking ‘‘for the calendar year in ‘‘(A) IN GENERAL.—The term ‘generally ap- (i) SEPARATE BASKET TREATMENT.—Any which the sale occurs’’ and inserting ‘‘for plicable income tax’ means an income tax taxes paid or accrued in a taxable year be- such calendar year’’. (or a series of income taxes) which is gen- ginning on or before the date of the enact- (2) NO INFLATION ADJUSTMENT FOR THE erally imposed under the laws of a foreign ment of this Act, with respect to income CREDIT AMOUNT IN 2005.—Section 29(b)(2), as country or possession on income derived which was described in subparagraph (I) of amended by paragraph (1), is amended by from the conduct of a trade or business with- section 904(d)(1) of such Code (as in effect on adding at the end the following new sen- in such country or possession. the day before the date of the enactment of tence: ‘‘This paragraph shall not apply with ‘‘(B) EXCEPTIONS.—Such term shall not in- this Act), shall be treated as taxes paid or respect to the $3 amount in subsection (a) for clude a tax unless it has substantial applica- accrued with respect to foreign oil and gas calendar year 2005 and the amount in effect tion, by its terms and in practice, to— income to the extent the taxpayer estab- under subsection (a) for sales in such cal- ‘‘(i) persons who are not dual capacity tax- lishes to the satisfaction of the Secretary of endar year shall be the amount which was in payers, and the Treasury that such taxes were paid or ac- effect for sales in calendar year 2004.’’. ‘‘(ii) persons who are citizens or residents crued with respect to foreign oil and gas in- (b) TAXABLE YEARS ENDING AFTER 2005.— of the foreign country or possession.’’ come. (1) MODIFICATION OF PHASEOUT.— (b) EFFECTIVE DATE.— (ii) CARRYOVERS.—Any unused oil and gas (A) IN GENERAL.—Section 45K(b)(1)(A) is (1) IN GENERAL.—The amendments made by extraction taxes which under section 907(f) of amended by inserting ‘‘the calendar year this section shall apply to taxes paid or ac- such Code (as so in effect) would have been preceding’’ before ‘‘the calendar year’’. crued in taxable years beginning after the allowable as a carryover to the taxpayer’s (B) CONFORMING AMENDMENTS.—Section date of the enactment of this Act. first taxable year beginning after the date of 45K(b)((2) is amended— (2) CONTRARY TREATY OBLIGATIONS the enactment of this Act (without regard to (i) by striking ‘‘The’’ and inserting ‘‘With UPHELD.—The amendments made by this sec- the limitation of paragraph (2) of such sec- respect to any calendar year, the’’, and tion shall not apply to the extent contrary tion 907(f) for first taxable year) shall be al- (ii) by striking ‘‘for the calendar year in to any treaty obligation of the United lowed as carryovers under section 904(c) of which the sale occurs’’ and inserting ‘‘for States. such Code in the same manner as if such such calendar year’’. SEC. ll. RULES RELATING TO FOREIGN OIL AND taxes were unused taxes under such section (2) NO INFLATION ADJUSTMENT FOR THE GAS INCOME. 904(c) with respect to foreign oil and gas ex- CREDIT AMOUNT IN 2005, 2006, AND 2007.—Section (a) SEPARATE BASKET FOR FOREIGN TAX traction income. 45K(b)(2), as amended by paragraph (1), is CREDIT.— (iii) LOSSES.—The amendment made by amended by adding at the end the following (1) SEPARATE BASKET.— paragraph (3)(C) shall not apply to foreign oil new sentence: ‘‘This paragraph shall not (A) YEARS BEFORE 2007.—Paragraph (1) of and gas extraction losses arising in taxable apply with respect to the $3 amount in sub- section 904(d) (relating to separate applica- years beginning on or before the date of the section (a) for calendar years 2005, 2006, and tion of section with respect to certain cat- enactment of this Act. 2007 and the amount in effect under sub- egories of income), as in effect for years be- (b) ELIMINATION OF DEFERRAL FOR FOREIGN section (a) for sales in each such calendar ginning before 2007, is amended by striking OIL AND GAS EXTRACTION INCOME.— year shall be the amount which was in effect ‘‘and’’ at the end of subparagraph (H), by re- (1) GENERAL RULE.—Paragraph (1) of sec- for sales in calendar year 2004.’’. designating subparagraph (I) as subpara- tion 954(g) (defining foreign base company oil (3) TREATMENT OF COKE AND COKE GAS.— graph (J), and by inserting after subpara- related income) is amended to read as fol- (A) NONAPPLICATION OF PHASEOUT.—Section graph (H) the following new subparagraph: lows: 45K(g)(2) is amended by adding at the end the ‘‘(I) foreign oil and gas income, and’’. ‘‘(1) IN GENERAL.—Except as otherwise pro- following new subparagraph: (B) 2007 AND AFTER.—Paragraph (1) of sec- vided in this subsection, the term ‘foreign oil ‘‘(D) NONAPPLICATION OF PHASEOUT.—Sub- tion 904(d), as in effect for years beginning and gas income’ means any income of a kind section (b)(1) shall not apply.’’.

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(B) APPLICATION OF INFLATION ADJUST- ‘‘(II) sold to or exchanged by persons other (B) such person agrees as a condition of the MENT.—Section 45K(g)(2)(B) is amended by than the taxpayer, donee, or any related per- qualified tax collection contract that not inserting ‘‘and the last sentence of sub- son (as defined in section 465(b)(3)(C)). more than 90 days after the date such con- section (b)(2) shall not apply.’’. ‘‘(C) MAXIMUM DOLLAR LIMITATION; NO CAR- tract is awarded, not less than 35 percent of (C) CLARIFICATION OF QUALIFYING FACIL- RYOVER OF INCREASED DEDUCTION.—The in- the employees of such person employed in ITY.—Section 45K(g)(1) is amended by insert- crease in the deduction under this section by connection with providing services under ing ‘‘(other than from petroleum based prod- reason of this paragraph for any taxable such contract shall— ucts)’’ after ‘‘coke or coke gas’’. year— (i) be hired after the date such contract is (c) EFFECTIVE DATE.—The amendments ‘‘(i) shall not exceed the artistic adjusted awarded; and made by this section shall apply to fuel sold gross income of the taxpayer for such tax- (ii) be severely disabled individuals; and after December 31, 2004. able year, and (C) such person is otherwise qualified to ‘‘(ii) shall not be taken into account in de- perform the services required. SA 2624. Mr. LEAHY (for himself, Mr. termining the amount which may be carried (c) DEFINITIONS.—For purposes of this sec- BENNETT, Mr. DOMENICI, Mr. SCHUMER, from such taxable year under subsection (d). tion— Mr. KENNEDY, Mr. BINGAMAN, Mr. ‘‘(D) ARTISTIC ADJUSTED GROSS INCOME.— (1) QUALIFIED TAX COLLECTION CONTRACT.— LIEBERMAN, Mr. JOHNSON, Mr. WARNER, For purposes of this paragraph, the term ‘ar- The term ‘‘qualified tax collection contract’’ Mr. SANTORUM, and Mr. COLEMAN) sub- tistic adjusted gross income’ means that por- shall have the meaning given such term mitted an amendment intended to be tion of the adjusted gross income of the tax- under section 6306(b) of the Internal Revenue proposed by him to the bill S. 2020, to payer for the taxable year attributable to— Code of 1986. provide for reconciliation pursuant to ‘‘(i) income from the sale or use of prop- (2) DOLLAR VALUE CATEGORY.—The term section 202(b) of the concurrent resolu- erty created by the personal efforts of the ‘‘dollar value category’’ means the dollar ranges of accounts for collection as deter- tion on the budget for fiscal year 2006; taxpayer which is of the same type as the do- nated property, and mined and assigned by the Secretary under which was ordered to lie on the table; ‘‘(ii) income from teaching, lecturing, per- section 6306(b)(1)(B) of the Internal Revenue as follows: forming, or similar activity with respect to Code of 1986 with respect to a qualified tax At the end of subtitle A of title III, insert property described in clause (i). collection contract. the following: ‘‘(E) PARAGRAPH NOT TO APPLY TO CERTAIN (3) SEVERELY DISABLED INDIVIDUAL.—The SEC. ll. CHARITABLE CONTRIBUTIONS OF CER- CONTRIBUTIONS.—Subparagraph (A) shall not term ‘‘severely disabled individual’’ means— TAIN ITEMS CREATED BY THE TAX- apply to any charitable contribution of any (A) a veteran of the United States armed PAYER. letter, memorandum, or similar property forces with a disability of 50 percent or (a) IN GENERAL.—Subsection (e) of section which was written, prepared, or produced by greater— 170 (relating to certain contributions of ordi- or for an individual while the individual is (i) determined by the Secretary of Vet- nary income and capital gain property), as an officer or employee of any person (includ- erans Affairs to be service-connected; or amended by section 316(a), is amended by ing any government agency or instrumen- (ii) deemed by law to be service-connected; adding at the end the following new para- tality) unless such letter, memorandum, or or graph: similar property is entirely personal. (B) any individual who is a disabled bene- ‘‘(8) SPECIAL RULE FOR CERTAIN CONTRIBU- ‘‘(F) COPYRIGHT TREATED AS SEPARATE ficiary (as defined in section 1148(k)(2) of the TIONS OF LITERARY, MUSICAL, OR ARTISTIC PROPERTY FOR PARTIAL INTEREST RULE.—In Social Security Act (42 U.S.C. 1320b–19(k)(2))) COMPOSITIONS.— the case of a qualified artistic charitable or who would be considered to be such a dis- ‘‘(A) IN GENERAL.—In the case of a qualified abled beneficiary but for having income or artistic charitable contribution— contribution, the tangible literary, musical, resources in excess of the income or re- ‘‘(i) the amount of such contribution shall artistic, or scholarly composition, or similar sources eligibility limits established under be the fair market value of the property con- property and the copyright on such work title XVI of the Social Security Act (42 tributed (determined at the time of such con- shall be treated as separate properties for U.S.C. 1381 et seq.), respectively. tribution), and purposes of this paragraph and subsection (f)(3).’’. ‘‘(ii) no reduction in the amount of such SA 2626. Mr. REED (for himself, Mr. contribution shall be made under paragraph (b) EFFECTIVE DATE.—The amendment (1). made by this section shall apply to contribu- KENNEDY, Mr. SCHUMER, Mr. KOHL, Mr. ‘‘(B) QUALIFIED ARTISTIC CHARITABLE CON- tions made after the date of the enactment ROCKEFELLER, Mr. KERRY, Mr. CARPER, TRIBUTION.—For purposes of this paragraph, of this Act in taxable years ending after such Mr. LEAHY, Mr. DAYTON, Mr. the term ‘qualified artistic charitable con- date. LIEBERMAN, and Ms. STABENOW) pro- tribution’ means a charitable contribution of posed an amendment to the bill S. 2020, any literary, musical, artistic, or scholarly SA 2625. Mr. NELSON of Nebraska to provide for reconciliation pursuant composition, or similar property, or the (for himself, Mr. DEWINE, and Ms. COL- to section 202(b) of the concurrent reso- copyright thereon (or both), but only if— LINS) proposed an amendment to the lution on the budget for fiscal year ‘‘(i) such property was created by the per- bill S. 2020, to provide for reconcili- 2006; as follows: sonal efforts of the taxpayer making such ation pursuant to section 202(b) of the At the end of title IV add the following: contribution no less than 18 months prior to concurrent resolution on the budget for such contribution, SEC. 410. TEMPORARY WINDFALL PROFITS TAX. ‘‘(ii) the taxpayer— fiscal year 2006; as follows: (a) IN GENERAL.—Subtitle E of the Internal ‘‘(I) has received a qualified appraisal of At the end of title IV, insert the following: Revenue Code of 1986 (relating to alcohol, to- the fair market value of such property in ac- SEC. ll. DISABILITY PREFERENCE PROGRAM bacco, and certain other excise taxes) is cordance with the regulations under this sec- FOR TAX COLLECTION CONTRACTS. amended by adding at the end thereof the tion, and (a) IN GENERAL.—The Secretary of the following new chapter: ‘‘(II) attaches to the taxpayer’s income tax Treasury shall not enter into any qualified ‘‘CHAPTER 56—TEMPORARY WINDFALL return for the taxable year in which such tax collection contract after April 1, 2006, PROFITS ON CRUDE OIL contribution was made a copy of such ap- until the Secretary implements a disability ‘‘Sec. 5896. Imposition of tax. praisal, preference program that meets the require- ‘‘Sec. 5897. Windfall profit; etc. ‘‘(iii) the donee is an organization de- ments of subsection (b). ‘‘Sec. 5898. Special rules and definitions. scribed in subsection (b)(1)(A), (b) DISABILITY PREFERENCE PROGRAM RE- ‘‘SEC. 5896. IMPOSITION OF TAX. ‘‘(iv) the use of such property by the donee QUIREMENTS.— ‘‘(a) IN GENERAL.—In addition to any other is related to the purpose or function consti- (1) IN GENERAL.—A disability preference tax imposed under this title, there is hereby tuting the basis for the donee’s exemption program meets the requirements of this sub- imposed on any applicable taxpayer an ex- under section 501 (or, in the case of a govern- section if such program requires that not cise tax in an amount equal to the applicable mental unit, to any purpose or function de- less than 10 percent of the accounts of each percentage of the windfall profit of such tax- scribed under subsection (c)), dollar value category are awarded to persons payer for any taxable year beginning in 2005. ‘‘(v) the taxpayer receives from the donee a described in paragraph (2). ‘‘(b) APPLICABLE TAXPAYER.—For purposes written statement representing that the (2) PERSON DESCRIBED.—For purposes of of this chapter, the term ‘applicable tax- donee’s use of the property will be in accord- paragraph (1), a person is described in this payer’ means, with respect to operations in ance with the provisions of clause (iv), and paragraph if— the United States— ‘‘(vi) the written appraisal referred to in (A) as of the date any qualified tax collec- ‘‘(1) any integrated oil company (as defined clause (ii) includes evidence of the extent (if tion contract is awarded— in section 291(b)(4)) which has an average any) to which property created by the per- (i) such person employs not less than 50 se- daily worldwide production of crude oil of at sonal efforts of the taxpayer and of the same verely disabled individuals within the United least 500,000 barrels for the taxable year. type as the donated property is or has been— States; or ‘‘(c) APPLICABLE PERCENTAGE.—For pur- ‘‘(I) owned, maintained, and displayed by (ii) not less than 30 percent of the employ- poses of subsection (a), the applicable per- organizations described in subsection ees of such person within the United States centage shall be determined by the Sec- (b)(1)(A), and are severely disabled individuals; retary such that the resulting increase in

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00072 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.176 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13219 revenues in the Treasury equals (1) IN GENERAL.—Subchapter A of chapter the budget for fiscal year 2006; which $2,920,000,000. 98 of the Internal Revenue Code of 1986 (re- was ordered to lie on the table; as fol- ‘‘SEC. 5897. WINDFALL PROFIT; ETC. lating to trust fund code) is amended by add- lows: ing at the end the following new section: ‘‘(a) GENERAL RULE.—For purposes of this At the end of subtitle A of title V, add the chapter, the term ‘windfall profit’ means the ‘‘SEC. 9511. LOW-INCOME HOME ENERGY ASSIST- following: ANCE TRUST FUND. excess of the adjusted taxable income of the SEC. 504. PENALTY FOR PROMOTING ABUSIVE ‘‘(a) CREATION OF TRUST FUND.—There is applicable taxpayer for the taxable year over TAX SHELTERS. established in the Treasury of the United the reasonably inflated average profit for (a) PENALTY FOR PROMOTING ABUSIVE TAX States a trust fund to be known as the ‘Low- such taxable year. SHELTERS.—Section 6700 (relating to pro- ‘‘(b) ADJUSTED TAXABLE INCOME.—For pur- Income Home Energy Assistance Trust moting abusive tax shelters, etc.) is amend- poses of this chapter, with respect to any ap- Fund’, consisting of any amount appro- ed— plicable taxpayer, the adjusted taxable in- priated or credited to the Trust Fund as pro- (1) by redesignating subsections (b) and (c) come for any taxable year is equal to the vided in this section or section 9602(b). as subsections (d) and (e), respectively, taxable income for such taxable year (within ‘‘(b) TRANSFERS TO TRUST FUND.—There (2) by striking ‘‘a penalty’’ and all that fol- the meaning of section 63 and determined are hereby appropriated to the Low-Income lows through the period in the first sentence without regard to this subsection)— Home Energy Assistance Trust Fund of subsection (a) and inserting ‘‘a penalty de- ‘‘(1) increased by any interest expense de- amounts equivalent to the increased reve- termined under subsection (b)’’, and duction, charitable contribution deduction, nues received in the Treasury as the result of (3) by inserting after subsection (a) the fol- and any net operating loss deduction carried the amendment made by section 410(a) of the lowing new subsections: forward from any prior taxable year, and Tax Relief Act of 2005. ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF ‘‘(2) reduced by any interest income, divi- ‘‘(c) EXPENDITURES FROM TRUST FUND.— PENALTY; LIABILITY FOR PENALTY.— dend income, and net operating losses to the Amounts in the Low Income Home Energy ‘‘(1) AMOUNT OF PENALTY.—The amount of extent such losses exceed taxable income for Assistance Trust Fund not to exceed the penalty imposed by subsection (a) shall the taxable year. $2,920,000,000 shall be available for fiscal year not exceed the greater of— In the case of any applicable taxpayer which 2006, as provided by appropriation Acts, to ‘‘(A) 150 percent of the gross income de- is a foreign corporation, the adjusted taxable carry out the program under the Low-In- rived (or to be derived) from such activity by income shall be determined with respect to come Home Energy Assistance Act of 1981 the person or persons subject to such pen- such income which is effectively connected through the distribution of funds to all the alty, and with the conduct of a trade or business in the States in accordance with section 2604 of ‘‘(B) if readily subject to calculation, the United States. that Act (42 U.S.C. 8623) (other than sub- total amount of underpayment by the tax- ‘‘(c) REASONABLY INFLATED AVERAGE PROF- section (e) of such section), but only if not payer (including penalties, interest, and IT.—For purposes of this chapter, with re- less than $1,880,000,000 has been appropriated taxes) in connection with such activity. spect to any applicable taxpayer, the reason- for such program for such fiscal year.’’. ‘‘(2) CALCULATION OF PENALTY.—The pen- ably inflated average profit for any taxable (2) CLERICAL AMENDMENT.—The table of alty amount determined under paragraph (1) year is an amount equal to the average of sections for such subchapter is amended by shall be calculated with respect to each in- the adjusted taxable income of such taxpayer adding at the end the following new item: stance of an activity described in subsection for taxable years beginning during the 2000- ‘‘Sec. 9511. Low-Income Home Energy As- (a), each instance in which income was de- 2004 taxable year period (determined without sistance Trust Fund.’’. rived by the person or persons subject to regard to the taxable year with the highest (e) EFFECTIVE DATES.— such penalty, and each person who partici- adjusted taxable income in such period) plus (1) IN GENERAL.—Except as provided in pated in such an activity. 10 percent of such average. paragraph (2), the amendments made by this ‘‘(3) LIABILITY FOR PENALTY.—If more than ‘‘SEC. 5898. SPECIAL RULES AND DEFINITIONS . section shall apply to taxable years begin- 1 person is liable under subsection (a) with ‘‘(a) WITHHOLDING AND DEPOSIT OF TAX.— ning in 2005. respect to such activity, all such persons The Secretary shall provide such rules as are (2) SUBSECTION (d).—The amendments made shall be jointly and severally liable for the necessary for the withholding and deposit of by subsection (d) shall take effect on the penalty under such subsection. the tax imposed under section 5896. date of the enactment of this Act. ‘‘(c) PENALTY NOT DEDUCTIBLE.—The pay- ‘‘(b) RECORDS AND INFORMATION.—Each tax- ment of any penalty imposed under this sec- payer liable for tax under section 5896 shall SA 2627. Mr. GRAHAM submitted an tion or the payment of any amount to settle keep such records, make such returns, and amendment intended to be proposed by or avoid the imposition of such penalty shall furnish such information as the Secretary him to the bill S. 2020, to provide for not be considered an ordinary and necessary may by regulations prescribe. reconciliation pursuant to section expense in carrying on a trade or business ‘‘(c) RETURN OF WINDFALL PROFIT TAX.— for purposes of this title and shall not be de- 202(b) of the concurrent resolution on ductible by the person who is subject to such The Secretary shall provide for the filing and the budget for fiscal year 2006; which the time of such filing of the return of the penalty or who makes such payment.’’. tax imposed under section 5896. was ordered to lie on the table; as fol- (b) CONFORMING AMENDMENT.—Section ‘‘(d) CRUDE OIL.—The term ‘crude oil’ in- lows: 6700(a) is amended by striking the last sen- cludes crude oil condensates and natural gas- At the end of title IV, add the following: tence. (c) EFFECTIVE DATE.—The amendments oline. SEC. ll. CLARIFICATION OF WORKING CAPITAL ‘‘(e) BUSINESSES UNDER COMMON CONTROL.— FOR REASONABLY ANTICIPATED made by this section shall apply to activities For purposes of this chapter, all members of NEEDS OF A BUSINESS FOR PUR- after the date of the enactment of this Act. the same controlled group of corporations POSES OF ACCUMULATED EARNINGS SEC. 505. PENALTY FOR AIDING AND ABETTING (within the meaning of section 267(f)) and all TAX. THE UNDERSTATEMENT OF TAX LI- ABILITY. persons under common control (within the (a) IN GENERAL.—Section 537(b) (relating to (a) IN GENERAL.—Section 6701(a) (relating meaning of section 52(b) but determined by special rules) is amended by adding at the end the following new paragraph: to imposition of penalty) is amended— treating an interest of more than 50 percent (1) by striking ‘‘preparation or presen- as a controlling interest) shall be treated as ‘‘(6) WORKING CAPITAL.—The reasonably an- ticipated needs of a business for any taxable tation of’’ and inserting ‘‘tax liability re- 1 person. flected in’’ in paragraph (1), ‘‘(f) REGULATIONS.—The Secretary shall year shall include working capital for the (2) by inserting ‘‘aid, assistance, procure- prescribe such regulations as may be nec- business in an amount which is not less than ment, or advice with respect to such’’ before essary or appropriate to carry out the pur- the sum of the costs of goods, operating ex- ‘‘portion’’ both places it appears in para- poses of this chapter.’’. penses, taxes, and interest expense which the graphs (2) and (3), and (b) CLERICAL AMENDMENT.—The table of business incurred during the preceding tax- chapters for subtitle E of the Internal Rev- able year. Any amounts incurred as part of a (3) by inserting ‘‘instance of aid, assist- enue Code of 1986 is amended by adding at plan a principal purposes of which is to in- ance, procurement, or advice or each such’’ the end the following new item: crease the limitation under this subsection before ‘‘document’’ in the matter following shall not be taken into account.’’ paragraph (3). ‘‘CHAPTER 56. Temporary Windfall Profits on (b) AMOUNT OF PENALTY.—Subsection (b) of Crude Oil.’’. (b) EFFECTIVE DATE.—The amendment made by this section shall apply to taxable section 6701 (relating to penalties for aiding (c) DEDUCTIBILITY OF WINDFALL PROFIT years beginning after December 31, 3005, and and abetting understatement of tax liability) TAX.—The first sentence of section 164(a) of before January 1, 2011. is amended to read as follows: the Internal Revenue Code of 1986 (relating ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF to deduction for taxes) is amended by insert- SA 2628. Mr. LEVIN (for himself, Mr. PENALTY; LIABILITY FOR PENALTY.— ing after paragraph (5) the following new ‘‘(1) AMOUNT OF PENALTY.—The amount of COLEMAN, and Mr. OBAMA) submitted paragraph: the penalty imposed by subsection (a) shall ‘‘(6) The windfall profit tax imposed by sec- an amendment intended to be proposed not exceed the greater of— tion 5896.’’. by him to the bill S. 2020, to provide for ‘‘(A) 150 percent of the gross income de- (d) LOW INCOME HOME ENERGY ASSISTANCE reconciliation pursuant to section rived (or to be derived) from such aid, assist- TRUST FUND.— 202(b) of the concurrent resolution on ance, procurement, or advice provided by the

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00073 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.183 S17NOPT2 S13220 CONGRESSIONAL RECORD — SENATE November 17, 2005 person or persons subject to such penalty, Federal Deposit Insurance Act (12 U.S.C. turn or return information shall be disclosed and 1813(c)); to such requestor’s officers and employees ‘‘(B) if readily subject to calculation, the (4) the term ‘‘Federal banking agencies’’ who are personally and directly engaged in total amount of underpayment by the tax- has the same meaning as in section 3(q) of an investigation, examination, or proceeding payer (including penalties, interest, and the Federal Deposit Insurance Act (12 U.S.C. by such requester to evaluate the accuracy taxes) in connection with the understate- 1813(q)); and of a financial statement or report or to de- ment of the liability for tax. (5) the term ‘‘Secretary’’ means the Sec- termine whether to require a restatement, ‘‘(2) CALCULATION OF PENALTY.—The pen- retary of the Treasury. penalize, or deter conduct by an issuer, in- alty amount determined under paragraph (1) SEC. 507. INFORMATION SHARING FOR ENFORCE- vestment company, or public accounting shall be calculated with respect to each in- MENT PURPOSES. firm, or associated person, in connection stance of aid, assistance, procurement, or ad- (a) PROMOTION OF PROHIBITED TAX SHEL- with a potential or actual violation of audit- vice described in subsection (a), each in- TERS OR TAX AVOIDANCE SCHEMES.—Section ing standards or prohibitions against false or stance in which income was derived by the 6103(h) (relating to disclosure to certain Fed- misleading statements or omissions in finan- person or persons subject to such penalty, eral officers and employees for purposes of cial statements or reports. Such disclosure and each person who made such an under- tax administration, etc.) is amended by add- shall be solely for use by such officers and statement of the liability for tax. ing at the end the following new paragraph: employees in such investigation, examina- ‘‘(3) LIABILITY FOR PENALTY.—If more than ‘‘(7) DISCLOSURE OF RETURNS AND RETURN tion, or proceeding. 1 person is liable under subsection (a) with INFORMATION RELATED TO PROMOTION OF PRO- ‘‘(B) REQUIREMENTS.—A request meets the respect to providing such aid, assistance, HIBITED TAX SHELTERS OR TAX AVOIDANCE requirements of this subparagraph if it sets procurement, or advice, all such persons SCHEMES.— forth— shall be jointly and severally liable for the ‘‘(A) WRITTEN REQUEST.—Upon receipt by ‘‘(i) the nature of the investigation, exam- penalty under such subsection.’’. the Secretary of a written request which ination, or proceeding, (c) PENALTY NOT DEDUCTIBLE.—Section 6701 meets the requirements of subparagraph (B) ‘‘(ii) the statutory authority under which is amended by adding at the end the fol- from the head of the United States Securi- such investigation, examination, or pro- lowing new subsection: ties and Exchange Commission, an appro- ceeding is being conducted, ‘‘(g) PENALTY NOT DEDUCTIBLE.—The pay- priate Federal banking agency as defined ‘‘(iii) the name or names of the issuer, in- ment of any penalty imposed under this sec- under section 1813(q) of title 12, United vestment company, or public accounting tion or the payment of any amount to settle States Code, or the Public Company Ac- firm to which such return information re- or avoid the imposition of such penalty shall counting Oversight Board, a return or return lates, not be considered an ordinary and necessary information shall be disclosed to such re- ‘‘(iv) the taxable period or periods to which expense in carrying on a trade or business questor’s officers and employees who are per- such return information relates, and for purposes of this title and shall not be de- sonally and directly engaged in an investiga- ‘‘(v) the specific reason or reasons why ductible by the person who is subject to such tion, examination, or proceeding by such re- such disclosure is, or may be, relevant to penalty or who makes such payment.’’. questor to evaluate, determine, penalize, or such investigation, examination or pro- (d) EFFECTIVE DATE.—The amendments deter conduct by a financial institution, ceeding.’’. made by this section shall apply to activities issuer, or public accounting firm, or associ- (c) EFFECTIVE DATE.—The amendments after the date of the enactment of this Act. ated person, in connection with a potential SEC. 506. PREVENTING TAX SHELTER ACTIVITIES made by this section shall apply to disclo- or actual violation of section 6700 (promotion sures and to information and document re- BY FINANCIAL INSTITUTIONS. of abusive tax shelters), 6701 (aiding and (a) EXAMINATIONS.— quests made after the date of the enactment abetting understatement of tax liability), or (1) DEVELOPMENT OF EXAMINATION TECH- of this Act. activities related to promoting or facili- NIQUES.—Each of the Federal banking agen- SEC. 508. DISCLOSING PAYMENTS TO PERSONS IN tating inappropriate tax avoidance or tax cies and the Commission shall, in consulta- UNCOOPERATIVE TAX HAVENS. evasion. Such disclosure shall be solely for tion with the Internal Revenue Service, de- (a) IN GENERAL.—Subpart A of part III of use by such officers and employees in such velop examination techniques to detect po- subchapter A of chapter 61 is amended by in- investigation, examination, or proceeding. tential violations of section 6700 or 6701 of serting after section 6038C the following new ‘‘(B) REQUIREMENTS.—A request meets the the Internal Revenue Code of 1986, by deposi- section: requirements of this subparagraph if it sets tory institutions, brokers, dealers, and in- ‘‘SEC. 6038D. DETERRING UNCOOPERATIVE TAX forth— vestment advisers, as appropriate. HAVENS THROUGH LISTING AND RE- ‘‘(i) the nature of the investigation, exam- PORTING REQUIREMENTS. (2) FREQUENCY.—Not less frequently than ination, or proceeding, once in each 2-year period, each of the Fed- ‘‘(a) IN GENERAL.—Each United States per- ‘‘(ii) the statutory authority under which eral banking agencies and the Commission son who transfers money or other property such investigation, examination, or pro- shall implement the examination techniques directly or indirectly to any uncooperative ceeding is being conducted, developed under paragraph (1) with respect tax haven, to any financial institution li- ‘‘(iii) the name or names of the financial to each of the depository institutions, bro- censed by or operating in any uncooperative institution, issuer, or public accounting firm kers, dealers, or investment advisers subject tax haven, or to any person who is a resident to which such return information relates, to their enforcement authority. Such exam- of any uncooperative tax haven shall furnish ‘‘(iv) the taxable period or periods to which ination shall, to the extent possible, be com- to the Secretary, at such time and in such such return information relates, and bined with any examination by such agency manner as the Secretary shall by regulation ‘‘(v) the specific reason or reasons why prescribe, such information with respect to otherwise required or authorized by Federal such disclosure is, or may be, relevant to such transfer as the Secretary may require. law. such investigation, examination or pro- ‘‘(b) EXCEPTIONS.—Subsection (a) shall not (b) REPORT TO INTERNAL REVENUE SERV- apply to a transfer by a United States person ICE.—In any case in which an examination ceeding. conducted under this section with respect to ‘‘(C) FINANCIAL INSTITUTION.—For the pur- if the amount of money (and the fair market a financial institution or other entity re- poses of this paragraph, the term ‘financial value of property) transferred is less than veals a potential violation, such agency shall institution’ means a depository institution, $10,000. Related transfers shall be treated as promptly notify the Internal Revenue Serv- foreign bank, insured institution, industrial 1 transfer for purposes of this subsection. ‘‘(c) UNCOOPERATIVE TAX HAVEN.—For pur- ice of such potential violation for investiga- loan company, broker, dealer, investment poses of this section— tion and enforcement by the Internal Rev- company, investment advisor, or other enti- enue Service in accordance with applicable ty subject to regulation or oversight by the ‘‘(1) IN GENERAL.—The term ‘uncooperative provisions of law. United States Securities and Exchange Com- tax haven’ means any foreign jurisdiction (c) REPORT TO CONGRESS.—The Federal mission or an appropriate Federal banking which is identified on a list maintained by banking agencies and the Commission shall agency.’’. the Secretary under paragraph (2) as being a submit a joint written report to Congress in (b) FINANCIAL AND ACCOUNTING FRAUD IN- jurisdiction— 2007 and 2010 on their progress in preventing VESTIGATIONS.—Section 6103(i) (relating to ‘‘(A) which imposes no or nominal taxation violations of sections 6700 and 6701 of the In- disclosure to Federal officers or employees either generally or on specified classes of in- ternal Revenue Code of 1986, by depository for administration of Federal laws not relat- come, and institutions, brokers, dealers, and invest- ing to tax administration) is amended by ‘‘(B) has corporate, business, bank, or tax ment advisers, as appropriate. adding at the end the following new para- secrecy or confidentiality rules and prac- (d) DEFINITIONS.—For purposes of this sec- graph: tices, or has ineffective information ex- tion— ‘‘(9) DISCLOSURE OF RETURNS AND RETURN change practices which, in the judgment of (1) the terms ‘‘broker’’, ‘‘dealer’’, and ‘‘in- INFORMATION FOR USE IN FINANCIAL AND AC- the Secretary, effectively limit or restrict vestment adviser’’ have the same meanings COUNTING FRAUD INVESTIGATIONS.— the ability of the United States to obtain in- as in section 3 of the Securities Exchange ‘‘(A) WRITTEN REQUEST.—Upon receipt by formation relevant to the enforcement of Act of 1934 (15 U.S.C. 78c); the Secretary of a written request which this title. (2) the term ‘‘Commission’’ means the Se- meets the requirements of subparagraph (B) ‘‘(2) MAINTENANCE OF LIST.—Not later than curities and Exchange Commission; from the head of the United States Securi- November 1 of each calendar year, the Sec- (3) the term ‘‘depository institution’’ has ties and Exchange Commission or the Public retary shall issue a list of foreign jurisdic- the same meaning as in section 3(c) of the Company Accounting Oversight Board, a re- tions which the Secretary determines qualify

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as uncooperative tax havens under paragraph ‘‘(2) IDENTIFIED TAX HAVEN INCOME.—For ‘‘(c) RESIDENTIAL ENERGY COSTS.—For pur- (1). purposes of paragraph (1), the term ‘identi- poses of this section, the term ‘qualified en- ‘‘(3) INEFFECTIVE INFORMATION EXCHANGE fied tax haven income’ means income for the ergy costs’ means the cost of any fuel, en- PRACTICES.—For purposes of paragraph (1), a taxable year which is attributable to a for- ergy utility, natural gas, fertilizer, and heat- jurisdiction shall be deemed to have ineffec- eign jurisdiction for any period during which ing oil used in the farming business of the tive information exchange practices if the such jurisdiction has been identified as an taxpayer during the taxable year. Secretary determines that during any tax- uncooperative tax haven under section ‘‘(d) TERMINATION.—This section shall not able year ending in the 12-month period pre- 6038D(c). apply to qualified energy costs paid or in- ceding the issuance of the list under para- ‘‘(3) REGULATIONS.—The Secretary shall curred after December 31, 2005.’’. graph (2)— prescribe regulations similar to the regula- (b) NO DOUBLE BENEFIT.—Section 280C is ‘‘(A) the exchange of information between tions issued under section 999(c) to carry out amended by adding at the end the following the United States and such jurisdiction was the purposes of this subsection.’’. new subsection: ‘‘(e) ENERGY ASSISTANCE FOR FARMERS AND inadequate to prevent evasion or avoidance (b) DENIAL OF FOREIGN TAX CREDIT.—Sec- RANCHERS.—No deduction shall be allowed of United States income tax by United tion 901 (relating to taxes of foreign coun- for that portion of the expenses otherwise al- States persons or to enable the United tries and of possessions of United States) is lowable as a deduction for the taxable year States effectively to enforce this title, or amended by redesignating subsection (m) as which is equal to the amount of the credit ‘‘(B) such jurisdiction was identified by an subsection (n) and by inserting after sub- determined under section 36(a).’’. intergovernmental group or organization of section (l) the following new subsection: (c) REFUNDABILITY.—Section 1324(b)(2) of ‘‘(m) REDUCTION OF FOREIGN TAX CREDIT, which the United States is a member as un- title 31, United States Code, is amended by ETC., FOR IDENTIFIED TAX HAVEN INCOME.— cooperative with international tax enforce- striking ‘‘or’’ before ‘‘enacted’’ and by in- ‘‘(1) IN GENERAL.—Notwithstanding any ment or information exchange and the serting before the period at the end ‘‘, or other provision of this part— United States concurs in the determination. from section 36 of such Code’’. ‘‘(A) no credit shall be allowed under sub- ‘‘(d) PENALTY FOR FAILURE TO FILE INFOR- (d) CLERICAL AMENDMENTS.—The table of MATION.—If a United States person fails to section (a) for any income, war profits, or ex- sections for subpart C of part IV of sub- furnish the information required by sub- cess profits taxes paid or accrued (or deemed chapter A of chapter 1 is amended by strik- section (a) with respect to any transfer with- paid under section 902 or 960) to any foreign ing the item relating to section 35 and by in the time prescribed therefor (including ex- jurisdiction if such taxes are with respect to adding at the end the following new items: income attributable to a period during which tensions), such United States person shall ‘‘Sec. 36. Credit for energy cost assist- such jurisdiction has been identified as an pay (upon notice and demand by the Sec- ance for farmers and ranchers. retary and in the same manner as tax) an uncooperative tax haven under section ‘‘Sec. 37. Overpayments of tax.’’. amount equal to 20 percent of the amount of 6038D(c), and ‘‘(B) subsections (a), (b), (c), and (d) of sec- (e) EFFECTIVE DATE.—The amendments such transfer. made by this section shall apply to taxable tion 904 and sections 902 and 960 shall be ap- ‘‘(e) SIMPLIFIED REPORTING.—The Sec- years beginning after December 31, 2004. retary may by regulations provide for sim- plied separately with respect to all income of a taxpayer attributable to periods described SEC. lll. MODIFICATIONS OF FOREIGN TAX plified reporting under this section for CREDIT RULES APPLICABLE TO United States persons making large volumes in subparagraph (A) with respect to all such DUAL CAPACITY TAXPAYERS. of similar payments. jurisdictions. (a) IN GENERAL.—Section 901 (relating to ‘‘(f) REGULATIONS.—The Secretary shall ‘‘(2) TAXES ALLOWED AS A DEDUCTION, ETC.— credit for taxes of foreign countries and of prescribe such regulations as may be nec- Sections 275 and 78 shall not apply to any tax possessions of the United States) is amended essary or appropriate to carry out the pur- which is not allowable as a credit under sub- by redesignating subsection (m) as sub- poses of this section.’’. section (a) by reason of this subsection. section (n) and by inserting after subsection (b) CLERICAL AMENDMENT.—The table of ‘‘(3) REGULATIONS.—The Secretary shall (l) the following new subsection: sections for such subpart A is amended by in- prescribe such regulations as may be nec- ‘‘(m) SPECIAL RULES RELATING TO DUAL serting after the item relating to section essary or appropriate to carry out the pur- CAPACITY TAXPAYERS.— 6038C the following new item: poses of this subsection, including regula- ‘‘(1) GENERAL RULE.—Notwithstanding any ‘‘Sec. 6038D. Deterring uncooperative tax tions which treat income paid through 1 or other provision of this chapter, any amount havens through listing and re- more entities as derived from a foreign juris- paid or accrued by a dual capacity taxpayer porting requirements.’’. diction to which this subsection applies if to a foreign country or possession of the such income was, without regard to such en- (c) EFFECTIVE DATE.—The amendments United States for any period shall not be made by this section shall apply to transfers tities, derived from such jurisdiction.’’. considered a tax— (c) EFFECTIVE DATE.—The amendments after the date which is 180 days after the ‘‘(A) if, for such period, the foreign country made by this section shall apply to taxable date of the enactment of this Act. or possession does not impose a generally ap- years beginning after the date of the enact- plicable income tax, or SEC. 509. DETERRING UNCOOPERATIVE TAX HA- ment of this Act. VENS BY RESTRICTING ALLOWABLE ‘‘(B) to the extent such amount exceeds the amount (determined in accordance with reg- TAX BENEFITS. SA 2629. Mr. DAYTON (for himself (a) LIMITATION ON DEFERRAL.— ulations) which— and Mr. SALAZAR) submitted an amend- (1) IN GENERAL.—Subsection (a) of section ‘‘(i) is paid by such dual capacity taxpayer 952 (defining subpart F income) is amended ment intended to be proposed by him pursuant to the generally applicable income by striking ‘‘and’’ at the end of paragraph to the bill S. 2020, to provide for rec- tax imposed by the country or possession, or (4), by striking the period at the end of para- onciliation pursuant to section 202(b) ‘‘(ii) would be paid if the generally applica- graph (5) and inserting ‘‘, and’’, and by in- of the concurrent resolution on the ble income tax imposed by the country or serting after paragraph (5) the following new budget for fiscal year 2006; as follows: possession were applicable to such dual ca- pacity taxpayer. paragraph: On page 235, between lines 13 and 14, insert ‘‘(6) an amount equal to the applicable the following: Nothing in this paragraph shall be construed fraction (as defined in subsection (e)) of the SEC. ll. REFUNDABLE TAX CREDIT FOR EN- to imply the proper treatment of any such income of such corporation other than in- ERGY COST ASSISTANCE OF FARM- amount not in excess of the amount deter- come which— ERS AND RANCHERS. mined under subparagraph (B). ‘‘(A) is attributable to earnings and profits (a) IN GENERAL.—Subpart C of part IV of ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- of the foreign corporation included in the subchapter A of chapter 1 (relating to re- poses of this subsection, the term ‘dual ca- gross income of a United States person under fundable credits) is amended by redesig- pacity taxpayer’ means, with respect to any section 951 (other than by reason of this nating section 36 as section 37 and by insert- foreign country or possession of the United paragraph or paragraph (3)(A)(i)), or ing after section 35 the following new sec- States, a person who— ‘‘(B) is described in subsection (b).’’. tion: ‘‘(A) is subject to a levy of such country or (2) APPLICABLE FRACTION.—Section 952 is ‘‘SEC. 36. CREDIT FOR ENERGY COST ASSISTANCE possession, and amended by adding at the end the following FOR FARMERS AND RANCHERS. ‘‘(B) receives (or will receive) directly or new subsection: ‘‘(a) GENERAL RULE.—In the case of an eli- indirectly a specific economic benefit (as de- ‘‘(e) IDENTIFIED TAX HAVEN INCOME WHICH gible taxpayer, there shall be allowed as a termined in accordance with regulations) IS SUBPART F INCOME.— credit against the tax imposed by this sub- from such country or possession. ‘‘(1) IN GENERAL.—For purposes of sub- title for the taxable year an amount equal to ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— section (a)(6), the term ‘applicable fraction’ the lesser of— For purposes of this subsection— means the fraction— ‘‘(1) 30 percent of the amount paid or in- ‘‘(A) IN GENERAL.—The term ‘generally ap- ‘‘(A) the numerator of which is the aggre- curred for qualified energy costs, or plicable income tax’ means an income tax gate identified tax haven income for the tax- ‘‘(2) $3,000. (or a series of income taxes) which is gen- able year, and ‘‘(b) ELIGIBLE TAXPAYER.—For purposes of erally imposed under the laws of a foreign ‘‘(B) the denominator of which is the ag- this section, the term ‘eligible taxpayer’ country or possession on income derived gregate income for the taxable year which is means any individual engaged in a farming from the conduct of a trade or business with- from sources outside the United States. business (as defined in section 263A(e)(4)). in such country or possession.

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‘‘(B) EXCEPTIONS.—Such term shall not in- ‘‘(ii) persons who are citizens or residents crued with respect to foreign oil and gas in- clude a tax unless it has substantial applica- of the foreign country or possession.’’ come. tion, by its terms and in practice, to— (b) EFFECTIVE DATE.— (B) CARRYOVERS.—Any unused oil and gas ‘‘(i) persons who are not dual capacity tax- (1) IN GENERAL.—The amendments made by extraction taxes which under section 907(f) of payers, and this section shall apply to taxes paid or ac- such Code (as so in effect) would have been ‘‘(ii) persons who are citizens or residents crued in taxable years beginning after the allowable as a carryover to the taxpayer’s of the foreign country or possession.’’ date of the enactment of this Act. first taxable year beginning after the date of (b) EFFECTIVE DATE.— (2) CONTRARY TREATY OBLIGATIONS the enactment of this Act (without regard to (1) IN GENERAL.—The amendments made by UPHELD.—The amendments made by this sec- the limitation of paragraph (2) of such sec- this section shall apply to taxes paid or ac- tion shall not apply to the extent contrary tion 907(f) for first taxable year) shall be al- crued in taxable years beginning after the to any treaty obligation of the United lowed as carryovers under section 904(c) of date of the enactment of this Act. States. such Code in the same manner as if such (2) CONTRARY TREATY OBLIGATIONS SEC. ll. RULES RELATING TO FOREIGN OIL AND taxes were unused taxes under such section UPHELD.—The amendments made by this sec- GAS INCOME. 904(c) with respect to foreign oil and gas ex- tion shall not apply to the extent contrary (a) SEPARATE BASKET FOR FOREIGN TAX traction income. to any treaty obligation of the United CREDIT.— (C) LOSSES.—The amendment made by sub- States. (1) YEARS BEFORE 2007.—Paragraph (1) of section (c)(3) shall not apply to foreign oil section 904(d) (relating to separate applica- and gas extraction losses arising in taxable SA 2630. Mr. SCHUMER (for himself tion of section with respect to certain cat- years beginning on or before the date of the and Mr. WYDEN) submitted an amend- egories of income), as in effect for years be- enactment of this Act. ment intended to be proposed by him ginning before 2007, is amended by striking Ms. LANDRIEU submitted to the bill S. 2020, to provide for rec- ‘‘and’’ at the end of subparagraph (H), by re- SA 2631. an amendment intended to be proposed onciliation pursuant to section 202(b) designating subparagraph (I) as subpara- by her to the bill S. 2020, to provide for of the concurrent resolution on the graph (J), and by inserting after subpara- graph (H) the following new subparagraph: reconciliation pursuant to section budget for fiscal year 2006; which was ‘‘(I) foreign oil and gas income, and’’. 202(b) of the concurrent resolution on ordered to lie on the table; as follows: (2) 2007 AND AFTER.—Paragraph (1) of sec- the budget for fiscal year 2006; which At the end of title V, add the following: tion 904(d), as in effect for years beginning was ordered to lie on the table; as fol- SEC. ll. MODIFICATIONS OF FOREIGN TAX after 2006, is amended by striking ‘‘and’’ at lows: CREDIT RULES APPLICABLE TO the end of subparagraph (A), by striking the DUAL CAPACITY TAXPAYERS. period at the end of subparagraph (B) and in- At the end of title IV, insert the following: (a) IN GENERAL.—Section 901 (relating to serting ‘‘, and’’, and by adding at the end the Subtitle B—Hope at Home credit for taxes of foreign countries and of following: SEC. 411. READY RESERVE-NATIONAL GUARD EM- possessions of the United States) is amended ‘‘(C) foreign oil and gas income.’’ PLOYEE CREDIT ADDED TO GEN- by redesignating subsection (m) as sub- (b) DEFINITION.— ERAL BUSINESS CREDIT. EADY ESERVE ATIONAL UARD RED section (n) and by inserting after subsection (1) YEARS BEFORE 2007.—Paragraph (2) of (a) R R -N G C - (l) the following new subsection: section 904(d), as in effect for years begin- IT.—Subpart D of part IV of subchapter A of ‘‘(m) SPECIAL RULES RELATING TO DUAL ning before 2007, is amended by redesignating chapter 1 (relating to business-related cred- CAPACITY TAXPAYERS.— subparagraphs (H) and (I) as subparagraphs its) is amended by adding at the end the fol- ‘‘(1) GENERAL RULE.—Notwithstanding any (I) and (J), respectively, and by inserting lowing: other provision of this chapter, any amount after subparagraph (G) the following new ‘‘SEC. 45N. READY RESERVE-NATIONAL GUARD paid or accrued by a dual capacity taxpayer subparagraph: EMPLOYEE CREDIT. ‘‘(a) GENERAL RULE.—For purposes of sec- to a foreign country or possession of the ‘‘(H) FOREIGN OIL AND GAS INCOME.—The tion 38, the Ready Reserve-National Guard United States for any period shall not be term ‘foreign oil and gas income’ has the employee credit determined under this sec- considered a tax— meaning given such term by section 954(g).’’ tion for any taxable year is an amount equal ‘‘(A) if, for such period, the foreign country (2) 2007 AND AFTER.—Section 904(d)(2), as in to 50 percent of the actual compensation or possession does not impose a generally ap- effect for years after 2006, is amended by re- amount for such taxable year. plicable income tax, or designating subparagraphs (J) and (K) as ‘‘(B) to the extent such amount exceeds the ‘‘(b) DEFINITION OF ACTUAL COMPENSATION subparagraphs (K) and (L) and by inserting AMOUNT.—For purposes of this section, the amount (determined in accordance with reg- after subparagraph (I) the following: term ‘actual compensation amount’ means ulations) which— ‘‘(J) FOREIGN OIL AND GAS INCOME.—For the amount of compensation paid or incurred ‘‘(i) is paid by such dual capacity taxpayer purposes of this section— by an employer with respect to a Ready Re- pursuant to the generally applicable income ‘‘(i) IN GENERAL.—The term ‘foreign oil and serve-National Guard employee on any day tax imposed by the country or possession, or gas income’ has the meaning given such during a taxable year when the employee ‘‘(ii) would be paid if the generally applica- term by section 954(g). was absent from employment for the purpose ble income tax imposed by the country or ‘‘(ii) COORDINATION.—Passive category in- of performing qualified active duty. possession were applicable to such dual ca- come and general category income shall not ‘‘(c) LIMITATION.—No credit shall be al- pacity taxpayer. include foreign oil and gas income (as so de- lowed with respect to a Ready Reserve-Na- Nothing in this paragraph shall be construed fined).’’ tional Guard employee who performs quali- to imply the proper treatment of any such (c) CONFORMING AMENDMENTS.— fied active duty on any day on which the em- amount not in excess of the amount deter- (1) Section 904(d)(3)(F)(i) is amended by ployee was not scheduled to work (for reason mined under subparagraph (B). striking ‘‘or (E)’’ and inserting ‘‘(E), or (I)’’. other than to participate in qualified active ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- (2) Section 907(a) is hereby repealed. duty). poses of this subsection, the term ‘dual ca- (3) Section 907(c)(4) is hereby repealed. ‘‘(d) DEFINITIONS.—For purposes of this sec- pacity taxpayer’ means, with respect to any (4) Section 907(f) is hereby repealed. tion— foreign country or possession of the United (d) EFFECTIVE DATES.— ‘‘(1) QUALIFIED ACTIVE DUTY.—The term States, a person who— (1) IN GENERAL.—The amendments made by ‘qualified active duty’ means— ‘‘(A) is subject to a levy of such country or this section shall apply to taxable years be- ‘‘(A) active duty, other than the training possession, and ginning after the date of the enactment of duty specified in section 10147 of title 10, ‘‘(B) receives (or will receive) directly or this Act. United States Code (relating to training re- indirectly a specific economic benefit (as de- (2) YEARS AFTER 2006.—The amendments quirements for the Ready Reserve), or sec- termined in accordance with regulations) made by paragraphs (1)(B) and (2)(B) shall tion 502(a) of title 32, United States Code (re- from such country or possession. apply to taxable years beginning after De- lating to required drills and field exercises ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— cember 31, 2006. for the National Guard), in connection with For purposes of this subsection— (3) TRANSITIONAL RULES.— which an employee is entitled to reemploy- ‘‘(A) IN GENERAL.—The term ‘generally ap- (A) SEPARATE BASKET TREATMENT.—Any ment rights and other benefits or to a leave plicable income tax’ means an income tax taxes paid or accrued in a taxable year be- of absence from employment under chapter (or a series of income taxes) which is gen- ginning on or before the date of the enact- 43 of title 38, United States Code, and erally imposed under the laws of a foreign ment of this Act, with respect to income ‘‘(B) hospitalization incident to such duty. country or possession on income derived which was described in subparagraph (I) of ‘‘(2) COMPENSATION.—The term ‘compensa- from the conduct of a trade or business with- section 904(d)(1) of such Code (as in effect on tion’ means any remuneration for employ- in such country or possession. the day before the date of the enactment of ment, whether in cash or in kind, which is ‘‘(B) EXCEPTIONS.—Such term shall not in- this Act), shall be treated as taxes paid or paid or incurred by a taxpayer and which is clude a tax unless it has substantial applica- accrued with respect to foreign oil and gas deductible from the taxpayer’s gross income tion, by its terms and in practice, to— income to the extent the taxpayer estab- under section 162(a)(1). ‘‘(i) persons who are not dual capacity tax- lishes to the satisfaction of the Secretary of ‘‘(3) READY RESERVE-NATIONAL GUARD EM- payers, and the Treasury that such taxes were paid or ac- PLOYEE.—The term ‘Ready Reserve-National

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Guard employee’ means an employee who is ‘‘(2) EMPLOYMENT CREDIT.—The employ- States Code with respect to a violation of a member of the Ready Reserve of a reserve ment credit with respect to a qualified re- chapter 43 of such title, and component of an Armed Force of the United placement employee of the taxpayer for any ‘‘(B) the 2 succeeding taxable years. States as described in sections 10142 and taxable year is equal to 50 percent of the ‘‘(f) GENERAL DEFINITIONS AND SPECIAL 10101 of title 10, United States Code. lesser of— RULES.—For purposes of this section— ‘‘(4) CERTAIN RULES TO APPLY.—Rules simi- ‘‘(A) the individual’s qualified compensa- ‘‘(1) ELIGIBLE TAXPAYER.—The term ‘eligi- lar to the rules of section 52 shall apply. tion attributable to service rendered as a ble taxpayer’ means a small business em- ‘‘(e) PORTION OF CREDIT MADE REFUND- qualified replacement employee, or ployer or a Ready Reserve-National Guard ABLE.— ‘‘(B) $12,000. self-employed taxpayer. ‘‘(1) IN GENERAL.—In the case of an eligible ‘‘(b) QUALIFIED COMPENSATION.—The term ‘‘(2) SMALL BUSINESS EMPLOYER.— employer of a Ready Reserve-National Guard ‘qualified compensation’ means— ‘‘(A) IN GENERAL.—The term ‘small busi- employee, the aggregate credits allowed to a ‘‘(1) compensation which is normally con- ness employer’ means, with respect to any taxpayer under subpart C shall be increased tingent on the qualified replacement em- taxable year, any employer who employed an by the lesser of— ployee’s presence for work and which is de- average of 50 or fewer employees on business ‘‘(A) the credit which would be allowed ductible from the taxpayer’s gross income days during such taxable year. under this section without regard to this under section 162(a)(1), ‘‘(B) CONTROLLED GROUPS.—For purposes of subsection and the limitation under section ‘‘(2) compensation which is not character- subparagraph (A), all persons treated as a 38(c), or ized by the taxpayer as vacation or holiday single employer under subsection (b), (c), ‘‘(B) the amount by which the aggregate pay, or as sick leave or pay, or as any other (m), or (o) of section 414 shall be treated as amount of credits allowed by this subpart form of pay for a nonspecific leave of ab- a single employer. (determined without regard to this sub- sence, and ‘‘(3) QUALIFIED ACTIVE DUTY.—The term section) would increase if the limitation im- ‘‘(3) group health plan costs (if any) with ‘qualified active duty’ has the meaning given posed by section 38(c) for any taxable year respect to the qualified replacement em- such term by section 45N(d)(1). were increased by the amount of employer ployee. ‘‘(4) SPECIAL RULES FOR CERTAIN MANUFAC- payroll taxes imposed on the taxpayer dur- ‘‘(c) QUALIFIED REPLACEMENT EMPLOYEE.— TURERS.— ing the calendar year in which the taxable For purposes of this section— ‘‘(A) IN GENERAL.—In the case of any quali- year begins. ‘‘(1) IN GENERAL.—The term ‘qualified re- fied manufacturer— The amount of the credit allowed under this placement employee’ means an individual ‘‘(i) subsection (a)(2)(B) shall be applied by subsection shall not be treated as a credit al- who is hired to replace a Ready Reserve-Na- substituting ‘$20,000’ for ‘$12,000’, and lowed under this subpart and shall reduce tional Guard employee or a Ready Reserve- ‘‘(ii) paragraph (2)(A) of this subsection the amount of the credit otherwise allowable National Guard self-employed taxpayer, but shall be applied by substituting ‘100’ for ‘50’. under subsection (a) without regard to sec- only with respect to the period during ‘‘(B) QUALIFIED MANUFACTURER.—For pur- tion 38(c). which— poses of this paragraph, the term ‘qualified ‘‘(2) ELIGIBLE EMPLOYER.—For purposes of ‘‘(A) such Ready Reserve-National Guard manufacturer’ means any person if— this subsection, the term ‘eligible employer’ employee is receiving an actual compensa- ‘‘(i) the primary business of such person is means an employer which is a State or local tion amount (as defined in section 45N(b)) classified in sector 31, 32, or 33 of the North government or subdivision thereof. from the employee’s employer and is partici- American Industrial Classification System, ‘‘(3) EMPLOYER PAYROLL TAXES.—For pur- pating in qualified active duty, including and poses of this subsection— time spent in travel status, or ‘‘(ii) all of such person’s facilities which ‘‘(A) IN GENERAL.—The term ‘employer ‘‘(B) such Ready Reserve-National Guard are used for production in such business are payroll taxes’ means the taxes imposed by— self-employed taxpayer is participating in located in the United States. ‘‘(i) section 3111(b), and such qualified active duty. ‘‘(5) CARRYBACK AND CARRYFORWARD AL- ‘‘(ii) sections 3211(a) and 3221(a) (deter- ‘‘(2) READY RESERVE-NATIONAL GUARD EM- LOWED.— mined at a rate equal to the rate under sec- PLOYEE.—The term ‘Ready Reserve-National ‘‘(A) IN GENERAL.—If the credit allowable tion 3111(b)). Guard employee’ has the meaning given such under subsection (a) for a taxable year ex- ‘‘(B) SPECIAL RULE.—A rule similar to the term by section 45N(d)(3). ceeds the amount of the limitation under rule of section 24(d)(2)(C) shall apply for pur- ‘‘(3) READY RESERVE-NATIONAL GUARD SELF- subsection (e)(1) for such taxable year (in poses of subparagraph (A).’’. EMPLOYED TAXPAYER.—The term ‘Ready Re- this paragraph referred to as the ‘unused (b) CREDIT TO BE PART OF GENERAL BUSI- serve-National Guard self-employed tax- credit year’), such excess shall be a credit NESS CREDIT.—Section 38(b) (relating to cur- payer’ means a taxpayer who— carryback to each of the 3 taxable years pre- rent year business credit) is amended by ‘‘(A) has net earnings from self-employ- ceding the unused credit year and a credit striking ‘‘and’’ at the end of paragraph (25), ment (as defined in section 1402(a)) for the carryforward to each of the 20 taxable years by striking the period at the end of para- taxable year, and following the unused credit year. graph (26) and inserting ‘‘, and’’, and by add- ‘‘(B) is a member of the Ready Reserve of ‘‘(B) RULES.—Rules similar to the rules of ing at the end the following: a reserve component of an Armed Force of section 39 shall apply with respect to the ‘‘(27) the Ready Reserve-National Guard the United States as described in section credit carryback and credit carryforward employee credit determined under section 10142 and 10101 of title 10, United States under subparagraph (A). 45N(a).’’. Code. ‘‘(6) CERTAIN RULES TO APPLY.—Rules simi- (c) DENIAL OF DOUBLE BENEFIT.—Section 280C(a) (relating to rule for employment ‘‘(d) COORDINATION WITH OTHER CREDITS.— lar to the rules of subsections (c), (d), and (e) credits) is amended by inserting ‘‘45N(a),’’ The amount of credit otherwise allowable of section 52 shall apply.’’. after ‘‘45A(a),’’. under sections 51(a) and 1396(a) with respect (b) NO DEDUCTION FOR COMPENSATION (d) CONFORMING AMENDMENT.—The table of to any employee shall be reduced by the TAKEN INTO ACCOUNT FOR CREDIT.—Section sections for subpart D of part IV of sub- credit allowed by this section with respect to 280C(a) (relating to rule for employment chapter A of chapter 1 is amended by insert- such employee. credits) is amended— ing after the item relating to section 45M the ‘‘(e) LIMITATIONS.— (1) by inserting ‘‘or compensation’’ after following: ‘‘(1) APPLICATION WITH OTHER CREDITS.—The ‘‘salaries’’, and ‘‘Sec. 45N. Ready Reserve-National Guard credit allowed under subsection (a) for any (2) by inserting ‘‘30D,’’ before ‘‘45A(a),’’. employee credit.’’. taxable year shall not exceed the excess (if (c) CONFORMING AMENDMENT.—Section (e) EFFECTIVE DATE.—The amendments any) of— 55(c)(2) is amended by inserting ‘‘30D(e)(1),’’ made by this section shall apply to taxable ‘‘(A) the regular tax for the taxable year after ‘‘30(b)(3),’’. years beginning after the date of the enact- reduced by the sum of the credits allowable (d) CLERICAL AMENDMENT.—The table of ment of this Act. under subpart A and sections 27, 29, and 30, sections for subpart B of part IV of sub- SEC. 412. READY RESERVE-NATIONAL GUARD RE- over chapter A of chapter 1 is amended by adding PLACEMENT EMPLOYEE CREDIT. ‘‘(B) the tentative minimum tax for the after the item relating to section 30C the fol- (a) IN GENERAL.—Subpart B of part IV of taxable year. lowing new item: subchapter A of chapter 1 (relating to foreign ‘‘(2) DISALLOWANCE FOR FAILURE TO COMPLY ‘‘Sec. 30D. Credit for replacement of acti- tax credit, etc.) is amended by adding after WITH EMPLOYMENT OR REEMPLOYMENT RIGHTS vated military reservists.’’. section 30C the following new section: OF MEMBERS OF THE RESERVE COMPONENTS OF (e) EFFECTIVE DATE.—The amendments ‘‘SEC. 30D. READY RESERVE-NATIONAL GUARD THE ARMED FORCES OF THE UNITED STATES.— REPLACEMENT EMPLOYEE CREDIT. No credit shall be allowed under subsection made by this section shall apply to taxable ‘‘(a) ALLOWANCE OF CREDIT.— (a) to a taxpayer for— years beginning after the date of the enact- ‘‘(1) IN GENERAL.—In the case of an eligible ‘‘(A) any taxable year, beginning after the ment of this Act. taxpayer, there shall be allowed as a credit date of the enactment of this section, in SEC. 413. INCOME TAX WITHHOLDING ON DIF- against the tax imposed by this chapter for which the taxpayer is under a final order, FERENTIAL WAGE PAYMENTS. the taxable year the sum of the employment judgment, or other process issued or required (a) IN GENERAL.—Section 3401 (relating to credits for each qualified replacement em- by a district court of the United States definitions) is amended by adding at the end ployee under this section. under section 4323 of title 38 of the United the following new subsection:

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‘‘(i) DIFFERENTIAL WAGE PAYMENTS TO AC- pensation) is amended by adding at the end quirement of paragraph (2)(A), all members TIVE DUTY MEMBERS OF THE UNIFORMED the following new sentence: ‘‘The term ‘com- of such corporation’s separate affiliated SERVICES.— pensation’ includes any differential wage group shall be treated as 1 corporation. For ‘‘(1) IN GENERAL.—For purposes of sub- payment (as defined in section 3401(i)(2)).’’. purposes of the preceding sentence, the term section (a), any differential wage payment (c) EFFECTIVE DATE.—The amendments ‘separate affiliated group’ means, with re- shall be treated as a payment of wages by made by this section shall apply to plan spect to any corporation, the affiliated group the employer to the employee. years beginning after December 31, 2005. which would be determined under section ‘‘(2) DIFFERENTIAL WAGE PAYMENT.—For (d) PROVISIONS RELATING TO PLAN AMEND- 1504(a) if such corporation were the common purposes of paragraph (1), the term ‘differen- MENTS.— parent and section 1504(b) did not apply. tial wage payment’ means any payment (1) IN GENERAL.—If this subsection applies ‘‘(B) CONTROL.—For purposes of paragraph which— to any plan or annuity contract amend- (2)(D), all distributee corporations which are ‘‘(A) is made by an employer to an indi- ment— members of the same affiliated group (as de- vidual with respect to any period during (A) such plan or contract shall be treated fined in section 1504(a) without regard to sec- which the individual is performing service in as being operated in accordance with the tion 1504(b)) shall be treated as 1 distributee the uniformed services while on active duty terms of the plan or contract during the pe- corporation.’’. for a period of more than 30 days, and riod described in paragraph (2)(B)(i), and (2) CONFORMING AMENDMENTS.— ‘‘(B) represents all or a portion of the (B) except as provided by the Secretary of (A) Subparagraph (A) of section 355(b)(2) is wages the individual would have received the Treasury, such plan shall not fail to amended to read as follows: from the employer if the individual were per- meet the requirements of the Internal Rev- ‘‘(A) it is engaged in the active conduct of forming service for the employer.’’. enue Code of 1986 or the Employee Retire- a trade or business,’’. (b) EFFECTIVE DATE.—The amendment ment Income Security Act of 1974 by reason (B) Section 355(b)(2) of such Code is amend- made by this section shall apply to remu- of such amendment. ed by striking the last sentence. neration paid after December 31, 2005. (2) AMENDMENTS TO WHICH SECTION AP- (3) EFFECTIVE DATES.— SEC. 414. TREATMENT OF DIFFERENTIAL WAGE PLIES.— (A) IN GENERAL.—The amendments made PAYMENTS FOR RETIREMENT PLAN (A) IN GENERAL.—This subsection shall by this subsection shall apply— PURPOSES. apply to any amendment to any plan or an- (i) to distributions after the date of the en- (a) PENSION PLANS.— nuity contract which is made— actment of this Act, and before January 1, (1) IN GENERAL.—Section 414(u) (relating to (i) pursuant to any amendment made by 2010, and special rules relating to veterans’ reemploy- this section, and (ii) for purposes of determining the contin- ment rights under USERRA) is amended by (ii) on or before the last day of the first ued qualification under section 355(b)(2)(A) of adding at the end the following new para- plan year beginning on or after January 1, the Internal Revenue Code of 1986 (as amend- graph: 2007. ed by paragraph (2)(A)) of distributions made ‘‘(11) TREATMENT OF DIFFERENTIAL WAGE (B) CONDITIONS.—This subsection shall not before such date, as a result of an acquisi- PAYMENTS.— apply to any plan or annuity contract tion, disposition, or other restructuring after ‘‘(A) IN GENERAL.—Except as provided in amendment unless— such date and before January 1, 2010. this paragraph, for purposes of applying this (i) during the period beginning on the date (B) TRANSITION RULE.—The amendments title to a retirement plan to which this sub- the amendment described in subparagraph made by this subsection shall not apply to section applies— (A)(i) takes effect and ending on the date de- any distribution pursuant to a transaction ‘‘(i) an individual receiving a differential scribed in subparagraph (A)(ii) (or, if earlier, which is— wage payment shall be treated as an em- the date the plan or contract amendment is (i) made pursuant to an agreement which ployee of the employer making the payment, adopted), the plan or contract is operated as was binding on such date of enactment and ‘‘(ii) the differential wage payment shall be if such plan or contract amendment were in at all times thereafter, treated as compensation, and effect, and (ii) described in a ruling request submitted ‘‘(iii) the plan shall not be treated as fail- (ii) such plan or contract amendment ap- to the Internal Revenue Service on or before ing to meet the requirements of any provi- plies retroactively for such period. such date, or sion described in paragraph (1)(C) by reason SEC. 415. MODIFICATIONS OF EFFECTIVE DATES (iii) described on or before such date in a of any contribution which is based on the OF LEASING PROVISIONS OF THE public announcement or in a filing with the differential wage payment. AMERICAN JOBS CREATION ACT OF Securities and Exchange Commission. 2004. ‘‘(B) SPECIAL RULE FOR DISTRIBUTIONS.— (C) ELECTIONS.— (a) IN GENERAL.—Section 849(b) of the ‘‘(i) IN GENERAL.—Notwithstanding sub- (i) OUT OF TRANSITION RELIEF.—Subpara- American Jobs Creation Act of 2004 is paragraph (A)(i), for purposes of section graph (B) shall not apply if the distributing amended by adding at the end the following 401(k)(2)(B)(i)(I), 403(b)(7)(A)(ii), 403(b)(11)(A), corporation elects not to have such subpara- new paragraph: or 457(d)(1)(A)(ii), an individual shall be graph apply to distributions of such corpora- ‘‘(5) LEASES TO FOREIGN ENTITIES.—In the treated as having been severed from employ- tion. Any such election, once made, shall be case of tax-exempt use property leased to a ment during any period the individual is per- irrevocable. tax-exempt entity which is a foreign person forming service in the uniformed services de- (ii) APPLICATION TO PRIOR DISTRIBUTIONS.— or entity, the amendments made by this part scribed in section 3401(i)(2)(A). Subparagraph (A)(ii) shall not apply to a dis- shall apply to taxable years beginning after ‘‘(ii) LIMITATION.—If an individual elects to tributing or controlled corporation if the December 31, 2004, with respect to leases en- receive a distribution by reason of clause (i), corporation elects not to have such subpara- tered into on or before March 12, 2004.’’. the plan shall provide that the individual graph apply to such corporation. Any such may not make an elective deferral or em- (b) EFFECTIVE DATE.—The amendment made by this section shall take effect as if election, once made, shall be irrevocable. ployee contribution during the 6-month pe- (b) SECTION 355 NOT TO APPLY TO DISTRIBU- included in the enactment of the American riod beginning on the date of the distribu- TIONS IF THE DISTRIBUTING OR CONTROLLED Jobs Creation Act of 2004. tion. CORPORATION ISADISQUALIFIED INVESTMENT ‘‘(C) NONDISCRIMINATION REQUIREMENT.— SA 2632. Mr. LOTT (for himself and CORPORATION.— Subparagraph (A)(iii) shall apply only if all (1) IN GENERAL.—Section 355 (relating to Mr. BAUCUS) submitted an amendment employees of an employer performing service distributions of stock and securities of a con- in the uniformed services described in sec- intended to be proposed by him to the trolled corporation) is amended by adding at tion 3401(i)(2)(A) are entitled to receive dif- bill S. 2020, to provide for reconcili- the end the following new subsection: ferential wage payments on reasonably ation pursuant to section 202(b) of the ‘‘(g) SECTION NOT TO APPLY TO DISTRIBU- equivalent terms and, if eligible to partici- concurrent resolution on the budget for TIONS INVOLVING DISQUALIFIED INVESTMENT pate in a retirement plan maintained by the fiscal year 2006; which was ordered to CORPORATIONS.— employer, to make contributions based on lie on the table; as follows: ‘‘(1) IN GENERAL.—This section (and so the payments. For purposes of applying this At the end of title IV, insert: much of section 356 as relates to this section) shall not apply to any distribution which is subparagraph, the provisions of paragraphs SEC. ll. MODIFICATIONS TO RULES RELATING (3), (4), and (5), of section 410(b) shall apply. TO TAXATION OF DISTRIBUTIONS OF part of a transaction if— ‘‘(D) DIFFERENTIAL WAGE PAYMENT.—For STOCK AND SECURITIES OF A CON- ‘‘(A) either the distributing corporation or purposes of this paragraph, the term ‘dif- TROLLED CORPORATION. controlled corporation is, immediately after ferential wage payment’ has the meaning (a) MODIFICATION OF ACTIVE BUSINESS DEFI- the transaction, a disqualified investment given such term by section 3401(i)(2).’’. NITION UNDER SECTION 355.— corporation, and (2) CONFORMING AMENDMENT.—The heading (1) IN GENERAL.—Section 355(b) (defining ‘‘(B) any person holds, immediately after for section 414(u) is amended by inserting active conduct of a trade or business) is the transaction, a 50-percent or greater in- ‘‘AND TO DIFFERENTIAL WAGE PAYMENTS TO amended by adding at the end the following terest in any disqualified investment cor- MEMBERS ON ACTIVE DUTY’’ after new paragraph: poration, but only if such person did not hold ‘‘USERRA’’. ‘‘(3) SPECIAL RULES RELATING TO ACTIVE such an interest in such corporation imme- (b) DIFFERENTIAL WAGE PAYMENTS TREAT- BUSINESS REQUIREMENT.— diately before the transaction. ED AS COMPENSATION FOR INDIVIDUAL RETIRE- ‘‘(A) IN GENERAL.—For purposes of deter- ‘‘(2) DISQUALIFIED INVESTMENT CORPORA- MENT PLANS.—Section 219(f)(1) (defining com- mining whether a corporation meets the re- TION.—For purposes of this subsection—

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‘‘(A) IN GENERAL.—The term ‘disqualified ing its ratable share of the assets of any (2) not paid or reimbursed, the amount of investment corporation’ means any distrib- partnership described in subclause (I). compensation or outside earned income shall uting or controlled corporation if the fair ‘‘(3) 50-PERCENT OR GREATER INTEREST.—For be determined by subtracting the actual and market value of the investment assets of the purposes of this subsection— necessary expenses incurred by the Member corporation is 75 percent or more of the fair ‘‘(A) IN GENERAL.—The term ‘50-percent or from any payment received for the activity. market value of all assets of the corporation. greater interest’ has the meaning given such ‘‘(B) INVESTMENT ASSETS.— term by subsection (d)(4). SA 2634. Mrs. BOXER (for herself and ‘‘(i) IN GENERAL.—Except as otherwise pro- ‘‘(B) ATTRIBUTION RULES.—The rules of sec- Mr. SCHUMER) submitted an amend- vided in this subparagraph, the term ‘invest- tion 318 shall apply for purposes of deter- ment intended to be proposed by her to ment assets’ means— mining ownership of stock for purposes of the bill S. 2020, to provide for reconcili- ‘‘(I) cash, this paragraph. ation pursuant to section 202(b) of the ‘‘(II) any stock or securities in a corpora- ‘‘(4) TRANSACTION.—For purposes of this concurrent resolution on the budget for tion, subsection, the term ‘transaction’ includes a ‘‘(III) any interest in a partnership, series of transactions. fiscal year 2006; as follows: ‘‘(IV) any debt instrument or other evi- ‘‘(5) REGULATIONS.—The Secretary shall At the appropriate place, insert the fol- dence of indebtedness, prescribe such regulations as may be nec- lowing: ‘‘(V) any option, forward or futures con- essary to carry out, or prevent the avoidance SEC. ll. TREATMENT AND SUPPORT SERVICES tract, notional principal contract, or deriva- of, the purposes of this subsection, including FOR VETERANS. tive, regulations— Out of any money in the Treasury of the ‘‘(VI) foreign currency, or ‘‘(A) to carry out, or prevent the avoidance United States not otherwise appropriated, ‘‘(VII) any similar asset. of, the purposes of this subsection in cases and in addition to any amount otherwise ap- ‘‘(ii) EXCEPTION FOR ASSETS USED IN ACTIVE involving— propriated, there are appropriated CONDUCT OF CERTAIN FINANCIAL TRADES OR ‘‘(i) the use of related persons, inter- $500,000,000 to the Secretary of Veterans Af- BUSINESSES.—Such term shall not include mediaries, pass-thru entities, options, or fairs for each of fiscal years 2006 through any asset which is held for use in the active other arrangements, and 2010, to provide veterans suffering from men- and regular conduct of— ‘‘(ii) the treatment of assets unrelated to tal illness, post-traumatic stress disorder, or ‘‘(I) a lending or finance business (within the trade or business of a corporation as in- drug or alcohol dependency with— the meaning of section 954(h)(4)), vestment assets if, prior to the distribution, (1) readjustment counseling and related ‘‘(II) a banking business through a bank (as investment assets were used to acquire such mental health services under section 1712A of defined in section 581), a domestic building unrelated assets, title 38, United States Code; and and loan association (within the meaning of ‘‘(B) which in appropriate cases exclude (2) treatment and rehabilitative services section 7701(a)(19)), or any similar institu- from the application of this subsection a dis- under section 1720A of such title. tion specified by the Secretary, or tribution which does not have the character SEC. ll. ELIMINATION OF THE SCHEDULED ‘‘(III) an insurance business if the conduct of a redemption which would be treated as a PHASE OUT OF THE LIMITATIONS ON of the business is licensed, authorized, or sale or exchange under section 302, and PERSONAL EXEMPTIONS AND regulated by an applicable insurance regu- ITEMIZED DEDUCTIONS FOR INDI- ‘‘(C) which modify the application of the latory body. VIDUALS EARNING IN EXCESS OF attribution rules applied for purposes of this This clause shall only apply with respect to $1,000,000. subsection.’’. any business if substantially all of the in- (a) PERSONAL EXEMPTIONS.—Section (2) EFFECTIVE DATES.— come of the business is derived from persons 151(d)(3)(E) of the Internal Revenue Code of (A) IN GENERAL.—The amendments made who are not related (within the meaning of 1986 is amended by adding at the end the fol- by this subsection shall apply to distribu- section 267(b) or 707(b)(1)) to the person con- lowing new clause: tions after the date of the enactment of this ducting the business. ‘‘(iii) EXCEPTION.—This subparagraph shall Act. ‘‘(iii) EXCEPTION FOR SECURITIES MARKED TO not apply with respect to any individual (B) TRANSITION RULE.—The amendments MARKET.—Such term shall not include any whose adjusted gross income for the taxable security (as defined in section 475(c)(2)) made by this subsection shall not apply to year exceeds $1,000,000 ($2,000,000 in the case which is held by a dealer in securities and to any distribution pursuant to a transaction of a joint return).’’. which section 475(a) applies. which is— (b) ITEMIZED DEDUCTIONS.—Section 68(f) of (i) made pursuant to an agreement which ‘‘(iv) STOCK OR SECURITIES IN A 25-PERCENT such Code is amended by adding at the end was binding on such date of enactment and CONTROLLED ENTITY.— the following new paragraph: at all times thereafter, ‘‘(I) IN GENERAL.—Such term shall not in- ‘‘(3) EXCEPTION.—This subsection shall not clude any stock and securities in, or any (ii) described in a ruling request submitted apply with respect to any individual whose asset described in subclause (IV) or (V) of to the Internal Revenue Service on or before adjusted gross income for the taxable year clause (i) issued by, a corporation which is a such date, or exceeds $1,000,000 ($2,000,000 in the case of a 25-percent controlled entity with respect to (iii) described on or before such date in a joint return).’’. the distributing or controlled corporation. public announcement or in a filing with the (c) EFFECTIVE DATE.—The amendments ‘‘(II) LOOK-THRU RULE.—The distributing or Securities and Exchange Commission. made by this section shall apply to taxable controlled corporation shall, for purposes of years beginning after December 31, 2005. applying this subsection, be treated as own- SA 2633. Mr. LOTT submitted an (d) APPLICATION OF EGTRRA SUNSET.—The ing its ratable share of the assets of any 25- amendment intended to be proposed by amendments made by this section shall be percent controlled entity. him to the bill S. 2020, to provide for subject to title IX of the Economic Growth ‘‘(III) 25-PERCENT CONTROLLED ENTITY.—For reconciliation pursuant to section and Tax Relief Reconciliation Act of 2001 to purposes of this clause, the term ‘25-percent 202(b) of the concurrent resolution on the same extent and in the same manner as controlled entity’ means, with respect to any the budget for fiscal year 2006; as fol- the provision of such Act to which such distributing or controlled corporation, any lows: amendment relates. corporation with respect to which the dis- At the appropriate place, insert the fol- SA 2635. Mr. SCHUMER (for himself tributing or controlled corporation owns di- lowing: rectly or indirectly stock meeting the re- and Mrs. FEINSTEIN) proposed an SEC. ll. CLARIFICATION OF TREATMENT OF amendment to the bill S. 2020, to pro- quirements of section 1504(a)(2), except that OUTSIDE INCOME AND EXPENSES IN such section shall be applied by substituting THE SENATE. vide for reconciliation pursuant to sec- ‘25 percent’ for ‘80 percent’ and without re- (a) IN GENERAL.—For purposes of rule tion 202(b) of the concurrent resolution gard to stock described in section 1504(a)(4). XXXVI and paragraph 5(b)(3) of rule XXXVII on the budget for fiscal year 2006; as ‘‘(v) INTERESTS IN CERTAIN PARTNERSHIPS.— of the Standing Rules of the Senate, com- follows: ‘‘(I) IN GENERAL.—Such term shall not in- pensation or outside earned income for any At the end of title IV add the following: clude any interest in a partnership, or any calendar year shall be reduced by actual and debt instrument or other evidence of indebt- necessary expenses incurred by a Member of SEC. 410. TEMPORARY WINDFALL PROFITS TAX. (a) IN GENERAL.—Subtitle E (relating to al- edness, issued by the partnership, if 1 or the Senate in connection with the practice of more of the trades or businesses of the part- medicine. A Member of the Senate shall in- cohol, tobacco, and certain other excise nership are (or, without regard to the 5-year clude information with respect to such ex- taxes) is amended by adding at the end requirement under subsection (b)(2)(B), penses with any report in which such com- thereof the following new chapter: would be) taken into account by the distrib- pensation or income is required to be in- ‘‘CHAPTER 56—TEMPORARY WINDFALL uting or controlled corporation, as the case cluded. PROFITS ON CRUDE OIL may be, in determining whether the require- (b) PAYMENT OR REIMBURSEMENT.—If ex- ‘‘Sec. 5896. Imposition of tax. ments of subsection (b) are met with respect penses described in subsection (a) are— ‘‘Sec. 5897. Windfall profit; etc. to the distribution. (1) paid or reimbursed by another person, ‘‘Sec. 5898. Special rules and definitions. ‘‘(II) LOOK-THRU RULE.—The distributing or the amount of any such payment shall not be ‘‘SEC. 5896. IMPOSITION OF TAX. controlled corporation shall, for purposes of counted as compensation or outside earned ‘‘(a) IN GENERAL.—In addition to any other applying this subsection, be treated as own- income; and tax imposed under this title, there is hereby

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imposed on any applicable taxpayer an ex- ‘‘CHAPTER 56. Temporary Windfall Profit on and science contribution’ means a charitable cise tax in an amount equal to 50 percent of Crude Oil.’’. contribution (other than a contribution of the windfall profit of such taxpayer for any used equipment) to a qualified partnership (c) DEDUCTIBILITY OF WINDFALL PROFIT taxable year beginning in 2005. for the purpose of an activity described in TAX.—The first sentence of section 164(a) of section 2202(c) of the Elementary and Sec- ‘‘(b) APPLICABLE TAXPAYER.—For purposes the Internal Revenue Code of 1986 (relating ondary Education Act of 1965. of this chapter, the term ‘applicable tax- to deduction for taxes) is amended by insert- ‘‘(ii) QUALIFIED PARTNERSHIP.—The term payer’ means, with respect to operations in ing after paragraph (5) the following new ‘qualified partnership’ means an eligible the United States— paragraph: partnership (within the meaning of section ‘‘(1) any integrated oil company (as defined ‘‘(6) The windfall profit tax imposed by sec- 2201(b)(1) of the Elementary and Secondary in section 291(b)(4)), and tion 5896.’’. Education Act of 1965), but only to the ex- ‘‘(2) any other producer or refiner of crude (d) NONREFUNDABLE CREDIT.—In the case of tent that such partnership does not include a oil with gross receipts from the sale of such taxable years beginning in 2005, for purposes person other than a person described in para- crude oil or refined oil products for the tax- of the Internal Revenue Code of 1986, the tax graph (1)(A). able year exceeding $100,000,000. liability of each taxpayer otherwise deter- ‘‘(C) TERMINATION.—This paragraph shall ‘‘SEC. 5897. WINDFALL PROFIT; ETC. mined under the Internal Revenue Code of not apply to any contributions made in tax- 1986 shall be reduced by $100 for each per- ‘‘(a) GENERAL RULE.—For purposes of this able years beginning after December 31, sonal exemption (within the meaning of sec- chapter, the term ‘windfall profit’ means the 2006.’’. tion 151 of such Code) claimed by such tax- excess of the adjusted taxable income of the (b) EFFECTIVE DATE.—The amendment applicable taxpayer for the taxable year over payer for such taxable year. made by this section shall apply to contribu- the reasonably inflated average profit for (e) EFFECTIVE DATE.—The amendments tions made in taxable years beginning after such taxable year. made by this section shall apply to taxable December 31, 2005. ‘‘(b) ADJUSTED TAXABLE INCOME.—For pur- years beginning in 2005. poses of this chapter, with respect to any ap- SA 2638. Mr. BUNNING submitted an plicable taxpayer, the adjusted taxable in- SA 2636. Mr. INHOFE submitted an amendment intended to be proposed by come for any taxable year is equal to the amendment intended to be proposed by him to the bill S. 2020, to provide for taxable income for such taxable year (within him to the bill S. 2020, to provide for reconciliation pursuant to section the meaning of section 63 and determined reconciliation pursuant to section 202(b) of the concurrent resolution on without regard to this subsection)— 202(b) of the concurrent resolution on the budget for fiscal year 2006; which ‘‘(1) increased by any interest expense de- the budget for fiscal year 2006; which was ordered to lie on the table; as fol- duction, charitable contribution deduction, was ordered to lie on the table; as fol- lows: and any net operating loss deduction carried lows: forward from any prior taxable year, and At the end of title IV, insert the following: ‘‘(2) reduced by any interest income, divi- On page 121, line 4, strike the period at the SEC. ll. EXEMPTION OF QUALIFIED 501(C)(3) dend income, and net operating losses to the end and insert ‘‘, or BONDS FOR NURSING HOMES FROM extent such losses exceed taxable income for ‘‘(v)(I) the applicable exempt organization, FEDERAL GUARANTEE PROHIBI- TIONS. the taxable year. or a financing subsidiary or affiliate wholly owned by one or more applicable exempt or- (a) IN GENERAL.—Section 149(b)(3) (relating In the case of any applicable taxpayer which ganizations, is the sole owner and bene- to exceptions) is amended by adding at the is a foreign corporation, the adjusted taxable ficiary of the contract, end the following new subparagraph: income shall be determined with respect to ‘‘(II) the interest in the contract of each ‘‘(E) EXCEPTION FOR QUALIFIED 501(C)(3) such income which is effectively connected person other than the applicable exempt or- BONDS FOR NURSING HOMES.— with the conduct of a trade or business in the ganization arises solely from a security or ‘‘(i) IN GENERAL.—Paragraph (1) shall not United States. collateral interest, and apply to any qualified 501(c)(3) bond issued ‘‘(c) REASONABLY INFLATED AVERAGE PROF- ‘‘(III) a principal portion of the death bene- before the date which is 1 year after the date IT.—For purposes of this chapter, with re- fits attributable to the insurance contract is of the enactment of this subparagraph for spect to any applicable taxpayer, the reason- paid to the applicable exempt organization, the benefit of an organization described in ably inflated average profit for any taxable or a subsidiary or affiliate wholly owned by section 501(c)(3), if such bond is part of an year is an amount equal to the average of one or more applicable exempt organiza- issue the proceeds of which are used to fi- the adjusted taxable income of such taxpayer tions. nance 1 or more of the following facilities for taxable years beginning during the 2002– primarily for the benefit of the elderly: 2004 taxable year period plus 10 percent of SA 2637. Mr. COLEMAN (for himself ‘‘(I) Licensed nursing home facility. ‘‘(II) Licensed or certified assisted living such average. and Mr. PRYOR) submitted an amend- ‘‘SEC. 5898. SPECIAL RULES AND DEFINITIONS. facility. ment intended to be proposed by him ‘‘(III) Licensed personal care facility. ‘‘(a) WITHHOLDING AND DEPOSIT OF TAX.— to the bill S. 2020, to provide for rec- ‘‘(IV) Continuing care retirement commu- The Secretary shall provide such rules as are onciliation pursuant to section 202(b) nity. necessary for the withholding and deposit of of the concurrent resolution on the ‘‘(ii) LIMITATION.—With respect to any cal- the tax imposed under section 5896. budget for fiscal year 2006; which was endar year, clause (i) shall not apply to any ‘‘(b) RECORDS AND INFORMATION.—Each tax- ordered to lie on the table; as follows: bond described in such clause if the aggre- payer liable for tax under section 5896 shall gate authorized face amount of the issue of On page 235, between lines 13 and 14, insert keep such records, make such returns, and which such bond is a part when increased by the following: furnish such information as the Secretary the outstanding amount of such bonds issued may by regulations prescribe. SEC. lll. ALTERNATIVE PERCENTAGE LIMITA- by the issuer for such calendar year exceeds TION FOR CORPORATE CHARITABLE ‘‘(c) RETURN OF WINDFALL PROFIT TAX.— $15,000,000. The Secretary shall provide for the filing and CONTRIBUTIONS TO THE MATHE- MATICS AND SCIENCE PARTNERSHIP ‘‘(iii) CONTINUING CARE RETIREMENT COMMU- the time of such filing of the return of the PROGRAM. NITY.—For purposes of this subparagraph, tax imposed under section 5896. (a) IN GENERAL.—Section 170(b) (related to the term ‘continuing care retirement com- ‘‘(d) CRUDE OIL.—The term ‘crude oil’ in- percentage limitations) is amended by add- munity’ means a community which provides, cludes crude oil condensates and natural gas- ing at the end the following new paragraph: on the same campus, a continuum of residen- oline. ‘‘(3) SPECIAL RULE FOR CORPORATE CON- tial living options and support services to ‘‘(e) BUSINESSES UNDER COMMON CONTROL.— TRIBUTIONS TO THE MATHEMATICS AND SCIENCE persons at least 60 years of age under a writ- For purposes of this chapter, all members of PARTNERSHIP PROGRAM.— ten agreement. For purposes of the preceding the same controlled group of corporations ‘‘(A) IN GENERAL.—In the case of a corpora- sentence, the residential living options shall (within the meaning of section 267(f)) and all tion which makes an eligible mathematics include independent living units, nursing persons under common control (within the and science contribution— home beds, and either assisted living units or meaning of section 52(b) but determined by ‘‘(i) the limitation under paragraph (2) personal care beds.’’. treating an interest of more than 50 percent shall apply separately with respect to all (b) EFFECTIVE DATE.—The amendment as a controlling interest) shall be treated as such contributions and all other charitable made by this section shall apply to bonds 1 person. contributions, and issued after the date of the enactment of this ‘‘(f) REGULATIONS.—The Secretary shall ‘‘(ii) paragraph (2) shall be applied with re- Act. prescribe such regulations as may be nec- spect to all eligible mathematics and science Mr. ROCKEFELLER sub- essary or appropriate to carry out the pur- contributions by substituting ‘15 percent’ for SA 2639. poses of this chapter.’’. ‘10 percent’. mitted an amendment intended to be (b) CLERICAL AMENDMENT.—The table of ‘‘(B) ELIGIBLE MATHEMATICS AND SCIENCE proposed by him to the bill S. 2020, to chapters for subtitle E of the Internal Rev- CONTRIBUTION.— provide for reconciliation pursuant to enue Code of 1986 is amended by adding at ‘‘(i) IN GENERAL.—For purposes of this section 202(b) of the concurrent resolu- the end the following new item: paragraph, the term ‘eligible mathematics tion on the budget for fiscal year 2006;

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00080 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.178 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13227 which was ordered to lie on the table; tax-exempt entity which is a foreign person ‘‘(3) 30 percent in the case of an employer as follows: or entity, the amendments made by this part with more than 35 but less than 51 qualified shall apply to taxable years beginning after employees. Beginning on page 76, strike line 23 and all December 31, 2004, with respect to leases en- ‘‘(c) PER EMPLOYEE DOLLAR LIMITATION.— that follows through page 77, line 2. tered into on or before March 12, 2004.’’. The amount of qualified employee health in- (b) LOW INCOME HOME ENERGY ASSISTANCE surance expenses taken into account under SA 2640. Mr. ROCKEFELLER sub- TRUST FUND.— subsection (a) with respect to any qualified mitted an amendment intended to be (1) IN GENERAL.—Subchapter A of chapter employee for any taxable year shall not ex- proposed by him to the bill S. 2020, to 98 (relating to trust fund code) is amended by ceed the maximum employer contribution provide for reconciliation pursuant to adding at the end the following new section: for self-only coverage or family coverage (as section 202(b) of the concurrent resolu- ‘‘SEC. 9511. LOW-INCOME HOME ENERGY ASSIST- applicable) determined under section 8906(a) tion on the budget for fiscal year 2006; ANCE TRUST FUND. of title 5, United States Code, for the cal- ‘‘(a) CREATION OF TRUST FUND.—There is endar year in which such taxable year be- which was ordered to lie on the table; gins. as follows: established in the Treasury of the United States a trust fund to be known as the ‘Low- ‘‘(d) DEFINITIONS AND SPECIAL RULES.—For purposes of this section— Beginning on page 76, strike line 24 and all Income Home Energy Assistance Trust ‘‘(1) QUALIFIED SMALL EMPLOYER.— that follows through page 77, line 2, and in- Fund’, consisting of any amount appro- ‘‘(A) IN GENERAL.—The term ‘qualified sert the following: priated or credited to the Trust Fund as pro- Section 1397E(d)(2)(B) is amended to read as small employer’ means any small employer vided in this section or section 9602(b). follows: which— ‘‘(b) TRANSFERS TO TRUST FUND.—There ‘‘(B) QUALIFIED CONTRIBUTIONS.— are hereby appropriated to the Low-Income ‘‘(i) provides eligibility for health insur- ance coverage (after any waiting period (as ‘‘(i) IN GENERAL.—For purposes of subpara- Home Energy Assistance Trust Fund defined in section 9801(b)(4)) to all qualified graph (A), the term ‘qualified contribution’ amounts equivalent to the increased reve- employees of the employer, and means any contribution (of a type and qual- nues received in the Treasury as the result of ‘‘(ii) pays at least 70 percent of the cost of ity acceptable to the eligible local education the amendment made by section 410(a) of the such coverage (60 percent in the case of fam- agency) of— Tax Relief Act of 2005. ily coverage) for each qualified employee. ‘‘(I) equipment or software for use in the ‘‘(c) EXPENDITURES FROM TRUST FUND.— ‘‘(B) TRANSITION RULE FOR NEW PLANS.— qualified zone academy (including state-of- Amounts in the Low Income Home Energy ‘‘(i) IN GENERAL.—If a small employer (or the-art technology and vocational equip- Assistance Trust Fund not to exceed any predecessor) did not provide health in- ment), $2,920,000,000 shall be available for fiscal year surance coverage to the qualified employees ‘‘(II) technical assistance in developing 2006, as provided by appropriation Acts, to of the employer during the employer’s curriculum or in training teachers in order carry out the program under the Low-In- precompliance period, then subparagraph (A) to promote appropriate market driven tech- come Home Energy Assistance Act of 1981 shall be applied to such employer for the nology in the classroom, through the distribution of funds to all the ‘‘(III) services of employees (but not of the first 5 taxable years following such period by States in accordance with section 2604 of substituting ‘50 percent’ for ‘70 percent’ in local education agency) as volunteer men- that Act (42 U.S.C. 8623) (other than sub- tors, clause (ii) (or for ‘60 percent’ in such clause, section (e) of such section), but only if not in the case of family coverage). ‘‘(IV) internships, or other educational op- less than $1,880,000,000 has been appropriated portunities outside the academy for stu- ‘‘(ii) PRECOMPLIANCE PERIOD.—For purposes for such program for such fiscal year.’’. of clause (i), the precompliance periods are— dents, (2) CLERICAL AMENDMENT.—The table of ‘‘(V) cash, or ‘‘(I) the period beginning with the small sections for such subchapter is amended by employer’s taxable year preceding its first ‘‘(VI) any other tangible or intangible adding at the end the following new item: property specified by the eligible local edu- taxable year beginning after the date of the ‘‘Sec. 9511. Low-Income Home Energy As- cation agency. enactment of this section, and sistance Trust Fund.’’. ‘‘(ii) EXCLUSION.—Such term shall not in- ‘‘(II) the period beginning with the small clude any discounts, set-up fees, and con- (c) EFFECTIVE DATES.— employer’s taxable year preceding the first tributions conditioned upon business with (1) IN GENERAL.—The amendments made by taxable year for which the employer meets the contributor. subsection (a) shall take effect as if included the requirement of subparagraph (A)(i). ‘‘(iii) VALUATION.—Valuation of the quali- in the enactment of the American Jobs Cre- An employer not in existence for any period fied contribution shall be reasonable given ation Act of 2004. shall be treated in the same manner as an the nature of the contribution. For tangible (2) SUBSECTION (b).—The amendments made employer which is in existence and not pro- and intangible property, valuation based on by subsection (b) shall take effect on the viding coverage. pricing that is regularly charged for the sale date of the enactment of this Act. ‘‘(C) SMALL EMPLOYER.— of such tangible and intangible property ‘‘(i) IN GENERAL.—For purposes of this shall be reasonable. For services, valuation SA 2642. Mr. BINGAMAN (for him- paragraph, the term ‘small employer’ means, of such services based on pricing that is reg- self, Mr. KERRY, and Ms. SNOWE) sub- with respect to any calendar year, any em- ularly charged for the sale of such services mitted an amendment intended to be ployer if such employer employed an average shall be reasonable. For services that are not proposed by him to the bill S. 2020, to of not less than 2 and not more than 50 quali- regularly sold, valuation based on the aver- provide for reconciliation pursuant to fied employees on business days during ei- age hourly compensation, including benefits, ther of the 2 preceding calendar years. For section 202(b) of the concurrent resolu- purposes of the preceding sentence, a pre- of the employees providing such services for tion on the budget for fiscal year 2006; the contributor shall be reasonable, so long ceding calendar year may be taken into ac- as such cost is applied to the reasonable esti- as follows: count only if the employer was in existence mate of the contributed hours for such serv- At the end of title IV, add the following: throughout such year. ices.’’. SEC. ll. CREDIT FOR EMPLOYEE HEALTH IN- ‘‘(ii) EMPLOYERS NOT IN EXISTENCE IN PRE- SURANCE EXPENSES. CEDING YEAR.—In the case of an employer SA 2641. Mr. BINGAMAN submitted (a) IN GENERAL.—Subpart D of part IV of which was not in existence throughout the an amendment intended to be proposed subchapter A of chapter 1 (relating to busi- 1st preceding calendar year, the determina- by him to the bill S. 2020, to provide for ness-related credits) is amended by adding at tion under clause (i) shall be based on the av- the end the following: erage number of qualified employees that it reconciliation pursuant to section ‘‘SEC. 45N. EMPLOYEE HEALTH INSURANCE EX- is reasonably expected such employer will 202(b) of the concurrent resolution on PENSES. employ on business days in the current cal- the budget for fiscal year 2006; which ‘‘(a) GENERAL RULE.—For purposes of sec- endar year. was ordered to lie on the table; as fol- tion 38, in the case of a qualified small em- ‘‘(2) QUALIFIED EMPLOYEE HEALTH INSUR- lows: ployer, the employee health insurance ex- ANCE EXPENSES.— At the end of title IV add the following: penses credit determined under this section ‘‘(A) IN GENERAL.—The term ‘qualified em- ployee health insurance expenses’ means any SEC. ll. MODIFICATIONS OF EFFECTIVE DATES is an amount equal to the applicable percent- OF LEASING PROVISIONS OF THE age of the amount paid by the taxpayer dur- amount paid by an employer for health in- AMERICAN JOBS CREATION ACT OF ing the taxable year for qualified employee surance coverage to the extent such amount 2004 AND FUNDING OF LIHEAP health insurance expenses. is attributable to coverage provided to any TRUST FUND. ‘‘(b) APPLICABLE PERCENTAGE.—For pur- employee while such employee is a qualified (a) IN GENERAL.—Section 849(b) of the poses of subsection (a), the applicable per- employee. American Jobs Creation Act of 2004, as centage is equal to— ‘‘(B) EXCEPTION FOR AMOUNTS PAID UNDER amended by section 553 of this Act, is amend- ‘‘(1) 50 percent in the case of an employer SALARY REDUCTION ARRANGEMENTS.—No ed by adding at the end the following new with less than 26 qualified employees, amount paid or incurred for health insurance paragraph: ‘‘(2) 40 percent in the case of an employer coverage pursuant to a salary reduction ar- ‘‘(3) LEASES TO FOREIGN ENTITIES.—In the with more than 25 but less than 36 qualified rangement shall be taken into account under case of tax-exempt use property leased to a employees, and subparagraph (A).

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00081 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.179 S17NOPT2 S13228 CONGRESSIONAL RECORD — SENATE November 17, 2005

‘‘(C) HEALTH INSURANCE COVERAGE.—The (f) EFFECTIVE DATE.—The amendments against the tax imposed by chapter 1 of the term ‘health insurance coverage’ has the made by this section shall apply to amounts Internal Revenue Code of 1986 for any month meaning given such term by paragraph (1) of paid or incurred in taxable years beginning during the taxable year an amount equal to section 9832(b) (determined by disregarding after December 31, 2005. 30 percent of any amount which is excludable the last sentence of paragraph (2) of such SEC. ll. MODIFICATIONS OF EFFECTIVE DATES from the gross income of a qualified em- section). OF LEASING PROVISIONS OF THE ployee of such employer under subsection ‘‘(3) QUALIFIED EMPLOYEE.—The term AMERICAN JOBS CREATION ACT OF (a). ‘qualified employee’ means an employee of 2004. (2) CERTAIN RULES TO APPLY.—For purposes an employer who, with respect to any period, (a) IN GENERAL.—Section 849(b) of the of this section, rules similar to the rules of is not provided health insurance coverage American Jobs Creation Act of 2004, as section 280C(a) of such Code shall apply. under— amended by section 553 of this Act,is amend- (3) CREDIT TO BE PART OF GENERAL BUSINESS ‘‘(A) a health plan of the employee’s ed by adding at the end the following new CREDIT.—The credit allowed under this sec- spouse, paragraph: tion shall be added to the current year busi- ‘‘(B) title XVIII, XIX, or XXI of the Social ‘‘(3) LEASES TO FOREIGN ENTITIES.—In the ness credit under section 38(b) of such Code Security Act, case of tax-exempt use property leased to a and shall be treated as a credit allowed ‘‘(C) chapter 17 of title 38, United States tax-exempt entity which is a foreign person under subpart D of part IV of subchapter A of Code, or entity, the amendments made by this part such Code. ‘‘(D) chapter 55 of title 10, United States shall apply to taxable years beginning after (c) QUALIFIED EMPLOYEE.—For purposes of Code, December 31, 2004, with respect to leases en- this section, the term ‘‘qualified employee’’ ‘‘(E) chapter 89 of title 5, United States tered into on or before March 12, 2004.’’. means, with respect to any month, an indi- Code, or (b) EFFECTIVE DATE.—The amendments vidual— ‘‘(F) any other provision of law. made by this section shall take effect as if (1) who had a principal residence (as de- ‘‘(4) EMPLOYEE.—The term ‘employee’— included in the enactment of the American fined in section 121 of the Internal Revenue ‘‘(A) means any individual, with respect to Jobs Creation Act of 2004. Code of 1986) in the Hurricane Katrina dis- any calendar year, who is reasonably ex- SEC. ll. EXTENSION OF SUPERFUND TAXES. aster area (as defined in section 1400N(2) of pected to receive at least $5,000 of compensa- (a) EXCISE TAXES.—Section 4611(e) is such Code) on August 28, 2005, and tion from the employer during such year, amended to read as follows: (2) who performs not less than 80 percent of ‘‘(B) does not include an employee within ‘‘(e) APPLICATION OF HAZARDOUS SUBSTANCE the employment services for a qualified em- the meaning of section 401(c)(1), and SUPERFUND FINANCING RATE.—The Hazardous ployer in the Hurricane Katrina disaster ‘‘(C) includes a leased employee within the Substance Superfund financing rate under area (as so defined). meaning of section 414(n). this section shall apply after December 31, (d) QUALIFIED EMPLOYER.—For purposes of ‘‘(5) COMPENSATION.—The term ‘compensa- 1986, and before January 1, 1996, and after De- this section, the term ‘‘qualified employer’’ tion’ means amounts described in section cember 31, 2005, and before January 1, 2015.’’ means any employer with a trade or business 6051(a)(3). (b) CORPORATE ENVIRONMENTAL INCOME located in the Hurricane Katrina disaster ‘‘(e) CERTAIN RULES MADE APPLICABLE.— TAX.—Section 59A(e) is amended to read as area (as so defined). For purposes of this section, rules similar to follows: (e) APPLICATION OF SECTION.—This section the rules of section 52 shall apply. ‘‘(e) APPLICATION OF TAX.—The tax imposed shall apply to lodging provided— ‘‘(f) DENIAL OF DOUBLE BENEFIT.—No de- by this section shall apply to taxable years (1) after the date of the enactment of this duction or credit under any other provision beginning after December 31, 1986, and before Act, and of this chapter shall be allowed with respect January 1, 1996, and to taxable years begin- (2) before the date which is 1 year after the to qualified employee health insurance ex- ning after December 31, 2005, and before Jan- date of the enactment of this Act. penses taken into account under subsection uary 1, 2015.’’ SEC. 105. HOMELESSNESS PREVENTION. (a). (c) EFFECTIVE DATES.— Notwithstanding any other provision of ‘‘(g) TERMINATION.—This section shall not (1) EXCISE TAXES.—The amendments made law, the Director of the Federal Emergency apply with respect to any taxable year begin- by subsection (a) shall take effect on the Management Agency (referred to in this sec- ning after December 31, 2006.’’. date of the enactment of this Act. tion as the ‘‘Director’’) shall not cease to (b) CREDIT TO BE PART OF GENERAL BUSI- (2) INCOME TAX.—The amendment made by make payments for hotel or motel accom- NESS CREDIT.—Section 38(b) (relating to cur- subsection (b) shall apply to taxable years modations, or for other short-term tem- rent year business credit) is amended by beginning after December 31, 2005. striking ‘‘and’’ at the end of paragraph (25), porary housing, on behalf of a victim of Hur- by striking the period at the end of para- SA 2643. Ms. LANDRIEU submitted ricane Katrina or Hurricane Rita who was graph (26) and inserting ‘‘, and’’, and by add- being assisted in that manner as of Novem- an amendment intended to be proposed ber 14, 2005 (referred to in this section as an ing at the end the following: by her to the bill S. 2020, to provide for ‘‘(27) the employee health insurance ex- ‘‘eligible victim’’), until such time as the Di- penses credit determined under section reconciliation pursuant to section rector determines that— 45N.’’. 202(b) of the concurrent resolution on (1) the eligible victim has located a habit- (c) CREDIT ALLOWED AGAINST MINIMUM the budget for fiscal year 2006; which able home; TAX.—Subparagraph (B) of section 38(c)(4) was ordered to lie on the table; as fol- (2) the Director has provided financial as- (relating to limitation based on amount of lows: sistance to the eligible victim for use in relo- tax for specified credits) is amended— cating to that home, and the eligible victim On page 35, between lines 16 and 17, insert has so relocated; and (1) in clause (ii)(II), by striking the period the following: at the end and inserting ‘‘, and’’; and (3) the eligible victim is able to afford the SEC. 104. HOUSING RELIEF FOR INDIVIDUALS AF- rent for that home, either with resources of (2) by adding at the end the following new FECTED BY HURRICANE KATRINA. clause: the eligible victim or through the use of as- (a) EXCLUSION OF EMPLOYER PROVIDED ‘‘(iii) the employee health insurance ex- sistance payments from the Director (and, in HOUSING FOR INDIVIDUAL AFFECTED BY HURRI- penses credit determined under section the case of a victim who can afford that CANE KATRINA.— 45N.’’. home only through the use of those assist- (1) IN GENERAL.—For purposes of the Inter- (d) CLERICAL AMENDMENT.—The table of ance payments, that the Director has pro- nal Revenue Code of 1986, gross income of a sections for subpart D of part IV of sub- vided the assistance payments for a period of qualified employee shall not include the chapter A of chapter 1 is amended by adding at least 90 days). value of any lodging furnished to such em- at the end the following: SEC. 106. SENSE OF THE SENATE. ployee, such employee’s spouse, or any of ‘‘Sec. 45N. Employee health insurance ex- such employee’s dependents by or on behalf It is the sense of the Senate that Congress penses.’’. of a qualified employer for any month during should develop and provide funding for solu- (e) EMPLOYER OUTREACH.—The Internal the taxable year. tions necessary to address the lack of supply Revenue Service shall, in conjunction with (2) LIMITATION.—The amount which may be of affordable housing in areas devastated by the Small Business Administration, develop excluded under subsection (a) for any month Hurricane Katrina and Hurricane Rita. materials and implement an educational pro- for which lodging is furnished during the gram to ensure that business personnel are taxable year shall not exceed $1,000. SA 2644. Ms. LANDRIEU submitted aware of— (3) TREATMENT OF EXCLUSION.—For pur- an amendment intended to be proposed (1) the eligibility criteria for the tax credit poses of the Internal Revenue Code of 1986, by her to the bill S. 2020, to provide for provided under section 45N of the Internal an exclusion under subsection (a) shall be reconciliation pursuant to section Revenue Code of 1986 (as added by this sec- treated as an exclusion under section 119 of 202(b) of the concurrent resolution on tion), such Code. the budget for fiscal year 2006; which (2) the methods to be used in calculating (b) EMPLOYER CREDIT FOR HOUSING EMPLOY- was ordered to lie on the table; as fol- such credit, and EES AFFECTED BY HURRICANE KATRINA.— (3) the documentation needed in order to (1) IN GENERAL.—In the case of a qualified lows: claim such credit. employer, there shall be allowed as a credit At the end of title IV, add the following:

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00082 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.179 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13229 SEC. ll. TREATMENT OF BIOFUEL PRODUCTION ‘‘(A) with respect to the first 5 taxable the budget for fiscal year 2006; as fol- FACILITIES AS EXEMPT FACILITY years ending after the date of enactment of lows: BOND. this section, the weatherization assistance Beginning on page 63, line 18, strike all (a) IN GENERAL.—Subsection (a) of section expenses for each such year, and through page 64, line 15, and insert the fol- 142 (relating to exempt facility bond) is ‘‘(B) with respect to a taxable year after lowing: amended by striking ‘‘or’’ at the end of para- the fifth taxable year ending after the date graph (14), by striking the period at the end of enactment of this section, the excess (if SEC. 212. EXTENSION AND INCREASE IN MIN- of paragraph (15) and inserting ‘‘, or’’ and by any) of the weatherization assistance ex- IMUM TAX RELIEF TO INDIVIDUALS. adding at the end the following new para- penses for such year over the weatherization (a) IN GENERAL.—Section 55(d)(1) is amend- graph: assistance expenses for the fifth taxable year ed— ‘‘(16) biofuel production facilities.’’. preceding such year. (1) by striking ‘‘$58,000’’ and all that fol- (b) BIOFUEL PRODUCTION FACILITIES.—Sec- ‘‘(3) UTILITY.—The term ‘utility’ means a lows through ‘‘2005’’ in subparagraph (A) and tion 142 is amended by adding at the end the corporation that is engaged in the sale of inserting ‘‘$62,550 in the case of taxable years following: electric energy or gas and is described in sec- beginning in 2006’’, and ‘‘(n) BIOFUEL PRODUCTION FACILITIES.— tion 7701(a)(33)(A). (2) by striking ‘‘$40,250’’ and all that fol- ‘‘(1) IN GENERAL.—For purposes of sub- ‘‘(4) STATE WEATHERIZATION AGENCY.—The lows through ‘‘2005’’ in subparagraph (B) and section (a)(16), the term ‘biofuel production term ‘State weatherization agency’ means inserting ‘‘$42,500 in the case of taxable years facilities’ means any facility for the produc- the department, agency, board, or other enti- beginning in 2006’’. tion of any transportation fuel and related ty of a State that is authorized by such (b) EFFECTIVE DATE.—The amendments byproducts from biomass. State to administer the weatherization pro- made by this section shall apply to taxable ‘‘(2) BIOMASS DEFINED.—For purposes of gram described in section 415 of the Energy years beginning after December 31, 2005. paragraph (1), the term ‘biomass’ means any Conservation and Production Act (42 U.S.C. Beginning on page 69, line 6, strike all organic matter that is available on a renew- 6865). through page 71, line 13, and insert the fol- able or recurring basis, including agricul- ‘‘(c) REGULATIONS.—The Secretary shall lowing: tural crops and trees, wood and wood wastes prescribe regulations necessary to carry out (d) EXPANSION OF CREDIT TO EXPENSES OF and residues, plants (including aquatic the purposes of this section.’’. GENERAL COLLABORATIVE RESEARCH CON- plants), grasses, residues, fibers, and animal (b) CREDIT TREATED AS PART OF GENERAL SORTIA.—Section 41 is amended— wastes, municipal wastes, and other waste BUSINESS CREDIT.—Section 38(b) (relating to (1) by striking ‘‘an energy research consor- materials.’’. current year business credit) is amended by tium’’ in subsections (a)(3) and (b)(3)(C)(i) (c) EFFECTIVE DATE.—The amendments striking ‘‘and’’ at the end of paragraph (25), and inserting ‘‘a research consortium’’, made by this section apply to bonds issued striking the period at the end of paragraph (2) by striking ‘‘energy’’ each place it ap- after the date of enactment of this Act. (26), and inserting ‘‘, and’’, and by inserting pears in subsection (f)(6)(A), (3) by inserting ‘‘or 501(c)(6)’’ after ‘‘section SA 2645. Mr. COLEMAN (for himself after paragraph (26) the following new para- graph: 501(c)(3)’’ in subsection (f)(6)(A)(i)(I), and and Mr. PRYOR) submitted an amend- ‘‘(27) the weatherization assistance credit (4) by striking ‘‘ENERGY RESEARCH’’ in the ment intended to be proposed by him determined under section 45N(a).’’. heading for subsection (f)(6)(A) and inserting to the bill S. 2020, to provide for rec- (c) CONFORMING AMENDMENT.—The table of ‘‘RESEARCH’’ . onciliation pursuant to section 202(b) sections for Subpart D of Part IV of sub- Beginning on page 267, line 12, strike all of the concurrent resolution on the chapter A of chapter 1 (relating to business through page 268, line 15, and insert the fol- budget for fiscal year 2006; which was related credits) is amended by adding after lowing: ordered to lie on the table; as follows: the item relating to section 45M the fol- (b) APPLICABLE PENALTY.—For purposes of lowing new item: At the end of title IV, insert the following: this section, the term ‘‘applicable penalty’’ ‘‘45N. Weatherization assistance credit’’. means any penalty, addition to tax, or fine SEC. ll. WEATHERIZATION ASSISTANCE CRED- IT. (d) EFFECTIVE DATE.—The amendments imposed under chapter 68 of the Internal Revenue Code of 1986. (a) IN GENERAL.—Subpart D of Part IV of made by this section shall apply to weather- subchapter A of chapter 1 (relating to busi- ization assistance expenses (within the (c) EFFECTIVE DATE.—The provisions of ness related credits) is amended by inserting meaning of section 45N of the Internal Rev- this section shall apply to interest, pen- after section 45M the following new section: enue Code of 1986) paid or incurred in taxable alties, additions to tax, and fines with re- spect to any taxable year if, as of the date of ‘‘SEC. 45N. WEATHERIZATION ASSISTANCE CRED- years ending after the date of enactment of IT. this Act. the enactment of this Act, the assessment of ‘‘(a) GENERAL RULE.—For purposes of sec- any tax, penalty, or interest with respect to tion 38, in the case of a utility, the amount SA 2646. Ms. MURKOWSKI submitted such taxable year is not prevented by the op- of the weatherization assistance credit deter- an amendment intended to be proposed eration of any law or rule of law. mined under this section for the taxable year by her to the bill S. 2020, to provide for On page 310, between lines 10 and 11, insert shall be an amount equal to 20 percent of the reconciliation pursuant to section the following: qualified weatherization assistance expenses. 202(b) of the concurrent resolution on (b) LEASES TO FOREIGN ENTITIES.—Section ‘‘(b) DEFINITIONS.—For purposes of this sec- 849(b) of the American Jobs Creation Act of the budget for fiscal year 2006; which 2004, as amended by subsection (a), is amend- tion: was ordered to lie on the table; as fol- ‘‘(1) WEATHERIZATION ASSISTANCE EX- ed by adding at the end the following new PENSES.—The term ‘weatherization assist- lows: paragraph: ance expenses’ means amounts— At the end of title IV, add the following: ‘‘(3) LEASES TO FOREIGN ENTITIES.—In the ‘‘(A) paid by the taxpayer— SEC. ll. INCOME AVERAGING FOR CERTAIN PU- case of tax-exempt use property leased to a ‘‘(i) to an entity that is described in sec- NITIVE DAMAGE AWARD RECIPI- tax-exempt entity which is a foreign person tion 415(b)(2) of the Energy Conservation and ENTS. or entity, the amendments made by this part Production Act (42 U.S.C. 6865(b)(2)), that re- (a) IN GENERAL.—For purposes of section shall apply to taxable years beginning after ceives funds from the Department of Energy 1301 of the Internal Revenue Code of 1986— December 31, 2005, with respect to leases en- Weatherization Assistance Program as such (1) any individual who receives any puni- tered into on or before March 12, 2004.’’. an entity, and that uses the taxpayer’s tive damage award as a plaintiff in the On page 310, line 11, strike ‘‘(b)’’ and insert amounts for the installation of energy effi- Exxon Valdez oil spill litigation (Case No. ‘‘(c)’’. ciency improvements in residences of low-in- A89-095-CV (HRH)) in any taxable year shall On page 320, in the table following line 17, come individuals for purposes of section be treated as engaged in a fishing business strike ‘‘119.5’’ and insert ‘‘120’’. 415(a)(2) of the Energy Conservation and Pro- (determined without regard to the commer- On page 322, line 24, insert ‘‘which has an duction Act (42 U.S.C. 6865(a)(2)), as adminis- cial nature of the business), and average daily worldwide production of crude tered by the Department of Energy, or (2) income which is attributable to such oil of at least 500,000 barrels for the taxable ‘‘(ii) to a State weatherization agency for award shall be treated as income attrib- year and’’ use by such agency in its program that en- utable to such a fishing business for such hances or extends the Department of Ener- taxable year. SA 2648. Mr. ROBERTS submitted an gy’s program described in subparagraph (A), (b) EFFECTIVE DATE.—The amendments amendment intended to be proposed by and made by this section shall apply to taxable him to the bill S. 2020, to provide for ‘‘(B) certified to the taxpayer by a State years ending after the date of the enactment of this Act. reconciliation pursuant to section weatherization agency as paid to one or 202(b) of the concurrent resolution on more entities described in subparagraph Mr. GRASSLEY (for himself the budget for fiscal year 2006; which (A)(i) or to such agency described in subpara- SA 2647. graph (A)(ii). and Mr. BAUCUS) proposed an amend- was ordered to lie on the table; as fol- ‘‘(2) QUALIFIED WEATHERIZATION ASSISTANCE ment to the bill S. 2020, to provide for lows: EXPENSES.—The term ‘qualified weatheriza- reconciliation pursuant to section On page 235, between lines 13 and 14, insert tion assistance expenses’ means— 202(b) of the concurrent resolution on the following:

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00083 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.185 S17NOPT2 S13230 CONGRESSIONAL RECORD — SENATE November 17, 2005 SEC. 405. EXCLUSION OF CERTAIN AMOUNTS (B) The period of the first 5 fiscal years SEC. ll. REPEAL OF STATE AND LOCAL TAX EX- FROM INCOME FOR PURPOSES OF covered by the most recently adopted con- EMPTION FOR FANNIE MAE AND ELIGIBILITY FOR FEDERALLY AS- current resolution on the budget. FREDDIE MAC. SISTED LOW-INCOME HOUSING PRO- (C) The period of the 5 fiscal years fol- (a) FANNIE MAE.—Section 309(c) of the Fed- GRAMS. lowing the first 5 fiscal years covered in the eral National Mortgage Association Charter The Department of Housing and Urban De- Act (12 U.S.C. 1723a(c)) is amended to read as velopment Act (42 U.S.C. 3537a) is amended most recently adopted concurrent resolution on the budget. follows: by inserting after section 12 the following ‘‘(c) [Repealed.]’’. new section: (3) DIRECT-SPENDING LEGISLATION.—For purposes of this subsection and except as (b) FREDDIE MAC.—Section 303(e) of the ‘‘SEC. 13. EXCLUSION OF CERTAIN AMOUNTS Federal Home Loan Mortgage Corporation FROM INCOME. provided in paragraph (4), the term ‘‘direct- spending legislation’’ means any bill, joint Act (12 U.S.C. 1452(e)) is amended to read as ‘‘(a) IN GENERAL.—Notwithstanding any resolution, amendment, motion, or con- follows: other provision of law, amounts received by ‘‘(e) [Repealed.]’’. a member of the Armed Forces under section ference report that affects direct spending as that term is defined by, and interpreted for 403 of title 37, United States Code, as a basic SA 2652. Mrs. LINCOLN (for herself, allowance for housing may not be treated as purposes of, the Balanced Budget and Emer- income for purposes of determining, for pur- gency Deficit Control Act of 1985. Ms. SNOWE, Mr. OBAMA, and Mr. ROCKE- poses of any program of the Department of (4) EXCLUSION.—For purposes of this sub- FELLER) submitted an amendment in- Housing and Urban Development (unless a section, the terms ‘‘direct-spending legisla- tended to be proposed by her to the bill request is made by such member for the re- tion’’ and ‘‘revenue legislation’’ do not in- S. 2020, to provide for reconciliation ceipt of rental assistance under any such clude— pursuant to section 202(b) of the con- program to be treated as such income) or (A) any concurrent resolution on the budg- et; or current resolution on the budget for any other agency of the Federal Government fiscal year 2006; as follows: for housing assistance (including any pro- (B) any provision of legislation that affects gram for grants, loans, subsidies, advances, the full funding of, and continuation of, the At the end of title IV, add the following: guarantees, credits, tax-exempt bonds, or deposit insurance guarantee commitment in SEC. ll. $10,000 INCOME THRESHOLD USED TO other financial assistance), the eligibility of effect on the date of enactment of the Budg- CALCULATE REFUNDABLE PORTION the member or the member’s family, or a de- et Enforcement Act of 1990. OF CHILD TAX CREDIT. pendent of the member or such dependent’s (5) BASELINE.—Estimates prepared pursu- (a) IN GENERAL.—Section 24(d) (relating to family, for— ant to this section shall— portion of credit refundable) is amended— ‘‘(1) assistance under such program; or (A) use the baseline surplus or deficit used (1) by striking ‘‘as exceeds’’ and all that ‘‘(2) occupancy in any dwelling unit in any for the most recently adopted concurrent follows through ‘‘, or’’ in paragraph (1)(B)(i) building or project for which assistance resolution on the budget; and and inserting ‘‘as exceeds $10,000, or’’, and under such program is provided— (B) be calculated under the requirements (2) by striking paragraph (3). ‘‘(A) to the member or the member’s fam- of subsections (b) through (d) of section 257 (b) EFFECTIVE DATE.—The amendments ily, or a dependent of the member or such de- of the Balanced Budget and Emergency Def- made by this section shall apply to taxable pendent’s family directly; or icit Control Act of 1985 for fiscal years be- years beginning after December 31, 2004. ‘‘(B) to the owner of such building or yond those covered by that concurrent reso- (c) APPLICATION OF SUNSET TO THIS SEC- project. lution on the budget. TION.—Each amendment made by this sec- ‘‘(b) OPT OUT.—Each State housing author- (6) PRIOR SURPLUS.—If direct spending or tion shall be subject to title IX of the Eco- ity may, without penalty, determine if it revenue legislation increases the on-budget nomic Growth and Tax Relief Reconciliation will provide the exclusion described in sub- deficit or causes an on-budget deficit when Act of 2001 to the same extent and in the section (a) to members of the Armed taken individually, it must also increase the same manner as the provision of such Act to Forces.’’. on-budget deficit or cause an on-budget def- which such amendment relates. icit when taken together with all direct SA 2649. Mr. MARTINEZ (for himself spending and revenue legislation enacted SA 2653. Mr. BAUCUS (for Mr. REID and Mr. NELSON of Florida) submitted since the beginning of the calendar year not (for himself, Mr. KERRY, Mr. LAUTEN- an amendment intended to be proposed accounted for in the baseline under para- BERG, Ms. SNOWE, Mr. SALAZAR, Mr. graph (5)(A), except that direct spending or BINGAMAN, Mr. JEFFORDS, Mr. BAYH, by him to the bill S. 2020, to provide for revenue effects resulting in net deficit reduc- reconciliation pursuant to section tion enacted pursuant to reconciliation in- Mrs. CLINTON, Mr. HARKIN, Mrs. FEIN- 202(b) of the concurrent resolution on structions since the beginning of that same STEIN, and Ms. COLLINS)) proposed an the budget for fiscal year 2006; which calendar year shall not be available. amendment to the bill S. 2020, to pro- was ordered to lie on the table; as fol- (b) WAIVER.—This section may be waived vide for reconciliation pursuant to sec- lows: or suspended in the Senate only by the af- tion 202(b) of the concurrent resolution On page 16, line 23, strike ‘‘or Mississippi’’ firmative vote of 3⁄5 of the Members, duly on the budget for fiscal year 2006; and insert ‘‘Mississippi, Florida, or Texas’’ chosen and sworn. which was ordered to lie on the table; On page 17, line 7, strike ‘‘Gulf Opportunity (c) APPEALS.—Appeals in the Senate from as follows: Zone’’ and insert ‘‘Katrina, Wilma, and Rita the decisions of the Chair relating to any At the end of title IV, add the following: Go Zones’’ provision of this section shall be limited to 1 Subtitle B—Extending Tax Incentives for Re- hour, to be equally divided between, and con- SA 2650. Mr. FEINGOLD (for himself, newable Energy Production and Energy Ef- trolled by, the appellant and the manager of ficient Construction Mr. CONRAD, Mr. CHAFEE, Mr. OBAMA, the bill or joint resolution, as the case may SECTION 411. EXTENSION OF RENEWABLE EN- and Mr. SALAZAR) proposed an amend- be. An affirmative vote of 3⁄5 of the Members ment to the bill S. 2020, to provide for ERGY PRODUCTION CREDIT of the Senate, duly chosen and sworn, shall THROUGH 2010. be required to sustain an appeal of the ruling reconciliation pursuant to section Paragraphs (1), (2), (3), (4), (5), (6), (7), and of the Chair on a point of order raised under 202(b) of the concurrent resolution on (9) of section 45(d) (relating to qualified fa- this section. the budget for fiscal year 2006; as fol- cilities) are amended by striking ‘‘2008’’ each lows: (d) DETERMINATION OF BUDGET LEVELS.— place it appears and inserting ‘‘2011’’. At the appropriate place, insert the fol- For purposes of this section, the levels of SEC. 412. EXTENSION OF RENEWABLE ENERGY lowing: new budget authority, outlays, and revenues INVESTMENT TAX CREDIT THROUGH SEC. ll. PAY-AS-YOU-GO POINT OF ORDER IN for a fiscal year shall be determined on the 2010. THE SENATE. basis of estimates made by the Committee Paragraphs (2)(A)(i)(II) and (3)(A)(ii) (relat- (a) POINT OF ORDER.— on the Budget of the Senate. ing to energy credit) is amended by striking (1) IN GENERAL.—It shall not be in order in (e) SUNSET.—This section shall expire on ‘‘2008’’ both places it appears and inserting the Senate to consider any direct spending September 30, 2010. ‘‘2011’’. or revenue legislation that would increase SEC. 413. EXTENSION OF CLEAN RENEWABLE EN- the on-budget deficit or cause an on-budget ERGY BONDS THROUGH 2010. deficit for any 1 of the 3 applicable time peri- SA 2651. Mr. SUNUNU proposed an Section 54(m) (relating to termination) is ods as measured in paragraphs (5) and (6). amendment to the bill S. 2020, to pro- amended by striking ‘‘2007’’ and inserting (2) APPLICABLE TIME PERIODS.—For pur- vide for reconciliation pursuant to sec- ‘‘2010’’. poses of this subsection, the term ‘‘applica- tion 202(b) of the concurrent resolution SEC. 414. EXTENSION OF ENERGY EFFICIENT ble time period’’ means any 1 of the 3 fol- on the budget for fiscal year 2006; as COMMERCIAL BUILDINGS DEDUC- lowing periods: follows: TION THROUGH 2010. (A) The first year covered by the most re- Section 179D(h) (relating to termination) is cently adopted concurrent resolution on the At the appropriate place, insert the fol- amended by striking ‘‘2007’’ and inserting budget. lowing: ‘‘2010’’.

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00084 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.185 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13231 SEC. 415. EXTENSION OF NEW ENERGY EFFI- (9) Allowing taxes to increase will make it unfair trade, especially dumping and sub- CIENT HOME CREDIT THROUGH 2010. harder for employers and individuals to af- sidies’’. Section 45L(g) (relating to termination) is ford health care insurance, leading to more (5) The countries that have been the most amended by striking ‘‘2007’’ and inserting individuals without health insurance. persistent and egregious violators of inter- ‘‘2010’’. (b) SENSE OF THE SENATE.—It is the sense national fair trade rules are engaged in an SEC. 416. EXTENSION OF RESIDENTIAL RENEW- of the Senate that the Senate should— aggressive effort to significantly weaken the ABLE ENERGY EFFICIENT PROP- (1) prevent an increase in taxes on millions disciplines provided in the Antidumping ERTY CREDIT THROUGH 2010. of Americans by not allowing the tax policy Agreement and the Subsidies Agreement and Section 25D(g) is amended to read as fol- enacted in 2003 to expire; and undermine the ability of the United States lows: (2) extend tax policies that have proven to to effectively enforce its trade remedy laws. ‘‘(a) TERMINATION.—The credit allowed enhance economic growth, create jobs, and (6) Chronic violators of fair trade dis- under this section shall not apply to— improve business’ and individuals’ ability to ciplines have put forward proposals that ‘‘(1) property described in paragraph (1) or afford health insurance coverage; and would substantially weaken United States (2) of subsection (d) placed in service after (3) address the multiple aspects of our Na- trade remedy laws and practices, including December 31, 2010, and tion’s health care crisis, including the need mandating that unfair trade orders termi- ‘‘(2) property described in subsection (d)(3) to make health care more affordable, to ex- placed in service after December 31, 2007.’’. nate after a set number of years even if un- pand coverage, and to strengthen the health fair trade and injury are likely to recur, SEC. 417. EXTENSION OF NONBUSINESS ENERGY care safety net by— mandating that trade remedy duties reflect PROPERTY CREDIT THROUGH 2010. (A) promoting the use of health care tech- Section 25C(g) (relating to termination) is less than the full margin of dumping or sub- nology, which will help reduce medical er- sidization, mandating higher de minimis lev- amended by striking ‘‘2007’’ and inserting rors that contribute to higher costs and pro- ‘‘2010’’. els of unfair trade, making cumulation of the mote greater efficiency in care delivery; effects of imports from multiple countries SEC. 418. MODIFICATIONS OF EFFECTIVE DATES (B) providing new financial assistance and more difficult in unfair trade investigations, OF LEASING PROVISIONS OF THE tax credits to make health insurance more AMERICAN JOBS CREATION ACT OF outlawing the critical practice of ‘‘zeroing’’ 2004. affordable; in antidumping investigations, mandating (C) creating financial incentives for young (a) IN GENERAL.—Section 849(b) of the the weighing of causes, and mandating other American Jobs Creation Act of 2004 is adults to purchase lifetime, portable health provisions that make it more difficult to amended by adding at the end the following insurance; prove injury. new paragraph: (D) expanding health insurance coverage (7) United States trade remedy laws have options for low-income entrepreneurs and ‘‘(5) LEASES TO FOREIGN ENTITIES.—In the already been significantly weakened by nu- case of tax-exempt use property leased to a self-employed individuals; merous unjust and activist WTO dispute set- tax-exempt entity which is a foreign person (E) increasing access to specialty care tlement decisions which have created new or entity, the amendments made by this part within the health care safety net by pro- obligations to which the United States never shall apply to taxable years beginning after viding a tax deduction to physician special- agreed. December 31, 2004, with respect to leases en- ists who provide care for patients referred (8) Trade remedy laws remain a critical re- from health care safety net providers; tered into on or before March 12, 2004.’’. source for American manufacturers, agricul- (F) reducing regulatory burdens on health (b) EFFECTIVE DATE.—The amendments tural producers, and aquacultural producers care safety net providers that lead to higher made by this section shall take effect as if in responding to closed foreign markets, sub- administrative costs and a diversion of funds included in the enactment of the American sidized imports, and other forms of unfair that could be spent on patient care; and Jobs Creation Act of 2004. trade, particularly in the context of the (G) improving outreach efforts to maxi- challenges currently faced by these vital sec- mize participation of eligible beneficiaries in SA 2654. Mr. GRASSLEY proposed an tors of the United States economy. Federal health care safety net programs. amendment to the bill S. 2020, to pro- (9) The United States had a current ac- vide for reconciliation pursuant to sec- count trade deficit of approximately SA 2655. Mr. CRAIG (for himself and tion 202(b) of the concurrent resolution $668,000,000,000 in 2004, including a trade def- Mr. ROCKEFELLER) submitted an icit of almost $162,000,000,000 with China on the budget for fiscal year 2006; as amendment intended to be proposed by follows: alone, as well as a trade deficit of him to the bill S. 2020, to provide for $40,000,000,000 in advanced technology. At the end of title IV, add the following: reconciliation pursuant to section (10) United States manufacturers have lost SEC. lll. SENSE OF THE SENATE. 202(b) of the concurrent resolution on over 3,000,000 jobs since June 2000, and United (a) FINDINGS.—The Senate makes the fol- the budget for fiscal year 2006; as fol- States manufacturing employment is cur- lowing findings: lows: rently at its lowest level since 1950. (1) As many as 44,000,000 Americans are es- (11) Many industries critical to United At the appropriate place, insert the fol- timated to lack health insurance during the States national security are at severe risk lowing: course of the year, many of whom are unin- from unfair foreign competition. sured for a short period of time while a SEC. ll. SENSE OF CONGRESS REGARDING (12) The Congress strongly believes that smaller number face longer periods without DOHA ROUND. the proposals put forward by countries seek- coverage. (a) FINDINGS.—The Congress makes the fol- ing to undermine trade remedy disciplines in (2) Rising health care costs contribute to lowing findings: the Doha Round would result in serious harm the problem of the uninsured and make it (1) Members of the World Trade Organiza- to the United States economy, including sig- more difficult to find a simple solution to tion (WTO) are currently engaged in a round nificant job losses and trade disadvantages. make health care affordable. of trade negotiations known as the Doha De- (3) There is not a one-size fits all solution velopment Agenda (Doha Round). (b) SENSE OF CONGRESS.—It is the sense of to address health care coverage issues. (2) The Doha Round includes negotiations Congress that— (4) Businesses have competing needs for aimed at clarifying and improving dis- (1) the United States should not be a signa- their resources, including investments to en- ciplines under the Agreement on Implemen- tory to any agreement or protocol with re- sure their competitiveness and providing tation of Article VI of the General Agree- spect to the Doha Development Round of the health care coverage for their employees and ment on Tariffs and Trade 1994 (Antidumping World Trade Organization negotiations, or dependents. Agreement) and the Agreement on Subsidies any other bilateral or multilateral trade ne- (5) Lower tax rates on dividends and cap- and Countervailing Measures (Subsidies gotiations, that— ital gains saved 24,000,000 families an average Agreement). (A) adopts any proposal to lessen the effec- of nearly $950 on their 2004 taxes, including (3) The WTO Ministerial Declaration tiveness of domestic and international dis- about 7,000,000 seniors who saved, on average, adopted on November 14, 2001 (WTO Paper ciplines on unfair trade or safeguard provi- $1,230 each. No. WT/MIN(01)/DEC/1) specifically provides sions, including proposals— (6) These pro-growth tax cuts have spurred that the Doha Round negotiations are to pre- (i) mandating that unfair trade orders ter- economic development and job creation and serve the ‘‘basic concepts, principles and ef- minate after a set number of years even if have been partly responsible for an increase fectiveness’’ of the Antidumping Agreement unfair trade and injury are likely to recur; in tax receipts. and the Subsidies Agreement. (ii) mandating that trade remedy duties re- (7) Of the more than 30,000,000 tax returns (4) In section 2102(b)(14)(A) of the Bipar- flect less than the full margin of dumping or that included dividend income, those with tisan Trade Promotion Authority Act of 2002, subsidization; adjusted gross income of less than $75,000 ac- the Congress mandated that the principal ne- (iii) mandating higher de minimis levels of counted for 64 percent, or over 19,000,000 of gotiating objective of the United States with unfair trade; such returns. respect to trade remedy laws was to ‘‘pre- (iv) making cumulation of the effects of (8) Of the nearly 23,000,000 tax returns that serve the ability of the United States to en- imports from multiple countries more dif- included capital gains, 62 percent of these re- force rigorously its trade laws . . . and avoid ficult in unfair trade investigations; turns, or about 14,000,000, had less than agreements that lessen the effectiveness of (v) outlawing the critical practice of ‘‘zero- $75,000 in adjusted gross income. domestic and international disciplines on ing’’ in antidumping investigations; or

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00085 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.186 S17NOPT2 S13232 CONGRESSIONAL RECORD — SENATE November 17, 2005 (vi) mandating the weighing of causes or ‘‘(A) is subject to a levy of such country or ginning after the date of the enactment of other provisions making it more difficult to possession, and this Act. prove injury in unfair trade cases; and ‘‘(B) receives (or will receive) directly or (2) YEARS AFTER 2006.—The amendments (B) would lessen in any manner the ability indirectly a specific economic benefit (as de- made by paragraphs (1)(B) and (2)(B) shall of the United States to enforce rigorously its termined in accordance with regulations) apply to taxable years beginning after De- trade laws, including the antidumping, coun- from such country or possession. cember 31, 2006. tervailing duty, and safeguard laws; ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— (3) TRANSITIONAL RULES.— (2) the United States trade laws and inter- For purposes of this subsection— (A) SEPARATE BASKET TREATMENT.—Any national rules appropriately serve the public ‘‘(A) IN GENERAL.—The term ‘generally ap- taxes paid or accrued in a taxable year be- interest by offsetting injurious unfair trade, plicable income tax’ means an income tax ginning on or before the date of the enact- and that further ‘‘balancing modifications’’ (or a series of income taxes) which is gen- ment of this Act, with respect to income or other similar provisions are unnecessary erally imposed under the laws of a foreign which was described in subparagraph (I) of and would add to the complexity and dif- country or possession on income derived section 904(d)(1) of such Code (as in effect on ficulty of achieving relief against injurious from the conduct of a trade or business with- the day before the date of the enactment of unfair trade practices; and in such country or possession. this Act), shall be treated as taxes paid or (3) the United States should ensure that ‘‘(B) EXCEPTIONS.—Such term shall not in- accrued with respect to foreign oil and gas any new agreement relating to international clude a tax unless it has substantial applica- income to the extent the taxpayer estab- disciplines on unfair trade or safeguard pro- tion, by its terms and in practice, to— lishes to the satisfaction of the Secretary of visions fully rectifies and corrects decisions ‘‘(i) persons who are not dual capacity tax- the Treasury that such taxes were paid or ac- by WTO dispute settlement panels or the Ap- payers, and crued with respect to foreign oil and gas in- pellate Body that have unjustifiably and ‘‘(ii) persons who are citizens or residents come. negatively impacted, or threaten to nega- of the foreign country or possession.’’ (B) CARRYOVERS.—Any unused oil and gas tively impact, United States law or practice, (b) EFFECTIVE DATE.— extraction taxes which under section 907(f) of including a law or practice with respect to (1) IN GENERAL.—The amendments made by such Code (as so in effect) would have been foreign dumping or subsidization. this section shall apply to taxes paid or ac- allowable as a carryover to the taxpayer’s crued in taxable years beginning after the first taxable year beginning after the date of SA 2656. Ms. SNOWE (for herself and date of the enactment of this Act. the enactment of this Act (without regard to Ms. COLLINS) submitted an amendment (2) CONTRARY TREATY OBLIGATIONS the limitation of paragraph (2) of such sec- intended to be proposed by her to the UPHELD.—The amendments made by this sec- tion 907(f) for first taxable year) shall be al- tion shall not apply to the extent contrary lowed as carryovers under section 904(c) of bill S. 2020, to provide for reconcili- to any treaty obligation of the United such Code in the same manner as if such ation pursuant to section 202(b) of the States. taxes were unused taxes under such section concurrent resolution on the budget for SEC. ll. RULES RELATING TO FOREIGN OIL AND 904(c) with respect to foreign oil and gas ex- fiscal year 2006; which was ordered to GAS INCOME. traction income. lie on the table; as follows: (a) SEPARATE BASKET FOR FOREIGN TAX (C) LOSSES.—The amendment made by sub- CREDIT.— On page 321, strike line 1 and all that fol- section (c)(3) shall not apply to foreign oil (1) YEARS BEFORE 2007.—Paragraph (1) of lows through page 323, line 6, and insert the and gas extraction losses arising in taxable section 904(d) (relating to separate applica- following: years beginning on or before the date of the tion of section with respect to certain cat- SEC. ll. INCREASED LIHEAP FUNDING FOR 2006. enactment of this Act. egories of income), as in effect for years be- SEC. ll. REVALUATION OF LIFO INVENTORIES With respect to fiscal year 2006, in addition ginning before 2007, is amended by striking to amounts appropriated under any other OF LARGE INTEGRATED OIL COMPA- ‘‘and’’ at the end of subparagraph (H), by re- NIES. provision of law, for making payments under designating subparagraph (I) as subpara- (a) GENERAL RULE.—Notwithstanding any title XXVI of the Omnibus Budget Reconcili- graph (J), and by inserting after subpara- other provision of law, if a taxpayer is an ap- ation Act of 1981 (42 U.S.C. 8621 et seq.), graph (H) the following new subparagraph: plicable integrated oil company for its last $2,920,000,000, shall be appropriated to dis- ‘‘(I) foreign oil and gas income, and’’. taxable year ending in calendar year 2005, tribute funds to all the States in accordance (2) 2007 AND AFTER.—Paragraph (1) of sec- the taxpayer shall— with section 2604 of that Act (42 U.S.C. 8623) tion 904(d), as in effect for years beginning (1) increase, effective as of the close of (other than subsection (e) of such section). after 2006, is amended by striking ‘‘and’’ at such taxable year, the value of each historic SEC.ll. MODIFICATIONS OF FOREIGN TAX the end of subparagraph (A), by striking the LIFO layer of inventories of crude oil, nat- CREDIT RULES APPLICABLE TO period at the end of subparagraph (B) and in- ural gas, or any other petroleum product DUAL CAPACITY TAXPAYERS. serting ‘‘, and’’, and by adding at the end the (within the meaning of section 4611) by the (a) IN GENERAL.—Section 901 (relating to following: layer adjustment amount, and credit for taxes of foreign countries and of ‘‘(C) foreign oil and gas income.’’ (2) decrease its cost of goods sold for such possessions of the United States) is amended (b) DEFINITION.— taxable year by the aggregate amount of the by redesignating subsection (m) as sub- (1) YEARS BEFORE 2007.—Paragraph (2) of increases under paragraph (1). section (n) and by inserting after subsection section 904(d), as in effect for years begin- If the aggregate amount of the increases (l) the following new subsection: ning before 2007, is amended by redesignating under paragraph (1) exceed the taxpayer’s ‘‘(m) SPECIAL RULES RELATING TO DUAL subparagraphs (H) and (I) as subparagraphs cost of goods sold for such taxable year, the CAPACITY TAXPAYERS.— (I) and (J), respectively, and by inserting taxpayer’s gross income for such taxable ‘‘(1) GENERAL RULE.—Notwithstanding any after subparagraph (G) the following new year shall be increased by the amount of other provision of this chapter, any amount subparagraph: such excess. paid or accrued by a dual capacity taxpayer ‘‘(H) FOREIGN OIL AND GAS INCOME.—The (b) LAYER ADJUSTMENT AMOUNT.—For pur- to a foreign country or possession of the term ‘foreign oil and gas income’ has the poses of this section— United States for any period shall not be meaning given such term by section 954(g).’’ (1) IN GENERAL.—The term ‘‘layer adjust- considered a tax— (2) 2007 AND AFTER.—Section 904(d)(2), as in ment amount’’ means, with respect to any ‘‘(A) if, for such period, the foreign country effect for years after 2006, is amended by re- historic LIFO layer, the product of— or possession does not impose a generally ap- designating subparagraphs (J) and (K) as (A) $24.00, and plicable income tax, or subparagraphs (K) and (L) and by inserting (B) the number of barrels of crude oil (or in ‘‘(B) to the extent such amount exceeds the after subparagraph (I) the following: the case of natural gas or other petroleum amount (determined in accordance with reg- ‘‘(J) FOREIGN OIL AND GAS INCOME.—For products, the number of barrel-of-oil equiva- ulations) which— purposes of this section— lents) represented by the layer. ‘‘(i) is paid by such dual capacity taxpayer ‘‘(i) IN GENERAL.—The term ‘foreign oil and (2) BARREL-OF-OIL EQUIVALENT.—The term pursuant to the generally applicable income gas income’ has the meaning given such ‘‘barrel-of-oil equivalent’’ has the meaning tax imposed by the country or possession, or term by section 954(g). given such term by section 29(d)(5) (as in ef- ‘‘(ii) would be paid if the generally applica- ‘‘(ii) COORDINATION.—Passive category in- fect before its redesignation by the Energy ble income tax imposed by the country or come and general category income shall not Tax Incentives Act of 2005). possession were applicable to such dual ca- include foreign oil and gas income (as so de- (c) APPLICATION OF REQUIREMENT.— pacity taxpayer. fined).’’ (1) NO CHANGE IN METHOD OF ACCOUNTING.— Nothing in this paragraph shall be construed (c) CONFORMING AMENDMENTS.— Any adjustment required by this section to imply the proper treatment of any such (1) Section 904(d)(3)(F)(i) is amended by shall not be treated as a change in method of amount not in excess of the amount deter- striking ‘‘or (E)’’ and inserting ‘‘(E), or (I)’’. accounting. mined under subparagraph (B). (2) Section 907(a) is hereby repealed. (2) UNDERPAYMENTS OF ESTIMATED TAX.—No ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- (3) Section 907(c)(4) is hereby repealed. addition to the tax shall be made under sec- poses of this subsection, the term ‘dual ca- (4) Section 907(f) is hereby repealed. tion 6655 of the Internal Revenue Code of 1986 pacity taxpayer’ means, with respect to any (d) EFFECTIVE DATES.— (relating to failure by corporation to pay es- foreign country or possession of the United (1) IN GENERAL.—The amendments made by timated tax) with respect to any under- States, a person who— this section shall apply to taxable years be- payment of an installment required to be

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00086 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.186 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13233 paid with respect to the taxable year de- telligence community shall not be treated as the United States should promptly begin an scribed in subsection (a) to the extent such serving on qualified extended duty unless— investigation to determine whether the tes- underpayment was created or increased by ‘‘(I) for purposes of such duty such em- timony given by any of the oil company ex- this section. ployee has moved from 1 duty station to an- ecutives at the November 9, 2005, joint hear- (d) APPLICABLE INTEGRATED OIL COM- other, and ing (referred to in subsection (a)(1)) violated PANY.—For purposes of this section, the term ‘‘(II) at least 1 of such duty stations is lo- section 1001 of title 18, United States Code, ‘‘applicable integrated oil company’’ means cated outside of the Washington, District of or other applicable statutes. an integrated oil company (as defined in sec- Columbia, and Baltimore metropolitan sta- tion 291(b)(4) of the Internal Revenue Code of tistical areas (as defined by the Secretary of SA 2660. Mr. DODD (for himself and 1986) which had gross receipts in excess of Commerce).’’. Ms. MIKULSKI) submitted an amend- $1,000,000,000 for its last taxable year ending (d) CONFORMING AMENDMENT.—The heading ment intended to be proposed by him during calendar year 2005 and which has an for section 121(d)(9) is amended to read as fol- to the bill S. 2020, to provide for rec- average daily worldwide production of crude lows: ‘‘UNIFORMED SERVICES, FOREIGN SERV- onciliation pursuant to section 202(b) oil of at least 250,000 barrels for such taxable ICE, AND INTELLIGENCE COMMUNITY’’. of the concurrent resolution on the (e) EFFECTIVE DATE; SPECIAL RULE.— year. For purposes of this subsection, all per- budget for fiscal year 2006; which was sons treated as a single employer under sub- (1) EFFECTIVE DATE.—The amendments sections (a) and (b) of section 52 of the Inter- made by this section shall take effect as if ordered to lie on the table; as follows: nal Revenue Code of 1986 shall be treated as included in the amendments made by section At the end of title IV, add the following: 1 person and, in the case of a short taxable 312 of the Taxpayer Relief Act of 1997. SEC. 405. MODIFICATION OF TAX RATES ON CAP- year, the rule under section 448(c)(3)(B) shall (2) WAIVER OF LIMITATIONS.—If refund or ITAL GAINS AND DIVIDENDS FOR IN- apply. credit of any overpayment of tax resulting DIVIDUALS WITH $1,000,000 OR MORE from the amendments made by this section OF TAXABLE INCOME. is prevented at any time before the close of (a) MODIFICATION OF TAX RATES ON CAPITAL SA 2657. Mr. ROCKEFELLER (for GAINS AND DIVIDENDS FOR INDIVIDUALS WITH himself, Mr. HATCH, Mr. BOND, Ms. MI- the 1-year period beginning on the date of the enactment of this Act by the operation $1,000,000 OR MORE OF TAXABLE INCOME.— KULSKI, Mr. LOTT, Ms. SNOWE, and Mrs. of any law or rule of law (including res judi- (1) IN GENERAL.—Section 1(h) is amended FEINSTEIN) submitted an amendment cata), such refund or credit may nevertheless by adding at the end the following new para- intended to be proposed by him to the be made or allowed if claim therefor is filed graph: bill S. 2020, to provide for reconcili- before the close of such period. ‘‘(12) MODIFIED RATES FOR INDIVIDUALS WITH ation pursuant to section 202(b) of the $1,000,000 OR MORE OF TAXABLE INCOME.—If a concurrent resolution on the budget for SA 2658. Mr. DAYTON submitted an taxpayer has taxable income of $1,000,000 or more for any taxable year— fiscal year 2006; which was ordered to amendment intended to be proposed by him to the bill S. 2020, to provide for ‘‘(A) paragraph (11) (relating to dividends lie on the table; as follows: taxed as capital gain) shall not apply to any At the end of title IV, insert the following: reconciliation pursuant to section qualified dividend income of the taxpayer for 202(b) of the concurrent resolution on SECTION ll. EXCLUSION OF GAIN FROM SALE the taxable year, and OF A PRINCIPAL RESIDENCE BY the budget for fiscal year 2006; as fol- ‘‘(B) paragraph (1)(C) shall be applied by CERTAIN EMPLOYEES OF THE IN- lows: substituting ‘20 percent’ for ‘15 percent’ with TELLIGENCE COMMUNITY. At the end of the bill add the following: respect to the adjusted net capital gain of (a) IN GENERAL.—Subparagraph (A) of sec- SECTION 1. VALUATION OF EMPLOYEE PER- the taxpayer for the taxable year, deter- tion 121(d)(9) (relating to exclusion of gain SONAL USE OF NONCOMMERCIAL mined by only taking into account gain or from sale of principal residence) is amended AIRCRAFT. loss properly allocable to the portion of the by striking ‘‘duty’’ and all that follows and (a) IN GENERAL.—For purposes of Federal taxable year after December 31, 2005.’’ inserting ‘‘duty— income tax inclusion, the value of any em- (2) APPLICATION TO MINIMUM TAX.—Section ‘‘(i) as a member of the uniformed services, ployee personal use of noncommercial air- 55(b)(3) is amended by adding at the end the ‘‘(ii) as a member of the Foreign Service of craft shall equal the excess (if any) of— following new sentence: ‘‘In the case of a the United States, or (1) greater of— taxpayer with alternative minimum taxable ‘‘(iii) as an employee of the intelligence (A) the fair market value of such use, or income of $1,000,000 or more for any taxable (B) the actual cost of such use (including community.’’. year, the rules of section 1(h)(12) shall apply (b) EMPLOYEE OF INTELLIGENCE COMMUNITY all fixed and variable costs), over (2) any amount paid by or on behalf of such for purposes of this paragraph.’’ DEFINED.—Subparagraph (C) of section employee for such use. (3) EFFECTIVE DATES.— 121(d)(9) is amended by redesignating clause (b) EFFECTIVE DATE.—Subsection (a) shall (A) CAPITAL GAINS.—Section 1(h)(12)(B) of (iv) as clause (v) and by inserting after apply to * * * the Internal Revenue Code of 1986 (as added clause (iii) the following new clause: by paragraph (1)) shall apply to taxable years ‘‘(iv) EMPLOYEE OF INTELLIGENCE COMMU- SA 2659. Mr. LAUTENBERG sub- beginning after December 31, 2005. NITY.—The term ‘employee of the intel- mitted an amendment intended to be (B) DIVIDEND RATES.—Section 1(h)(12)(A) of ligence community’ means an employee (as proposed by him to the bill S. 2020, to such Code (as added by paragraph (1)) shall defined by section 2105 of title 5, United provide for reconciliation pursuant to apply to dividends received after December States Code) of— 31, 2005. ‘‘(I) the Office of the Director of National section 202(b) of the concurrent resolu- (4) APPLICATION OF JGTRRA SUNSET.—The Intelligence, tion on the budget for fiscal year 2006; amendment made by this subsection shall be ‘‘(II) the Central Intelligence Agency, which was ordered to lie on the table; subject to section 303 of the Jobs and Growth ‘‘(III) the National Security Agency, as follows: Tax Relief Reconciliation Act of 2003 to the ‘‘(IV) the Defense Intelligence Agency, At the appropriate place, insert the fol- same extent and in the same manner as the ‘‘(V) the National Geospatial-Intelligence lowing: provision of such Act to which such amend- Agency, SEC. ll. SENSE OF THE SENATE REGARDING ment relates. ‘‘(VI) the National Reconnaissance Office, TESTIMONY OF CERTAIN OIL COM- (b) DEDICATION OF RESULTING REVENUES.— ‘‘(VII) any other office within the Depart- PANY EXECUTIVES. (1) NO CHILD LEFT BEHIND TRUST FUND.— ment of Defense for the collection of special- (a) FINDINGS.—The Senate makes the fol- Subchapter A of chapter 98 (relating to trust ized national intelligence through reconnais- lowing findings: fund code) is amended by adding at the end sance programs, (1) On November 9, 2005, the Senate Com- the following new section: ‘‘(VIII) any of the intelligence elements of mittee on Energy and Natural Resources and ‘‘SEC. 9511. NO CHILD LEFT BEHIND TRUST FUND. the Army, the Navy, the Air Force, the Ma- the Senate Committee on Commerce, ‘‘(a) CREATION OF TRUST FUND.—There is rine Corps, the Federal Bureau of Investiga- Science and Transportation held a joint established in the Treasury of the United tion, the Department of Treasury, the De- hearing on ‘‘Energy Pricing and Profits’’. States a trust fund to be known as the ‘No partment of Energy, and the Coast Guard, (2) The chief executive officers of the 5 Child Left Behind Trust Fund’, consisting of ‘‘(IX) the Bureau of Intelligence and Re- largest oil companies appeared as witnesses any amount appropriated or credited to the search of the Department of State, or at the joint hearing on ‘‘Energy Prices and Trust Fund as provided in this section or ‘‘(X) any of the elements of the Depart- Profits’’. section 9602(b). ment of Homeland Security concerned with (3) Section 1001 of title 18, United States ‘‘(b) TRANSFERS TO TRUST FUND.—There the analyses of foreign intelligence informa- Code, prohibits any ‘‘materially false, ficti- are hereby appropriated to the No Child Left tion.’’. tious, or fraudulent statement or representa- Behind Trust Fund the following amounts (c) SPECIAL RULE.—Subparagraph (C) of tion’’ at a Senate hearing. equivalent to the increased revenues re- section 121(d)(9), as amended by subsection (4) A White House document obtained by ceived in the Treasury as the result of the (b), is amended by adding at the end the fol- The Washington Post contradicts the testi- amendment made by section 405(a) of the lowing new clause: mony of some of these witnesses. Tax Relief Act of 2005: ‘‘(vi) SPECIAL RULE RELATING TO INTEL- (b) SENSE OF THE SENATE.—It is the sense ‘‘(1) In the case of fiscal year 2006, LIGENCE COMMUNITY.—An employee of the in- of the Senate that the Attorney General of $4,085,000,000.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00087 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.180 S17NOPT2 S13234 CONGRESSIONAL RECORD — SENATE November 17, 2005 ‘‘(2) In the case of fiscal year 2007, her to the bill S. 2020, to provide for tion or the payment of any amount to settle $4,543,000,000. reconciliation pursuant to section or avoid the imposition of such penalty shall ‘‘(3) In the case of fiscal year 2008, 202(b) of the concurrent resolution on not be considered an ordinary and necessary $4,725,000,000. the budget for fiscal year 2006; which expense in carrying on a trade or business ‘‘(c) EXPENDITURES FROM TRUST FUND.— for purposes of this title and shall not be de- Amounts in the No Child Left Behind Trust was ordered to lie on the table; as fol- ductible by the person who is subject to such Fund shall be available for fiscal years be- lows: penalty or who makes such payment.’’. ginning after 2005, as provided by appropria- At the end of title IV, insert the following: (b) CONFORMING AMENDMENT.—Section tion Acts, to carry out programs under the SEC. ll. SENSE OF THE SENATE REGARDING 6700(a) is amended by striking the last sen- Elementary and Secondary Education Act of THE DEDICATION OF EXCESS FUNDS tence. 1965 in accordance with the provisions of, . (c) EFFECTIVE DATE.—The amendments and amendments made by, the No Child Left It is the sense of the Senate that any in- made by this section shall apply to activities Behind Act of 2001.’’. creases in revenues to the Treasury as a re- after the date of the enactment of this Act. (2) MILITARY RESTORATION TRUST FUND.— sult of this Act and the amendments made SEC. 505. PENALTY FOR AIDING AND ABETTING Subchapter A of chapter 98 (relating to trust by this Act that exceed the amounts speci- THE UNDERSTATEMENT OF TAX LI- fund code), as amended by paragraph (1), is fied in the reconciliation instructions shall ABILITY. amended by adding at the end the following be dedicated to the Low-Income Home En- (a) IN GENERAL.—Section 6701(a) (relating new section: ergy Assistance Program, in an amount not to imposition of penalty) is amended— ‘‘SEC. 9512. MILITARY RESTORATION TRUST to exceed the amount which is $2,900,000,000 (1) by striking ‘‘preparation or presen- FUND. more than the funding levels established for tation of’’ and inserting ‘‘tax liability re- ‘‘(a) CREATION OF TRUST FUND.—There is such Program for fiscal year 2005. flected in’’ in paragraph (1), established in the Treasury of the United (2) by inserting ‘‘aid, assistance, procure- States a trust fund to be known as the ‘Mili- SA 2663. Mr. HATCH submitted an ment, or advice with respect to such’’ before tary Restoration Trust Fund’, consisting of amendment intended to be proposed by ‘‘portion’’ both places it appears in para- any amount appropriated or credited to the him to the bill S. 2020, to provide for graphs (2) and (3), and (3) by inserting ‘‘instance of aid, assist- Trust Fund as provided in this section or reconciliation pursuant to section section 9602(b). ance, procurement, or advice or each such’’ ‘‘(b) TRANSFERS TO TRUST FUND.—There 202(b) of the concurrent resolution on before ‘‘document’’ in the matter following are hereby appropriated to the Military Res- the budget for fiscal year 2006; which paragraph (3). toration Trust Fund the following amounts was ordered to lie on the table; as fol- (b) AMOUNT OF PENALTY.—Subsection (b) of equivalent to the increased revenues re- lows: section 6701 (relating to penalties for aiding ceived in the Treasury as the result of the On page 84, strike lines 20 through 25, and and abetting understatement of tax liability) amendment made by section 405(a) of the on page 85, strike lines 1 through 5. is amended to read as follows: Tax Relief Act of 2005: ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF ‘‘(1) In the case of fiscal year 2006, SA 2664. Mr. LEVIN submitted an PENALTY; LIABILITY FOR PENALTY.— ‘‘(1) AMOUNT OF PENALTY.—The amount of $4,085,000,000. amendment intended to be proposed by ‘‘(2) In the case of fiscal year 2007, the penalty imposed by subsection (a) shall $4,543,000,000. him to the bill S. 2020, to provide for not exceed the greater of— ‘‘(3) In the case of fiscal year 2008, reconciliation pursuant to section ‘‘(A) 100 percent of the gross income de- $4,725,000,000. 202(b) of the concurrent resolution on rived (or to be derived) from such aid, assist- ‘‘(c) EXPENDITURES FROM TRUST FUND.— the budget for fiscal year 2006; which ance, procurement, or advice provided by the Amounts in the Military Restoration Trust was ordered to lie on the table; as fol- person or persons subject to such penalty, Fund shall be available for fiscal years be- lows: and ginning after 2005, as provided by appropria- ‘‘(B) if readily subject to calculation, the At the end of subtitle A of title V, add the tion Acts, to replenish equipment and vehi- total amount of underpayment by the tax- following: cle stocks of the Marine Corps and the Army payer (including penalties, interest, and (including the National Guard and Reserve) SEC. 504. PENALTY FOR PROMOTING ABUSIVE taxes) in connection with the understate- that have been damaged or destroyed as a re- TAX SHELTERS. ment of the liability for tax. sult of Operation Iraqi Freedom and Oper- (a) PENALTY FOR PROMOTING ABUSIVE TAX ‘‘(2) CALCULATION OF PENALTY.—The pen- ation Enduring Freedom.’’. SHELTERS.—Section 6700 (relating to pro- alty amount determined under paragraph (1) (3) CLERICAL AMENDMENTS.—The table of moting abusive tax shelters, etc.) is amend- shall be calculated with respect to each in- sections for such subchapter is amended by ed— stance of aid, assistance, procurement, or ad- adding at the end the following new items: (1) by redesignating subsections (b) and (c) vice described in subsection (a), each in- as subsections (d) and (e), respectively, ‘‘Sec. 9511. No Child Left Behind Trust stance in which income was derived by the (2) by striking ‘‘a penalty’’ and all that fol- Fund. person or persons subject to such penalty, ‘‘Sec. 9512. Military Restoration Trust lows through the period in the first sentence and each person who made such an under- Fund.’’. of subsection (a) and inserting ‘‘a penalty de- statement of the liability for tax. termined under subsection (b)’’, and ‘‘(3) LIABILITY FOR PENALTY.—If more than SA 2661. Mr. DAYTON submitted an (3) by inserting after subsection (a) the fol- 1 person is liable under subsection (a) with amendment intended to be proposed by lowing new subsections: respect to providing such aid, assistance, him to the bill S. 2020, to provide for ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF procurement, or advice, all such persons PENALTY; LIABILITY FOR PENALTY.— shall be jointly and severally liable for the reconciliation pursuant to section ‘‘(1) AMOUNT OF PENALTY.—The amount of 202(b) of the concurrent resolution on penalty under such subsection.’’. the penalty imposed by subsection (a) shall (c) PENALTY NOT DEDUCTIBLE.—Section 6701 the budget for fiscal year 2006; which not exceed the greater of— is amended by adding at the end the fol- was ordered to lie on the table; as fol- ‘‘(A) 100 percent of the gross income de- lowing new subsection: lows: rived (or to be derived) from such activity by ‘‘(g) PENALTY NOT DEDUCTIBLE.—The pay- On page 235, between lines 13 and 14, insert the person or persons subject to such pen- ment of any penalty imposed under this sec- the following: alty, and tion or the payment of any amount to settle SEC. ll. VALUATION OF EMPLOYEE PERSONAL ‘‘(B) if readily subject to calculation, the or avoid the imposition of such penalty shall USE OF NONCOMMERCIAL AIR- total amount of underpayment by the tax- not be considered an ordinary and necessary CRAFT. payer (including penalties, interest, and expense in carrying on a trade or business (a) IN GENERAL.—For purposes of Federal taxes) in connection with such activity. for purposes of this title and shall not be de- income tax inclusion, the value of any em- ‘‘(2) CALCULATION OF PENALTY.—The pen- ductible by the person who is subject to such ployee personal use of noncommercial air- alty amount determined under paragraph (1) penalty or who makes such payment.’’. craft shall equal the excess (if any) of— shall be calculated with respect to each in- (d) EFFECTIVE DATE.—The amendments (1) greater of— stance of an activity described in subsection made by this section shall apply to activities (A) the fair market value of such use, or (a), each instance in which income was de- after the date of the enactment of this Act. (B) the actual cost of such use (including rived by the person or persons subject to all fixed and variable costs), over such penalty, and each person who partici- SA 2665. Mr. HARKIN (for himself (2) any amount paid by or on behalf of such pated in such an activity. and Mr. OBAMA) submitted an amend- employee for such use. ‘‘(3) LIABILITY FOR PENALTY.—If more than ment intended to be proposed by him (b) EFFECTIVE DATE.—Subsection (a) shall 1 person is liable under subsection (a) with to the bill S. 2020, to provide for rec- apply to use after the date of the enactment respect to such activity, all such persons of this Act. shall be jointly and severally liable for the onciliation pursuant to section 202(b) penalty under such subsection. of the concurrent resolution on the SA 2662. Ms. COLLINS submitted an ‘‘(c) PENALTY NOT DEDUCTIBLE.—The pay- budget for fiscal year 2006; as follows: amendment intended to be proposed by ment of any penalty imposed under this sec- At the end of title IV, add the following:

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SEC. ll. RESTORATION OF THE PHASEOUT OF ‘‘(2) ANNUAL CREDIT.—The annual credit de- waste, biomass, raw commodities, or wind as PERSONAL EXEMPTIONS AND THE termined with respect to any rural renais- a fuel, OVERALL LIMITATION ON ITEMIZED sance bond is the product of— ‘‘(v) a distance learning or telemedicine DEDUCTION; REDUCTION IN INCOME ‘‘(A) the credit rate determined by the Sec- project, THRESHOLD USED TO CALCULATE REFUNDABLE PORTION OF CHILD retary under paragraph (3) for the day on ‘‘(vi) a rural utility infrastructure project, TAX CREDIT. which such bond was sold, multiplied by including any electric or telephone system, ‘‘(vii) a project to expand broadband tech- (a) RESTORATION OF THE PHASEOUT OF PER- ‘‘(B) the outstanding face amount of the nology, SONAL EXEMPTIONS AND THE OVERALL LIMITA- bond. ‘‘(viii) a rural teleworks project, and TION ON ITEMIZED DEDUCTIONS.— ‘‘(3) DETERMINATION.—For purposes of para- ‘‘(ix) any project described in any pre- (1) RESTORATION OF PHASEOUT OF PERSONAL graph (2), with respect to any rural renais- ceding clause carried out by the Delta Re- EXEMPTIONS.— sance bond, the Secretary shall determine gional Authority. (A) IN GENERAL.—Paragraph (3) of section daily or caused to be determined daily a ‘‘(C) SPECIAL RULES.—For purposes of this 151(d) (relating to exemption amount) is credit rate which shall apply to the first day paragraph— amended by striking subparagraphs (E) and on which there is a binding, written contract ‘‘(i) any project described in subparagraph (F). for the sale or exchange of the bond. The (B)(iv) for a farmer-owned entity may be (B) EFFECTIVE DATE.—The amendment credit rate for any day is the credit rate considered a qualified project if such entity made by this paragraph shall apply to tax- which the Secretary or the Secretary’s des- is located in a rural area, or in the case of a able years beginning after December 31, 2005. ignee estimates will permit the issuance of farmer-owned entity the headquarters of (2) RESTORATION OF PHASEOUT OF OVERALL rural renaissance bonds with a specified ma- which are located in a nonrural area, if the LIMITATION ON ITEMIZED DEDUCTIONS.— turity or redemption date without discount project is located in a rural area, and (A) IN GENERAL.—Section 68 is amended by and without interest cost to the qualified issuer. ‘‘(ii) any project for a farmer-owned entity striking subsections (f) and (g). which is a facility described in subparagraph (B) EFFECTIVE DATE.—The amendment ‘‘(4) CREDIT ALLOWANCE DATE.—For pur- poses of this section, the term ‘credit allow- (B)(iv) for agricultural producers may be made by this paragraph shall apply to tax- considered a qualified project regardless of able years beginning after December 31, 2005. ance date’ means— ‘‘(A) March 15, whether the facility is located in a rural or (b) REDUCTION IN INCOME THRESHOLD USED ‘‘(B) June 15, nonrural area. TO CALCULATE REFUNDABLE PORTION OF CHILD ‘‘(C) September 15, and ‘‘(3) SPECIAL USE RULES.— TAX CREDIT.— ‘‘(D) December 15. ‘‘(A) REFINANCING RULES.—For purposes of (1) IN GENERAL.—Section 24(d) (relating to paragraph (1)(B), a qualified project may be portion of credit refundable) is amended— Such term also includes the last day on refinanced with proceeds of a rural renais- (A) by striking ‘‘as exceeds’’ and all that which the bond is outstanding. sance bond only if the indebtedness being re- follows through ‘‘, or’’ in paragraph (1)(B)(i) ‘‘(5) SPECIAL RULE FOR ISSUANCE AND RE- financed (including any obligation directly and inserting ‘‘as exceeds $9,000 (or $10,000 in DEMPTION.—In the case of a bond which is or indirectly refinanced by such indebted- the case of taxable years beginning in 2006), issued during the 3-month period ending on a ness) was originally incurred after the date or’’, credit allowance date, the amount of the of the enactment of this section. (B) by striking ‘‘2001, the $10,000 amount’’ credit determined under this subsection with ‘‘(B) REIMBURSEMENT.—For purposes of in paragraph (3) and inserting ‘‘2006, the respect to such credit allowance date shall paragraph (1)(B), a rural renaissance bond $9,000 amount’’, and be a ratable portion of the credit otherwise may be issued to reimburse a borrower for (C) by striking ‘‘2000’’ in paragraph (3)(B) determined based on the portion of the 3- amounts paid after the date of the enact- and inserting ‘‘2005’’. month period during which the bond is out- ment of this section with respect to a quali- (2) EFFECTIVE DATE.—The amendments standing. A similar rule shall apply when the fied project, but only if— made by this subsection shall apply to tax- bond is redeemed or matures. ‘‘(i) prior to the payment of the original able years beginning after December 31, 2005. ‘‘(c) LIMITATION BASED ON AMOUNT OF expenditure, the borrower declared its intent (3) APPLICATION OF SUNSET TO THIS SEC- TAX.—The credit allowed under subsection to reimburse such expenditure with the pro- TION.—Each amendment made by this sub- (a) for any taxable year shall not exceed the ceeds of a rural renaissance bond, section shall be subject to title IX of the excess of— ‘‘(ii) not later than 60 days after payment Economic Growth and Tax Relief Reconcili- ‘‘(1) the sum of the regular tax liability (as of the original expenditure, the qualified ation Act of 2001 to the same extent and in defined in section 26(b)) plus the tax imposed issuer adopts an official intent to reimburse the same manner as the provision of such by section 55, over the original expenditure with such proceeds, Act to which such amendment relates. ‘‘(2) the sum of the credits allowable under and this part (other than subpart C thereof, re- ‘‘(iii) the reimbursement is made not later SA 2666. Mr. PRYOR (for himself and lating to refundable credits). than 18 months after the date the original ‘‘(d) RURAL RENAISSANCE BOND.—For pur- Mr. COLEMAN) submitted an amend- expenditure is paid. poses of this section— ment intended to be proposed by him ‘‘(C) TREATMENT OF CHANGES IN USE.—For ‘‘(1) IN GENERAL.—The term ‘rural renais- purposes of paragraph (1)(B), the proceeds of to the bill S. 2020, to provide for rec- sance bond’ means any bond issued as part of an issue shall not be treated as used for a onciliation pursuant to section 202(b) an issue if— qualified project to the extent that a bor- of the concurrent resolution on the ‘‘(A) the bond is issued by a qualified rower takes any action within its control budget for fiscal year 2006; which was issuer, which causes such proceeds not to be used ordered to lie on the table; as follows: ‘‘(B) 95 percent or more of the proceeds for a qualified project. The Secretary shall from the sale of such issue are to be used for At the appropriate place, insert the fol- prescribe regulations specifying remedial ac- capital expenditures incurred for 1 or more lowing: tions that may be taken (including condi- qualified projects, tions to taking such remedial actions) to SEC. ll. CREDIT TO HOLDERS OF RURAL REN- ‘‘(C) the qualified issuer designates such prevent an action described in the preceding AISSANCE BONDS. bond for purposes of this section and the sentence from causing a bond to fail to be a (a) IN GENERAL.—Subpart H of part IV of bond is in registered form, and rural renaissance bond. subchapter A of chapter 1 (relating to credits ‘‘(D) the issue meets the requirements of ‘‘(e) MATURITY LIMITATIONS.— against tax) is amended by adding at the end subsections (e) and (h). ‘‘(1) DURATION OF TERM.—A bond shall not the following new section: ‘‘(2) QUALIFIED PROJECT; SPECIAL USE be treated as a rural renaissance bond if the ‘‘SEC. 54A. CREDIT TO HOLDERS OF RURAL REN- RULES.— maturity of such bond exceeds the maximum AISSANCE BONDS. ‘‘(A) IN GENERAL.—The term ‘qualified term determined by the Secretary under ‘‘(a) ALLOWANCE OF CREDIT.—In the case of project’ means 1 or more projects described paragraph (2) with respect to such bond. a taxpayer who holds a rural renaissance in subparagraph (B) located in a rural area. ‘‘(2) MAXIMUM TERM.—During each calendar bond on a credit allowance date of such bond, ‘‘(B) PROJECTS DESCRIBED.—A project de- month, the Secretary shall determine the which occurs during the taxable year, there scribed in this subparagraph is— maximum term permitted under this para- shall be allowed as a credit against the tax ‘‘(i) a water or waste treatment project, graph for bonds issued during the following imposed by this chapter for such taxable ‘‘(ii) an affordable housing project, calendar month. Such maximum term shall year an amount equal to the sum of the cred- ‘‘(iii) a community facility project, includ- be the term which the Secretary estimates its determined under subsection (b) with re- ing hospitals, fire and police stations, and will result in the present value of the obliga- spect to credit allowance dates during such nursing and assisted-living facilities, tion to repay the principal on the bond being year on which the taxpayer holds such bond. ‘‘(iv) a value-added agriculture or renew- equal to 50 percent of the face amount of ‘‘(b) AMOUNT OF CREDIT.— able energy facility project for agricultural such bond. Such present value shall be deter- ‘‘(1) IN GENERAL.—The amount of the credit producers or farmer-owned entities, includ- mined without regard to the requirements of determined under this subsection with re- ing any project to promote the production, subsection (f)(3) and using as a discount rate spect to any credit allowance date for a rural processing, or retail sale of ethanol (includ- the average annual interest rate of tax-ex- renaissance bond is 25 percent of the annual ing fuel at least 85 percent of the volume of empt obligations having a term of 10 years or credit determined with respect to such bond. which consists of ethanol), biodiesel, animal more which are issued during the month. If

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the term as so determined is not a multiple ‘‘(2) USER FEE REQUIREMENT.—The require- ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not of a whole year, such term shall be rounded ment of this paragraph is met if the issuer of apply to any payment— to the next highest whole year. any rural rennaissance bond makes grants ‘‘(A) except as provided in subparagraph ‘‘(3) RATABLE PRINCIPAL AMORTIZATION RE- for qualified projects as defined under sub- (B), which is subject to withholding under QUIRED.—A bond shall not be treated as a section (d)(2) on a semi-annual basis every any other provision of this chapter or chap- rural renaissance bond unless it is part of an year that such bond is outstanding in an an- ter 3, issue which provides for an equal amount of nual amount equal to one-half of the rate on ‘‘(B) which is subject to withholding under principal to be paid by the qualified issuer United States Treasury Bills of the same ma- section 3406 and from which amounts are during each calendar year that the issue is turity multiplied by the outstanding prin- being withheld under such section, outstanding. ciple balance of rural rennaissance bonds ‘‘(C) of interest, ‘‘(f) LIMITATION ON AMOUNT OF BONDS DES- issued by such issuer. ‘‘(D) for real property, IGNATED.— ‘‘(k) SPECIAL RULES RELATING TO POOL ‘‘(E) to any tax-exempt entity, foreign gov- ‘‘(1) NATIONAL LIMITATION.—There is a rural BONDS.—No portion of a pooled financing ernment, or other entity subject to the re- renaissance bond limitation of $200,000,000. bond may be allocable to loan unless the bor- quirements of paragraph (1), ‘‘(2) ALLOCATION BY SECRETARY.—The Sec- rower has entered into a written loan com- ‘‘(F) made pursuant to a classified or con- retary shall allocate the amount described in mitment for such portion prior to the issue fidential contract (as defined in section paragraph (1) among qualified issuers in such date of such issue. 6050M(e)(3)), and manner as the Secretary determines appro- ‘‘(l) OTHER DEFINITIONS AND SPECIAL ‘‘(G) made by a political subdivision of a priate. RULES.—For purposes of this section— State (or any instrumentality thereof) which ‘‘(g) CREDIT INCLUDED IN GROSS INCOME.— ‘‘(1) BOND.—The term ‘bond’ includes any makes less than $100,000,000 of such payments Gross income includes the amount of the obligation. annually. credit allowed to the taxpayer under this ‘‘(2) POOLED FINANCING BOND.—The term ‘‘(3) COORDINATION WITH OTHER SECTIONS.— section (determined without regard to sub- ‘pooled financing bond’ shall have the mean- For purposes of sections 3403 and 3404 and for section (c)) and the amount so included shall ing given such term by section 149(f)(4)(A). purposes of so much of subtitle F (except sec- be treated as interest income. ‘‘(3) RURAL AREA.—The term ‘rural area’ tion 7205) as relates to this chapter, pay- ‘‘(h) SPECIAL RULES RELATING TO EXPENDI- means any area other than— ments to any person of any payment for TURES.— ‘‘(A) a city or town which has a population goods and services which is subject to with- ‘‘(1) IN GENERAL.—An issue shall be treated of greater than 50,000 inhabitants, or holding shall be treated as if such payments as meeting the requirements of this sub- ‘‘(B) the urbanized area contiguous and ad- were wages paid by an employer to an em- section if, as of the date of issuance, the jacent to such a city or town. ployee.’’. qualified issuer reasonably expects— ‘‘(4) PARTNERSHIP; S CORPORATION; AND (2) EFFECTIVE DATE.—The amendment ‘‘(A) at least 95 percent of the proceeds OTHER PASS-THRU ENTITIES.— made by this subsection shall apply to pay- from the sale of the issue are to be spent for ‘‘(A) IN GENERAL.—Under regulations pre- ments made after December 31, 2005. 1 or more qualified projects within the 5-year scribed by the Secretary, in the case of a (b) LOW INCOME HOME ENERGY ASSISTANCE period beginning on the date of issuance of partnership, trust, S corporation, or other TRUST FUND.— the rural renaissance bond, pass-thru entity, rules similar to the rules of (1) IN GENERAL.—Subchapter A of chapter ‘‘(B) a binding commitment with a third section 41(g) shall apply with respect to the 98 (relating to trust fund code) is amended by party to spend at least 10 percent of the pro- credit allowable under subsection (a). adding at the end the following new section: ceeds from the sale of the issue will be in- ‘‘(B) NO BASIS ADJUSTMENT.—In the case of ‘‘SEC. 9511. LOW-INCOME HOME ENERGY ASSIST- curred within the 6-month period beginning a bond held by a partnership or an S corpora- ANCE TRUST FUND. on the date of issuance of the rural renais- tion, rules similar to the rules under section ‘‘(a) CREATION OF TRUST FUND.—There is sance bond or, in the case of a rural renais- 1397E(i) shall apply. established in the Treasury of the United sance bond, the proceeds of which are to be ‘‘(5) BONDS HELD BY REGULATED INVESTMENT States a trust fund to be known as the ‘Low- loaned to 2 or more borrowers, such binding COMPANIES.—If any rural renaissance bond is Income Home Energy Assistance Trust commitment will be incurred within the 6- held by a regulated investment company, the Fund’, consisting of any amount appro- month period beginning on the date of the credit determined under subsection (a) shall priated or credited to the Trust Fund as pro- loan of such proceeds to a borrower, and be allowed to shareholders of such company vided in this section or section 9602(b). ‘‘(C) such projects will be completed with under procedures prescribed by the Sec- ‘‘(b) TRANSFERS TO TRUST FUND.—There due diligence and the proceeds from the sale retary. are hereby appropriated to the Low-Income of the issue will be spent with due diligence. ‘‘(6) REPORTING.—Issuers of rural renais- Home Energy Assistance Trust Fund ‘‘(2) EXTENSION OF PERIOD.—Upon submis- sance bonds shall submit reports similar to amounts equivalent to the increased reve- sion of a request prior to the expiration of the reports required under section 149(e).’’. nues received in the Treasury as the result of the period described in paragraph (1)(A), the (b) REPORTING.—Subsection (d) of section the amendment made by section 410(a) of the Secretary may extend such period if the 6049 (relating to returns regarding payments Tax Relief Act of 2005. qualified issuer establishes that the failure of interest) is amended by adding at the end ‘‘(c) EXPENDITURES FROM TRUST FUND.— to satisfy the 5-year requirement is due to the following new paragraph: Amounts in the Low Income Home Energy reasonable cause and the related projects ‘‘(9) REPORTING OF CREDIT ON RURAL RENAIS- Assistance Trust Fund not to exceed will continue to proceed with due diligence. SANCE BONDS.— $2,920,000,000 shall be available for fiscal year ‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT OF 2006, as provided by appropriation Acts, to BOND PROCEEDS WITHIN 5 YEARS.—To the ex- SA 2667. Ms. SNOWE (for herself, Mr. carry out the program under the Low-In- tent that less than 95 percent of the proceeds BINGAMAN, Ms. COLLINS, and Mr. REED) come Home Energy Assistance Act of 1981 of such issue are expended by the close of the proposed an amendment to the bill S. through the distribution of funds to all the 5-year period beginning on the date of 2020, to provide for reconciliation pur- States in accordance with section 2604 of issuance (or if an extension has been ob- suant to section 202(b) of the concur- that Act (42 U.S.C. 8623) (other than sub- tained under paragraph (2), by the close of section (e) of such section), but only if not the extended period), the qualified issuer rent resolution on the budget for fiscal less than $1,880,000,000 has been appropriated shall redeem all of the nonqualified bonds year 2006; as follows: for such program for such fiscal year.’’. within 90 days after the end of such period. At the end of title IV add the following: (2) CLERICAL AMENDMENT.—The table of For purposes of this paragraph, the amount SEC. ll. IMPOSITION OF WITHHOLDING ON CER- sections for such subchapter is amended by of the nonqualified bonds required to be re- TAIN PAYMENTS MADE BY GOVERN- adding at the end the following new item: deemed shall be determined in the same MENT ENTITIES AND FUNDING OF ‘‘Sec. 9511. Low-Income Home Energy As- LIHEAP TRUST FUND. manner as under section 142. sistance Trust Fund.’’. (a) IMPOSITION OF WITHHOLDING ON CERTAIN ‘‘(i) SPECIAL RULES RELATING TO ARBI- (c) EFFECTIVE DATES.— PAYMENTS MADE BY GOVERNMENT ENTITIES.— TRAGE.—A bond which is part of an issue (1) IN GENERAL.—The amendments made by shall not be treated as a rural renaissance (1) IN GENERAL.—Section 3402 is amended subsection (a) shall take effect as if included bond unless, with respect to the issue of by adding at the end the following new sub- in the enactment of the American Jobs Cre- which the bond is a part, the qualified issuer section: ation Act of 2004. satisfies the arbitrage requirements of sec- ‘‘(t) EXTENSION OF WITHHOLDING TO CERTAIN (2) SUBSECTION (b).—The amendments made PAYMENTS MADE BY GOVERNMENT ENTITIES.— tion 148 with respect to proceeds of the issue. by subsection (b) shall take effect on the ‘‘(j) QUALIFIED ISSUER.—For purposes of ‘‘(1) GENERAL RULE.—The Government of date of the enactment of this Act. this section— the United States, every State, every polit- ‘‘(1) IN GENERAL.—The term ‘qualified ical subdivision thereof, and every instru- SA 2668. Mr. DORGAN submitted an issuer’ means any not-for-profit cooperative mentality of the foregoing (including multi- amendment intended to be proposed by lender which has as of the date of the enact- State agencies) making any payment for ment of this section received a guarantee goods and services which is subject to with- him to the bill S. 2020, to provide for under section 306 of the Rural Electrification holding shall deduct and withhold form such reconciliation pursuant to section Act and which meets the requirement of payment a tax in an amount equal to 1.75 202(b) of the concurrent resolution on paragraph (2). percent of such payment. the budget for fiscal year 2006; which

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00090 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.191 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13237 was ordered to lie on the table; as fol- (e) APPLICATION OF SECTION.—This section ‘‘(B) QUALIFIED CONSERVATION CONTRIBU- lows: shall apply to lodging provided— TIONS BY CERTAIN CORPORATE FARMERS AND (1) after the date of the enactment of this RANCHERS.— At the end of title IV, insert the following: Act, and ‘‘(i) IN GENERAL.—Any qualified conserva- SEC. ll. REPEAL OF REDUCTION IN CREDIT (2) before the date which is 6 months after tion contribution (as defined in subsection FOR QUALIFIED ELECTRIC VEHI- the date of the enactment of this Act, and (h)(1)) made— CLES. (3) no credit with respect to such lodging ‘‘(I) by a corporation which, for the taxable (a) IN GENERAL.—Section 30(b) (relating to shall be claimed before October 1, 2006. year during which the contribution is made, limitations on credit for qualified electric is a qualified farmer or rancher (as defined in vehicles) is amended by striking paragraph SA 2670. Mr. GRASSLEY (for himself paragraph (1)(E)(iv)(II)) and the stock of (2) and by redesignating paragraph (3) as and Mr. BAUCUS) proposed an amend- which is not readily tradable on an estab- paragraph (2). ment to the bill S. 2020, to provide for lished securities market at any time during (b) EFFECTIVE DATE.—The amendments such year, and made by this section shall apply to vehicles reconciliation pursuant to section ‘‘(II) to an organization described in para- placed in service after December 31, 2005. 202(b) of the concurrent resolution on the budget for fiscal year 2006; as fol- graph (1)(A), SA 2669. Ms. LANDRIEU (for herself lows: shall be allowed to the extent the aggregate of such contributions does not exceed the ex- and Mr. VITTER) proposed an amend- On page 82, between lines 20 and 21, insert the following: cess of the taxpayer’s taxable income over ment to the bill S. 2020, to provide for the amount of charitable contributions al- reconciliation pursuant to section SEC. 224. EXTENSION OF FULL CREDIT FOR QUALIFIED ELECTRIC VEHICLES. lowable under subparagraph (A). 202(b) of the concurrent resolution on ‘‘(ii) CARRYOVER.—If the aggregate amount (a) IN GENERAL.—Section 30(b) (relating to the budget for fiscal year 2006; as fol- limitations) is amended by striking para- of contributions described in clause (i) ex- lows: graph (2) and by redesignating paragraph (3) ceeds the limitation of clause (i), such excess On page 35, between lines 16 and 17, insert as paragraph (2). shall be treated (in a manner consistent with the following: (b) EFFECTIVE DATE.—The amendments the rules of subsection (d)(2)) as a charitable contribution to which clause (i) applies in SEC. 104. HOUSING RELIEF FOR INDIVIDUALS AF- made by subsection (a) shall apply to taxable FECTED BY HURRICANE KATRINA. years beginning after December 31, 2005. each of the 15 succeeding years in order of (a) EXCLUSION OF EMPLOYER PROVIDED On page 107, between lines 4 and 5, insert time. AXABLE INCOME HOUSING FOR INDIVIDUAL AFFECTED BY HURRI- the following: ‘‘(C) T .—For purposes of CANE KATRINA.— SEC. 307. ENCOURAGEMENT OF CONTRIBUTIONS this paragraph, taxable income shall be com- OF CAPITAL GAIN REAL PROPERTY (1) IN GENERAL.—For purposes of the Inter- puted without regard to— MADE FOR CONSERVATION PUR- nal Revenue Code of 1986, gross income of a ‘‘(i) this section, POSES. ‘‘(ii) part VIII (except section 248), qualified employee shall not include the (a) IN GENERAL.— value of any lodging furnished to such em- ‘‘(iii) any net operating loss carrryback to (1) INDIVIDUALS.—Paragraph (1) of sub- the taxable year under section 172, ployee, such employee’s spouse, or any of section 170(b) (relating to percentage limita- such employee’s dependents by or on behalf ‘‘(iv) section 199, and tions) is amended by redesignating subpara- ‘‘(v) any capital loss carryback to the tax- of a qualified employer for any month during graphs (E) and (F) as subparagraphs (F) and the taxable year. able year under section 1212(a)(1).’’. (G), respectively, and by inserting after sub- (b) CONFORMING AMENDMENTS.— (2) LIMITATION.—The amount which may be paragraph (D) the following new subpara- (1) The second sentence of clause (i) of sec- excluded under subsection (a) for any month graph: tion 170(b)(1)(C) is amended by striking ‘‘sub- for which lodging is furnished during the ‘‘(E) CONTRIBUTIONS OF QUALIFIED CON- paragraph (D)’’ and inserting ‘‘subparagraph taxable year shall not exceed $600. SERVATION CONTRIBUTIONS.— (D) or (E)’’. (3) TREATMENT OF EXCLUSION.—For pur- ‘‘(i) IN GENERAL.—Any qualified conserva- (2) Clause (i) of section 170(b)(1)(D) is poses of the Internal Revenue Code of 1986 tion contribution (as defined in subsection amended by striking ‘‘subparagraph (A)’’ and (other than sections 3121(a)(19) and (h)(1)) to an organization described in sub- inserting ‘‘subparagraphs (A) or (E)’’. 3306(b)(14), an exclusion under subsection (a) paragraph (A) shall be allowed to the extent (3) Paragraph (2) of section 170(d) is amend- shall be treated as an exclusion under sec- the aggregate of such contributions does not ed by striking ‘‘subsection (b)(2)’’ each place tion 119 of such Code. exceed the excess of 50 percent of the tax- it appears and inserting ‘‘subsection (b) EMPLOYER CREDIT FOR HOUSING EMPLOY- payer’s contribution base over the amount of (b)(2)(A)’’. EES AFFECTED BY HURRICANE KATRINA.— all other charitable contributions allowable (4) Section 545(b)(2) is amended by striking (1) IN GENERAL.—In the case of a qualified under this paragraph. employer, there shall be allowed as a credit ‘‘and (D)’’ and inserting ‘‘(D), and (E)’’. ‘‘(ii) CARRYOVER.—If the aggregate amount (c) EFFECTIVE DATE.—The amendments against the tax imposed by chapter 1 of the of contributions described in clause (i) ex- made by this section shall apply to contribu- Internal Revenue Code of 1986 for any month ceeds the limitation of clause (i), such excess tions made in taxable years beginning after during the taxable year an amount equal to shall be treated (in a manner consistent with December 31, 2005, and before January 1, 2008. 30 percent of any amount which is excludable the rules of subsection (d)(1)) as a charitable SEC. 308. ENHANCED DEDUCTION FOR CHARI- from the gross income of a qualified em- contribution to which clause (i) applies in TABLE CONTRIBUTION OF LIT- ployee of such employer under subsection each of the 15 succeeding years in order of ERARY, MUSICAL, ARTISTIC, AND (a). time. SCHOLARLY COMPOSITIONS. (2) CERTAIN RULES TO APPLY.—For purposes ‘‘(iii) COORDINATION WITH OTHER SUBPARA- (a) IN GENERAL.—Subsection (e) of section of this section, rules similar to the rules of GRAPHS.—For purposes of applying this sub- 170 (relating to certain contributions of ordi- section 280C(a) of such Code shall apply. section and subsection (d)(1), contributions nary income and capital gain property), as (3) CREDIT TO BE PART OF GENERAL BUSINESS described in clause (i) shall not be treated as amended by this section 33 of this Act, is CREDIT.—The credit allowed under this sec- described in subparagraph (A), (B), (C), or amended by adding at the end the following tion shall be added to the current year busi- (D). new paragraph: ness credit under section 38(b) of such Code ‘‘(iv) QUALIFIED FARMER OR RANCHER.— ‘‘(18) SPECIAL RULE FOR CERTAIN CONTRIBU- and shall be treated as a credit allowed ‘‘(I) IN GENERAL.—If the individual is a TIONS OF LITERARY, MUSICAL, ARTISTIC, OR under subpart D of part IV of subchapter A of qualified farmer or rancher for the taxable SCHOLARLY COMPOSITIONS.— such Code. year in which the contribution is made, ‘‘(A) IN GENERAL.—In the case of a qualified (c) QUALIFIED EMPLOYEE.—For purposes of clause (i) shall be applied by substituting ‘100 artistic charitable contribution— this section, the term ‘‘qualified employee’’ percent’ for ‘50 percent’. ‘‘(i) the amount of such contribution taken means, with respect to any month, an indi- ‘‘(II) DEFINITION.—For purposes of sub- into account under this section shall be the vidual— clause (I), the term ‘qualified farmer or fair market value of the property contrib- (1) who had a principal residence (as de- rancher’ means a taxpayer whose gross in- uted (determined at the time of such con- fined in section 121 of the Internal Revenue come from the trade or business of farming tribution), and Code of 1986) in the go zone (as defined in sec- (within the meaning of section 2032A(e)(5)) is ‘‘(ii) no reduction in the amount of such tion 1400N(1) of such Code) on August 28, 2005, greater than 50 percent of the taxpayer’s contribution shall be made under paragraph and gross income for the taxable year.’’. (1). (2) who performs not less than 80 percent of (2) CORPORATIONS.—Paragraph (2) of sec- ‘‘(B) QUALIFIED ARTISTIC CHARITABLE CON- the employment services for a qualified em- tion 170(b) is amended to read as follows: TRIBUTION.—For purposes of this paragraph, ployer in the Hurricane Katrina disaster ‘‘(2) CORPORATIONS.—In the case of a cor- the term ‘qualified artistic charitable con- area (as so defined). poration— tribution’ means a charitable contribution of (d) QUALIFIED EMPLOYER.—For purposes of ‘‘(A) IN GENERAL.—The total deductions any literary, musical, artistic, or scholarly this section, the term ‘‘qualified employer’’ under subsection (a) for any taxable year composition, or similar property, or the means any employer with a trade or business (other than for contributions to which sub- copyright thereon (or both), but only if— located in the Hurricane Katrina disaster paragraph (B) applies) shall not exceed 10 ‘‘(i) such property was created by the per- area (as so defined). percent of the taxpayer’s taxable income. sonal efforts of the taxpayer making such

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00091 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.191 S17NOPT2 S13238 CONGRESSIONAL RECORD — SENATE November 17, 2005 contribution no less than 18 months prior to ‘‘SEC. 139B. MILEAGE REIMBURSEMENTS TO tions made in taxable years beginning after such contribution, CHARITABLE VOLUNTEERS. December 31, 2005. ‘‘(ii) the taxpayer— ‘‘(a) IN GENERAL.—Gross income of an indi- On page 149, line 7, strike ‘‘$100’’ and insert ‘‘(I) has received a qualified appraisal of vidual does not include amounts received, ‘‘$250’’. the fair market value of such property in ac- from an organization described in section Beginning on page 150, line 4, strike all cordance with the regulations under this sec- 170(c), as reimbursement of operating ex- through page 151, line 2 and insert the fol- tion, and penses with respect to use of a passenger lowing: ‘‘(II) attaches to the taxpayer’s income tax automobile for the benefit of such organiza- SEC. 318. MODIFICATION OF RECORDKEEPING return for the taxable year in which such tion. The preceding sentence shall apply only REQUIREMENTS FOR CERTAIN contribution was made a copy of such ap- to the extent that the expenses which are re- CHARITABLE CONTRIBUTIONS. praisal, imbursed would be deductible under this (a) RECORDKEEPING REQUIREMENT.—Sub- ‘‘(iii) the donee is an organization de- chapter if section 274(d) were applied— section (f) of section 170, as amended by sec- scribed in subsection (b)(1)(A), ‘‘(1) by using the standard business mileage tion 317 of this Act, is amended by adding at ‘‘(iv) the use of such property by the donee rate established under such section, and the end the following new paragraph: is related to the purpose or function consti- ‘‘(2) as if the individual were an employee ‘‘(16) RECORDKEEPING.—No deduction shall tuting the basis for the donee’s exemption of an organization not described in section be allowed under subsection (a) for any con- under section 501 (or, in the case of a govern- 170(c). tribution of a cash, check, or other monetary mental unit, to any purpose or function de- ‘‘(b) APPLICATION TO VOLUNTEER SERVICES gift unless the donor maintains as a record scribed under section 501(c)), ONLY.—Subsection (a) shall not apply with of such contribution— ‘‘(v) the taxpayer receives from the donee a respect to any expenses relating to the per- ‘‘(A) a cancelled check, or written statement representing that the formance of services for compensation. ‘‘(B) a receipt or a letter or other written donee’s use of the property will be in accord- ‘‘(c) NO DOUBLE BENEFIT.—A taxpayer may communication from the donee showing the ance with the provisions of clause (iv), and not claim a deduction or credit under any name of the donee organization, the date of ‘‘(vi) the written appraisal referred to in other provision of this title with respect to the contribution, and the amount of the con- clause (ii) includes evidence of the extent (if the expenses under subsection (a). tribution.’’. any) to which property created by the per- ‘‘(d) EXEMPTION FROM REPORTING REQUIRE- (b) EFFECTIVE DATE.—The amendment sonal efforts of the taxpayer and of the same MENTS.—Section 6041 shall not apply with re- made by this section shall apply to contribu- type as the donated property is or has been— spect to reimbursements excluded from in- tions made in taxable years beginning after ‘‘(I) owned, maintained, and displayed by come under subsection (a). the date of the enactment of this Act. organizations described in subsection ‘‘(e) TERMINATION.—This section shall not On page 172, after line 21, add the fol- (b)(1)(A), and apply to taxable years beginning after De- lowing: ‘‘(II) sold to or exchanged by persons other cember 31, 2007.’’. SEC. 322. EXPANSION OF THE BASE OF TAX ON than the taxpayer, donee, or any related per- (b) CLERICAL AMENDMENT.—The table of PRIVATE FOUNDATION NET INVEST- MENT INCOME. son (as defined in section 465(b)(3)(C)). sections for part III of subchapter B of chap- (a) GROSS INVESTMENT INCOME.— ‘‘(C) MAXIMUM DOLLAR LIMITATION; NO CAR- ter 1 is amended by inserting after the item (1) IN GENERAL.—Paragraph (2) of section RYOVER OF INCREASED DEDUCTION.—The in- relating to section 139 the following new item: 4940(c) (relating to gross investment income) crease in the deduction under this section by is amended by adding at the end the fol- ‘‘Sec. 139A. Mileage reimbursements to reason of this paragraph for any taxable lowing new sentence: ‘‘Such term shall also charitable volunteers’’. year— include income from sources similar to those ‘‘(i) shall not exceed the artistic adjusted (c) EFFECTIVE DATE.—The amendments in the preceding sentence.’’. gross income of the taxpayer for such tax- made by this section shall apply to taxable (2) CONFORMING AMENDMENT.—Subsection able year, and years beginning after December 31, 2005. (e) of section 509 (relating to gross invest- ‘‘(ii) shall not be taken into account in de- SEC. 310. ALTERNATIVE PERCENTAGE LIMITA- ment income) is amended by adding at the termining the amount which may be carried TION FOR CORPORATE CHARITABLE end the following new sentence: ‘‘Such term CONTRIBUTIONS TO THE MATHE- from such taxable year under subsection (d). shall also include income from sources simi- ‘‘(D) ARTISTIC ADJUSTED GROSS INCOME.— MATICS AND SCIENCE PARTNERSHIP PROGRAM. lar to those in the preceding sentence.’’. For purposes of this paragraph, the term ‘ar- APITAL AIN ET NCOME (a) IN GENERAL.—Section 170(b) (related to (b) C G N I .—Paragraph tistic adjusted gross income’ means that por- (4) of section 4940(c) (relating to capital tion of the adjusted gross income of the tax- percentage limitations) is amended by add- ing at the end the following new paragraph: gains and losses) is amended— payer for the taxable year attributable to— (1) in subparagraph (A), by striking ‘‘used ‘‘(3) SPECIAL RULE FOR CORPORATE CON- ‘‘(i) income from the sale or use of prop- for the production of interest, dividends, TRIBUTIONS TO THE MATHEMATICS AND SCIENCE erty created by the personal efforts of the rents, and royalties’’ and inserting ‘‘used for PARTNERSHIP PROGRAM.— taxpayer which is of the same type as the do- the production of gross investment income nated property, and ‘‘(A) IN GENERAL.—In the case of a corpora- tion which makes an eligible mathematics (as defined in paragraph (2))’’, and ‘‘(ii) income from teaching, lecturing, per- (2) in subparagraph (C), by inserting ‘‘or forming, or similar activity with respect to and science contribution— ‘‘(i) the limitation under paragraph (2) carrybacks’’ after ‘‘carryovers’’. property described in clause (i). (c) EFFECTIVE DATE.—The amendments shall apply separately with respect to all ‘‘(E) PARAGRAPH NOT TO APPLY TO CERTAIN made by this section shall apply to taxable such contributions and all other charitable CONTRIBUTIONS.—Subparagraph (A) shall not years beginning after the date of the enact- contributions, and apply to any charitable contribution of any ment of this Act. letter, memorandum, or similar property ‘‘(ii) paragraph (2) shall be applied with re- spect to all eligible mathematics and science SEC. 323. DEFINITION OF CONVENTION OR ASSO- which was written, prepared, or produced by CIATION OF CHURCHES. or for an individual while the individual is contributions by substituting ‘15 percent’ for Section 7701 (relating to definitions) is an officer or employee of any person (includ- ‘10 percent’. amended by redesignating subsection(o) as ing any government agency or instrumen- ‘‘(B) ELIGIBLE MATHEMATICS AND SCIENCE subsection (p) and by inserting after sub- tality) unless such letter, memorandum, or CONTRIBUTION.— section (n) the following new subsection: similar property is entirely personal. ‘‘(i) IN GENERAL.—For purposes of this ‘‘(o) CONVENTION OR ASSOCIATION OF ‘‘(F) COPYRIGHT TREATED AS SEPARATE paragraph, the term ‘eligible mathematics CHURCHES.—For purposes of this title, any PROPERTY FOR PARTIAL INTEREST RULE.—In and science contribution’ means a charitable organization which is otherwise a convention the case of a qualified artistic charitable contribution (other than a contribution of or association of churches shall not fail to so contribution, the tangible literary, musical, used equipment) to a qualified partnership qualify merely because the membership of artistic, or scholarly composition, or similar for the purpose of an activity described in such organization includes individuals as property and the copyright on such work section 2202(c) of the Elementary and Sec- well as churches or because individuals have shall be treated as separate properties for ondary Education Act of 1965.. voting rights in such organization.’’. purposes of this paragraph and subsection ‘‘(ii) QUALIFIED PARTNERSHIP.—The term SEC. 324. NOTIFICATION REQUIREMENT FOR EN- (f)(3). ‘qualified partnership’ means an eligible TITIES NOT CURRENTLY REQUIRED ‘‘(G) TERMINATION.—This paragraph shall partnership (within the meaning of section TO FILE. not apply to contributions made after De- 2201(b)(1) of the Elementary and Secondary (a) IN GENERAL.—Section 6033 (relating to cember 31, 2007.’’. Education Act of 1965), but only to the ex- returns by exempt organizations), as amend- (b) EFFECTIVE DATE.—The amendment tent that such partnership does not include a ed by section 346 of this Act, is amended by made by this section shall apply to contribu- person other than a person described in para- redesignating subsection (j) as subsection (k) tions made after December 31, 2005. graph (1)(A). and by inserting after subsection (i) the fol- SEC. 309. MILEAGE REIMBURSEMENTS TO CHARI- ‘‘(C) TERMINATION.—This paragraph shall lowing new subsection: TABLE VOLUNTEERS EXCLUDED not apply to any contributions made in tax- ‘‘(j) ADDITIONAL NOTIFICATION REQUIRE- FROM GROSS INCOME. able years beginning after December 31, MENTS.—Any organization the gross receipts (a) IN GENERAL.—Part III of subchapter B 2006.’’. of which in any taxable year result in such of chapter 1 is amended by inserting after (b) EFFECTIVE DATE.—The amendment organization being referred to in subsection section 139A the following new section: made by this section shall apply to contribu- (a)(3)(A)(ii) or (a)(3)(B)—

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‘‘(1) shall furnish annually, at such time (g) SECRETARIAL OUTREACH REQUIRE- Secretary may make available for inspection and in such manner as the Secretary may by MENTS.— or disclosure returns and return information forms or regulations prescribe, information (1) NOTICE REQUIREMENT.—The Secretary of of an organization described in paragraph (2), setting forth— the Treasury shall notify in a timely manner (4), (6), (7), (8), (10), or (13) of section 501(c) for ‘‘(A) the legal name of the organization, every organization described in section the purpose of, and to the extent necessary ‘‘(B) any name under which such organiza- 6033(j) of the Internal Revenue Code of 1986 in, the administration of State laws regu- tion operates or does business, (as added by this section) of the requirement lating the solicitation or administration of ‘‘(C) the organization’s mailing address and under such section 6033(j) and of the penalty the charitable funds or charitable assets of Internet web site address (if any), established under section 6033(k)— such organizations. Such information may ‘‘(D) the organization’s taxpayer identi- (A) by mail, in the case of any organization be inspected only by or disclosed only to rep- fication number, the identity and address of which is included resentatives of the appropriate State officer ‘‘(E) the name and address of a principal in the list of exempt organizations main- designated as the individuals who are to in- officer, and tained by the Secretary, and spect or to receive the returns or return in- ‘‘(F) evidence of the continuing basis for (B) by Internet or other means of outreach, formation under this paragraph on behalf of the organization’s exemption from the filing in the case of any other organization. such officer. Such representatives shall not requirements under subsection (a)(1), and (2) LOSS OF STATUS PENALTY FOR FAILURE include any contractor or agent. ‘‘(2) upon the termination of the existence TO FILE RETURN.—The Secretary of the Treas- ‘‘(4) USE IN CIVIL JUDICIAL AND ADMINISTRA- of the organization, shall furnish notice of ury shall publicize in a timely manner in ap- TIVE PROCEEDINGS.—Returns and return in- such termination.’’. propriate forms and instructions and formation disclosed pursuant to this sub- (b) LOSS OF EXEMPT STATUS FOR FAILURE through other appropriate means, the pen- section may be disclosed in civil administra- TO FILE RETURN OR NOTICE.—Section 6033 (re- alty established under section 6033(k) of such tive and civil judicial proceedings pertaining lating to returns by exempt organizations), Code for the failure to file a return under to the enforcement of State laws regulating as amended by subsection (a), is amended by section 6033(a)(1) of such Code. such organizations in a manner prescribed by redesignating subsection (k) as subsection (l) (h) EFFECTIVE DATE.—The amendments the Secretary similar to that for tax admin- and by inserting after subsection (j) the fol- made by this section shall apply to notices istration proceedings under section lowing new subsection: and returns with respect to annual periods 6103(h)(4). ‘‘(k) LOSS OF EXEMPT STATUS FOR FAILURE beginning after 2005 ‘‘(5) NO DISCLOSURE IF IMPAIRMENT.—Re- TO FILE RETURN OR NOTICE.— turns and return information shall not be ‘‘(1) IN GENERAL.—If an organization de- SEC. 325. DISCLOSURE TO STATE OFFICIALS OF scribed in subsection (a)(1) or (i) fails to file PROPOSED ACTIONS RELATED TO disclosed under this subsection, or in any an annual return or notice required under ei- EXEMPT ORGANIZATIONS. proceeding described in paragraph (4), to the ther subsection for 3 consecutive years, such (a) IN GENERAL.—Subsection (c) of section extent that the Secretary determines that organization’s status as an organization ex- 6104 is amended by striking paragraph (2) and such disclosure would seriously impair Fed- empt from tax under section 501(a) shall be inserting the following new paragraphs: eral tax administration. considered revoked on and after the date set ‘‘(2) DISCLOSURE OF PROPOSED ACTIONS RE- ‘‘(6) DEFINITIONS.—For purposes of this sub- by the Secretary for the filing of the third LATED TO CHARITABLE ORGANIZATIONS.— section— annual return or notice. The Secretary shall ‘‘(A) SPECIFIC NOTIFICATIONS.—In the case ‘‘(A) RETURN AND RETURN INFORMATION.— publish and maintain a list of any organiza- of an organization to which paragraph (1) ap- The terms ‘return’ and ‘return information’ tion the status of which is so revoked. plies, the Secretary may disclose to the ap- have the respective meanings given to such ‘‘(2) APPLICATION NECESSARY FOR REIN- propriate State officer— terms by section 6103(b). STATEMENT.—Any organization the tax-ex- ‘‘(i) a notice of proposed refusal to recog- ‘‘(B) APPROPRIATE STATE OFFICER.—The empt status of which is revoked under para- nize such organization as an organization de- term ‘appropriate State officer’ means— graph (1) must apply in order to obtain rein- scribed in section 501(c)(3) or a notice of pro- ‘‘(i) the State attorney general, statement of such status regardless of posed revocation of such organization’s rec- ‘‘(ii) the State tax officer, whether such organization was originally re- ognition as an organization exempt from ‘‘(iii) in the case of an organization to quired to make such an application. taxation, which paragraph (1) applies, any other State ‘‘(3) RETROACTIVE REINSTATEMENT IF REA- ‘‘(ii) the issuance of a letter of proposed de- official charged with overseeing organiza- SONABLE CAUSE SHOWN FOR FAILURE.—If upon ficiency of tax imposed under section 507 or tions of the type described in section application for reinstatement of status as an chapter 41 or 42, and 501(c)(3), and organization exempt from tax under section ‘‘(iii) the names, addresses, and taxpayer ‘‘(iv) in the case of an organization to 501(a), an organization described in para- identification numbers of organizations which paragraph (3) applies, the head of an graph (1) can show to the satisfaction of the which have applied for recognition as organi- agency designated by the State attorney Secretary evidence of reasonable cause for zations described in section 501(c)(3). general as having primary responsibility for the failure described in such paragraph, the ‘‘(B) ADDITIONAL DISCLOSURES.—Returns overseeing the solicitation of funds for chari- organization’s exempt status may, in the dis- and return information of organizations with table purposes.’’. cretion of the Secretary, be reinstated effec- respect to which information is disclosed (b) CONFORMING AMENDMENTS.— tive from the date of the revocation under under subparagraph (A) may be made avail- (1) Subparagraph (A) of section 6103(p)(3) is such paragraph.’’. able for inspection by or disclosed to an ap- amended by inserting ‘‘an section 6104(c)’’ (c) NO DECLARATORY JUDGMENT RELIEF.— propriate State officer. after ‘‘section’’ in the first sentence. Section 7428(b) (relating to limitations) is ‘‘(C) PROCEDURES FOR DISCLOSURE.—Infor- (2) Paragraph (4) of section 6103(p) is amended by adding at the end the following mation may be inspected or disclosed under amended— new paragraph: subparagraph (A) or (B) only— (A) in the matter preceding subparagraph ‘‘(4) NONAPPLICATION FOR CERTAIN REVOCA- ‘‘(i) upon written request by an appropriate (A), by inserting ‘‘, or any appropriate State TIONS.—No action may be brought under this State officer, and officer (as defined in section 6104(c)),’’ before section with respect to any revocation of ‘‘(ii) for the purpose of, and only to the ex- ‘‘or any other person’’, status described in section 6033(k)(1).’’. tent necessary in, the administration of (B) in subparagraph (F)(i), by inserting ‘‘or (d) NO INSPECTION REQUIREMENT.—Section State laws regulating such organizations. any appropriate State officer (as defined in 6104(b) (relating to inspection of annual in- Such information may only be inspected by section 6104(c)),’’ before ‘‘or any other per- formation returns) is amended by inserting or disclosed to representatives of the appro- son’’, and ‘‘(other than subsection (j) thereof)’’ after (C) in the matter following subparagraph ‘‘6033’’. priate State officer designated as the indi- (F), by inserting ‘‘, an appropriate State offi- (e) NO DISCLOSURE REQUIREMENT.—Section viduals who are to inspect or to receive the 6104(d)(3) (relating to exceptions from disclo- returns or return information under this cer (as defined in section 6104(c)),’’ after ‘‘in- sure requirements) is amended by redesig- paragraph on behalf of such officer. Such cluding an agency’’ each place it appear. nating subparagraph (B) as subparagraph (C) representatives shall not include any con- (3) The heading for paragraph (1) of section and by inserting after subparagraph (A) the tractor or agent. 6104(c) is amended by inserting ‘‘FOR CHARI- following new subparagraph: ‘‘(D) DISCLOSURES OTHER THAN BY RE- TABLE ORGANIZATIONS’’ after ‘‘RULE’’. ‘‘(B) NONDISCLOSURE OF ANNUAL NOTICES.— QUEST.—The Secretary may make available (4) Paragraph (2) of section 7213(a) is Paragraph (1) shall not require the disclosure for inspection or disclose returns and return amended by inserting ‘‘or under section of any notice required under section 6033(j).’’. information of an organization to which 6104(c)’’ after ‘‘6103’’. (f) NO MONETARY PENALTY FOR FAILURE TO paragraph (1) applies to an appropriate State (5) Paragraph (2) of section 7213A(a) is NOTIFY.—Section 6652(c)(1) (relating to an- officer of any State if the Secretary deter- amended by inserting ‘‘or 6104(c)’’ after nual returns under section 6033 or 6012(a)(6)) mines that such inspection or disclosure may ‘‘6103’’. is amended by adding at the end the fol- facilitate the resolution of Federal or State (6) Paragraph (2) of section 7431(a) is lowing new subparagraph: issues relating to the tax-exempt status of amended by inserting ‘‘(including any disclo- ‘‘(E) NO PENALTY FOR CERTAIN ANNUAL NO- such organization. sure in violation of section 6014(c)’’ after TICES.—This paragraph shall not apply with ‘‘(3) DISCLOSURE WITH RESPECT TO CERTAIN ‘‘6103’’. respect to any notice required under section OTHER EXEMPT ORGANIZATIONS.—Upon written (c) EFFECTIVE DATE.—The amendments 6033(j).’’. request by an appropriate State officer, the made by this section shall take effect on the

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date of the enactment of this Act but shall SEC. 333. TREATMENT OF CHARITABLE CON- ‘‘(A) IN GENERAL.—A deduction otherwise not apply to requests made before such date. TRIBUTION DEDUCTIONS TO DONOR allowed under subsection (a) for any con- On page 174, line 4, strike ‘‘121st day’’ and ADVISED FUNDS. tribution to a sponsoring organization (as insert ‘‘181st day’’. (a) INCOME.—Section 170(f) (relating to dis- defined in section 4967(g)(1)) to be main- On page 174, line 6, strike ‘‘121st day’’ and allowance of deduction in certain cases and tained in any donor advised fund (as defined insert ‘‘181st day’’. special rules), as amended by section 318 of in section 4967(g)(2)) of such organization On page 174, line 10, strike ‘‘121st day’’ and this Act, is amended by adding at the end shall only be allowed if— the following new paragraph: insert ‘‘181st day’’. ‘‘(i) such sponsoring organization is not de- ‘‘(17) CONTRIBUTIONS TO DONOR ADVISED On page 174, line 12, strike ‘‘121st day’’ and scribed in paragraph (3) or (4) of subsection FUNDS.— insert ‘‘181st day’’. (a) or section 509(a)(3), and ‘‘(A) IN GENERAL.—A deduction otherwise On page 176, line 25, strike ‘‘5’’ and insert ‘‘(ii) the taxpayer obtains a contempora- allowed under subsection (a) for any con- ‘‘the applicable percentage’’. neous written acknowledgment (determined tribution to a sponsoring organization (as On page 177, line 1, strike ‘‘percent’’. under rules similar to the rules of section defined in section 4967(g)(1)) to be main- On page 178, line 2, strike ‘‘5 percent’’ and 170(f)(8)(C)) from the sponsoring organization tained in any donor advised fund (as defined insert ‘‘the applicable percentage’’. that such organization has exclusive legal in section 4967(g)(2)) of such organization On page 178, between lines 4 and 5, insert control over the assets contributed. the following: shall only be allowed if— ‘‘(B) CONTRIBUTIONS TO TYPE I OR TYPE II ‘‘(4) APPLICABLE PERCENTAGE.—For pur- ‘‘(i) such sponsoring organization is not de- SUPPORTING ORGANIZATIONS.— poses of paragraphs (1) and (3), the applicable scribed in paragraph (3), (4), or (5) of sub- ‘‘(i) IN GENERAL.—Notwithstanding sub- section (c) or section 509(a)(3), and percentage is— paragraph (A)(i), a contribution to a spon- ‘‘(ii) the taxpayer obtains a contempora- ‘‘(A) 3 percent for the first taxable year be- soring organization (as so defined) described neous written acknowledgment (determined ginning after the date of the enactment of in clause (ii) to be maintained in any donor under rules similar to the rules of paragraph this section, advised fund (as so defined) of such organiza- (8)(C) from the sponsoring organization that ‘‘(B) 4 percent for the second taxable year tion shall be allowed to the extent not pro- such organization has exclusive legal control beginning after such date, and hibited by regulations. ‘‘(C) 5 percent for any taxable year begin- over the assets contributed. ‘‘(ii) ORGANIZATION DESCRIBED.—An organi- ‘‘(B) CONTRIBUTIONS TO TYPE I OR TYPE II ning after the second taxable year beginning zation is described in this clause if the orga- SUPPORTING ORGANIZATIONS.— after such date. nization meets the requirements of subpara- On page 178, strike lines 9 through 15 and ‘‘(i) IN GENERAL.—Notwithstanding sub- graphs (A) and (C) of section 509(a)(3) and is— insert the following: paragraph (A)(i), a contribution to a spon- ‘‘(I) operated, supervised, or controlled by ‘‘(A) any amount paid by the sponsoring soring organization (as so defined) described one or more organizations described in para- organization from a donor advised fund— in clause (ii) to be maintained in any donor graph (1) or (2) of section 509(a), or ‘‘(i) to any organization described in sec- advised fund (as so defined) of such organiza- ‘‘(II) supervised or controlled in connection tion 170(b)(1)(A) (other than any organization tion shall be allowed to the extent not pro- with one or more such organizations.’’. described in section 509(a)(3)) or any spon- hibited by regulations. (d) REGULATIONS.—The regulations pre- soring organization if such amount is for ‘‘(ii) ORGANIZATION DESCRIBED.—An organi- scribed under sections 170(f)(17)(B)(i), maintenance in a donor advised fund), and zation is described in this clause if the orga- 2055(e)(5)(B)(i), 2522(c)(13)(B)(i), ‘‘(ii) notwithstanding clause (i), to any or- nization meets the requirements of subpara- 4967(e)(i)(A)(ii), and 4968(c)(2) of the Internal ganization described section 170(f)(17)(B)(ii), graphs (A) and (C) of section 509(a)(3) and is— Revenue Code of 1986 shall deny a deduction but only to the extent not prohibited by reg- ‘‘(I) operated, supervised, or controlled by for contributions to sponsoring organiza- ulations, and one or more organizations described in para- tions (as defined in section 4967(g)(1) of such On page 179, strike lines 1 through 3 and in- graph (1) or (2) of section 509(a), or Code) which are described in section sert the following: ‘‘(II) supervised or controlled in connection 170(f)(17)(B)(ii) of such Code and shall apply ‘‘(2) DISTRIBUTIONS TO SPONSORING ORGANI- with one or more such organizations.’’. excise taxes to distributions from donor ad- ZATIONS.— (b) ESTATE.—Section 2055(e) is amended by vised funds (as defined in section 4967(g)(2) of ‘‘(A) IN GENERAL.—Except as provided in adding at the end the following new para- such Code) and sponsoring organizations (as graph: subparagraph (B), such term shall include so defined) to organizations so described in ‘‘(5) CONTRIBUTIONS TO DONOR ADVISED any distribution to a sponsoring organiza- cases where the donor of the contributions or FUNDS.— tion. the donor or donor advisor of the amounts ‘‘(A) IN GENERAL.—A deduction otherwise ‘‘(B) ORGANIZATION LEVEL DISTRIBUTIONS.— distributed directly or indirectly controls a allowed under subsection (a) for any con- For purposes of subsection (c)(1)(B), such supported organization (as defined in section tribution to a sponsoring organization (as term shall not include any distribution to a 509(f)(3) of such Code) of such organization. sponsoring organization unless such distribu- defined in section 4967(g)(1)) to be main- (e) EFFECTIVE DATE.—The amendments tion is designated for use in connection with tained in any donor advised fund (as defined made by this section shall apply to contribu- a charitable program of such organization. in section 4967(g)(2)) of such organization tions made after the date which is 180 days On page 185, line 9, strike ‘‘section shall only be allowed if— after the date of the enactment of this Act. 4967(g)(2)(C)’’ and insert ‘‘section ‘‘(i) such sponsoring organization is not de- On page 205, line 16, strike ‘‘5 percent’’ and 4967(g)(2)(A)(iii)’’. scribed in paragraph (3) or(4) of subsection insert ‘‘the applicable percentage’’. On page 186, strike lines 7 through 14 and (a) or section 509(a)(3), and On page 206, between lines 11 and 12, insert insert the following: ‘‘(ii) the taxpayer obtains a contempora- the following: ‘‘(c) TAXABLE DISTRIBUTION.—For purposes neous written acknowledgment (determined ‘‘(3) APPLICABLE PERCENTAGE.—For pur- of this subsection— under rules similar to the rules of section poses of paragraph (1)(A)(ii), the applicable ‘‘(1) IN GENERAL.—The term ‘taxable dis- 170(f)(8)(C)) from the sponsoring organization percentage is— tribution’ means any distribution from a that such organization has exclusive legal ‘‘(A) 3 percent for the first taxable year be- donor advised fund to any person other than control over the assets contributed. ginning after the date of the enactment of the sponsoring organization’s non donor ad- ‘‘(B) CONTRIBUTIONS TO TYPE I OR TYPE II this section, vised funds or accounts or organizations de- SUPPORTING ORGANIZATIONS.— ‘‘(B) 4 percent for the second taxable year scribed in section 170(b)(1)(A) (other than ‘‘(i) IN GENERAL.—Notwithstanding sub- beginning after such date, and any organization described in section paragraph (A)(i), a contribution to a spon- ‘‘(C) 5 percent for any taxable year begin- 509(a)(3) or any sponsoring organization if soring organization (as so defined) described ning after the second taxable year beginning such amount is for maintenance in a donor in clause (ii) to be maintained in any donor after such date. advised fund). advised fund (as so defined) of such organiza- On page 206, strike lines 18 through 22 and ‘‘(2) EXCEPTION.—Notwithstanding para- tion shall be allowed to the extent not pro- insert the following: graph (1), such term shall not include any hibited by regulations. ‘‘(2) ADMINISTRATIVE AND OPERATING EX- distribution from a donor advised fund to ‘‘(ii) ORGANIZATION DESCRIBED.—An organi- PENSES.—Reasonable and necessary adminis- any organization described section zation is described in this clause if the orga- trative expenses of a type III supporting or- 170(f)(17)(B)(ii) to the extent such distribu- nization meets the requirements of subpara- ganization shall be treated as a qualifying tion is not prohibited under regulations. graphs (A) and (C) of section 509(a)(3) and is— distribution to a supported organization. On page 189, line 17, strike ‘‘121st day’’ and ‘‘(I) operated, supervised, or controlled by On page 214, line 6, strike ‘‘any’’. insert ‘‘181st day’’. one or more organizations described in para- On page 216, strike line 24 and insert the On page 190, line 22, strike ‘‘4967(g)(2)(C)’’ graph (1) or (2) of section 509(a), or following: and insert ‘‘4967(g)(2)(A)(iii)’’. ‘‘(II) supervised or controlled in connection ‘‘(5) SPECIAL RULE FOR CERTAIN HOLDINGS OF On page 192, lines 18 and 19, strike ‘‘pro- with one or more such organizations.’’. TYPE III SUPPORTING ORGANIZATIONS.—For vided by the sponsoring organization in con- (c) GIFT.—Section 2522(c) is amended by purposes of this subsection, the term ‘excess nection with’’ and insert ‘‘from’’. adding at the end the following new para- business holdings’ shall not include any Beginning on page 193, line 17 strike all graph: holdings of a type III supporting organiza- through page 196, line 4 and insert the fol- ‘‘(13) CONTRIBUTIONS TO DONOR ADVISED tion (as defined in section 4959(h)(2)) in any lowing: FUNDS.— business enterprise if the holdings are held

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00094 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13241 for the benefit of the community pursuant to (1) Subparagraph (J) of section 26(b)(2) is (C) the plan is required to provide coverage the direction of a State attorney general or amended by striking ‘‘25 percent’’ and insert- of individuals who, but for the exception of a State official with jurisdiction over the ing ‘‘60 percent’’. the application of section 409A of such Code type III supporting organization. (2) Clause (i) of section 1042(c)(4)(A) is by reason of this section, would be subject to ‘‘(6) PRESENT HOLDINGS.—For purposes of amended by striking ‘‘section 1362(d)(3)(C)’’ tax under such section with respect to the On page 219, strike lines 5 through 9 and in- and inserting ‘‘section 1375(b)(3)’’. plan, and sert the following: (3) Subparagraph (B) of section 1362(f)(1) is (D) the plan meets such other require- (a) REQUIREMENT TO FILE RETURN.—Sub- amended by striking ‘‘or (3)’’. ments as the Secretary of the Treasury pre- paragraph (B) of section 6033(a)(3), as redesig- (4) Clause (i) of section 1375(b)(1)(A) is scribes in the regulations under subsection nated by section 311, is amended by inserting amended by striking ‘‘25 percent’’ and insert- (a). ‘‘(other than an organization described in ing ‘‘60 percent’’. SEC. 407. SENSE OF THE SENATE REGARDING section 509(a)(3))’’ after ‘‘paragraph (1)’’. (5) Subsection (d) of section 1375 is amend- THE DEDICATION OF EXCESS FUNDS. Beginning on page 225, line 9, strike all ed by striking ‘‘subchapter C’’ both places it It is the sense of the Senate that any in- through page 230, line 21 and insert the fol- appears and inserting ‘‘accumulated’’. creases in revenues to the Treasury as a re- lowing: (6) The heading for section 1375 is amended sult of this Act and the amendments made SEC. 402. MODIFICATION TO S CORPORATION by striking ‘‘25 PERCENT’’ and inserting ‘‘60 by this Act that exceed the amounts speci- PASSIVE INVESTMENT INCOME PERCENT’’. fied in the reconciliation instructions shall RULES. (7) The item relating to section 1375 in the be dedicated to the Low-Income Home En- (a) INCREASED PERCENTAGE LIMIT.—Para- table of sections for part III of subchapter S ergy Assistance Program, in an amount not graph (2) of section 1375(a) is amended by of chapter 1 is amended by striking ‘‘25 per- to exceed the amount which is $2,900,000,000 striking ‘‘25 PERCENT’’ and inserting ‘‘60 cent’’ and inserting ‘‘60 percent’’. more than the funding levels established for PERCENT’’. (d) EFFECTIVE DATE.—The amendments such Program for fiscal year 2005. (b) REPEAL OF EXCESSIVE PASSIVE INCOME Beginning on page 236, line 17, strike all AS A TERMINATION EVENT.— made by this section shall apply to taxable years beginning after December 31, 2005. through page 239, line 6 and insert the fol- (1) IN GENERAL.—Section 1362(d) is amended lowing: by striking paragraph (3). On page 235, in between lines 13 and 14, in- sert the following: SEC. 502. MODIFICATION OF EFFECTIVE DATE OF (2) CONFORMING AMENDMENT.—Subsection EXCEPTION FROM SUSPENSION SEC. 405. MODIFICATION OF BOND RULE. (b) of section 1375 is amended by striking RULES FOR CERTAIN LISTED AND paragraphs (3) and (4) and inserting the fol- In the case of bonds issued after the date of REPORTABLE TRANSACTIONS. lowing new paragraph: the enactment of this Act and before August (a) EFFECTIVE DATE MODIFICATION.— ‘‘(3) PASSIVE INVESTMENT INCOME DE- 31, 2009— (1) IN GENERAL.—Paragraph (2) of section FINED.— (1) the requirement of paragraph (1) of sec- 903(d) of the American Jobs Creation Act of ‘‘(A) Except as otherwise provided in this tion 648 of the Deficit Reduction Act of 1984 2004 is amended to read as follows: paragraph, the term ‘passive investment in- (98 Stat. 941) shall be treated as met with re- ‘‘(2) EXCEPTION FOR REPORTABLE OR LISTED come’ means gross receipts derived from roy- spect to the securities or obligations referred TRANSACTIONS.— alties, rents, dividends, interest, and annu- to in such section if such securities or obli- ‘‘(A) IN GENERAL.—The amendments made ities. gations are held in a fund the annual dis- by subsection (c) shall apply with respect to ‘‘(B) EXCEPTION FOR INTEREST ON NOTES tributions from which cannot exceed 7 per- interest accruing after October 3, 2004. FROM SALES OF INVENTORY.—The term ‘pas- cent of the average fair market value of the ‘‘(B) SPECIAL RULE FOR CERTAIN LISTED AND sive investment income’ shall not include in- assets held in such fund except to the extent REPORTABLE TRANSACTIONS.— terest on any obligation acquired in the ordi- distributions are necessary to pay debt serv- ‘‘(i) IN GENERAL.—Except as provided in nary course of the corporation’s trade or ice on the bond issue, clause (ii), the amendments made by sub- business from its sale of property described (2) paragraph (3) of such section shall be section (c) shall also apply with respect to in section 1221(a)(1). applied by substituting ‘‘distributions from’’ interest accruing on or before October 3, ‘‘(C) TREATMENT OF CERTAIN LENDING OR FI- for ‘‘the investment earnings of’’ both places 2004. NANCE COMPANIES.—If the S corporation it appears, and ‘‘(ii) PARTICIPANTS IN SETTLEMENT INITIA- meets the requirements of section 542(c)(6) (3) Paragraph (4) of such section shall be TIVES.—Clause (i) shall not apply to any for the taxable year, the term ‘passive in- applied by substituting ‘‘March 1, 1985’’ for transaction if, as of January 23, 2006— vestment income’ shall not include gross re- ‘‘October 9, 1969’’. ‘‘(I) the taxpayer is participating in a set- ceipts for the taxable year which are derived SEC. 406. TREATMENT OF CERTAIN STOCK OP- tlement initiative described in Internal Rev- directly from the active and regular conduct TION PLANS UNDER NONQUALIFIED enue Service Announcement 2005-80 with re- of a lending or finance business (as defined in DEFERRED COMPENSATION RULES. spect to such transaction, or section 542(d)(1)). (a) IN GENERAL.—The Secretary of the ‘‘(II) the taxpayer has entered into a set- ‘‘(D) TREATMENT OF CERTAIN DIVIDENDS.—If Treasury shall modify the regulations under tlement agreement pursuant to such an ini- an S corporation holds stock in a C corpora- section 409A of the Internal Revenue Code of tiative. tion meeting the requirements of section 1986 to extend to applicable foreign option ‘‘(iii) TERMINATION OF EXCEPTION.—Clause 1504(a)(2), the term ‘passive investment in- plans the exception under such section for (ii)(I) shall not apply to any taxpayer if, come’ shall not include dividends from such incentive stock options under section 422 of after January 23, 2006, the taxpayer with- C corporation to the extent such dividends such Code and options granted under an em- draws from, or terminates, participation in are attributable to the earnings and profits ployee stock purchase plan meeting the re- the initiative or the Secretary of the Treas- of such C corporation derived from the active quirements of section 423 of such Code. Such ury or the Secretary’s delegate determines conduct of a trade or business. extension shall be subject to such terms and that a settlement agreement will not be ‘‘(E) EXCEPTION FOR BANKS, ETC.—In the conditions as may be prescribed in such reg- reached pursuant to the initiative within a case of a bank (as defined in section 581), a ulations. reasonable period of time.’’. bank holding company (within the meaning (b) APPLICABLE FOREIGN OPTION PLANS.— (2) EFFECTIVE DATE.—The amendment of section 2(a) of the Bank Holding Company For purposes of subsection (a)— made by this subsection shall take effect as Act of 1956 (12 U.S.C. 1841(a))), or a financial (1) IN GENERAL.—The term ‘‘applicable for- if included in the provisions of the American holding company (within the meaning of sec- eign option plan’’ means a plan providing for Jobs Creation Act of 2004 to which it relates. tion 2(p) of such Act), the term ‘passive in- the issuance of employee stock options— (b) TREATMENT OF AMENDED RETURNS AND vestment income’ shall not include— (A) which is established under the laws of OTHER SIMILAR NOTICES OF ADDITIONAL TAX ‘‘(i) interest income earned by such bank a foreign jurisdiction, and OWED.— or company, or (B) which, under such laws or the terms of (1) IN GENERAL.—Section 6404(g)(1) (relating ‘‘(ii) dividends on assets required to be held the plan (or both), is subject to requirements to suspension) is amended by adding at the by such bank or company, including stock in substantially similar to the requirements end the following new sentence: ‘‘If, after the the Federal Reserve Bank, the Federal Home under section 422 or 423 of such Code. return for a taxable year is filed, the tax- Loan Bank, or the Federal Agricultural (2) SUBSTANTIALLY SIMILAR.—A plan shall payer provides to the Secretary 1 or more Mortgage Bank or participation certificates not be treated as subject to substantially signed written documents showing that the issued by a Federal Intermediate Credit similar requirements under paragraph (1)(B) taxpayer owes an additional amount of tax Bank. unless— for the taxable year, clause (i) shall be ap- ‘‘(F) COORDINATION WITH SECTION 1374.—The (A) the plan is required to cover substan- plied by substituting the date the last of the amount of passive investment income shall tially all employees, documents was provided for the date on be determined by not taking into account (B) in the case of an option under an em- which the return is filed.’’. any recognized built-in gain or loss of the S ployee stock purchase plan, the plan is re- (2) EFFECTIVE DATE.—The amendment corporation for any taxable year in the rec- quired to provide an option price which is made by this subsection shall apply to docu- ognition period. Terms used in the preceding not less than the amount specified in section ments provided on or after the date of the sentence shall have the same respective 423(b)(6) of such Code, except that such sec- enactment of this Act. meanings as when used in section 1374.’’. tion shall be applied by substituting ‘‘80 per- On page 244, after line 24, insert the fol- (c) CONFORMING AMENDMENTS.— cent’’ for ‘‘85 percent’’ each place it appears, lowing:

VerDate Aug 31 2005 02:29 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00095 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 S13242 CONGRESSIONAL RECORD — SENATE November 17, 2005

SEC. 504. PENALTY FOR PROMOTING ABUSIVE ‘‘(3) LIABILITY FOR PENALTY.—If more than (A) by striking ‘‘$100,000’’ and inserting TAX SHELTERS. 1 person is liable under subsection (a) with ‘‘$500,000’’, (a) PENALTY FOR PROMOTING ABUSIVE TAX respect to providing such aid, assistance, (B) by striking ‘‘$500,000’’ and inserting SHELTERS.—Section 6700 (relating to pro- procurement, or advice, all such persons ‘‘$1,000,000’’, and moting abusive tax shelters, etc.) is amend- shall be jointly and severally liable for the (C) by striking ‘‘3 years’’ and inserting ‘‘5 ed— penalty under such subsection.’’. years’’. (1) by redesignating subsections (b) and (c) (c) PENALTY NOT DEDUCTIBLE.—Section 6701 (c) EFFECTIVE DATE.—The amendments as subsections (d) and (e), respectively, is amended by adding at the end the fol- made by this section shall apply to actions, (2) by striking ‘‘a penalty’’ and all that fol- lowing new subsection: and failures to act, occurring after the date lows through the period in the first sentence ‘‘(g) PENALTY NOT DEDUCTIBLE.—The pay- of the enactment of this Act. of subsection (a) and inserting ‘‘a penalty de- ment of any penalty imposed under this sec- On page 276, line 20, strike ‘‘$1,250’’ and in- termined under subsection (b)’’, and tion or the payment of any amount to settle sert ‘‘$2,000’’. (3) by inserting after subsection (a) the fol- or avoid the imposition of such penalty shall On page 276, line 22, strike ‘‘$25’’ and insert lowing new subsections: not be considered an ordinary and necessary ‘‘$40’’. ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF expense in carrying on a trade or business On page 323, after line 20, insert the fol- PENALTY; LIABILITY FOR PENALTY.— for purposes of this title and shall not be de- lowing: ‘‘(1) AMOUNT OF PENALTY.—The amount of ductible by the person who is subject to such SEC. 563. APPLICATION OF FIRPTA TO REGU- the penalty imposed by subsection (a) shall penalty or who makes such payment.’’. LATED INVESTMENT COMPANIES. be 100 percent of the gross income derived (or (d) EFFECTIVE DATE.—The amendments (a) IN GENERAL.—Subclause (II) of section to be derived) from such activity by the per- made by this section shall apply to the ac- 897(h)(4)(A)(i) (defining qualified investment son or persons subject to such penalty. tivities described in section 6701(a) of the In- entity) is amended by inserting ‘‘which is a ‘‘(2) CALCULATION OF PENALTY.—The pen- ternal Revenue Code of 1986 after the date of United States real property holding corpora- alty amount determined under paragraph (1) the enactment of this Act. tion or which would be a United States real shall be calculated with respect to each in- Beginning on page 261, line 20, strike all property holding corporation if the excep- stance of an activity described in subsection through page 264, line 14, and insert the fol- tions provided in subsections (c)(3) and (h)(2) (a), each instance in which income was de- lowing: did not apply to interests in any real estate rived by the person or persons subject to SEC. 531. INCREASE IN CRIMINAL MONETARY investment trust or regulated investment such penalty, and each person who partici- PENALTY LIMITATION FOR THE UN- company’’ after ‘‘regulated investment com- pated in such an activity. DERPAYMENT OR OVERPAYMENT OF pany’’. TAX DUE TO FRAUD. (b) EFFECTIVE DATE.—The amendment ‘‘(3) LIABILITY FOR PENALTY.—If more than (a) IN GENERAL.—Section 7206 (relating to made by this section shall apply to distribu- 1 person is liable under subsection (a) with fraud and false statements) is amended— tions with respect to taxable years beginning respect to such activity, all such persons (1) by striking ‘‘Any person who—’’ and in- after December 31, 2004. shall be jointly and severally liable for the serting ‘‘(a) IN GENERAL.—Any person who— SEC. 564. TREATMENT OF DISTRIBUTIONS AT- penalty under such subsection. ’’, and TRIBUTABLE TO FIRPTA GAINS. ‘‘(c) PENALTY NOT DEDUCTIBLE.—The pay- (2) by adding at the end the following new (a) QUALIFIED INVESTMENT ENTITY.— ment of any penalty imposed under this sec- subsection: (1) IN GENERAL.—Section 897(h)(1) is amend- tion or the payment of any amount to settle ‘‘(b) INCREASE IN MONETARY LIMITATION FOR ed— or avoid the imposition of such penalty shall UNDERPAYMENT OR OVERPAYMENT OF TAX DUE (A) by striking ‘‘a nonresident alien indi- not be considered an ordinary and necessary TO FRAUD.—If any portion of any under- vidual or a foreign corporation’’ in the first expense in carrying on a trade or business payment (as defined in section 6664(a)) or sentence and inserting ‘‘a nonresident alien for purposes of this title and shall not be de- overpayment (as defined in section 6401(a)) of individual, a foreign corporation, or other ductible by the person who is subject to such tax required to be shown on a return is at- qualified investment entity’’, penalty or who makes such payment.’’. tributable to fraudulent action described in (b) CONFORMING AMENDMENT.—Section (B) by striking ‘‘such nonresident alien in- 6700(a) is amended by striking the last sen- subsection (a), the applicable dollar amount dividual or foreign corporation’’ in the first tence. under subsection (a) shall in no event be less sentence and inserting ‘‘such nonresident (c) EFFECTIVE DATE.—The amendments than an amount equal to such portion. A rule alien individual, foreign corporation, or made by this section shall apply to the ac- similar to the rule under section 6663(b) shall other qualified investment entity’’, and tivities described in paragraphs (1) and (2) of apply for purposes of determining the por- (C) by striking the second sentence and in- section 6700(a) of the Internal Revenue Code tion so attributable.’’. serting the following new sentence: ‘‘Not- of 1986 and after the date of the enactment of (b) INCREASE IN PENALTIES.— withstanding the preceding sentence, any this Act. (1) ATTEMPT TO EVADE OR DEFEAT TAX.— distribution by a qualified investment entity SEC. 505. PENALTY FOR AIDING AND ABETTING Section 7201 is amended— to a nonresident alien, a foreign corporation, THE UNDERSTATEMENT OF TAX LI- (A) by striking ‘‘$100,000’’ and inserting or other qualified investment entity with re- ABILITY. ‘‘$500,000’’, spect to any class of stock which is regularly (a) IN GENERAL.—Section 6701(a) (relating (B) by striking ‘‘$500,000’’ and inserting traded on an established securities market to imposition of penalty) is amended— ‘‘$1,000,000’’, and located in the United States shall not be (1) by inserting ‘‘, or tax liability reflected (C) by striking ‘‘5 years’’ and inserting ‘‘10 treated as gain recognized from the sale or in,’’ after ‘‘the preparation or presentation years’’. exchange of a United States real property in- of’’ in paragraph (1), (2) WILLFUL FAILURE TO FILE RETURN, SUP- terest if the shareholder did not own more (2) by inserting ‘‘aid, assistance, procure- PLY INFORMATION, OR PAY TAX.—Section 7203 than 5 percent of such class of stock at any ment, or advice with respect to such’’ before is amended— time during the 1 year period ending on the ‘‘portion’’ both places it appears in para- (A) in the first sentence— date of such distribution.’’. graphs (2) and (3), and (i) by striking ‘‘Any person’’ and inserting (2) APPLICATION AFTER 2007.—Clause (ii) of (3) by inserting ‘‘instance of aid, assist- the following: section 897(h)(4)(A) is amended by adding at ance, procurement, or advice or each such’’ ‘‘(a) IN GENERAL.—Any person’’, and the end the following new sentence: ‘‘Not- before ‘‘document’’ in the matter following (ii) by striking ‘‘$25,000’’ and inserting withstanding the preceding sentence, an en- paragraph (3). ‘‘$50,000’’, tity described in clause (i)(II) shall be treat- (b) AMOUNT OF PENALTY.—Subsection (b) of (B) in the third sentence, by striking ‘‘sec- ed as a qualified investment entity for pur- section 6701 (relating to penalties for aiding tion’’ and inserting ‘‘subsection’’, and poses of applying paragraph (1) in any case in and abetting understatement of tax liability) (C) by adding at the end the following new which a real estate investment trust makes is amended to read as follows: subsection: a distribution to an entity described in ‘‘(b) AMOUNT OF PENALTY; CALCULATION OF ‘‘(b) AGGRAVATED FAILURE TO FILE.— clause (i)(II).’’. PENALTY; LIABILITY FOR PENALTY.— ‘‘(1) IN GENERAL.—In the case of any failure (b) TREATMENT OF CERTAIN DISTRIBUTIONS ‘‘(1) AMOUNT OF PENALTY.—The amount of described in paragraph (2), the first sentence AS DIVIDENDS.— the penalty imposed by subsection (a) shall of subsection (a) shall be applied by sub- (1) IN GENERAL.—Section 852(b)(3) (relating be 100 percent of the gross income derived (or stituting— to capital gains) is amended by adding at the to be derived) from such aid, assistance, pro- ‘‘(A) ‘felony’ for ‘misdemeanor’, end the following new subparagraph: curement, or advice provided by the person ‘‘(B) ‘$500,000 ($1,000,000’ for ‘$25,000 ‘‘(E) CERTAIN DISTRIBUTIONS.—In the case or persons subject to such penalty. ($100,000’, and of a distribution to which section 897 does ‘‘(2) CALCULATION OF PENALTY.—The pen- ‘‘(C) ‘10 years’ for ‘1 year’. not apply by reason of the second sentence of alty amount determined under paragraph (1) ‘‘(2) FAILURE DESCRIBED.—A failure de- section 897(h)(1), the amount of such dis- shall be calculated with respect to each in- scribed in this paragraph is a failure to make tribution which would be included in com- stance of aid, assistance, procurement, or ad- a return described in subsection (a) for a pe- puting long-term capital gains for the share- vice described in subsection (a), each in- riod of 3 or more consecutive taxable holder under subparagraph (B) or (D) (with- stance in which income was derived by the years.’’. out regard to this subparagraph)— person or persons subject to such penalty, (3) FRAUD AND FALSE STATEMENTS.—Section ‘‘(i) shall not be included in computing and each person who made such an under- 7206(a) (as redesignated by subsection (a)) is such shareholder’s long-term capital gains, statement of the liability for tax. amended— and

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00096 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13243 ‘‘(ii) shall be included in such shareholder’s described in clause (i)(I) with respect to ei- (ii) described in a ruling request submitted gross income as a dividend from the regu- ther the interest which was disposed of, or to the Internal Revenue Service on or before lated investment company.’’. acquired, in the transaction. such date, or (2) CONFORMING AMENDMENT.—Section ‘‘(iii) EXCEPTION FOR CERTAIN PUBLICLY (iii) described on or before such date in a 871(k)(2) (relating to short-term capital gain TRADED STOCK.—A transaction shall not be public announcement or in a filing with the dividends) is amended by adding at the end treated as an applicable wash sales trans- Securities and Exchange Commission. the following new subparagraph: action if it involves the disposition of any (C) ELECTIONS.— ‘‘(E) CERTAIN DISTRIBUTIONS.—In the case class of stock in a qualified investment enti- (i) OUT OF TRANSITION RELIEF.—Subpara- of a distribution to which section 897 does ty which is regularly traded on an estab- graph (B) shall not apply if the distributing not apply by reason of the second sentence of lished securities market within the United corporation elects not to have such subpara- section 897(h)(1), the amount which would be States but only if the nonresident alien indi- graph apply to distributions of such corpora- treated as a short-term capital gain dividend vidual or foreign corporation did not own tion. Any such election, once made, shall be to the shareholder (without regard to this more than 5 percent of such class of stock at irrevocable. subparagraph)— any time during the 1-year period ending on (ii) APPLICATION TO PRIOR DISTRIBUTIONS.— ‘‘(i) shall not be treated as a short-term the date of the distribution described in Subparagraph (A)(ii) shall not apply to a dis- capital gain dividend, and clause (i)(I).’’. tributing or controlled corporation if the ‘‘(ii) shall be included in such shareholder’s (b) NO WITHHOLDING REQUIRED.—Section corporation elects not to have such subpara- gross income as a dividend from the regu- 1445(b) of the Internal Revenue Code of 1986 graph apply to such corporation. Any such lated investment company.’’. (relating to exemptions) is amended by add- election, once made, shall be irrevocable. (c) EFFECTIVE DATES.— ing at the end the following new paragraph: (b) SECTION 355 NOT TO APPLY TO DISTRIBU- (1) IN GENERAL.—Except as provided in ‘‘(8) APPLICABLE WASH SALES TRANS- TIONS IF THE DISTRIBUTING OR CONTROLLED paragraph (2), the amendments made by this ACTIONS.—No person shall be required to de- CORPORATION ISADISQUALIFIED INVESTMENT section shall apply to taxable years of quali- duct and withhold any amount under sub- CORPORATION.— fied investment entities beginning after the section (a) with respect to a disposition (1) IN GENERAL.—Section 355 (relating to date of the enactment of this Act. which is treated as a disposition of a United distributions of stock and securities of a con- (2) DIVIDENDS.—The amendments made by States real property interest solely by rea- trolled corporation) is amended by adding at subsection (b) shall apply to dividends with son of section 897(h)(4).’’. the end the following new subsection: respect to taxable years of regulated invest- ‘‘(g) SECTION NOT TO APPLY TO DISTRIBU- ment companies beginning after December (c) EFFECTIVE DATE.—The amendments TIONS INVOLVING DISQUALIFIED INVESTMENT 31, 2004. made by this section shall apply to disposi- tions after December 31, 2005, in taxable CORPORATIONS.— SEC. 565. PREVENTION OF AVOIDANCE OF TAX ‘‘(1) IN GENERAL.—This section (and so ON INVESTMENTS OF FOREIGN PER- years ending after such date. much of section 356 as relates to this section) SONS IN UNITED STATES REAL SEC. 566. MODIFICATIONS TO RULES RELATING PROPERTY THROUGH WASH SALE TO TAXATION OF DISTRIBUTIONS OF shall not apply to any distribution which is TRANSACTIONS. STOCK AND SECURITIES OF A CON- part of a transaction if— (a) IN GENERAL.—Section 897(h) of the In- TROLLED CORPORATION. ‘‘(A) either the distributing corporation or ternal Revenue Code of 1986 (relating to spe- (a) MODIFICATION OF ACTIVE BUSINESS DEFI- controlled corporation is, immediately after cial rules in certain investment entities) is NITION UNDER SECTION 355.— the transaction, a disqualified investment amended by redesignating paragraph (4) as (1) IN GENERAL.—Section 355(b) (defining corporation, and paragraph (5) and by inserting after para- active conduct of a trade or business) is ‘‘(B) any person holds, immediately after graph (3) the following new paragraph: amended by adding at the end the following the transaction, a 50-percent or greater in- ‘‘(4) TREATMENT OF CERTAIN WASH SALE new paragraph: terest in any disqualified investment cor- TRANSACTIONS.— ‘‘(3) SPECIAL RULES RELATING TO ACTIVE poration, but only if such person did not hold ‘‘(A) IN GENERAL.—If an interest in a do- BUSINESS REQUIREMENT.— such an interest in such corporation imme- mestically controlled qualified investment ‘‘(A) IN GENERAL.—For purposes of deter- diately before the transaction. entity is disposed of in an applicable wash mining whether a corporation meets the re- ‘‘(2) DISQUALIFIED INVESTMENT CORPORA- sale transaction, the taxpayer shall, for pur- quirement of paragraph (2)(A), all members TION.—For purposes of this subsection— poses of this section, be treated as having of such corporation’s separate affiliated ‘‘(A) IN GENERAL.—The term ‘disqualified gain from the sale or exchange of a United group shall be treated as 1 corporation. For investment corporation’ means any distrib- States real property interest in an amount purposes of the preceding sentence, the term uting or controlled corporation if the fair equal to the portion of the distribution de- ‘separate affiliated group’ means, with re- market value of the investment assets of the scribed in subparagraph (B) with respect to spect to any corporation, the affiliated group corporation is 75 percent or more of the fair such interest which, but for the disposition, which would be determined under section market value of all assets of the corporation. would have been treated by the taxpayer as 1504(a) if such corporation were the common ‘‘(B) INVESTMENT ASSETS.— gain from the sale or exchange of a United parent and section 1504(b) did not apply. ‘‘(i) IN GENERAL.—Except as otherwise pro- States real property interest under para- ‘‘(B) CONTROL.—For purposes of paragraph vided in this subparagraph, the term ‘invest- graph (1). (2)(D), all distributee corporations which are ment assets’ means— ‘‘(B) APPLICABLE WASH SALES TRANS- members of the same affiliated group (as de- ‘‘(I) cash, ACTION.—For purposes of this paragraph— fined in section 1504(a) without regard to sec- ‘‘(II) any stock or securities in a corpora- ‘‘(i) IN GENERAL.—The term ‘applicable tion 1504(b)) shall be treated as 1 distributee tion, wash sales transaction’ means any trans- corporation.’’. ‘‘(III) any interest in a partnership, action (or series of transactions) under (2) CONFORMING AMENDMENTS.— ‘‘(IV) any debt instrument or other evi- which a nonresident alien individual or for- (A) Subparagraph (A) of section 355(b)(2) is dence of indebtedness, eign corporation— amended to read as follows: ‘‘(V) any option, forward or futures con- ‘‘(I) disposes of an interest in a domesti- ‘‘(A) it is engaged in the active conduct of tract, notional principal contract, or deriva- cally controlled qualified investment entity a trade or business,’’. tive, during the 30-day period preceding a dis- (B) Section 355(b)(2) of such Code is amend- ‘‘(VI) foreign currency, or tribution which is to be made with respect to ed by striking the last sentence. ‘‘(VII) any similar asset. the interest and any portion of which, but (3) EFFECTIVE DATES.— ‘‘(ii) EXCEPTION FOR ASSETS USED IN ACTIVE for the disposition, would have been treated (A) IN GENERAL.—The amendments made CONDUCT OF CERTAIN FINANCIAL TRADES OR by the taxpayer as gain from the sale or ex- by this subsection shall apply— BUSINESSES.—Such term shall not include change of a United States real property in- (i) to distributions after the date of the en- any asset which is held for use in the active terest under paragraph (1), and actment of this Act, and before January 1, and regular conduct of— ‘‘(II) acquires an identical interest in such 2010, and ‘‘(I) a lending or finance business (within entity during the 60-day period beginning (ii) for purposes of determining the contin- the meaning of section 954(h)(4)), with the 1st day of the 30-day period de- ued qualification under section 355(b)(2)(A) of ‘‘(II) a banking business through a bank (as scribed in subclause (I). the Internal Revenue Code of 1986 (as amend- defined in section 581), a domestic building For purposes of subclause (II), a nonresident ed by paragraph (2)(A)) of distributions made and loan association (within the meaning of alien individual or foreign corporation shall before such date, as a result of an acquisi- section 7701(a)(19)), or any similar institu- be treated as having acquired any interest tion, disposition, or other restructuring after tion specified by the Secretary, or acquired by a person related (within the such date and before January 1, 2010. ‘‘(III) an insurance business if the conduct meaning of section 465(b)(3)(C)) to the indi- (B) TRANSITION RULE.—The amendments of the business is licensed, authorized, or vidual or corporation. made by this subsection shall not apply to regulated by an applicable insurance regu- ‘‘(ii) EXCEPTION WHERE DISTRIBUTION ACTU- any distribution pursuant to a transaction latory body. ALLY RECEIVED.—A transaction shall not be which is— This clause shall only apply with respect to treated as an applicable wash sales trans- (i) made pursuant to an agreement which any business if substantially all of the in- action if the nonresident alien individual or was binding on such date of enactment and come of the business is derived from persons foreign corporation receives the distribution at all times thereafter, who are not related (within the meaning of

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00097 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 S13244 CONGRESSIONAL RECORD — SENATE November 17, 2005 section 267(b) or 707(b)(1)) to the person con- tions after the date of the enactment of this ‘‘(B) the outstanding face amount of the ducting the business. Act. bond. ‘‘(iii) EXCEPTION FOR SECURITIES MARKED TO (B) TRANSITION RULE.—The amendments ‘‘(3) DETERMINATION.—For purposes of para- MARKET.—Such term shall not include any made by this subsection shall not apply to graph (2), with respect to any rural renais- security (as defined in section 475(c)(2)) any distribution pursuant to a transaction sance bond, the Secretary shall determine which is held by a dealer in securities and to which is— daily or caused to be determined daily a which section 475(a) applies. (i) made pursuant to an agreement which credit rate which shall apply to the first day ‘‘(iv) STOCK OR SECURITIES IN A 25-PERCENT was binding on such date of enactment and on which there is a binding, written contract CONTROLLED ENTITY.— at all times thereafter, for the sale or exchange of the bond. The ‘‘(I) IN GENERAL.—Such term shall not in- (ii) described in a ruling request submitted credit rate for any day is the credit rate clude any stock and securities in, or any to the Internal Revenue Service on or before which the Secretary or the Secretary’s des- asset described in subclause (IV) or (V) of such date, or ignee estimates will permit the issuance of clause (i) issued by, a corporation which is a (iii) described on or before such date in a rural renaissance bonds with a specified ma- 25-percent controlled entity with respect to public announcement or in a filing with the turity or redemption date without discount the distributing or controlled corporation. Securities and Exchange Commission. and without interest cost to the qualified ‘‘(II) LOOK-THRU RULE.—The distributing or SEC. 567. AMORTIZATION OF EXPENSES IN- issuer. controlled corporation shall, for purposes of CURRED IN CREATING OR ACQUIR- ‘‘(4) CREDIT ALLOWANCE DATE.—For pur- applying this subsection, be treated as own- ING MUSIC OR MUSIC COPYRIGHTS. poses of this section, the term ‘credit allow- ing its ratable share of the assets of any 25- (a) IN GENERAL.—Section 263A (relating to ance date’ means— percent controlled entity. capitalization and inclusion in inventory ‘‘(A) March 15, ‘‘(III) 25-PERCENT CONTROLLED ENTITY.—For costs of certain expenses) is amended by re- ‘‘(B) June 15, purposes of this clause, the term ‘25-percent designating subsection (i) as subsection (j) ‘‘(C) September 15, and controlled entity’ means, with respect to any and by adding after subsection (h) the fol- ‘‘(D) December 15. distributing or controlled corporation, any lowing new subsection: Such term also includes the last day on corporation with respect to which the dis- ‘‘(i) SPECIAL RULES FOR CERTAIN MUSICAL tributing or controlled corporation owns di- WORKS AND COPYRIGHTS.— which the bond is outstanding. rectly or indirectly stock meeting the re- ‘‘(1) IN GENERAL.—If— ‘‘(5) SPECIAL RULE FOR ISSUANCE AND RE- quirements of section 1504(a)(2), except that ‘‘(A) any expense is paid or incurred by the DEMPTION.—In the case of a bond which is such section shall be applied by substituting taxpayer in creating or acquiring any musi- issued during the 3-month period ending on a ‘25 percent’ for ‘80 percent’ and without re- cal composition (including any accom- credit allowance date, the amount of the gard to stock described in section 1504(a)(4). panying words) or any copyright with re- credit determined under this subsection with ‘‘(v) INTERESTS IN CERTAIN PARTNERSHIPS.— spect to a musical composition, and respect to such credit allowance date shall ‘‘(I) IN GENERAL.—Such term shall not in- ‘‘(B) such expense is required to be capital- be a ratable portion of the credit otherwise clude any interest in a partnership, or any ized under this section, determined based on the portion of the 3- month period during which the bond is out- debt instrument or other evidence of indebt- then, notwithstanding section 167(g), the standing. A similar rule shall apply when the edness, issued by the partnership, if 1 or amount capitalized shall be amortized rat- bond is redeemed or matures. more of the trades or businesses of the part- ably over the 5-year period beginning with ‘‘(c) LIMITATION BASED ON AMOUNT OF nership are (or, without regard to the 5-year the month in which the composition or copy- TAX.—The credit allowed under subsection requirement under subsection (b)(2)(B), right was acquired (or, in the case of ex- (a) for any taxable year shall not exceed the would be) taken into account by the distrib- penses paid or incurred in connection with excess of— uting or controlled corporation, as the case the creation of a musical composition, the 5- ‘‘(1) the sum of the regular tax liability (as may be, in determining whether the require- taxable-year period beginning with the tax- defined in section 26(b)) plus the tax imposed ments of subsection (b) are met with respect able year in which the expenses were paid or by section 55, over to the distribution. incurred). ‘‘(2) the sum of the credits allowable under ‘‘(II) LOOK-THRU RULE.—The distributing or ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not this part (other than subpart C thereof, re- controlled corporation shall, for purposes of apply to any expense— lating to refundable credits). applying this subsection, be treated as own- ‘‘(A) which is a qualified creative expense ‘‘(d) RURAL RENAISSANCE BOND.—For pur- ing its ratable share of the assets of any under subsection (h), poses of this section— partnership described in subclause (I). ‘‘(B) to which a simplified procedure estab- ‘‘(1) IN GENERAL.—The term ‘rural renais- ‘‘(3) 50-PERCENT OR GREATER INTEREST.—For lished under subsection (j)(2) applies, sance bond’ means any bond issued as part of purposes of this subsection— ‘‘(C) which is an amortizable section 197 in- ‘‘(A) IN GENERAL.—The term ‘50-percent or an issue if— tangible (as defined in section 197(c)), or greater interest’ has the meaning given such ‘‘(A) the bond is issued by a qualified ‘‘(D) which, without regard to this section, term by subsection (d)(4). issuer, would not be allowable as a deduction.’’ ‘‘(B) ATTRIBUTION RULES.—The rules of sec- ‘‘(B) 95 percent or more of the proceeds (b) EFFECTIVE DATE.—The amendments tion 318 shall apply for purposes of deter- made by this section shall apply to expenses from the sale of such issue are to be used for mining ownership of stock for purposes of paid or incurred after December 31, 2005, in capital expenditures incurred for 1 or more this paragraph. taxable years ending after such date. qualified projects, ‘‘(4) TRANSACTION.—For purposes of this ‘‘(C) the qualified issuer designates such SEC. 568. CREDIT TO HOLDERS OF RURAL REN- subsection, the term ‘transaction’ includes a AISSANCE BONDS. bond for purposes of this section and the series of transactions. (a) IN GENERAL.—Subpart H of part IV of bond is in registered form, and ‘‘(5) REGULATIONS.—The Secretary shall subchapter A of chapter 1 (relating to credits ‘‘(D) the issue meets the requirements of prescribe such regulations as may be nec- against tax) is amended by adding at the end subsections (e) and (h). essary to carry out, or prevent the avoidance the following new section: ‘‘(2) QUALIFIED PROJECT; SPECIAL USE of, the purposes of this subsection, including ‘‘SEC. 54A. CREDIT TO HOLDERS OF RURAL REN- RULES.— regulations— AISSANCE BONDS. ‘‘(A) IN GENERAL.—The term ‘qualified ‘‘(A) to carry out, or prevent the avoidance ‘‘(a) ALLOWANCE OF CREDIT.—In the case of project’ means 1 or more projects described of, the purposes of this subsection in cases a taxpayer who holds a rural renaissance in subparagraph (B) located in a rural area. involving— bond on a credit allowance date of such bond, ‘‘(B) PROJECTS DESCRIBED.—A project de- ‘‘(i) the use of related persons, inter- which occurs during the taxable year, there scribed in this subparagraph is— mediaries, pass-thru entities, options, or shall be allowed as a credit against the tax ‘‘(i) a water or waste treatment project, other arrangements, and imposed by this chapter for such taxable ‘‘(ii) an affordable housing project, ‘‘(ii) the treatment of assets unrelated to year an amount equal to the sum of the cred- ‘‘(iii) a community facility project, includ- the trade or business of a corporation as in- its determined under subsection (b) with re- ing hospitals, fire and police stations, and vestment assets if, prior to the distribution, spect to credit allowance dates during such nursing and assisted-living facilities, investment assets were used to acquire such year on which the taxpayer holds such bond. ‘‘(iv) a value-added agriculture or renew- unrelated assets, ‘‘(b) AMOUNT OF CREDIT.— able energy facility project for agricultural ‘‘(B) which in appropriate cases exclude ‘‘(1) IN GENERAL.—The amount of the credit producers or farmer-owned entities, includ- from the application of this subsection a dis- determined under this subsection with re- ing any project to promote the production, tribution which does not have the character spect to any credit allowance date for a rural processing, or retail sale of ethanol (includ- of a redemption which would be treated as a renaissance bond is 25 percent of the annual ing fuel at least 85 percent of the volume of sale or exchange under section 302, and credit determined with respect to such bond. which consists of ethanol), biodiesel, animal ‘‘(C) which modify the application of the ‘‘(2) ANNUAL CREDIT.—The annual credit de- waste, biomass, raw commodities, or wind as attribution rules applied for purposes of this termined with respect to any rural renais- a fuel, subsection.’’. sance bond is the product of— ‘‘(v) a distance learning or telemedicine (2) EFFECTIVE DATES.— ‘‘(A) the credit rate determined by the Sec- project, (A) IN GENERAL.—The amendments made retary under paragraph (3) for the day on ‘‘(vi) a rural utility infrastructure project, by this subsection shall apply to distribu- which such bond was sold, multiplied by including any electric or telephone system,

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00098 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13245 ‘‘(vii) a project to expand broadband tech- issue which provides for an equal amount of nual amount equal to one-half of the rate on nology, principal to be paid by the qualified issuer United States Treasury Bills of the same ma- ‘‘(viii) a rural teleworks project, and during each calendar year that the issue is turity multiplied by the outstanding prin- ‘‘(ix) any project described in any pre- outstanding. ciple balance of rural renaissance bonds ceding clause carried out by the Delta Re- ‘‘(f) LIMITATION ON AMOUNT OF BONDS DES- issued by such issuer. gional Authority. IGNATED.— ‘‘(k) SPECIAL RULES RELATING TO POOL ‘‘(C) SPECIAL RULES.—For purposes of this ‘‘(1) NATIONAL LIMITATION.—There is a rural BONDS.—No portion of a pooled financing paragraph— renaissance bond limitation of $200,000,000. bond may be allocable to loan unless the bor- ‘‘(i) any project described in subparagraph ‘‘(2) ALLOCATION BY SECRETARY.—The Sec- rower has entered into a written loan com- (B)(iv) for a farmer-owned entity may be retary shall allocate the amount described in mitment for such portion prior to the issue considered a qualified project if such entity paragraph (1) among qualified projects in date of such issue. is located in a rural area, or in the case of a such manner as the Secretary determines ap- ‘‘(l) OTHER DEFINITIONS AND SPECIAL farmer-owned entity the headquarters of propriate. RULES.—For purposes of this section— which are located in a nonrural area, if the ‘‘(g) CREDIT INCLUDED IN GROSS INCOME.— ‘‘(1) BOND.—The term ‘bond’ includes any Gross income includes the amount of the project is located in a rural area, and obligation. ‘‘(ii) any project for a farmer-owned entity credit allowed to the taxpayer under this ‘‘(2) POOLED FINANCING BOND.—The term section (determined without regard to sub- which is a facility described in subparagraph ‘pooled financing bond’ shall have the mean- section (c)) and the amount so included shall (B)(iv) for agricultural producers may be ing given such term by section 149(f)(4)(A). considered a qualified project regardless of be treated as interest income. ‘‘(3) RURAL AREA.—The term ‘rural area’ whether the facility is located in a rural or ‘‘(h) SPECIAL RULES RELATING TO EXPENDI- means any area other than— nonrural area. TURES.— ‘‘(A) a city or town which has a population ‘‘(3) SPECIAL USE RULES.— ‘‘(1) IN GENERAL.—An issue shall be treated of greater than 50,000 inhabitants, or ‘‘(A) REFINANCING RULES.—For purposes of as meeting the requirements of this sub- ‘‘(B) the urbanized area contiguous and ad- paragraph (1)(B), a qualified project may be section if, as of the date of issuance, the jacent to such a city or town. refinanced with proceeds of a rural renais- qualified issuer reasonably expects— ‘‘(4) PARTNERSHIP; S CORPORATION; AND sance bond only if the indebtedness being re- ‘‘(A) at least 95 percent of the proceeds OTHER PASS-THRU ENTITIES.— financed (including any obligation directly from the sale of the issue are to be spent for ‘‘(A) IN GENERAL.—Under regulations pre- or indirectly refinanced by such indebted- 1 or more qualified projects within the 5-year ness) was originally incurred after the date period beginning on the date of issuance of scribed by the Secretary, in the case of a of the enactment of this section. the rural renaissance bond, partnership, trust, S corporation, or other pass-thru entity, rules similar to the rules of ‘‘(B) REIMBURSEMENT.—For purposes of ‘‘(B) a binding commitment with a third paragraph (1)(B), a rural renaissance bond party to spend at least 10 percent of the pro- section 41(g) shall apply with respect to the may be issued to reimburse a borrower for ceeds from the sale of the issue will be in- credit allowable under subsection (a). amounts paid after the date of the enact- curred within the 6-month period beginning ‘‘(B) NO BASIS ADJUSTMENT.—In the case of ment of this section with respect to a quali- on the date of issuance of the rural renais- a bond held by a partnership or an S corpora- fied project, but only if— sance bond or, in the case of a rural renais- tion, rules similar to the rules under section ‘‘(i) prior to the payment of the original sance bond, the proceeds of which are to be 1397E(i) shall apply. expenditure, the borrower declared its intent loaned to 2 or more borrowers, such binding ‘‘(5) BONDS HELD BY REGULATED INVESTMENT to reimburse such expenditure with the pro- commitment will be incurred within the 6- COMPANIES.—If any rural renaissance bond is ceeds of a rural renaissance bond, month period beginning on the date of the held by a regulated investment company, the ‘‘(ii) not later than 60 days after payment loan of such proceeds to a borrower, and credit determined under subsection (a) shall of the original expenditure, the qualified ‘‘(C) such projects will be completed with be allowed to shareholders of such company issuer adopts an official intent to reimburse due diligence and the proceeds from the sale under procedures prescribed by the Sec- the original expenditure with such proceeds, of the issue will be spent with due diligence. retary. and ‘‘(2) EXTENSION OF PERIOD.—Upon submis- ‘‘(6) REPORTING.—Issuers of rural renais- ‘‘(iii) the reimbursement is made not later sion of a request prior to the expiration of sance bonds shall submit reports similar to than 18 months after the date the original the period described in paragraph (1)(A), the the reports required under section 149(e).’’. expenditure is paid. Secretary may extend such period if the (b) REPORTING.—Subsection (d) of section ‘‘(C) TREATMENT OF CHANGES IN USE.—For qualified issuer establishes that the failure 6049 (relating to returns regarding payments purposes of paragraph (1)(B), the proceeds of to satisfy the 5-year requirement is due to of interest) is amended by adding at the end an issue shall not be treated as used for a reasonable cause and the related projects the following new paragraph: qualified project to the extent that a bor- will continue to proceed with due diligence. ‘‘(9) REPORTING OF CREDIT ON RURAL RENAIS- rower takes any action within its control ‘‘(3) FAILURE TO SPEND REQUIRED AMOUNT OF SANCE BONDS.— which causes such proceeds not to be used BOND PROCEEDS WITHIN 5 YEARS.—To the ex- ‘‘(A) IN GENERAL.—For purposes of sub- for a qualified project. The Secretary shall tent that less than 95 percent of the proceeds section (a), the term ‘interest’ includes prescribe regulations specifying remedial ac- of such issue are expended by the close of the amounts includible in gross income under tions that may be taken (including condi- 5-year period beginning on the date of section 54(f) and such amounts shall be treat- tions to taking such remedial actions) to issuance (or if an extension has been ob- ed as paid on the credit allowance date (as prevent an action described in the preceding tained under paragraph (2), by the close of defined in section 54(b)(4)). sentence from causing a bond to fail to be a the extended period), the qualified issuer ‘‘(B) REPORTING TO CORPORATIONS, ETC.— rural renaissance bond. shall redeem all of the nonqualified bonds Except as otherwise provided in regulations, ‘‘(e) MATURITY LIMITATIONS.— within 90 days after the end of such period. in the case of any interest described in sub- ‘‘(1) DURATION OF TERM.—A bond shall not For purposes of this paragraph, the amount paragraph (A), subsection (b)(4) shall be ap- be treated as a rural renaissance bond if the of the nonqualified bonds required to be re- plied without regard to subparagraphs (A), maturity of such bond exceeds the maximum deemed shall be determined in the same (H), (I), (J), (K), and (L)(i) of such subsection. term determined by the Secretary under manner as under section 142. ‘‘(C) REGULATORY AUTHORITY.—The Sec- paragraph (2) with respect to such bond. ‘‘(i) SPECIAL RULES RELATING TO ARBI- retary may prescribe such regulations as are ‘‘(2) MAXIMUM TERM.—During each calendar TRAGE.—A bond which is part of an issue necessary or appropriate to carry out the month, the Secretary shall determine the shall not be treated as a rural renaissance purposes of this paragraph, including regula- maximum term permitted under this para- bond unless, with respect to the issue of tions which require more frequent or more graph for bonds issued during the following which the bond is a part, the qualified issuer detailed reporting.’’. calendar month. Such maximum term shall satisfies the arbitrage requirements of sec- (c) CONFORMING AMENDMENT.—The table of be the term which the Secretary estimates tion 148 with respect to proceeds of the issue. sections for subpart H of part IV of sub- will result in the present value of the obliga- ‘‘(j) QUALIFIED ISSUER.—For purposes of chapter A of chapter 1 is amended by adding tion to repay the principal on the bond being this section— at the end the following new item: equal to 50 percent of the face amount of ‘‘(1) IN GENERAL.—The term ‘qualified ‘‘Sec. 54A. Credit to holders of rural ren- such bond. Such present value shall be deter- issuer’ means any not-for-profit cooperative aissance bonds.’’. mined without regard to the requirements of lender which has as of the date of the enact- subsection (f)(3) and using as a discount rate ment of this section received a guarantee (d) ISSUANCE OF REGULATIONS.—The Sec- the average annual interest rate of tax-ex- under section 306 of the Rural Electrification retary of Treasury shall issue regulations re- empt obligations having a term of 10 years or Act and which meets the requirement of quired under section 54A of the Internal Rev- more which are issued during the month. If paragraph (2). enue Code of 1986 (as added by this section) the term as so determined is not a multiple ‘‘(2) USER FEE REQUIREMENT.—The require- not later than 120 days after the date of the of a whole year, such term shall be rounded ment of this paragraph is met if the issuer of enactment of this Act. to the next highest whole year. any rural renaissance bond makes grants for (e) EFFECTIVE DATE.—The amendments ‘‘(3) RATABLE PRINCIPAL AMORTIZATION RE- qualified projects as defined under sub- made by this section shall apply to bonds QUIRED.—A bond shall not be treated as a section (d)(2) on a semi-annual basis every issued after the date of the enactment of this rural renaissance bond unless it is part of an year that such bond is outstanding in an an- Act and before January 1, 2010.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00099 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 S13246 CONGRESSIONAL RECORD — SENATE November 17, 2005 SEC. 569. MODIFICATION OF TREATMENT OF possession were applicable to such dual ca- ized national intelligence through reconnais- LOANS TO QUALIFIED CONTINUING pacity taxpayer. sance programs, CARE FACILITIES. Nothing in this paragraph shall be construed ‘‘(VIII) any of the intelligence elements of (a) IN GENERAL.—Subsection (g) of section to imply the proper treatment of any such the Army, the Navy, the Air Force, the Ma- 7872 is amended to read as follows: rine Corps, the Federal Bureau of Investiga- ‘‘(g) EXCEPTION FOR LOANS TO QUALIFIED amount not in excess of the amount deter- tion, the Department of Treasury, the De- CONTINUING CARE FACILITIES.— mined under subparagraph (B). partment of Energy, and the Coast Guard, ‘‘(1) IN GENERAL.—This section shall not ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur- ‘‘(IX) the Bureau of Intelligence and Re- apply for any calendar year to any below- poses of this subsection, the term ‘dual ca- market loan owed by a facility which on the pacity taxpayer’ means, with respect to any search of the Department of State, or last day of such year is a continuing care fa- foreign country or possession of the United ‘‘(X) any of the elements of the Depart- cility, if such loan was made pursuant to a States, a person who— ment of Homeland Security concerned with continuing care contract and if the lender ‘‘(A) is subject to a levy of such country or the analyses of foreign intelligence informa- (or the lender’s spouse) attains age 62 before possession, and tion.’’. (c) SPECIAL RULE.—Subparagraph (C) of the close of such year. ‘‘(B) receives (or will receive) directly or section 121(d)(9), as amended by subsection ‘‘(2) CONTINUING CARE CONTRACT.—For pur- indirectly a specific economic benefit (as de- (b), is amended by adding at the end the fol- poses of this section, the term ‘continuing termined in accordance with regulations) lowing new clause: care contract’ means a written contract be- from such country or possession. ‘‘(vi) SPECIAL RULE RELATING TO INTEL- tween an individual and a qualified con- ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— LIGENCE COMMUNITY.—An employee of the in- tinuing care facility under which— For purposes of this subsection— telligence community shall not be treated as ‘‘(A) the individual or individual’s spouse ‘‘(A) IN GENERAL.—The term ‘generally ap- may use a qualified continuing care facility plicable income tax’ means an income tax serving on qualified extended duty unless— for their life or lives, (or a series of income taxes) which is gen- ‘‘(I) for purposes of such duty such em- ‘‘(B) the individual or individual’s spouse erally imposed under the laws of a foreign ployee has moved from 1 duty station to an- will be provided with housing in an inde- country or possession on income derived other, and pendent living unit (which has additional from the conduct of a trade or business with- ‘‘(II) at least 1 of such duty stations is lo- available facilities outside such unit for the in such country or possession. cated outside of the Washington, District of Columbia, and Baltimore metropolitan sta- provision of meals and other personal care), ‘‘(B) EXCEPTIONS.—Such term shall not in- an assisted living facility or a nursing facil- clude a tax unless it has substantial applica- tistical areas (as defined by the Secretary of ity, as is available in the continuing care fa- tion, by its terms and in practice, to— Commerce).’’. (d) CONFORMING AMENDMENT.—The heading cility, as appropriate for the health of such ‘‘(i) persons who are not dual capacity tax- for section 121(d)(9) is amended to read as fol- individual or individual’s spouse, and payers, and lows: ‘‘UNIFORMED SERVICES, FOREIGN SERV- ‘‘(C) the individual or individual’s spouse ‘‘(ii) persons who are citizens or residents ICE, AND INTELLIGENCE COMMUNITY’’. will be provided assisted living or nursing of the foreign country or possession. (e) EFFECTIVE DATE.—The amendments care as the health of such individual or indi- ‘‘(4) LARGE INTEGRATED OIL COMPANY.—For made by this section shall apply to sales or vidual’s spouse requires, and as is available purposes of this subsection, the term ‘large exchanges after the date of the enactment of in the continuing care facility. integrated oil company’ means, with respect this Act. ‘‘(3) QUALIFIED CONTINUING CARE FACILITY.— to any taxable year, an integrated oil com- SEC. 572. DISABILITY PREFERENCE PROGRAM ‘‘(A) IN GENERAL.—For purposes of this sec- pany (as defined in section 291(b)(4)) which— FOR TAX COLLECTION CONTRACTS. tion, the term ‘qualified continuing care fa- ‘‘(A) had gross receipts in excess of (a) IN GENERAL.—The Secretary of the cility’ means 1 or more facilities— $1,000,000,000 for such taxable year, and Treasury shall not enter into any qualified ‘‘(i) which are designed to provide services ‘‘(B) has an average daily worldwide pro- tax collection contract after April 1, 2006, under continuing care contracts, duction of crude oil of at least 500,000 barrels until the Secretary implements a disability ‘‘(ii) that include an independent living for such taxable year.’’ preference program that meets the require- unit, plus an assisted living or nursing facil- (b) EFFECTIVE DATE.— ments of subsection (b). ity, or both, and (1) IN GENERAL.—The amendments made by (b) DISABILITY PREFERENCE PROGRAM RE- ‘‘(iii) substantially all of the independent this section shall apply to taxes paid or ac- QUIREMENTS.— living unit residents of which are covered by crued in taxable years beginning after the (1) IN GENERAL.—A disability preference continuing care contracts. date of the enactment of this Act. program meets the requirements of this sub- ‘‘(B) NURSING HOMES EXCLUDED.—The term (2) CONTRARY TREATY OBLIGATIONS section if such program requires that not ‘qualified continuing care facility’ shall not UPHELD.—The amendments made by this sec- less than 10 percent of the accounts of each include any facility which is of a type which tion shall not apply to the extent contrary dollar value category are awarded to persons is traditionally considered a nursing home.’’. to any treaty obligation of the United described in paragraph (2). (b) EFFECTIVE DATE.—The amendment States. (2) PERSON DESCRIBED.—For purposes of made by this section shall apply to loans SEC. 571. EXCLUSION OF GAIN FROM SALE OF A paragraph (1), a person is described in this made after December 31, 2005. PRINCIPAL RESIDENCE BY CERTAIN paragraph if— SEC. 570. MODIFICATIONS OF FOREIGN TAX EMPLOYEES OF THE INTELLIGENCE (A) as of the date any qualified tax collec- CREDIT RULES APPLICABLE TO COMMUNITY. tion contract is awarded— LARGE INTEGRATED OIL COMPA- (a) IN GENERAL.—Subparagraph (A) of sec- NIES WHICH ARE DUAL CAPACITY (i) such person employs not less than 50 se- TAXPAYERS. tion 121(d)(9) (relating to exclusion of gain verely disabled individuals within the United (a) IN GENERAL.—Section 901 (relating to from sale of principal residence) is amended States; or credit for taxes of foreign countries and of by striking ‘‘duty’’ and all that follows and (ii) not less than 30 percent of the employ- possessions of the United States), as amend- inserting ‘‘duty— ees of such person within the United States ed by this Act, is amended by redesignating ‘‘(i) as a member of the uniformed services, are severely disabled individuals; subsections (m) and (n) as subsections (n) ‘‘(ii) as a member of the Foreign Service of (B) such person agrees as a condition of the and (o), respectively, and by inserting after the United States, or qualified tax collection contract that not subsection (l) the following new subsection: ‘‘(iii) as an employee of the intelligence more than 90 days after the date such con- ‘‘(m) SPECIAL RULES RELATING TO LARGE community.’’. tract is awarded, not less than 35 percent of INTEGRATED OIL COMPANIES WHICH ARE DUAL (b) EMPLOYEE OF INTELLIGENCE COMMUNITY the employees of such person employed in CAPACITY TAXPAYERS.— DEFINED.—Subparagraph (C) of section connection with providing services under ‘‘(1) GENERAL RULE.—Notwithstanding any 121(d)(9) is amended by redesignating clause such contract shall— other provision of this chapter, any amount (iv) as clause (v) and by inserting after (i) be hired after the date such contract is paid or accrued by a dual capacity taxpayer clause (iii) the following new clause: awarded; and which is a large integrated oil company to a ‘‘(iv) EMPLOYEE OF INTELLIGENCE COMMU- (ii) be severely disabled individuals; and foreign country or possession of the United NITY.—The term ‘employee of the intel- (C) such person is otherwise qualified to States for any period shall not be considered ligence community’ means an employee (as perform the services required. a tax— defined by section 2105 of title 5, United (c) DEFINITIONS.—For purposes of this sec- ‘‘(A) if, for such period, the foreign country States Code) of— tion— or possession does not impose a generally ap- ‘‘(I) the Office of the Director of National (1) QUALIFIED TAX COLLECTION CONTRACT.— plicable income tax, or Intelligence, The term ‘‘qualified tax collection contract’’ ‘‘(B) to the extent such amount exceeds the ‘‘(II) the Central Intelligence Agency, shall have the meaning given such term amount (determined in accordance with reg- ‘‘(III) the National Security Agency, under section 6306(b) of the Internal Revenue ulations) which— ‘‘(IV) the Defense Intelligence Agency, Code of 1986. ‘‘(i) is paid by such dual capacity taxpayer ‘‘(V) the National Geospatial-Intelligence (2) DOLLAR VALUE CATEGORY.—The term pursuant to the generally applicable income Agency, ‘‘dollar value category’’ means the dollar tax imposed by the country or possession, or ‘‘(VI) the National Reconnaissance Office, ranges of accounts for collection as deter- ‘‘(ii) would be paid if the generally applica- ‘‘(VII) any other office within the Depart- mined and assigned by the Secretary under ble income tax imposed by the country or ment of Defense for the collection of special- section 6306(b)(1)(B) of the Internal Revenue

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00100 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.187 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13247 Code of 1986 with respect to a qualified tax given such term in section 1171 of the Social health information technology programs of collection contract. Security Act. the Department; (3) SEVERELY DISABLED INDIVIDUAL.—The ‘‘(5) LABORATORY.—The term ‘laboratory’ ‘‘(2) facilitate the adoption of a nation- term ‘‘severely disabled individual’’ means— has the meaning given that term in section wide, interoperable system for the electronic (A) a veteran of the United States armed 353. exchange of health information; forces with a disability of 50 percent or ‘‘(6) PHARMACIST.—The term ‘pharmacist’ ‘‘(3) ensure the adoption and implementa- greater— has the meaning given that term in section tion of standards for the electronic exchange (i) determined by the Secretary of Vet- 804 of the Federal Food, Drug, and Cosmetic of health information to reduce cost and im- erans Affairs to be service-connected; or Act. prove health care quality; (ii) deemed by law to be service-connected; ‘‘(7) QUALIFIED HEALTH INFORMATION TECH- ‘‘(4) ensure that health information tech- or NOLOGY.—The term ‘qualified health infor- nology policy and programs of the Depart- (B) any individual who is a disabled bene- mation technology’ means a computerized ment are coordinated with those of relevant ficiary (as defined in section 1148(k)(2) of the system (including hardware and software) executive branch agencies (including Federal Social Security Act (42 U.S.C. 1320b–19(k)(2))) that— commissions) with a goal of avoiding dupli- or who would be considered to be such a dis- ‘‘(A) protects the privacy and security of cation of efforts and of helping to ensure abled beneficiary but for having income or health information; that each agency undertakes health informa- resources in excess of the income or re- ‘‘(B) maintains and provides permitted ac- tion technology activities primarily within sources eligibility limits established under cess to health information in an electronic the areas of its greatest expertise and tech- title XVI of the Social Security Act (42 format; nical capability; U.S.C. 1381 et seq.), respectively. ‘‘(C) incorporates decision support to re- ‘‘(5) to the extent permitted by law, coordi- TITLE VI—COMPLIANCE WITH duce medical errors and enhance health care nate outreach and consultation by the rel- CONGRESSIONAL BUDGET ACT quality; evant executive branch agencies (including ‘‘(D) complies with the standards adopted Federal commissions) with public and pri- SEC. 601. SUNSET OF CERTAIN PROVISIONS AND AMENDMENTS. by the Federal Government under section vate parties of interest, including con- The provisions of, and amendments made 2903; and sumers, payers, employers, hospitals and by, title I, title II, subtitle A of title III, and ‘‘(E) allows for the reporting of quality other health care providers, physicians, com- title IV shall not apply to taxable years be- measures under section 2907. munity health centers, laboratories, vendors ginning after September 30, 2010, and the In- ‘‘(8) STATE.—The term ‘State’ means each and other stakeholders; ternal Revenue Code of 1986 shall be applied of the several States, the District of Colum- ‘‘(6) advise the President regarding specific and administered to such years as if such bia, Puerto Rico, the Virgin Islands, Guam, Federal health information technology pro- provisions and amendments had never been American Samoa, and the Northern Mariana grams; and enacted. Islands. ‘‘(7) prepare the reports described under ‘‘SEC. 2902. OFFICE OF THE NATIONAL COORDI- section 2903(i) (excluding paragraph (4) of SA 2671. Mr. FRIST (for Mr. ENZI) NATOR OF HEALTH INFORMATION such section). proposed an amendment to the bill S. TECHNOLOGY. ‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— ‘‘(1) IN GENERAL.—Upon the request of the 1418, to enhance the adoption of a na- ‘‘(a) OFFICE OF NATIONAL HEALTH INFORMA- TION TECHNOLOGY.—There is established National Coordinator, the head of any Fed- tionwide interoperable health informa- within the Office of the Secretary an Office eral agency is authorized to detail, with or tion technology system and to improve of the National Coordinator of Health Infor- without reimbursement from the Office, any the quality and reduce the costs of mation Technology (referred to in this sec- of the personnel of such agency to the Office health care in the United States; as fol- tion as the ‘Office’). The Office shall be head- to assist it in carrying out its duties under lows: ed by a National Coordinator who shall be this section. Strike all after the enacting clause and in- appointed by the Secretary and shall report ‘‘(2) EFFECT OF DETAIL.—Any detail of per- sert the following: directly to the Secretary. sonnel under paragraph (1) shall— URPOSE ‘‘(A) not interrupt or otherwise affect the SECTION 1. SHORT TITLE. ‘‘(b) P .—It shall be the purpose of the Office to coordinate with relevant Fed- civil service status or privileges of the Fed- This Act may be cited as the ‘‘Wired for eral employee; and Health Care Quality Act’’. eral agencies and private entities and over- see programs and activities to develop a na- ‘‘(B) be in addition to any other staff of the SEC. 2. IMPROVING HEALTH CARE QUALITY, tionwide interoperable health information Department employed by the National Coor- SAFETY, AND EFFICIENCY. technology infrastructure that— dinator. The Public Health Service Act (42 U.S.C. ‘‘(1) ensures that patients’ individually ‘‘(3) ACCEPTANCE OF DETAILEES.—Notwith- 201 et seq.) is amended by adding at the end identifiable health information is secure and standing any other provision of law, the Of- the following: protected; fice may accept detailed personnel from ‘‘TITLE XXIX—HEALTH INFORMATION ‘‘(2) improves health care quality, reduces other Federal agencies without regard to TECHNOLOGY AND QUALITY medical errors, and advances the delivery of whether the agency described under para- ‘‘SEC. 2901. DEFINITIONS. patient-centered medical care; graph (1) is reimbursed. ‘‘In this title: ‘‘(3) reduces health care costs resulting ‘‘(e) RULE OF CONSTRUCTION.—Nothing in ‘‘(1) HEALTH CARE PROVIDER.—The term from inefficiency, medical errors, inappro- this section shall be construed to require the ‘health care provider’ means a hospital, priate care, and incomplete information; duplication of Federal efforts with respect to skilled nursing facility, home health entity, ‘‘(4) ensures that appropriate information the establishment of the Office, regardless of health care clinic, federally qualified health to help guide medical decisions is available whether such efforts were carried out prior center, group practice (as defined in section at the time and place of care; to or after the enactment of this title. 1877(h)(4) of the Social Security Act), a phar- ‘‘(5) promotes a more effective market- ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— macist, a pharmacy, a laboratory, a physi- place, greater competition, and increased There are authorized to be appropriated to cian (as defined in section 1861(r) of the So- choice through the wider availability of ac- carry out this section, $5,000,000 for fiscal cial Security Act), a practitioner (as defined curate information on health care costs, year 2006, $5,000,000 for fiscal year 2007, and in section 1842(b)(18)(CC) of the Social Secu- quality, and outcomes; such sums as may be necessary for each of rity Act), a health facility operated by or ‘‘(6) improves the coordination of care and fiscal years 2008 through 2010. pursuant to a contract with the Indian information among hospitals, laboratories, ‘‘SEC. 2903. AMERICAN HEALTH INFORMATION Health Service, a rural health clinic, and any physician offices, and other entities through COLLABORATIVE. other category of facility or clinician deter- an effective infrastructure for the secure and ‘‘(a) PURPOSE.—The Secretary shall estab- mined appropriate by the Secretary. authorized exchange of health care informa- lish the public-private American Health In- ‘‘(2) HEALTH INFORMATION.—The term tion; formation Collaborative (referred to in this ‘health information’ has the meaning given ‘‘(7) improves public health reporting and section as the ‘Collaborative’) to— such term in section 1171(4) of the Social Se- facilitates the early identification and rapid ‘‘(1) advise the Secretary and recommend curity Act. response to public health threats and emer- specific actions to achieve a nationwide ‘‘(3) HEALTH INSURANCE PLAN.—The term gencies, including bioterror events and infec- interoperable health information technology ‘health insurance plan’ means— tious disease outbreaks; infrastructure; ‘‘(A) a health insurance issuer (as defined ‘‘(8) facilitates health research; and ‘‘(2) serve as a forum for the participation in section 2791(b)(2)); ‘‘(9) promotes prevention of chronic dis- of a broad range of stakeholders to provide ‘‘(B) a group health plan (as defined in sec- eases. input on achieving the interoperability of tion 2791(a)(1)); and ‘‘(c) DUTIES OF THE NATIONAL COORDI- health information technology; and ‘‘(C) a health maintenance organization (as NATOR.—The National Coordinator shall— ‘‘(3) recommend standards (including con- defined in section 2791(b)(3)). ‘‘(1) serve as the principal advisor to the tent, communication, and security stand- ‘‘(4) INDIVIDUALLY IDENTIFIABLE HEALTH IN- Secretary concerning the development, ap- ards) for the electronic exchange of health FORMATION.—The term ‘individually identifi- plication, and use of health information information (including for the reporting of able health information’ has the meaning technology, and coordinate and oversee the quality data under section 2907) for adoption

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by the Federal Government and voluntary workplace) determined to be necessary by ‘‘(h) VOLUNTARY ADOPTION.— adoption by private entities. the Collaborative. ‘‘(1) IN GENERAL.—Any standards adopted ‘‘(b) COMPOSITION.— ‘‘(d) STANDARDS.— by the Federal Government under subsection ‘‘(1) IN GENERAL.—The Collaborative shall ‘‘(1) EXISTING STANDARDS.—The standards (e) shall be voluntary with respect to private be composed of members of the public and adopted by the Consolidated Health entities. private sectors to be appointed by the Sec- Informatics Initiative shall be deemed to ‘‘(2) RULE OF CONSTRUCTION.—Nothing in retary, including representatives from— have been recommended by the Collaborative this section shall be construed to require ‘‘(A) consumer or patient organizations; under this section. that a private entity that enters into a con- ‘‘(B) organizations with expertise in pri- ‘‘(2) FIRST YEAR REVIEW.—Not later than 1 tract with the Federal Government adopt vacy and security; year after the date of enactment of this title, the standards adopted by the Federal Gov- ‘‘(C) health care providers; the Collaborative shall— ernment under this section with respect to ‘‘(D) health insurance plans or other third ‘‘(A) review existing standards (including activities not related to the contract. party payors; content, communication, and security stand- ‘‘(3) LIMITATION.—Private entities that ‘‘(E) information technology vendors; and ards) for the electronic exchange of health enter into a contract with the Federal Gov- ‘‘(F) purchasers or employers. information; ernment shall adopt the standards adopted ‘‘(2) PARTICIPATION.—In appointing mem- ‘‘(B) identify deficiencies and omissions in by the Federal Government under this sec- bers under paragraph (1), and in developing such existing standards; and tion for the purpose of activities under such the procedures for conducting the activities ‘‘(C) identify duplication and overlap in Federal contract. of the Collaborative, the Secretary shall en- such existing standards; ‘‘(i) REPORTS.—The Secretary shall submit sure a balance among various sectors of the and recommend new standards and modifica- to the Committee on Health, Education, health care system so that no single sector tions to such existing standards as nec- Labor, and Pensions and the Committee on unduly influences the recommendations of essary. Finance of the Senate and the Committee on the Collaborative. ‘‘(3) ONGOING REVIEW.—Beginning 1 year Energy and Commerce and the Committee on ‘‘(3) TERMS.—Members appointed under after the date of enactment of this title, and Ways and Means of the House of Representa- paragraph (1) shall serve for 2 year terms, ex- annually thereafter, the Collaborative tives, on an annual basis, a report that— cept that any member appointed to fill a va- shall— ‘‘(1) describes the specific actions that cancy for an unexpired term shall be ap- ‘‘(A) review existing standards (including have been taken by the Federal Government pointed for the remainder of such term. A content, communication, and security stand- and private entities to facilitate the adop- member may serve for not to exceed 180 days ards) for the electronic exchange of health tion of an interoperable nationwide system after the expiration of such member’s term information; for the electronic exchange of health infor- or until a successor has been appointed. ‘‘(B) identify deficiencies and omissions in mation; ‘‘(4) OUTSIDE INVOLVEMENT.—With respect such existing standards; and ‘‘(2) describes barriers to the adoption of to the functions of the Collaborative, the ‘‘(C) identify duplication and overlap in such a nationwide system; Secretary shall ensure an adequate oppor- such existing standards; ‘‘(3) contains recommendations to achieve tunity for the participation of outside advi- and recommend new standards and modifica- full implementation of such a nationwide sors, including individuals with expertise tions to such existing standards as nec- system; and in— essary. ‘‘(4) contains a plan and progress toward ‘‘(A) health information privacy; ‘‘(4) LIMITATION.—The standards and time- the establishment of an entity to ensure the ‘‘(B) health information security; frame for adoption described in this section continuation of the functions of the Collabo- ‘‘(C) health care quality and patient safety, shall be consistent with any standards devel- rative. including individuals with expertise in uti- oped pursuant to the Health Insurance Port- ‘‘(j) APPLICATION OF FACA.—The Federal lizing health information technology to im- ability and Accountability Act of 1996. Advisory Committee Act (5 U.S.C. App.) prove health care quality and patient safety; ‘‘(e) FEDERAL ACTION.—Not later than 90 shall apply to the Collaborative, except that ‘‘(D) data exchange; and days after the issuance of a recommendation the term provided for under section 14(a)(2) ‘‘(E) developing health information tech- from the Collaborative under subsection shall be 5 years. (d)(2), the Secretary of Health and Human nology standards and new health informa- ‘‘(k) RULE OF CONSTRUCTION.—Nothing in tion technology. Services, the Secretary of Veterans Affairs, this section shall be construed to require the and the Secretary of Defense, in collabora- duplication of Federal efforts with respect to ‘‘(c) RECOMMENDATIONS AND POLICIES.—Not tion with representatives of other relevant the establishment of the Collaborative, re- later than 1 year after the date of enactment Federal agencies, as determined appropriate gardless of whether such efforts were carried of this title, and annually thereafter, the by the Secretary, shall jointly review such out prior to or after the enactment of this Collaborative shall recommend to the Sec- recommendations. If appropriate, the Sec- title. retary uniform national policies for adoption retary shall provide for the adoption by the ‘‘(l) AUTHORIZATION OF APPROPRIATIONS.— by the Federal Government and voluntary Federal Government of any standard or There are authorized to be appropriated to adoption by private entities to support the standards contained in such recommenda- widespread adoption of health information tion. carry out this section, $4,000,000 for fiscal technology, including— ‘‘(f) COORDINATION OF FEDERAL SPENDING.— year 2006, $4,000,000 for fiscal year 2007, and ‘‘(1) protection of individually identifiable ‘‘(1) IN GENERAL.—Not later than 1 year such sums as may be necessary for each of health information through privacy and se- after the adoption by the Federal Govern- fiscal years 2008 through 2010. curity practices; ment of a recommendation as provided for in ‘‘SEC. 2904. IMPLEMENTATION AND CERTIFI- ‘‘(2) measures to prevent unauthorized ac- subsection (e), and in compliance with chap- CATION OF HEALTH INFORMATION cess to health information, including unau- ter 113 of title 40, United States Code, no STANDARDS. thorized access through the use of certain Federal agency shall expend Federal funds ‘‘(a) IMPLEMENTATION.— peer-to-peer file-sharing applications; for the purchase of any new health informa- ‘‘(1) IN GENERAL.—The Secretary, based ‘‘(3) methods to notify patients if their in- tion technology or health information tech- upon the recommendations of the Collabo- dividually identifiable health information is nology system for clinical care or for the rative, shall develop criteria to ensure uni- wrongfully disclosed; electronic retrieval, storage, or exchange of form and consistent implementation of any ‘‘(4) methods to facilitate secure patient health information that is not consistent standards for the electronic exchange of access to health information; with applicable standards adopted by the health information voluntarily adopted by ‘‘(5) fostering the public understanding of Federal Government under subsection (e). private entities in technical conformance health information technology; ‘‘(2) RULE OF CONSTRUCTION.—Nothing in with such standards adopted under this title. ‘‘(6) the ongoing harmonization of indus- paragraph (1) shall be construed to restrict ‘‘(2) IMPLEMENTATION ASSISTANCE.—The try-wide health information technology the purchase of minor (as determined by the Secretary may recognize a private entity or standards; Secretary) hardware or software components entities to assist private entities in the im- ‘‘(7) recommendations for a nationwide in order to modify, correct a deficiency in, or plementation of the standards adopted under interoperable health information technology extend the life of existing hardware or soft- this title using the criteria developed by the infrastructure; ware. Secretary under this section. ‘‘(8) the identification and prioritization of ‘‘(g) COORDINATION OF FEDERAL DATA COL- ‘‘(b) CERTIFICATION.— specific use cases for which health informa- LECTION.—Not later than 3 years after the ‘‘(1) IN GENERAL.—The Secretary, based tion technology is valuable, beneficial, and adoption by the Federal Government of a upon the recommendations of the Collabo- feasible; recommendation as provided for in sub- rative, shall develop criteria to ensure and ‘‘(9) recommendations for the establish- section (e), all Federal agencies collecting certify that hardware and software that ment of an entity to ensure the continuation health data for the purposes of quality re- claim to be in compliance with applicable of the functions of the Collaborative; and porting, surveillance, epidemiology, adverse standards for the electronic exchange of ‘‘(10) other policies (including rec- event reporting, research, or for other pur- health information adopted under this title ommendations for incorporating health in- poses determined appropriate by the Sec- have established and maintained such com- formation technology into the provision of retary, shall comply with standards adopted pliance in technical conformance with such care and the organization of the health care under subsection (e). standards.

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‘‘(2) CERTIFICATION ASSISTANCE.—The Sec- chase and enhance the utilization of quali- that is not a qualified health information retary may recognize a private entity or en- fied health information technology. technology system; tities to assist in the certification described ‘‘(2) ESTABLISHMENT OF FUND.—To be eligi- ‘‘(ii) to conduct activities for which Fed- under paragraph (1) using the criteria devel- ble to receive a competitive grant under this eral funds are expended under this title, or oped by the Secretary under this section. subsection, a State shall establish a quali- the amendments made by the Wired for ‘‘(c) OUTSIDE INVOLVEMENT.—The Sec- fied health information technology loan fund Health Care Quality Act; or retary, through consultation with the Col- (referred to in this subsection as a ‘State ‘‘(iii) for any purpose other than making laborative, may accept recommendations on loan fund’) and comply with the other re- loans to eligible entities under this section. the development of the criteria under sub- quirements contained in this section. A ‘‘(6) TYPES OF ASSISTANCE.—Except as oth- sections (a) and (b) from a Federal agency or grant to a State under this subsection shall erwise limited by applicable State law, private entity. be deposited in the State loan fund estab- amounts deposited into a State loan fund lished by the State. No funds authorized by under this subsection may only be used for ‘‘SEC. 2905. GRANTS TO FACILITATE THE WIDE- SPREAD ADOPTION OF INTEROPER- other provisions of this title to be used for the following: ABLE HEALTH INFORMATION TECH- other purposes specified in this title shall be ‘‘(A) To award loans that comply with the NOLOGY. deposited in any State loan fund. following: ‘‘(a) COMPETITIVE GRANTS TO FACILITATE ‘‘(3) ELIGIBILITY.—To be eligible to receive ‘‘(i) The interest rate for each loan shall be THE WIDESPREAD ADOPTION OF HEALTH INFOR- a grant under paragraph (1) a State shall— less than or equal to the market interest ‘‘(A) submit to the Secretary an applica- rate. MATION TECHNOLOGY.— tion at such time, in such manner, and con- ‘‘(ii) The principal and interest payments ‘‘(1) IN GENERAL.—The Secretary may award competitive grants to eligible entities taining such information as the Secretary on each loan shall commence not later than to facilitate the purchase and enhance the may require; 1 year after the loan was awarded, and each utilization of qualified health information ‘‘(B) submit to the Secretary a strategic loan shall be fully amortized not later than technology systems to improve the quality plan in accordance with paragraph (4); 10 years after the date of the loan. ‘‘(C) establish a qualified health informa- ‘‘(iii) The State loan fund shall be credited and efficiency of health care. tion technology loan fund in accordance with with all payments of principal and interest ‘‘(2) ELIGIBILITY.—To be eligible to receive paragraph (2); on each loan awarded from the fund. a grant under paragraph (1) an entity shall— ‘‘(D) require that health care providers re- ‘‘(B) To guarantee, or purchase insurance ‘‘(A) submit to the Secretary an applica- ceiving such loans— for, a local obligation (all of the proceeds of tion at such time, in such manner, and con- ‘‘(i) link, to the extent practicable, the which finance a project eligible for assist- taining such information as the Secretary qualified health information system to a ance under this subsection) if the guarantee may require; local or regional health information net- or purchase would improve credit market ac- ‘‘(B) submit to the Secretary a strategic work; cess or reduce the interest rate applicable to plan for the implementation of data sharing ‘‘(ii) consult with the Health Information the obligation involved. and interoperability measures; Technology Resource Center established in ‘‘(C) As a source of revenue or security for ‘‘(C) be a— section 914(d) to access the knowledge and the payment of principal and interest on rev- ‘‘(i) not for profit hospital, including a fed- experience of existing initiatives regarding enue or general obligation bonds issued by erally qualified health center (as defined in the successful implementation and effective the State if the proceeds of the sale of the section 1861(aa)(4) of the Social Security use of health information technology; and bonds will be deposited into the State loan Act); ‘‘(iii) agree to notify patients if their indi- fund. ‘‘(ii) individual or group practice; or vidually identifiable health information is ‘‘(D) To earn interest on the amounts de- ‘‘(iii) another health care provider not de- wrongfully disclosed; posited into the State loan fund. scribed in clause (i) or (ii); ‘‘(E) require that health care providers re- ‘‘(7) ADMINISTRATION OF STATE LOAN ‘‘(D) adopt the standards adopted by the ceiving such loans adopt the standards FUNDS.— Federal Government under section 2903; adopted by the Federal Government under ‘‘(A) COMBINED FINANCIAL ADMINISTRA- ‘‘(E) implement the measures adopted section 2903; TION.—A State may (as a convenience and to under section 2907 and report to the Sec- ‘‘(F) require that health care providers re- avoid unnecessary administrative costs) retary on such measures; ceiving such loans implement the measures combine, in accordance with State law, the ‘‘(F) agree to notify patients if their indi- adopted under section 2907 and report to the financial administration of a State loan fund vidually identifiable health information is Secretary on such measures; and established under this subsection with the fi- wrongfully disclosed; ‘‘(G) provide matching funds in accordance nancial administration of any other revolv- ‘‘(G) demonstrate significant financial with paragraph (8). ing fund established by the State if other- need; and ‘‘(4) STRATEGIC PLAN.— wise not prohibited by the law under which ‘‘(H) provide matching funds in accordance ‘‘(A) IN GENERAL.—A State that receives a the State loan fund was established. with paragraph (4). grant under this subsection shall annually ‘‘(B) COST OF ADMINISTERING FUND.—Each ‘‘(3) USE OF FUNDS.—Amounts received prepare a strategic plan that identifies the State may annually use not to exceed 4 per- under a grant under this subsection shall be intended uses of amounts available to the cent of the funds provided to the State under used to facilitate the purchase and enhance State loan fund of the State. a grant under this subsection to pay the rea- the utilization of qualified health informa- ‘‘(B) CONTENTS.—A strategic plan under sonable costs of the administration of the tion technology systems and training per- subparagraph (A) shall include— programs under this section, including the sonnel in the use of such technology. ‘‘(i) a list of the projects to be assisted recovery of reasonable costs expended to es- ‘‘(4) MATCHING REQUIREMENT.—To be eligi- through the State loan fund in the first fis- tablish a State loan fund which are incurred ble for a grant under this subsection an enti- cal year that begins after the date on which after the date of enactment of this title. ty shall contribute non-Federal contribu- the plan is submitted; ‘‘(C) GUIDANCE AND REGULATIONS.—The Sec- tions to the costs of carrying out the activi- ‘‘(ii) a description of the criteria and meth- retary shall publish guidance and promul- ties for which the grant is awarded in an ods established for the distribution of funds gate regulations as may be necessary to amount equal to $1 for each $3 of Federal from the State loan fund; and carry out the provisions of this subsection, funds provided under the grant. ‘‘(iii) a description of the financial status including— ‘‘(5) PREFERENCE IN AWARDING GRANTS.—In of the State loan fund and the short-term ‘‘(i) provisions to ensure that each State awarding grants under this subsection the and long-term goals of the State loan fund. commits and expends funds allotted to the Secretary shall give preference to— ‘‘(5) USE OF FUNDS.— State under this subsection as efficiently as ‘‘(A) eligible entities that are located in ‘‘(A) IN GENERAL.—Amounts deposited in a possible in accordance with this title and ap- rural, frontier, and other underserved areas State loan fund, including loan repayments plicable State laws; and as determined by the Secretary; and interest earned on such amounts, shall ‘‘(ii) guidance to prevent waste, fraud, and ‘‘(B) eligible entities that will link, to the be used only for awarding loans or loan guar- abuse. extent practicable, the qualified health in- antees, or as a source of reserve and security ‘‘(D) PRIVATE SECTOR CONTRIBUTIONS.— formation system to local or regional health for leveraged loans, the proceeds of which ‘‘(i) IN GENERAL.—A State loan fund estab- information plan or plans; and are deposited in the State loan fund estab- lished under this subsection may accept con- ‘‘(C) with respect to an entity described in lished under paragraph (1). Loans under this tributions from private sector entities, ex- subsection (a)(2)(C)(iii), a nonprofit health section may be used by a health care pro- cept that such entities may not specify the care provider. vider to facilitate the purchase and enhance recipient or recipients of any loan issued ‘‘(b) COMPETITIVE GRANTS TO STATES FOR the utilization of qualified health informa- under this subsection. THE DEVELOPMENT OF STATE LOAN PROGRAMS tion technology and training of personnel in ‘‘(ii) AVAILABILITY OF INFORMATION.—A TO FACILITATE THE WIDESPREAD ADOPTION OF the use of such technology. State shall make publicly available the iden- HEALTH INFORMATION TECHNOLOGY.— ‘‘(B) LIMITATION.—Amounts received by a tity of, and amount contributed by, any pri- ‘‘(1) IN GENERAL.—The Secretary may State under this subsection may not be vate sector entity under clause (i) and may award competitive grants to States for the used— issue letters of commendation or make other establishment of State programs for loans to ‘‘(i) for the purchase or other acquisition of awards (that have no financial value) to any health care providers to facilitate the pur- any health information technology system such entity.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00103 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.188 S17NOPT2 S13250 CONGRESSIONAL RECORD — SENATE November 17, 2005

‘‘(8) MATCHING REQUIREMENTS.— inatory participation in the health informa- ‘‘(B) DETERMINATION OF AMOUNT CONTRIB- ‘‘(A) IN GENERAL.—The Secretary may not tion plan by all stakeholders; UTED.—Non-Federal contributions required make a grant under paragraph (1) to a State ‘‘(F) adopt the standards adopted by the under subparagraph (A) may be in cash or in unless the State agrees to make available Secretary under section 2903; kind, fairly evaluated, including equipment, (directly or through donations from public or ‘‘(G) require that health care providers re- technology, or services. Amounts provided private entities) non-Federal contributions ceiving such grants implement the measures by the Federal Government, or services as- in cash toward the costs of the State pro- adopted under section 2907 and report to the sisted or subsidized to any significant extent gram to be implemented under the grant in Secretary on such measures; by the Federal Government, may not be in- an amount equal to not less than $1 for each ‘‘(H) agree to notify patients if their indi- cluded in determining the amount of such $1 of Federal funds provided under the grant. vidually identifiable health information is non-Federal contributions. ‘‘(B) DETERMINATION OF AMOUNT OF NON- wrongfully disclosed; ‘‘(d) REPORTS.—Not later than 1 year after FEDERAL CONTRIBUTION.—In determining the ‘‘(I) facilitate the electronic exchange of the date on which the first grant is awarded amount of non-Federal contributions that a health information within the local or re- under this section, and annually thereafter State has provided pursuant to subparagraph gional area and among local and regional during the grant period, an entity that re- (A), the Secretary may not include any areas; ceives a grant under this section shall sub- amounts provided to the State by the Fed- ‘‘(J) prepare and submit to the Secretary mit to the Secretary a report on the activi- eral Government. an application in accordance with paragraph ties carried out under the grant involved. ‘‘(9) PREFERENCE IN AWARDING GRANTS.— (3); and Each such report shall include— The Secretary may give a preference in ‘‘(K) agree to provide matching funds in ac- ‘‘(1) a description of the financial costs and awarding grants under this subsection to cordance with paragraph (5). benefits of the project involved and of the States that adopt value-based purchasing ‘‘(3) APPLICATION.— entities to which such costs and benefits ac- programs to improve health care quality. ‘‘(A) IN GENERAL.—To be eligible to receive crue; ‘‘(10) REPORTS.—The Secretary shall annu- a grant under paragraph (1), an entity shall ‘‘(2) an analysis of the impact of the ally submit to the Committee on Health, submit to the Secretary an application at project on health care quality and safety; Education, Labor, and Pensions and the such time, in such manner, and containing ‘‘(3) a description of any reduction in dupli- Committee on Finance of the Senate, and such information as the Secretary may re- cative or unnecessary care as a result of the the Committee on Energy and Commerce and quire. project involved; the Committee on Ways and Means of the ‘‘(B) REQUIRED INFORMATION.—At a min- ‘‘(4) a description of the efforts of recipi- House of Representatives, a report summa- imum, an application submitted under this ents under this section to facilitate secure rizing the reports received by the Secretary paragraph shall include— patient access to health information; and from each State that receives a grant under ‘‘(i) clearly identified short-term and long- ‘‘(5) other information as required by the this subsection. term objectives of the regional or local Secretary. health information plan; ‘‘(e) REQUIREMENT TO ACHIEVE QUALITY IM- ‘‘(c) COMPETITIVE GRANTS FOR THE IMPLE- ‘‘(ii) a technology plan that complies with PROVEMENT.—The Secretary shall annually MENTATION OF REGIONAL OR LOCAL HEALTH the standards adopted under section 2903 and evaluate the activities conducted under this INFORMATION TECHNOLOGY PLANS.— that includes a descriptive and reasoned esti- section and shall, in awarding grants, imple- ‘‘(1) IN GENERAL.—The Secretary may mate of costs of the hardware, software, ment the lessons learned from such evalua- award competitive grants to eligible entities training, and consulting services necessary tion in a manner so that awards made subse- to implement regional or local health infor- to implement the regional or local health in- quent to each such evaluation are made in a mation plans to improve health care quality formation plan; manner that, in the determination of the and efficiency through the electronic ex- ‘‘(iii) a strategy that includes initiatives to Secretary, will result in the greatest im- change of health information pursuant to improve health care quality and efficiency, provement in quality measures under section the standards, protocols, and other require- including the use and reporting of health 2907. ments adopted by the Secretary under sec- care quality measures adopted under section ‘‘(f) LIMITATION.—An eligible entity may tions 2903 and 2907. 2907; only receive one non-renewable grant under ‘‘(2) ELIGIBILITY.—To be eligible to receive ‘‘(iv) a plan that describes provisions to en- subsection (a), one non-renewable grant a grant under paragraph (1) an entity shall— courage the implementation of the elec- under subsection (b), and one non-renewable ‘‘(A) demonstrate financial need to the tronic exchange of health information by all grant under subsection (c). Secretary; physicians, including single physician prac- ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(B) demonstrate that one of its principal tices and small physician groups partici- ‘‘(1) IN GENERAL.—For the purpose of car- missions or purposes is to use information pating in the health information plan; rying out this section, there is authorized to technology to improve health care quality ‘‘(v) a plan to ensure the privacy and secu- be appropriated $116,000,000 for fiscal year and efficiency; rity of personal health information that is 2006, $141,000,000 for fiscal year 2007, and such ‘‘(C) adopt bylaws, memoranda of under- consistent with Federal and State law; sums as may be necessary for each of fiscal standing, or other charter documents that ‘‘(vi) a governance plan that defines the years 2008 through 2010. demonstrate that the governance structure manner in which the stakeholders shall ‘‘(2) AVAILABILITY.—Amounts appropriated and decisionmaking processes of such entity jointly make policy and operational deci- under paragraph (1) shall remain available allow for participation on an ongoing basis sions on an ongoing basis; through fiscal year 2010. by multiple stakeholders within a commu- ‘‘(vii) a financial or business plan that de- ‘‘SEC. 2906. DEMONSTRATION PROGRAM TO INTE- nity, including— scribes— GRATE INFORMATION TECHNOLOGY ‘‘(i) physicians (as defined in section 1861(r) ‘‘(I) the sustainability of the plan; INTO CLINICAL EDUCATION. of the Social Security Act), including physi- ‘‘(II) the financial costs and benefits of the ‘‘(a) IN GENERAL.—The Secretary may cians that provide services to low income plan; and award grants under this section to carry out and underserved populations; ‘‘(III) the entities to which such costs and demonstration projects to develop academic ‘‘(ii) hospitals (including hospitals that benefits will accrue; and curricula integrating qualified health infor- provide services to low income and under- ‘‘(viii) in the case of an applicant entity mation technology systems in the clinical served populations); that is unable to demonstrate the participa- education of health professionals. Such ‘‘(iii) pharmacists or pharmacies; tion of all stakeholders pursuant to para- awards shall be made on a competitive basis ‘‘(iv) health insurance plans; graph (2)(C), the justification from the enti- and pursuant to peer review. ‘‘(v) health centers (as defined in section ty for any such nonparticipation. ‘‘(b) ELIGIBILITY.—To be eligible to receive 330(b)) and Federally qualified health centers ‘‘(4) USE OF FUNDS.—Amounts received a grant under subsection (a), an entity (as defined in section 1861(aa)(4) of the Social under a grant under paragraph (1) shall be shall— Security Act); used to establish and implement a regional ‘‘(1) submit to the Secretary an application ‘‘(vi) rural health clinics (as defined in sec- or local health information plan in accord- at such time, in such manner, and con- tion 1861(aa) of the Social Security Act); ance with this subsection. taining such information as the Secretary ‘‘(vii) patient or consumer organizations; ‘‘(5) MATCHING REQUIREMENT.— may require; ‘‘(viii) employers; and ‘‘(A) IN GENERAL.—The Secretary may not ‘‘(2) submit to the Secretary a strategic ‘‘(ix) any other health care providers or make a grant under this subsection to an en- plan for integrating qualified health infor- other entities, as determined appropriate by tity unless the entity agrees that, with re- mation technology in the clinical education the Secretary; spect to the costs to be incurred by the enti- of health professionals and for ensuring the ‘‘(D) demonstrate the participation, to the ty in carrying out the infrastructure pro- consistent utilization of decision support extent practicable, of stakeholders in the gram for which the grant was awarded, the software to reduce medical errors and en- electronic exchange of health information entity will make available (directly or hance health care quality; within the local or regional plan pursuant to through donations from public or private en- ‘‘(3) be— paragraph (2)(C); tities) non-Federal contributions toward ‘‘(A) a health professions school; ‘‘(E) adopt nondiscrimination and conflict such costs in an amount equal to not less ‘‘(B) a school of nursing; or of interest policies that demonstrate a com- than 50 percent of such costs ($1 for each $2 ‘‘(C) an institution with a graduate med- mitment to open, fair, and nondiscrim- of Federal funds provided under the grant). ical education program;

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00104 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.189 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13251 ‘‘(4) provide for the collection of data re- ‘‘(ii) such measures are consistent with the ‘‘(4) Organizations that focus on quality garding the effectiveness of the demonstra- purposes described in section 2902(b); improvement as well as the measurement tion project to be funded under the grant in ‘‘(iii) such measures include measures of and reporting of quality measures. improving the safety of patients, the effi- clinical processes and outcomes, patient ex- ‘‘(5) Organizations that certify and license ciency of health care delivery, and in in- perience, efficiency, and equity; and health care providers. creasing the likelihood that graduates of the ‘‘(iv) such measures include measures of ‘‘(6) State government public health pro- grantee will adopt and incorporate health in- overuse and underuse of health care items grams. formation technology, and implement the and services. ‘‘(7) Individuals or entities skilled in the quality measures adopted under section 2907, ‘‘(2) PRIORITIES.—In developing the quality conduct and interpretation of biomedical, in the delivery of health care services; and measures under this section, the Secretary health services, and health economics re- ‘‘(5) provide matching funds in accordance shall ensure that priority is given to— search and with expertise in outcomes and with subsection (c). ‘‘(A) measures with the greatest potential effectiveness research and technology assess- ‘‘(c) USE OF FUNDS.— impact for improving the quality and effi- ment. ‘‘(1) IN GENERAL.—With respect to a grant ciency of care provided under this Act; ‘‘(8) Individuals or entities involved in the under subsection (a), an eligible entity ‘‘(B) measures that may be rapidly imple- development and establishment of standards shall— mented by group health plans, health insur- and certification for health information ‘‘(A) use grant funds in collaboration with ance issuers, physicians, hospitals, nursing technology systems and clinical data. 2 or more disciplines; and homes, long-term care providers, and other ‘‘(9) Individuals or entities with experience ‘‘(B) use grant funds to integrate qualified providers; and with— health information technology into commu- ‘‘(C) measures which may inform health ‘‘(A) urban health care issues; nity-based clinical education. care decisions made by consumers and pa- ‘‘(B) safety net health care issues; and ‘‘(2) LIMITATION.—An eligible entity shall tients. ‘‘(C) rural and frontier health care issues. not use amounts received under a grant ‘‘(3) RISK ADJUSTMENT.—The Secretary ‘‘(e) USE OF QUALITY MEASURES.— under subsection (a) to purchase hardware, shall establish procedures to account for dif- ferences in patient health status, patient ‘‘(1) IN GENERAL.—For purposes of activi- software, or services. ties conducted or supported by the Secretary ‘‘(d) MATCHING FUNDS.— characteristics, and geographic location. To under this Act, the Secretary shall, to the ‘‘(1) IN GENERAL.—The Secretary may the extent practicable, such procedures shall extent practicable, adopt and utilize the award a grant to an entity under this section recognize existing procedures. quality measures developed under this sec- only if the entity agrees to make available ‘‘(4) MAINTENANCE.—The Secretary shall, as tion. non-Federal contributions toward the costs determined appropriate, but in no case more ‘‘(2) COLLABORATIVE AGREEMENTS.—With re- of the program to be funded under the grant often than once during each 12-month period, spect to activities conducted or supported by in an amount that is not less than $1 for each update the quality measures, including the Secretary under this Act, the Secretary $2 of Federal funds provided under the grant. through the addition of more accurate and may establish collaborative agreements with ‘‘(2) DETERMINATION OF AMOUNT CONTRIB- precise measures and the retirement of exist- private entities, including group health UTED.—Non-Federal contributions under ing outdated measures. plans and health insurance issuers, pro- paragraph (1) may be in cash or in kind, fair- ‘‘(5) RELATIONSHIP WITH PROGRAMS UNDER viders, purchasers, consumer organizations, ly evaluated, including equipment or serv- THE SOCIAL SECURITY ACT.—The Secretary and entities receiving a grant under section ices. Amounts provided by the Federal Gov- shall ensure that the quality measures devel- 2905, to— ernment, or services assisted or subsidized to oped under this section— ‘‘(A) encourage the use of the quality any significant extent by the Federal Gov- ‘‘(A) complement quality measures devel- measures adopted by the Secretary under ernment, may not be included in deter- oped by the Secretary under programs ad- this section; and mining the amount of such contributions. ministered by the Secretary under the Social ‘‘(B) foster uniformity between the health ‘‘(e) EVALUATION.—The Secretary shall Security Act, including programs under ti- take such action as may be necessary to tles XVIII, XIX, and XXI of such Act; and care quality measures utilized by private en- evaluate the projects funded under this sec- ‘‘(B) do not conflict with the needs and pri- tities. tion and publish, make available, and dis- orities of the programs under titles XVIII, ‘‘(3) REPORTING.—The Secretary shall im- seminate the results of such evaluations on XIX, and XXI of such Act, as set forth by the plement procedures to enable the Depart- as wide a basis as is practicable. Administrator of the Centers for Medicare & ment of Health and Human Services to ac- ‘‘(f) REPORTS.—Not later than 1 year after Medicaid Services. cept the electronic submission of data for the date of enactment of this title, and annu- ‘‘(c) REQUIRED CONSIDERATIONS IN DEVEL- purposes of— ally thereafter, the Secretary shall submit OPING AND UPDATING THE MEASURES.—In de- ‘‘(A) quality measurement using the qual- to the Committee on Health, Education, veloping and updating the quality measures ity measures developed under this section Labor, and Pensions and the Committee on under this section, the Secretary may take and using the standards adopted by the Fed- Finance of the Senate, and the Committee into account— eral Government under section 2903; and on Energy and Commerce and the Committee ‘‘(1) any demonstration or pilot program ‘‘(B) for reporting measures used to make on Ways and Means of the House of Rep- conducted by the Secretary relating to meas- value-based payments under programs under resentatives a report that— uring and rewarding quality and efficiency of the Social Security Act. ‘‘(1) describes the specific projects estab- care; ‘‘(f) DISSEMINATION OF INFORMATION.—Be- lished under this section; and ‘‘(2) any existing activities conducted by ginning on January 1, 2008, in order to make ‘‘(2) contains recommendations for Con- the Secretary relating to measuring and re- comparative quality information available gress based on the evaluation conducted warding quality and efficiency; to health care consumers, health profes- under subsection (e). ‘‘(3) any existing activities conducted by sionals, public health officials, researchers, ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— private entities, including health insurance and other appropriate individuals and enti- There is authorized to be appropriated to plans and payors; ties, the Secretary shall provide for the dis- carry out this section, $5,000,000 for fiscal ‘‘(4) the report by the Institute of Medicine semination, aggregation, and analysis of year 2007, and such sums as may be necessary of the National Academy of Sciences under quality measures collected under section 2905 for each of fiscal years 2008 through 2010. section 238(b) of the Medicare Prescription and the dissemination of recommendations ‘‘(h) SUNSET.—This section shall not apply Drug, Improvement, and Modernization Act and best practices derived in part from such after September 30, 2010. of 2003; and analysis. ‘‘SEC. 2907. QUALITY MEASURES. ‘‘(5) issues of data collection and reporting, ‘‘(g) TECHNICAL ASSISTANCE.—The Sec- ‘‘(a) IN GENERAL.—The Secretary shall de- including the feasibility of collecting and re- retary shall provide technical assistance to velop quality measures, including measures porting data on measures. public and private entities to enable such en- to assess the effectiveness, timeliness, pa- ‘‘(d) SOLICITATION OF ADVICE AND REC- tities to— tient self-management, patient centeredness, OMMENDATIONS.—On and after July 1, 2006, efficiency, and safety, for the purpose of the Secretary shall consult with the fol- ‘‘(1) implement and use evidence-based measuring the quality of care patients re- lowing regarding the development, updating, guidelines with the greatest potential to im- ceive. and use of quality measures developed under prove health care quality, efficiency, and pa- ‘‘(b) REQUIREMENTS.—The Secretary shall this section: tient safety; and ensure that the quality measures developed ‘‘(1) Health insurance plans and health care ‘‘(2) establish mechanisms for the rapid under this section comply with the fol- providers, including such plans and providers dissemination of information regarding evi- lowing: with experience in the care of the frail elder- dence-based guidelines with the greatest po- ‘‘(1) MEASURES.— ly and individuals with multiple complex tential to improve health care quality, effi- ‘‘(A) REQUIREMENTS.—In developing the chronic conditions, or groups representing ciency, and patient safety. quality measures under this section, the Sec- such health insurance plans and providers. ‘‘(h) RULE OF CONSTRUCTION.—Nothing in retary shall, to the extent feasible, ensure ‘‘(2) Groups representing patients and con- this title shall be construed as prohibiting that— sumers. the Secretary, acting through the Adminis- ‘‘(i) such measures are evidence based, reli- ‘‘(3) Purchasers and employers or groups trator of the Centers for Medicare & Med- able, and valid; representing purchasers or employers. icaid Services, from developing quality

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00105 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.189 S17NOPT2 S13252 CONGRESSIONAL RECORD — SENATE November 17, 2005 measures (and timing requirements for re- ‘‘(C) assemble, analyze, and widely dis- mittee on Agriculture, Nutrition, and porting such measures) for use under pro- seminate evidence and experience related to Forestry be authorized to conduct a grams administered by the Secretary under the adoption, implementation, and effective hearing during the session of the Sen- the Social Security Act, including programs use of interoperable health information tech- ate on Thursday, November 17, 2005 at under titles XVIII, XIX, and XXI of such nology. 10 a.m. in 328A, Senate Russell Office Act.’’. ‘‘(D) provide for the establishment of re- Building. The purpose of this Com- SEC. 3. LICENSURE AND THE ELECTRONIC EX- gional and local health information net- CHANGE OF HEALTH INFORMATION. works to facilitate the development of inter- mittee hearing will be to consider the (a) IN GENERAL.—The Secretary of Health operability across health care settings and role of U.S. agriculture in the control and Human Services shall carry out, or con- improve the quality of health care; and eradication of avian influenza. tract with a private entity to carry out, a ‘‘(E) provide for the development of solu- The PRESIDING OFFICER. Without study that examines— tions to barriers to the exchange of elec- objection, it is so ordered. (1) the variation among State laws that re- tronic health information; and COMMITTEE ON BANKING, HOUSING, AND URBAN late to the licensure, registration, and cer- ‘‘(F) conduct other activities identified by AFFAIRS tification of medical professionals; and the States, local or regional health informa- Mr. GRASSLEY. Mr. President, I ask (2) how such variation among State laws tion networks, or health care stakeholders unanimous consent that the Com- impacts the secure electronic exchange of as a focus for developing and sharing best health information— practices. mittee on Banking, Housing, and (A) among the States; and ‘‘(3) SUPPORT FOR ACTIVITIES.—To provide Urban Affairs be authorized to meet (B) between the States and the Federal support for the activities of the Center, the during the session of the Senate on No- Government. Director shall modify the requirements, if vember 17, 2005, at 10 a.m., to conduct (b) REPORT AND RECOMMENDATIONS.—Not necessary, that apply to the National Re- a hearing on ‘‘A Review of the GAO Re- later than 1 year after the date of enactment source Center for Health Information Tech- port on the Sale of Financial Products of this Act, the Secretary of Health and nology to provide the necessary infrastruc- to Military Personnel.’’ Human Services shall publish a report that— ture to support the duties and activities of The PRESIDING OFFICER. Without (1) describes the results of the study car- the Center and facilitate information ex- objection, it is so ordered. ried out under subsection (a); and change across the public and private sectors. COMMITTEE ON COMMERCE, SCIENCE, AND (2) makes recommendations to States re- ‘‘(4) RULE OF CONSTRUCTION.—Nothing in TRANSPORTATION garding the harmonization of State laws this subsection shall be construed to require based on the results of such study. the duplication of Federal efforts with re- Mr. GRASSLEY. Mr. President, I ask SEC. 4. ENSURING PRIVACY AND SECURITY. spect to the establishment of the Center, re- unanimous consent that the Com- Nothing in this Act (or the amendments gardless of whether such efforts were carried mittee on Commerce, Science, and made by this Act) shall be construed to af- out prior to or after the enactment of this Transportation be authorized to meet fect the scope, substance, or applicability subsection. on Thursday, November 17, 2005, at 2:30 of— ‘‘(e) TECHNICAL ASSISTANCE TELEPHONE p.m., on pending Committee business. (1) section 264 of the Health Insurance NUMBER OR WEBSITE.—The Secretary shall The PRESIDING OFFICER. Without Portability and Accountability Act of 1996; establish a toll-free telephone number or objection, it is so ordered. (2) sections 1171 through 1179 of the Social Internet website to provide health care pro- COMMITTEE ON ENVIRONMENT AND PUBLIC Security Act; and viders and patients with a single point of contact to— WORKS (3) any regulation issued pursuant to any Mr. GRASSLEY. Mr. President, I ask such section. ‘‘(1) learn about Federal grants and tech- unanimous consent that the Com- SEC. 5. GAO STUDY. nical assistance services related to inter- Not later than 6 months after the date of operable health information technology; mittee on Environment and Public enactment of this Act, the Comptroller Gen- ‘‘(2) learn about qualified health informa- Works be authorized to hold a business eral of the United States shall submit to tion technology and the quality measures meeting on November 17, 2005 at 9:30 Congress a report on the necessity and work- adopted by the Federal Government under a.m. to consider the following agenda: sections 2903 and 2907; ability of requiring health plans (as defined S. 1708 ‘‘Emergency Lease Requirements ‘‘(3) learn about regional and local health in section 1171 of the Social Security Act (42 Act of 2005.’’ U.S.C. 1320d)), health care clearinghouses (as information networks for assistance with S. 1496 ‘‘Electronic Duck Stamp Act of defined in such section 1171), and health care health information technology; and 2005.’’ providers (as defined in such section 1171) ‘‘(4) disseminate additional information de- S. 1165 ‘‘James Campbell National Wildlife who transmit health information in elec- termined by the Secretary. Refuge Expansion Act of 2005.’’ ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— tronic form, to notify patients if their indi- S.ll ‘‘Army Corps Assessment Authoriza- There is authorized to be appropriated, such tion for the State of Louisiana.’’ vidually identifiable health information (as sums as may be necessary for each of fiscal defined in such section 1171) is wrongfully years 2006 and 2007 to carry out this sub- Eight Committee resolutions to au- disclosed. section.’’. thorize the remainder of GSA’s FY06 SEC. 6. STUDY OF REIMBURSEMENT INCENTIVES. SEC. 8. REAUTHORIZATION OF INCENTIVE Capital Investment and Leasing Pro- The Secretary of Health and Human Serv- GRANTS REGARDING TELEMEDI- gram. ices shall carry out, or contract with a pri- CINE. The PRESIDING OFFICER. Without vate entity to carry out, a study that exam- Section 330L(b) of the Public Health Serv- objection, it is so ordered. ines methods to create efficient reimburse- ice Act (42 U.S.C. 254c–18(b)) is amended by COMMITTEE ON ENVIRONMENT AND PUBLIC ment incentives for improving health care striking ‘‘2002 through 2006’’ and inserting WORKS quality in Federally qualified health centers, ‘‘2006 through 2010’’. Mr. GRASSLEY. Mr. President, I ask rural health clinics, and free clinics. f SEC. 7. HEALTH INFORMATION TECHNOLOGY RE- unanimous consent that the Com- SOURCE CENTER. NOTICES OF HEARINGS/MEETINGS mittee on Environment and Public Section 914 of the Public Health Service COMMITTEE ON INDIAN AFFAIRS Works be authorized to hold a hearing Act (42 U.S.C. 299b–3) is amended by adding Mr. MCCAIN. Mr. President, I would on November 17, 2005 at 9:35 a.m. to at the end the following: like to announce that the Committee evaluate the degree to which the pre- ‘‘(d) HEALTH INFORMATION TECHNOLOGY RE- liminary findings on the failure of the SOURCE CENTER.— on Indian Affairs will meet on Thurs- levees are being incorporated into the ‘‘(1) IN GENERAL.—The Secretary, acting day, November 17, 2005, at 10 a.m. in through the Director, shall develop a Health Room 216 of the Hart Senate Office restoration of hurricane protection. Information Technology Resource Center to Building to conduct an oversight hear- The PRESIDING OFFICER. Without provide technical assistance and develop best ing on the In Re Tribal Lobbying Mat- objection, it is so ordered. practices to support and accelerate efforts to ters, Et Al. Those wishing additional COMMITTEE ON HOMELAND SECURITY AND adopt, implement, and effectively use inter- information may contact the Indian GOVERNMENTAL AFFAIRS operable health information technology in Affairs Committee at 224–2251. Mr. GRASSLEY. Mr. President, I ask compliance with section 2903 and 2907. unanimous consent that the Com- f ‘‘(2) PURPOSES.—The purpose of the Center mittee on Homeland Security and Gov- is to— AUTHORITIES FOR COMMITTEES ernmental Affairs be authorized to ‘‘(A) provide a forum for the exchange of TO MEET knowledge and experience; meet on Thursday, November 17, 2005, ‘‘(B) accelerate the transfer of lessons COMMITTEE ON AGRICULTURE, NUTRITION, AND at 10 a.m. for a hearing titled, ‘‘From learned from existing public and private sec- FORESTRY Proposed to Final: Evaluating Regula- tor initiatives, including those currently re- Mr. GRASSLEY. Mr. President, I ask tions for the National Security Per- ceiving Federal financial support; unanimous consent that the Com- sonnel System.’’

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00106 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.189 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13253 The PRESIDING OFFICER. Without mittee on the Judiciary be authorized request that the Senate proceed to the objection, it is so ordered. to meet to meet to conduct a hearing immediate consideration of Calendar COMMITTEE ON INDIAN AFFAIRS on ‘‘Recent Developments in Assessing No. 285, S. 705. Mr. GRASSLEY. Mr. President, I ask Future Asbestos Claims Under the The PRESIDING OFFICER. The unanimous consent that the Com- FAIR Act’’ on Thursday, November 17, clerk will report the bill by title. mittee on Indian Affairs be authorized 2005 at 2 p.m. in the Dirksen Senate Of- The legislative clerk read as follows: to meet on Thursday, November 17, fice Building Room 226. A bill (S. 705) to establish the Interagency 2005, at 10 a.m. in Room 216 of the Hart Panel I: Douglas Holtz-Eakin, Ph.D., Council on Meeting the Housing and Service Senate Office Building to conduct an Director, Congressional Budget Office, Needs of Seniors, and for other purposes. oversight hearing on the In Re Tribal Washington, DC. There being no objection, the Senate Panel II: Charles Bates, Ph.D., Chair- Lobbying Matters, et al. proceeded to consider the bill, which man, Bates White LLC, Washington, The PRESIDING OFFICER. Without had been reported from the Committee DC; Laura Welch, M.D., Medical Direc- objection, it is so ordered. on Banking, Housing, and Urban Af- tor, Center to Protect Workers Rights, COMMITTEE ON THE JUDICIARY fairs, with an amendment, as follows: Washington, DC; Mark Peterson, Ph.D., [Strike out all after the enacting Mr. GRASSLEY. Mr. President, I ask President, Legal Analysis Systems, unanimous consent that the Com- clause and insert the part printed in Thousand Oaks, CA; Mark Lederer, italic.] mittee on the Judiciary be authorized Chief Financial Officer, Claims Resolu- S. 705 to meet to conduct a markup on Thurs- tion Management Corporation (aka day, November 17, 2005 at 9:30 a.m. in The Manville Trust), Katonah, NY; Be it enacted by the Senate and House of Rep- Senate Dirksen Office Building Room resentatives of the United States of America in Denise Martin, Ph.D., Sr. Vice Presi- Congress assembled, 226. dent, National Economic Research As- øSECTION 1. SHORT TITLE. Agenda sociates, New York, NY. øThis Act may be cited as the ‘‘Meeting The PRESIDING OFFICER. Without the Housing and Service Needs of Seniors I. Nominations objection, it is so ordered. Act of 2005’’. Joseph Frank Bianco, to be U.S. Dis- SELECT COMMITTEE ON INTELLIGENCE øSEC. 2. FINDINGS. trict Judge for the Eastern District of Mr. GRASSLEY. Mr. President, I ask øCongress finds the following: New York; Timothy Mark Burgess, to unanimous consent that the Select ø(1) The senior population (persons 65 or be U.S. District Judge for the District Committee on Intelligence be author- older) in this country is rapidly growing, and of Alaska; Gregory F. Van Tatenhove, ized to meet during the session of the is expected to increase from 34,700,000 in 2000 to be U.S. District Judge for the East- Senate on November 17, 2005 at 10:30 to nearly 40,000,000 by 2010, and then will dra- a.m. to hold a closed hearing. matically increase to over 50,000,000 by 2020. ern District of Kentucky; Eric Nicholas ø(2) By 2020, the population of ‘‘older’’ sen- Vitaliano, to be U.S. District Judge for The PRESIDING OFFICER. Without objection, it is so ordered. iors, those over age 85, is expected to double the Eastern District of New York; to 7,000,000, and then double again to James O’Gara, to be Deputy Director SELECT COMMITTEE ON INTELLIGENCE 14,000,000 by 2040. for Supply Reduction, Office of Na- Mr. GRASSLEY. Mr. President, I ask ø(3) As the senior population increases, so tional Drug Control Policy; Emilio unanimous consent that the Select does the need for additional safe, decent, af- Gonzalez, to be Director of the Bureau Committee on Intelligence be author- fordable, and suitable housing that meets of Citizenship and Immigration Serv- ized to meet during the session of the their unique needs. ø(4) Due to the health care, transportation, ices, Department of Homeland Secu- Senate on November 17, 2005 at 2:30 p.m. to hold a closed business meeting. and service needs of seniors, issues of pro- rity; Catherine Lucille Hanaway, to be viding suitable and affordable housing oppor- U.S. Attorney for the Eastern District The PRESIDING OFFICER. Without objection, it is so ordered. tunities differ significantly from the housing of Missouri; Carol E. Dinkins, to be needs of other families. Chairman of the Privacy and Civil Lib- SUBCOMMITTEE ON AFRICAN AFFAIRS ø(5) Seniors need access to a wide array of erties Oversight Board; Alan Charles Mr. GRASSLEY. Mr. President, I ask housing options, such as affordable assisted Raul, to be Vice Chairman of the Pri- unanimous consent that the Sub- living, in-home care, supportive or service- vacy and Civil Liberties Oversight committee on African Affairs be au- enriched housing, and retrofitted homes and apartments to allow seniors to age in place Board. thorized to meet during the session of the Senate on Thursday, November 17, and to avoid premature placement in institu- II. Bills 2005, at 2:30 p.m. to hold a hearing on tional settings. ø African Organizations and Institutions: (6) While there are many programs in S. 1088, Streamlined Procedures Act place to assist seniors in finding and afford- of 2005, Kyl, Cornyn, Grassley, Hatch; Cross-Continental Progress. ing suitable housing and accessing needed S. 1789, Personal Data Privacy and The PRESIDING OFFICER. Without services, these programs are fragmented and Security Act of 2005, Specter, Leahy, objection, it is so ordered. spread across many agencies, making it dif- Feinstein, Feingold; SUBCOMMITTEE ON AVIATION ficult for seniors to access assistance or to S. 751, Notification of Risk to Per- Mr. GRASSLEY. Mr. President, I ask receive comprehensive information. ø sonal Data Act, Feinstein, Kyl; unanimous consent that the Sub- (7) Better coordination among Federal agencies is needed, as is better coordination H.R. 683, Trademark Dilution Revi- committee on Aviation be authorized to meet on Thursday, November 17, at State and local levels, to ensure that sen- sion Act of 2005, Smith–TX; iors can access government activities, pro- S. 1967, A bill to amend title 18, 2005, at 10 a.m., on Aviation Safety. grams, services, and benefits in an effective United States Code, with respect to The PRESIDING OFFICER. Without and efficient manner. certain activities of the Secret Service, objection, it is so ordered. ø(8) Up to date, accurate, and accessible and for other purposes, Specter; f statistics on key characteristics of seniors, including conditions, behaviors, and needs, S. 1961, Extending the Child Safety PRIVILEGE OF THE FLOOR Pilot Program Act of 2005, Biden, are required to accurately identify the hous- Mr. LEAHY. Mr. President, I ask ing and service needs of seniors. Hatch, Cornyn; unanimous consent that Priya ø S. 1354, Wartime Treatment Study SEC. 3. DEFINITIONS. Narasimhan be granted the privilege of øIn this Act: Act, Feingold, Grassley, Kennedy; the floor during votes and throughout ø(1) The term ‘‘housing’’ means any form S. ———, Comprehensive Immigra- the debate today. of residence, including rental housing, home- tion Reform, Chairman’s Mark. The PRESIDING OFFICER. Without ownership, assisted living, group home, sup- objection, it is so ordered. portive housing arrangement, nursing facil- III. Matters ity, or any other physical location where a S.J. Res. 1, Marriage Protection f person can live. Amendment, Allard, Sessions, Kyl, MEETING THE HOUSING AND ø(2) The term ‘‘service’’ includes transpor- Hatch, Cornyn, Coburn, Brownback. SERVICE NEEDS OF SENIORS tation, health care, nursing assistance, meal, ACT OF 2005 personal care and chore services, assistance COMMITTEE ON THE JUDICIARY with daily activities, mental health care, Mr. GRASSLEY. Mr. President, I ask Mr. GRASSLEY. Mr. President, for physical therapy, case management, and any unanimous consent that the Com- the leader I have a unanimous consent other services needed by seniors to allow

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00107 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.190 S17NOPT2 S13254 CONGRESSIONAL RECORD — SENATE November 17, 2005 them to stay in their housing or find alter- ø(9) The Administrator of the Centers for hold open Council meetings) to receive input native housing that meets their needs. Medicare and Medicaid Services or a des- and ideas about how to best meet the hous- ø(3) The term ‘‘program’’ includes any Fed- ignee of the Administrator. ing and service needs of seniors; eral or State program providing income sup- ø(10) The Administrator of the Administra- ø(G) to maintain an updated website of port, health benefits or other benefits to sen- tion on Aging or a designee of the Adminis- policies, meetings, best practices, programs, iors, housing assistance, mortgages, mort- trator. services, and any other helpful information gage or loan insurance or guarantees, hous- ø(11) The head (or designee) of any other to keep people informed of the Council’s ac- ing counseling, supportive services, assist- Federal agency as the Council considers ap- tivities; and ance with daily activities, or other assist- propriate. ø(H) to work with the Federal Interagency ance for seniors. ø(12) State and local representatives Forum on Aging Statistics, the Census Bu- ø(4) The term ‘‘Council’’ means the Inter- knowledgeable about the needs of seniors as reau, and member agencies to collect and agency Council on Meeting the Housing and chosen by the Council members described in maintain data relating to the housing and Service Needs of Seniors. paragraphs (1) through (11). service needs of seniors so that all data can ø(5) The term ‘‘senior’’ means any indi- ø(d) CHAIRPERSON.—The Chairperson of the be accessed in one place and to identify and vidual 65 years of age or older. Council shall alternate between the Sec- address unmet data needs. retary of Housing and Urban Development ø(b) REPORTS.— øSEC. 4. INTERAGENCY COUNCIL ON MEETING and the Secretary of Health and Human ø(1) BY MEMBERS.—Each year, the head of THE HOUSING AND SERVICE NEEDS each agency that is a member of the Council OF SENIORS. Services on an annual basis. ø(e) VICE CHAIR.—Each year, the Council shall prepare and transmit to the Council a ø (a) ESTABLISHMENT.—There is established shall elect a Vice Chair from among its report that describes— ø in the executive branch an independent members. (A) each program and service adminis- council to be known as the Interagency ø(f) MEETINGS.—The Council shall meet at tered by the agency that serves seniors and Council on Meeting the Housing and Service the call of its Chairperson or a majority of the number of seniors served by each pro- Needs of Seniors. its members at any time, and no less often gram or service, the resources available in ø(b) OBJECTIVES.—The objectives of the than quarterly. The Council shall hold meet- each, as well as a breakdown of where each Council are as follows: ings with stakeholders and other interested program and service can be accessed; ø ø(1) To promote coordination and collabo- parties at least twice a year, so that the (B) the barriers and impediments, includ- ration among the Federal departments and opinions of such parties can be taken into ing statutory or regulatory, to the access agencies involved with housing, health care, account and so that outside groups can learn and use of such programs and services by and service needs of seniors in order to bet- of the Council’s activities and plans. seniors; ø(C) the efforts made by each agency to in- ter meet the needs of senior citizens. øSEC. 5. FUNCTIONS OF THE COUNCIL. ø crease opportunities for seniors to find and (2) To identify the unique housing and ø(a) RELEVANT ACTIVITIES.—In carrying out service needs faced by seniors around the afford housing that meet their needs, includ- its objectives, the Council shall— ing how the agency is working with other country and to recommend ways that the ø (1) review all Federal programs and serv- agencies to better coordinate programs and Federal Government, States, State and local ices that assist seniors in finding, affording, governments, and others can better meet services; and and rehabilitating housing, including those ø(D) any new data collected by each agency those needs, including how to ensure that that assist seniors in accessing health care, seniors can find and afford housing that al- relating to the housing and service needs of transportation, supportive services, and as- seniors. lows them to access health care, transpor- sistance with daily activities, where or close tation, nursing assistance, and assistance ø(2) BY THE COUNCIL.—Each year, the Coun- to where seniors live; cil shall prepare and transmit to the Presi- with daily activities where they live or in ø (2) monitor, evaluate, and recommend im- dent, the Senate Committee on Banking, their communities. provements in existing programs and serv- ø(3) To facilitate the aging in place of sen- Housing, and Urban Affairs, the Senate Com- ices administered, funded, or financed by mittee on Health, Education, Labor, and iors, by identifying and making available the Federal, State, and local agencies to assist programs and services necessary to enable Pensions, the House Financial Services Com- seniors in meeting their housing and service mittee, and the House Committee on Edu- seniors to remain in their homes as they age. needs and make any recommendations about ø cation and the Workforce a report that— (4) To improve coordination among the how agencies can better work to house and housing and service related programs and ø(A) summarizes the reports required in serve seniors; and paragraph (1); services of Federal agencies for seniors and ø (3) recommend ways— ø(B) utilizes recent data to assess the na- to make recommendations about needed ø (A) to reduce duplication among programs ture of the problems faced by seniors in changes with an emphasis on— and services by Federal agencies that assist ø meeting their unique housing and service (A) maximizing the impact of existing seniors in meeting their housing and service programs and services; needs; needs; ø(C) provides a comprehensive and detailed ø(B) reducing or eliminating areas of over- ø (B) to ensure collaboration among and description of the programs and services of lap and duplication in the provision and ac- within agencies in the provision and avail- cessibility of such programs and services; the Federal Government in meeting the ability of programs and services so that sen- needs and problems described in subpara- and iors are able to easily access needed pro- ø(C) making access to programs and serv- graph (B); grams and services; ø(D) describes the activities and accom- ices easier for seniors around the country. ø(C) to work with States to better provide ø(5) To increase the efficiency and effec- plishments of the Council in working with housing and services to seniors by— Federal, State, and local governments, and tiveness of existing housing and service re- ø(i) holding individual meetings with State lated programs and services which serve sen- private organizations in coordinating pro- representatives; grams and services to meet the needs de- iors. ø(ii) providing ongoing technical assist- ø scribed in subparagraph (B) and the re- (6) To establish an ongoing system of co- ance to States in better meeting the needs of ordination among and within such agencies sources available to meet those needs; seniors; and ø(E) assesses the level of Federal assist- or organizations so that the housing and ø(iii) working with States to designate service needs of seniors are met in a more ef- ance required to meet the needs described in State liaisons to the Council; subparagraph (B); and ficient manner. ø (D) to identify best practices for programs ø(F) makes recommendations for appro- ø (c) MEMBERSHIP.—The Council shall be and services that assist seniors in meeting priate legislative and administrative actions composed of the following: their housing and service needs, including to meet the needs described in subparagraph ø (1) The Secretary of Housing and Urban model— (B) and for coordinating programs and serv- ø Development or a designee of the Secretary. (i) programs linking housing and services; ices designed to meet those needs. ø(2) The Secretary of Health and Human ø(ii) financing products offered by govern- øSEC. 6. POWERS OF THE COUNCIL. Services or a designee of the Secretary. ment, quasi-government, and private sector ø(a) HEARINGS.—The Council may hold ø(3) The Secretary of Agriculture or a des- entities; ø such hearings, sit and act at such times and ignee of the Secretary. (iii) land use, zoning, and regulatory prac- places, take such testimony, and receive ø (4) The Secretary of Transportation or a tices; and such evidence as the Council considers advis- ø designee of the Secretary. (iv) innovations in technology applica- able to carry out the purposes of this Act. ø (5) The Secretary of Labor or a designee tions that give seniors access to information ø(b) INFORMATION FROM AGENCIES.—Agen- of the Secretary. on available services; cies which are members of the Council shall ø(6) The Secretary of Veterans Affairs or a ø(E) to collect and disseminate informa- provide all requested information and data designee of the Secretary. tion about seniors and the programs and to the Council as requested. ø(7) The Secretary of the Treasury or a services available to them to ensure that ø(c) POSTAL SERVICES.—The Council may designee of the Secretary. seniors can access comprehensive informa- use the United States mails in the same ø(8) The Commissioner of the Social Secu- tion; manner and under the same conditions as rity Administration or a designee of the ø(F) to hold biannual meetings with stake- other departments and agencies of the Fed- Commissioner. holders and other interested parties (or to eral Government.

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ø(d) GIFTS.—The Council may accept, use, (3) As the senior population increases, so does tion related to the programs and services nec- and dispose of gifts or donations of services the need for additional safe, decent, affordable, essary to enable seniors to remain in their homes or property. and suitable housing that meets their unique as they age. øSEC. 7. COUNCIL PERSONNEL MATTERS. needs. (4) To improve coordination among the hous- ø(a) COMPENSATION OF MEMBERS.—All mem- (4) Due to the health care, transportation, ing and service related programs and services of bers of the Council who are officers or em- and service needs of seniors, issues of providing Federal agencies for seniors and to make rec- ployees of the United States shall serve suitable and affordable housing opportunities ommendations about needed changes with an without compensation in addition to that re- differ significantly from the housing needs of emphasis on— ceived for their services as officers or em- other families. (A) maximizing the impact of existing pro- ployees of the United States. (5) Seniors need access to a wide array of grams and services; ø(b) TRAVEL EXPENSES.—The members of housing options, such as affordable assisted liv- (B) reducing or eliminating areas of overlap the Council shall be allowed travel expenses, ing, in-home care, supportive or service-enriched and duplication in the provision and accessi- including per diem in lieu of subsistence, at housing, and retrofitted homes and apartments bility of such programs and services; and rates authorized for employees of agencies to allow seniors to age in place and to avoid (C) making access to programs and services under subchapter I of chapter 57 of title 5, premature placement in institutional settings. easier for seniors around the country. United States Code, while away from their (6) While there are many programs in place to (5) To increase the efficiency and effectiveness homes or regular places of business in the assist seniors in finding and affording suitable of existing housing and service related programs performance of services for the Council. housing and accessing needed services, these and services which serve seniors. ø(c) STAFF.— programs are fragmented and spread across (6) To establish an ongoing system of coordi- ø(1) IN GENERAL.—The Council shall, with- many agencies, making it difficult for seniors to nation among and within such agencies or orga- out regard to civil service laws and regula- access assistance or to receive comprehensive in- nizations so that the housing and service needs tions, appoint and terminate an Executive formation. of seniors are met in a more efficient manner. Director and such other additional personnel (7) Better coordination among Federal agen- (c) MEMBERSHIP.—The Council shall be com- as may be necessary to enable the Council to cies is needed, as is better coordination at State posed of the following: perform its duties. and local levels, to ensure that seniors can ac- (1) The Secretary of Housing and Urban De- ø(2) EXECUTIVE DIRECTOR.—The Council cess government activities, programs, services, velopment. shall appoint an Executive Director at its and benefits in an effective and efficient man- (2) The Secretary of Health and Human Serv- initial meeting. The Executive Director shall ner. ices. be compensated at a rate not to exceed the (8) Up to date, accurate, and accessible statis- (3) The Secretary of Agriculture or a designee rate of pay payable for level V of the Execu- tics on key characteristics of seniors, including of the Secretary. tive Schedule under section 5316 of title 5, conditions, behaviors, and needs, are required to (4) The Secretary of Transportation or a des- United States Code. accurately identify the housing and service ignee of the Secretary. ø(3) COMPENSATION.—With the approval of needs of seniors. (5) The Secretary of Labor or a designee of the the Council, the Executive Director may ap- SEC. 3. DEFINITIONS. Secretary. point and fix the compensation of such addi- In this Act: (6) The Secretary of Veterans Affairs or a des- tional personnel as necessary to carry out (1) HOUSING.—The term ‘‘housing’’ means any ignee of the Secretary. the duties of the Council. The rate of com- form of residence, including rental housing, (7) The Secretary of the Treasury or a des- pensation may be set without regard to the homeownership, assisted living, group home, ignee of the Secretary. provisions of chapter 51 and subchapter II of supportive housing arrangement, nursing facil- (8) The Commissioner of the Social Security chapter 53 of title 5, United States Code, re- ity, or any other physical location where a per- Administration or a designee of the Commis- lating to classification of positions and Gen- son can live. sioner. eral Schedule pay rates, except that the rate (2) SERVICE.—The term ‘‘service’’ includes (9) The Administrator of the Centers for Medi- of pay may not exceed the rate payable for transportation, health care, nursing assistance, care and Medicaid Services or a designee of the level V of the Executive Schedule under sec- meal, personal care and chore services, assist- Administrator. tion 5316 of such title. ance with daily activities, mental health care, (10) The Administrator of the Administration ø(d) TEMPORARY AND INTERMITTENT SERV- physical therapy, case management, and any on Aging or a designee of the Administrator. ICES.—In carrying out its objectives, the other services needed by seniors to allow them to (11) The head (or designee) of any other Fed- Council may procure temporary and inter- stay in their housing or find alternative housing eral agency as the Council considers appro- mittent services of consultants and experts that meets their needs. priate. under section 3109(b) of title 5, United States (3) PROGRAM.—The term ‘‘program’’ includes (12)(A) 3 additional members, as appointed by Code, at rates for individuals which do not any Federal or State program providing income the President to serve terms not to exceed 4 exceed the daily equivalent of the annual support, health benefits or other benefits to sen- years, of whom— rate of basic pay prescribed for level V of the iors, housing assistance, mortgages, mortgage or (i) one shall be a Governor of a State; Executive Schedule under section 5316 of loan insurance or guarantees, housing coun- (ii) one shall be a Mayor of a political subdivi- such title. seling, supportive services, assistance with daily sion of a State; ø(e) DETAIL OF GOVERNMENT EMPLOYEES.— activities, or other assistance for seniors. (iii) one shall be a county, town, township, Upon request of the Council, any Federal (4) COUNCIL.—The term ‘‘Council’’ means the parish, village, hamlet, or other general purpose Government employee may be detailed to Interagency Council on Meeting the Housing local official of a political subdivision of a State. the Council without reimbursement, and and Service Needs of Seniors. (B) Of the members appointed by the Presi- such detail shall be without interruption or (5) SENIOR.—The term ‘‘senior’’ means any in- dent under subparagraph (A)— loss of civil service status or privilege. dividual 65 years of age or older. (i) no more than 2 members may be affiliated ø(f) ADMINISTRATIVE SUPPORT.—The Sec- with the same political party; and SEC. 4. INTERAGENCY COUNCIL ON MEETING THE retary of Housing Urban Development and HOUSING AND SERVICE NEEDS OF (ii) none shall be considered a Federal em- the Secretary of Health and Human Services SENIORS. ployee. shall provide the Council with such adminis- (a) ESTABLISHMENT.—There is established in (d) CHAIRPERSON.—The Chairperson of the trative and supportive services as are nec- the executive branch an independent council to Council shall alternate between the Secretary of essary to ensure that the Council can carry be known as the Interagency Council on Meet- Housing and Urban Development and the Sec- out its functions. ing the Housing and Service Needs of Seniors. retary of Health and Human Services every 2 ø SEC. 8. AUTHORIZATION OF APPROPRIATIONS. (b) OBJECTIVES.—The objectives of the Council years. øThere are authorized to be appropriated are as follows: (e) VICE CHAIR.—Every 2 years, the Council to carry out this Act, $1,500,000 for each of (1) To promote coordination and collaboration shall elect a Vice Chair from among its members. fiscal years 2005 through 2010.¿ among the Federal departments and agencies in- (f) MEETINGS.—The Council shall meet at the SECTION 1. SHORT TITLE. volved with housing, health care, and service call of its Chairperson or a majority of its mem- This Act may be cited as the ‘‘Meeting the needs of seniors in order to better meet the needs bers at any time, and no less often than quar- Housing and Service Needs of Seniors Act of of senior citizens. terly. The Council shall hold meetings with 2005’’. (2) To identify the unique housing and service stakeholders and other interested parties at SEC. 2. FINDINGS. needs faced by seniors around the country and least twice a year, so that the opinions of such Congress finds the following: to recommend ways that the Federal Govern- parties can be taken into account and so that (1) The senior population (persons 65 or older) ment, States, State and local governments, and outside groups can learn of the Council’s activi- in this country is rapidly growing, and is ex- others can better meet those needs, including ties and plans. pected to increase from 34,700,000 in 2000 to how to ensure that seniors can find and afford SEC. 5. FUNCTIONS OF THE COUNCIL. nearly 40,000,000 by 2010, and then will dramati- housing that allows them to access health care, (a) RELEVANT ACTIVITIES.—In carrying out its cally increase to over 50,000,000 by 2020. transportation, nursing assistance, and assist- objectives, the Council shall— (2) By 2020, the population of ‘‘older’’ seniors, ance with daily activities where they live or in (1) review all Federal programs and services those over age 85, is expected to double to their communities. that assist seniors in finding, affording, and re- 7,000,000, and then double again to 14,000,000 by (3) To facilitate the aging in place of seniors, habilitating housing, including those that assist 2040. by identifying and making available informa- seniors in accessing health care, transportation,

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00109 Fmt 0624 Sfmt 6333 E:\CR\FM\A17NO6.076 S17NOPT2 S13256 CONGRESSIONAL RECORD — SENATE November 17, 2005 supportive services, and assistance with daily (A) summarizes the reports required in para- may procure temporary and intermittent services activities, where or close to where seniors live; graph (1); of consultants and experts under section 3109(b) (2) monitor, evaluate, and recommend im- (B) utilizes recent data to assess the nature of of title 5, United States Code, at rates for indi- provements in existing programs and services the problems faced by seniors in meeting their viduals which do not exceed the daily equiva- administered, funded, or financed by Federal, unique housing and service needs; lent of the annual rate of basic pay prescribed State, and local agencies to assist seniors in (C) provides a comprehensive and detailed de- for level V of the Executive Schedule under sec- meeting their housing and service needs and scription of the programs and services of the tion 5316 of such title. make any recommendations about how agencies Federal Government in meeting the needs and (e) DETAIL OF GOVERNMENT EMPLOYEES.— can better work to house and serve seniors; and problems described in subparagraph (B); Upon request of the Council, any Federal Gov- (3) recommend ways to— (D) describes the activities and accomplish- ernment employee may be detailed to the Coun- (A) reduce duplication among programs and ments of the Council in working with Federal, cil without reimbursement, and such detail shall services by Federal agencies that assist seniors State, and local governments, and private orga- be without interruption or loss of civil service in meeting their housing and service needs; nizations in coordinating programs and services status or privilege. (B) ensure collaboration among and within to meet the needs described in subparagraph (B) (f) ADMINISTRATIVE SUPPORT.—The Secretary agencies in the provision and availability of and the resources available to meet those needs; of Housing Urban Development and the Sec- programs and services so that seniors are able to (E) assesses the level of Federal assistance re- retary of Health and Human Services shall pro- easily access needed programs and services; quired to meet the needs described in subpara- vide the Council with such administrative (in- (C) work with States to better provide housing graph (B); and cluding office space), supportive services, and and services to seniors by— (F) makes recommendations for appropriate technical supports as are necessary to ensure (i) holding individual meetings with State rep- legislative and administrative actions to meet that the Council can carry out its functions. resentatives; the needs described in subparagraph (B) and for (ii) providing ongoing technical assistance to SEC. 8. AUTHORIZATION OF APPROPRIATIONS. coordinating programs and services designed to States in better meeting the needs of seniors; There are authorized to be appropriated to meet those needs. and carry out this Act, $1,500,000 for each of fiscal (iii) working with States to designate State li- SEC. 6. POWERS OF THE COUNCIL. years 2005 through 2010. aisons to the Council; (a) HEARINGS.—The Council may hold such Mr. SARBANES. Mr. President, I rise (D) identify best practices for programs and hearings, sit and act at such times and places, today to urge my colleagues to support services that assist seniors in meeting their take such testimony, and receive such evidence passage of S. 705, legislation to estab- as the Council considers advisable to carry out housing and service needs, including model— lish an Interagency Council on Meeting (i) programs linking housing and services; the purposes of this Act. (ii) financing products offered by government, (b) INFORMATION FROM AGENCIES.—Agencies the Housing and Service Needs of Sen- quasi-government, and private sector entities; which are represented on the Council shall pro- iors. This legislation will help the Fed- (iii) land use, zoning, and regulatory prac- vide all requested information and data to the eral Government work with its part- tices; and Council as requested. ners to meet the growing housing and (iv) innovations in technology applications (c) POSTAL SERVICES.—The Council may use related needs of senior citizens around that give seniors access to information on avail- the United States mails in the same manner and the country. The Interagency Council able services or that help in providing services to under the same conditions as other departments will work to better coordinate Federal seniors; and agencies of the Federal Government. (E) collect and disseminate information about (d) GIFTS.— programs so that seniors and their seniors and the programs and services available (1) IN GENERAL.—The Council may accept, families can access the programs and to them to ensure that seniors can access com- use, and dispose of gifts or donations of services the services necessary to allow them to prehensive information; or property. age in place or find suitable housing al- (F) hold biannual meetings with stakeholders (2) REGULATIONS REQUIRED.—The Council ternatives. and other interested parties (or to hold open shall adopt internal regulations governing the The challenges that confront us are Council meetings) to receive input and ideas receipt of gifts or donations of services or prop- about how to best meet the housing and service growing more urgent as our population erty similar to those described in part 2601 of ages. Data from the 2000 census show needs of seniors; title 5, Code of Federal Regulations. (G) maintain an updated website of policies, that the population over 65 years of age SEC. 7. COUNCIL PERSONNEL MATTERS. meetings, best practices, programs, services, and was 34.7 million. This number is ex- (a) COMPENSATION OF MEMBERS.— any other helpful information to keep people in- (1) NON-FEDERAL EMPLOYEES.—A member of pected to grow to over 50 million by formed of the Council’s activities; and the Council who is not an officer or employee of 2020. It is projected that by 2030 nearly (H) work with the Federal Interagency Forum 20 percent of our population will be on Aging Statistics, the Census Bureau, and the Federal Government shall serve without member agencies to collect and maintain data compensation. over 65. That is, almost one American relating to the housing and service needs of sen- (2) FEDERAL EMPLOYEES.—A member of the in every five will be elderly. iors so that all data can be accessed in one place Council who is an officer or employee of the As our senior population continues to and to identify and address unmet data needs. United States shall serve without compensation increase, so will the demand for afford- (b) REPORTS.— in addition to the compensation received for services of the member as an officer or employee able housing and service options. This (1) BY MEMBERS.—Each year, the head of is a matter of concern not only for each agency who is a member of the Council of the Federal Government. shall prepare and transmit to the Council a re- (b) TRAVEL EXPENSES.—The members of the those who will need the services but for port that describes— Council shall be allowed travel expenses, includ- families—children along with spouses. (A) each program and service administered by ing per diem in lieu of subsistence, at rates au- It concerns communities all around the the agency that serves a substantial number of thorized for employees of agencies under sub- country, as productive and responsible seniors and the number of seniors served by chapter I of chapter 57 of title 5, United States citizens grow older and need help. It is each program or service, the resources available Code, while away from their homes or regular a matter of deep concern for us all, be- places of business in the performance of services in each, as well as a breakdown of where each cause it will affect the well-being of program and service can be accessed; for the Council. (B) the barriers and impediments, including (c) STAFF.— our entire society. statutory or regulatory, to the access and use of (1) EXECUTIVE DIRECTOR.—The Council shall In order for seniors to age in place, or such programs and services by seniors; appoint an Executive Director at its initial meet- find alternative housing arrangements, (C) the efforts made by each agency to in- ing. The Executive Director shall be com- services must be linked with housing. crease opportunities for seniors to find and af- pensated at a rate not to exceed the rate of pay Seniors must be able to access needed ford housing that meet their needs, including payable for level V of the Executive Schedule health supports, transportation, meal how the agency is working with other agencies under section 5316 of title 5, United States Code. and chore services, and assistance with to better coordinate programs and services; and (2) COMPENSATION.—With the approval of the (D) any new data collected by each agency re- Council, the Executive Director may appoint daily tasks in or close to their homes. lating to the housing and service needs of sen- and fix the compensation of such additional Without needed supports, seniors and iors. personnel as necessary to carry out the duties of their families face difficult and even (2) BY THE COUNCIL.—Each year, the Council the Council. The rate of compensation may be daunting decisions. shall prepare and transmit to the President, the set without regard to the provisions of chapter The Commission on Affordable Hous- Committee on Banking, Housing, and Urban Af- 51 and subchapter II of chapter 53 of title 5, ing and Health Facility Needs for Sen- fairs of the Senate, the Committee on Health, United States Code, relating to classification of iors—‘‘Seniors Commission’’—estab- Education, Labor, and Pensions of the Senate, positions and General Schedule pay rates, ex- lished by Congress in 1999 found that the Special Committee on Aging of the Senate, cept that the rate of pay may not exceed the the Financial Services Committee of the House rate payable for level V of the Executive Sched- too often, seniors face premature insti- of Representatives, the Committee on Education ule under section 5316 of such title. tutionalization because housing and and the Workforce of the House of Representa- (d) TEMPORARY AND INTERMITTENT SERV- services are not linked. According to tives, a report that— ICES.—In carrying out its objectives, the Council the Commission’s report, ‘‘the very

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00110 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.076 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13257 heart’’ of its work ‘‘is the recognition Mark Calabria, and Tewana Wilkerson. attention to many of these issues. We have that the housing and service needs of In addition, we could not have done supported efforts to expand the mission of seniors traditionally have been ad- this without the active support of housing programs and to provide the needed tools for serving older persons with disabil- dressed in different ‘worlds’ that often Kathy Casey, Chairman SHELBY’s Staff ities through building features that accom- fail to recognize or communicate with Director. modate service needs, staffing that includes each other.’’ The Commission con- EXHIBIT 1 trained service coordinators, and retrofitting cluded that: ‘‘the most striking char- AARP, dollars to convert buildings to assisted liv- acteristic of seniors’’ housing and Washington, DC, April 15, 2005. ing. AARP is co-chairing a process, along health care in this country is the dis- Hon. PAUL SARBANES, with the National Cooperative Bank Devel- connection of one field from another.’’ Dirksen Senate Office Building, opment Corporation, Fannie Mae, and the If left unattended, the problem of Washington, DC. National Council of State Housing Finance lack of coordination will increasingly DEAR SENATOR SARBANES: On behalf of Agencies, to develop recommendations on AARP, thank you for introducing S. 705, the how housing finance programs could be bet- undermine all of our efforts to assure ‘‘Meeting the Housing and Service Needs of ter structured to promote affordable assisted that Americans, as they age, have ac- Seniors Act of 2005,’’ a bill to establish an living. While these efforts have been impor- cess to the services they need. The Interagency Council to improve coordination tant, they do not yet approach the scale of Interagency Council on the Housing in service delivery. As proposed, the Inter- what is needed to serve the frail older people and Service Needs of Seniors will in- agency Council would not only coordinate, who need help. Only a concerted effort by all crease coordination and will serve as a but also monitor, evaluate, and recommend agencies at all levels of government can ade- permanent national platform to ad- improvements in existing programs and serv- quately address these needs. dress the needs and issues of our aging ices that assist seniors in meeting their We urge Congress and the Administration housing and service needs at the federal, to work together to expedite the passage of population. state, and local level. And, the Council would this legislation and subsequent establish- The Interagency Council will help to collect and disseminate information about ment of the Interagency Council. AARP improve collaboration and coordina- seniors along with these programs and serv- again thanks you for your attention to the tion among the Federal agencies and ices. needs of American seniors, and stands ready our State and local partners, to ensure Better coordination of housing programs is to assist you to enact this important legisla- that seniors are better able to access needed for a variety of reasons. In many in- tion. If you have any further questions, feel housing and services. This Council will stances, multiple program requirements and free to contact me, or have your staff con- work to find new ways to link housing paperwork may become duplicative and bur- tact Tim Gearan of our Federal Affairs staff. densome. Resident means testing and quali- programs and needed supportive serv- Sincerely, fications may also be slightly different DAVID CERTNER, ices to increase their efficiency, to across programs. And, different methods of Director, Federal Affairs. make them more accessible, and to establishing rent levels and defining market strengthen their capacity. areas for comparison are used by different ELDERLY HOUSING COALITION, The decisions that our seniors and programs. Lastly, different housing sponsors April 5, 2005. their families must make are difficult and agencies may have different waiting Re support for Interagency Council on Hous- enough. They should not be made more lists that can overlap for a population at ing and Service Needs of Seniors. need. painful and burdensome by having to Hon. PAUL SARBANES, The need for greater coordination is par- Committee on Banking, Housing and Urban Af- negotiate a confusing maze of pro- ticularly apparent when trying to put to- fairs Committee, U.S. Senate, Dirksen Sen- grams and services and a multiplicity gether the housing, health, and social serv- ate Office Building, Washington, DC. of administrative procedures. I am ices programs at all levels of government DEAR SENATOR SARBANES, The Elderly hopeful that the Interagency Council that are critical to successfully serving per- Housing Coalition (EHC) is comprised of or- sons with disabilities of all ages. Research on Meeting the Housing and Service ganizations that represent providers of af- has shown that federal housing programs Needs of Seniors will be able to focus fordable housing and supportive service for have very efficiently, if inadvertently, tar- attention on this problem, while work- the elderly. We are writing in enthusiastic geted those who are at high risk of needing ing towards solutions. support of your legislation that would estab- supportive services to remain independent. lish the Interagency Council on Housing and This bill has wide support from a di- Analysis by AARP’s Public Policy Institute Service Needs of Seniors. This Council is des- verse array of groups, ranging from of data from the 2002 American Communities perately needed and will help federal, state senior advocates to faith-based organi- Survey found that, compared to older home- and local governments better serve the hous- zations and direct service providers. owners, older renters in subsidized housing ing and service needs of our elderly popu- The diversity of groups that have were: Much older—half of the older renters in lation. worked together in support of this leg- According to the Congressional Commis- subsidized housing were 75 or older compared islation is indicative of the great need sion on Affordable Housing and Health Facil- to just over a third of older homeowners; for such coordination. If we are to suc- Twice as likely to experience physical and ity Needs for Seniors in the 21st Century, we cessfully address the growing needs of cognitive limitations that threaten their must integrate our current fragmented sys- seniors, it is clear that much work ability to live independently; tem of programs that seniors rely on to find must be done. The establishment of an More than three times as likely to live the housing and services they need. As the Interagency Council on Meeting the alone and have weak informal supports from number of seniors grows exponentially and family; and will, in fact, have doubled by 2030, we must Housing and Service Needs of Seniors find a way to use our resources more effec- is a critical first step in this endeavor. Roughly three times as likely to be at high risk of needing Medicaid assistance due to tively. I urge my colleagues to vote in favor of low incomes and high levels of disability. Your bill will be a great first step to bring- this important legislation. I ask unani- Better coordination of housing, health, and ing the key governmental agencies together mous consent that the legislation as social services programs would serve a vari- to identify how they can best work to maxi- reported from Committee be printed ety of purposes. Housing managers need reli- mize program efficiency and streamline ac- immediately following this statement. able partners from health and social services cess. Again, we are pleased to offer our sup- I also ask unanimous consent that the agencies to serve the large and growing num- port for this legislation establishing an interagency council and thank you for your attached letters of support, section-by- ber of frail older people in their buildings. Social services agencies could benefit from leadership on this issue. section analysis of the bill, and rel- the greater efficiencies of serving concentra- If there is anything that the Elderly Hous- evant fact sheet be printed in the tions of older people with supportive services ing Coalition can do to help or if you have RECORD. needs. But the most compelling case for bet- any questions about the EHC please contact The PRESIDING OFFICER. Without ter coordination comes from the lives of the Nancy Libson or Alayna Waldrum. objection it is so ordered. older people who need assistance—the older Sincerely, (See exhibit 1.) woman who is desperately clinging to inde- Alliance for Retired Americans, Amer- Mr. SARBANES. Finally, I want to pendence in her apartment; the older man ican Association of Homes and Services thank Chairman SHELBY for his leader- who is told he must move to a nursing home for the Aging, American Association of ship and assistance in moving this leg- to get needed services; or the older resident Service Coordinators, Association of Jewish Aging Services of North Amer- islation. I also want to acknowledge in a nursing home who might have been able to leave if suitable housing and services were ica, B’nai B’rith International, Catho- the excellent work of the staff on this available. lic Charities USA, Catholic Health As- bill, especially that of Jennifer Fogel- AARP actively participated in the Seniors sociation of the United States, Council Bublick, as well as Sarah Garrett, Housing Commission whose 2002 report called of Large Public Housing Authorities,

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Elderly Housing Development and Op- AMERICAN ASSOCIATION OF HOMES pendent Jewish communities across North erations Corporation. AND SERVICES FOR THE AGING, America—one of the world’s largest and Kinship Caregiver Resources/ Washington, DC, April 5, 2005. most effective networks of social service pro- Intergenerational Village Project, Re Interagency Council on Housing and viders and programs, meeting the needs of Local Initiatives Support Corporation, Service Needs of Seniors legislation. all people, Jews and non-Jews, wherever they National Association of Housing Co- Hon. PAUL SARBANES, live. More importantly, the American Jewish operatives, National Association of Committee on Banking, Housing and Urban Af- population is aging faster than the general Housing and Redevelopment Officials, fairs Committee, U.S. Senate, Dirksen Sen- population. More than a million Jews are National Housing Conference, National ate Office Building, Washington, DC. over 65; more than 318,000 live alone. Federa- Low Income Housing Coalition, Na- DEAR SENATOR SARBANES: On behalf of tion-supported programs, transportation as- tional PACE Association, Stewards of AAHSA, I am writing to thank you for intro- sistance, home-delivered meals and a myriad Affordable Housing for the Future, Vol- ducing legislation to establish an Inter- of other services help ensure that our seniors unteers of America. agency Council on Housing and Service are cared for with dignity and loving-kind- Needs of Seniors. AAHSA members serve two ness. It is critical that we maximize program efficiency and streamline access. AMERICAN ASSOCIATION OF million people every day through mission- driven, not-for-profit organizations dedi- SERVICE COORDINATORS, United Jewish Communities strongly sup- Columbus, OH, April 5, 2005. cated to providing the services people need, ports your bill, which will better help key when they need them, in the place they call Hon. PAUL SARBANES, governmental agencies coordinate aging pro- Washington, DC. home. Our members offer the continuum of grams. We urge Congress and the Adminis- aging services: assisted living residences, tration to work together to pass this legisla- DEAR SENATOR SARBANES: On behalf of the continuing care retirement communities, tion. Thank you for your leadership on this 1,600 members of the American Association nursing homes, senior housing facilities, and initiative. If there is anything that UJC can of Service Coordinators (AASC), I want to outreach services. AAHSA’s mission is to do to be of further assistance, please do not express our support for your proposed legis- create the future of aging services through hesitate to let us know. lation to establish an Interagency Council on quality the public can trust. Sincerely, Half of our members own or operate feder- Housing and Service Needs of Seniors. AASC STEPHAN O. KLINE, ally subsidized senior apartment buildings believes that this bill is urgently needed to Director, Government Affairs. assist service coordinators and others seek- and work collaboratively with home and ing to bring together the various federal and community based service providers that op- other programs needed by older persons and erate programs governed by a maze of de- THE ENTERPRISE FOUNDATION, other special populations. partmental regulations. This unique perspec- Columbia, MD, May 20, 2005. tive gives us and our members a bird’s eye Hon. PAUL S. SARBANES, In my testimony, before the Commission view of how important it is for the various Ranking Member, Senate Committee on Bank- on Affordable Housing and Health Facility federal agencies to work together to ensure ing, Housing and Urban Affairs, Hart Sen- describing the present fragmented system, I the best care in the most responsive and effi- ate Office Building, Washington, DC. stated that ‘‘even for long-time profes- cient manner possible. DEAR SENATOR SARBANES: The Enterprise sionals, the current ‘crazy-quilt’ tapestry of In 2002 the Commission on Affordable Foundation strongly supports your bill to es- services and shelter options make it difficult Housing and Health Facility Needs for Sen- tablish an Interagency Council on Housing to fully grasp their complexities, let alone iors in the 21st Century reported to Congress and Service Needs of Seniors (S. 705). Devel- try to access them. The results are confusion that a top priority for the federal govern- oping effective and efficient coordination among consumers, duplication of service de- ment should be integrating the existing frag- among the various federal agencies that are livery, government agencies not knowing mented system of programs that seniors rely involved in providing housing, health care who supplies what service or that some serv- on to piece together the housing and services and supportive services to seniors is critical ices even exist, reduction in qualified service they need. Time is precious—the United to meeting the needs of elderly low-income workers, regulations that impede dedicated States is facing exponential growth in our Americans and their families. service providers from providing the service senior population, which will double by 2030. they were hired and want to perform.’’ AAHSA members have created a number of The Enterprise Foundation and our sub- sidiary organization, the Enterprise Social One of AASC recommendations to the successful models for combining services and senior housing. Unfortunately these are lim- Investment Corporation, certainly recognize Commission was the establishment of a cabi- ited and difficult to replicate because of the that providing decent, affordable housing for net-level department that would encompass programmatic barriers. Now is the time to low-income seniors requires effective link- in one entity housing, health care and other get the policymakers to the table to address ages between housing and services to enable federal support programs serving the elderly the barriers and opportunities that exist in seniors to remain in their homes and com- to better focus federal policy and regulatory our federal programs and how to make them munities. To date, ESIC has completed 212 efforts, in conjunction with states and com- work. elderly housing projects, representing an munities. AASC believes that your bill is an We know that this can be done. AAHSA invetment of more than $729 million. Of the important step to establish a permanent na- strongly supports your bill, which will help 68,727 affordable housing units ESIC has pro- tional platform to address many of the cross- the Executive branch and Federal agencies duced, 20,005 include support services for el- cutting needs and issues confronting increas- better coordinate the successful aging pro- derly and disabled residents as well as fami- ing numbers of frail and vulnerable older grams, as an important first step. Thank you lies. persons. for your leadership. If there is anything that In recognition of the need for collabora- As you may know, AASC is a national, AAHSA or my staff can do to support you, tion, The Foundation, ESIC and the Corpora- nonprofit organization representing profes- please do not hesitate to let me know. tion for Supportive Housing have recently sional service coordinators who serve low-in- Sincerely, embarked on a new Supportive Housing In- come older persons and other special popu- LARRY MINNIX, vestment Partnership that is the nation’s lations living in federally assisted and public President and CEO. largest, most ambitious initiative focused on housing facilities nationwide, their care- leveraging private capital investments to givers, and others in their local community. UNITED JEWISH COMMUNITIES, significantly increase the production of sup- Our dedicated membership consists of serv- Washington, DC, May 12, 2005. portive housing across the country. This ice coordinators, case managers and social Hon. PAUL SARBANES, partnership will enable nonprofit developers workers, housing managers and administra- U.S. Senate, Hart Senate Office Building, to build more than 3,000 new supportive tors, housing management companies, public Washington, DC. housing units over the next two years. This housing authorities, state housing finance DEAR SENATOR SARBANES: On behalf of partnership is designed to expand the impact agencies, state and local area agencies on United Jewish Communities, I am pleased to of all of the partners, to be flexible in adapt- aging and a broad range of national and offer our support for your efforts to establish ing to local needs and environments, and state organizations and professionals in- an Interagency Council on Housing and Serv- also to support the established relationships volved in affordable, service-enhanced hous- ice Needs for Seniors through your introduc- and the significant efforts to date of each ing. Background information on AASC is tion of S. 705, the Meeting the Housing and partner. Service Needs of Seniors Act of 2005. As pro- available on our website: posed, the executive level Interagency Coun- Similar collaboration at the federal level www.servicercoordinators.org. cil will provide crucial coordination of hous- among and within agencies providing pro- We are grateful for your leadership on the ing, health and social services for seniors. grams and services for seniors would maxi- vital issue. Please let me know how AASC The Interagency Council will also make pos- mize the impact of . . . seniors receive the can assist you to expedite enactment of this sible greater cooperation between the federal assistance they need. important legislation. agencies involved with these programs, in- The Enterprise Foundation commends you Sincerely, cluding HUD, HHS, DOT and AOA. for your leadership on this and other housing JANICE MONKS, As you may know, UJC represents and issues and urges Congress to expedite the President. serves 155 Jewish Federations and 400 inde- passage of this critical legislation. Please

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call upon us if we can provide additional in- S. 705—SECTION-BY-SECTION ANALYSIS iors; work with states to ensure programs formation or assistance., Section 1. Short title and services are coordinated at state and Sincerely, local levels; identify best practices for meet- This section establishes the title of the F. BARTON HARVEY III, ing the needs of seniors; ensure seniors have bill, the ‘‘Meeting the Housing and Service Chairman of the Board access to information about programs and Needs of Seniors Act of 2005’’ and Chief Executive Officer. services, including the establishment of a Section 2. Congressional findings website; and maintain updated data sources ELDERLY HOUSING DEVELOPMENT This section states Congressional Findings, on seniors and their needs. This section also requires that each agency & OPERATIONS CORPORATION, including: or department that is a member of the Coun- Fort Lauderdale, FL, April 15, 2005. (1) The senior population (persons 65 or cil provide a report to the Council that de- Hon. PAUL SARBANES, older) in this country is rapidly growing, and scribes: each program in the agency or de- U.S. Senate, is expected to increase from 34,700,000 in 2000 partment that serves a substantial number Washington, DC. to nearly 40,000,000 by 2010, and then will dra- matically increase to over 50,000,000 by 2020. of seniors; any barriers to the access and use DEAR SENATOR SARBANES: I am pleased (2) Seniors need access to a wide array of of such programs; the efforts made by the that Elderly Housing Development and Oper- housing options, such as affordable assisted agency in increasing service enriched hous- ations Corporation (EHDOC) representing living, in home care, supportive or service- ing opportunities for seniors; and any new over 40 senior housing facilities in 14 states, enriched housing, and retrofitted homes and data relating to housing and service needs of is joining with other non-profit organiza- apartments to allow seniors to age in place seniors. tions involved with federally assisted senior and to avoid premature placement in institu- Based on the information provided by each housing to strongly support your bill to es- tional settings. member agency, the Council is required to tablish an Interagency Council on Housing (3) While there are many programs in place prepare and transmit a report to Congress and Service Needs of Seniors. We believe to assist seniors in finding and affording and the President that summarizes the agen- that the establishment of this Interagency suitable housing and accessing needed serv- cy information; assesses the needs of seniors; Council will provide a cost-effective and effi- ices, these programs are fragmented and provides a comprehensive description of the cient means to promote coordination be- spread across many agencies, making it dif- programs and services that exist for seniors; tween the various federal agencies involved ficult for seniors to access assistance or to describes how the agencies and Council are with senior housing and services, particu- receive comprehensive information. working with state and local governments larly HUD and HHS. (4) Better coordination among Federal and private organizations to better coordi- EHDOC is well aware of the need to im- agencies is needed, as is better coordination nate senior programs; and makes rec- prove collaboration between the various fed- at State and local levels, to ensure that sen- ommendations for legislative and adminis- eral agencies based on our efforts to assist iors can access government activities, pro- trative changes needed to better meet the low-income, frail elderly in Council House in grams, services, and benefits in an effective needs of seniors. Suitland, MD. Unfortunately, it is often dif- and efficient manner. Section 6. Powers of the council ficult to link the various services needed to Section 3. Definitions This section details how the Council will enable many frail elderly to remain in their work, including granting the Council the homes as they age due to the existing frag- This section provides definitions of the fol- power to hold hearings and take testimony mentation of federal housing, services and lowing terms: ‘‘housing,’’ ‘‘service,’’ ‘‘pro- as needed. In addition, this section provides health care policies and programs. gram,’’ ‘‘Council,’’ and ‘‘senior.’’ that member agencies must provide the The difficulty experienced by EHDOC with Section 4. Interagency Council on Meeting the Council with all requested information. This linking housing and services is repeated by Housing and Service Needs of Seniors section also requires the Council to adopt in- many nonprofit sponsors of federally assisted This section establishes a high level execu- ternal ethics guidelines. senior housing throughout the country. As tive branch Interagency Council on Meeting Section 7. Council personnel matters you know, I was honored to serve as your ap- the Housing and Service Needs of Seniors. This section clarifies that Council mem- pointee to the recent Commission on Afford- This section also lays out the objectives of bers shall not be compensated for their serv- able Housing and Health Care Facilities the Council, including promoting coordina- ice on the Council. Under this section, the Needs of Older Persons. We repeatedly heard tion and collaboration among the federal Council must appoint an Executive Director testimony from public and private agencies agencies and departments which serve sen- at its initial meeting, and the Executive Di- involved with senior housing, supportive iors; identifying housing and service needs of rector, with the approval of the Council may services and health care, older persons and seniors; facilitating the aging in place of hire staff. others, of their difficulties in bringing to- seniors; and making recommendations about This section also requires the Secretaries gether these services to meet the needs of needed changes to maximize the impact of of the U.S. Department of Housing and older persons. existing programs, reduce duplication and Urban Development and the U.S. Depart- As stated in the Senior Commissions’ final increase access to programs and services. ment of Health and Human Services to pro- report, ‘‘the very heart of this Commission’s This section details the Council member- vide all necessary administrative support in- work is the recognition that the housing and ship—the Secretaries of HUD and HHS, as cluding office space and computer/internet service needs of seniors traditionally have well as the Secretaries or designees of the access. been addressed in different ‘worlds’ that Department of Agriculture, Labor, Transpor- Section 8. Authorization of appropriations often fail to recognize or communicate with tation, Veterans Affairs, and the Treasury. This section authorizes $1.5 million per each other.’’ Findings of the Commission Also serving on the Council will be the fol- year for 5 years for the Council. lowing (or their designees): the Commis- concluded ‘‘while policymakers have strug- SUMMARY OF LEGISLATION TO ESTABLISH AN sioner of the Social Security Administra- gled to be responsive to the needs of seniors, INTERAGENCY COUNCIL ON MEETING THE tion, the Administrator of the Centers for the very structure of Congressional commit- HOUSING AND SERVICE NEEDS OF SENIORS tees and Federal agencies often makes it dif- Medicare and Medicaid Services and the Ad- ministrator of the Administration on Aging. This legislation will create an executive ficult to address complex needs in a com- level Interagency Council to better coordi- prehensive and coordinated fashion. For ex- The Council will also have three additional members- a Governor, a Mayor and a local nate housing programs and related services ample: medical needs of seniors are ad- so that senior citizens can age in place and dressed by Medicare and Medicaid; social official, as appointed by the President. This section establishes that the Secretaries of access needed services. Unfortunately, the service needs are addressed by Medicaid, the current programs and services that assist OAA, and other block grant programs; hous- HUD and HHS will chair the Council in ro- tating 2-year terms. Under this section, the the elderly in meeting their needs are spread ing programs are administered by HUD and across numerous federal agencies, making it the Department of Agriculture’s RHS; and Council is required to meet quarterly, and must hold at least 2 meetings a year with difficult for seniors to understand and access transportation programs are administered by needed services. the U.S. Department of Trsportation (DOT).’’ stakeholders and interested parties. This re- quirement can be met by opening at least The senior population (persons 65 or older) We commend you for your leadership in ad- two of the quarterly meetings to the public. in this country is rapidly growing, and is ex- dressing this critical need to effectively pected to increase from 34.7 million in 2000 to bring together the various federal agencies Section 5. Functions of the council nearly 40 million by 2010, and then will dra- and others involved with affordable housing This section lists the activities that the matically increase to over 50 million by 2020. and service needs of older persons through Council will undertake in meeting its objec- By the year 2030, nearly one-fifth of the the establishment of an Interagency Council tives. In meeting its objectives, the Council United States population will be above 65 on Senior Housing. Please let me if you have will: review all federal programs and services years of age. As the senior population in- any questions or how EHDOC can assist you that assist seniors; monitor, evaluate and creases, so does the need for additional safe, with the enactment of this important legis- recommend improvements in existing pro- decent, affordable, and suitable housing that lation. grams, and how programs can be better co- meets their unique needs. Sincerely, ordinated; recommend ways to reduce dupli- The Council will undertake a number of ac- STEVE PROTULIS, cation and ensure greater collaboration; tivities to help coordinate housing programs Executive Director. work to facilitate the aging in place of sen- and services for seniors:

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00113 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.104 S17NOPT2 S13260 CONGRESSIONAL RECORD — SENATE November 17, 2005 Conduct a thorough review of all federal To pay for long-term care, many seniors ing characteristic of seniors’ housing and programs and services designed to assist sen- rely on government funding—Medicaid (39%) health care in this country is the disconnec- iors with their housing needs and Medicare (20%), while 36% of seniors pay tion of one field from another.’’ Facilitate the ‘‘aging in place’’ of seniors out-of-pocket expenses. The Seniors Commission also found that Make recommendations about how to re- Today, approximately one-third of all Med- ‘‘the time has come for coordination among duce duplication among programs and how icaid spending pays for long-term care, mak- Federal and State agencies and administra- to more effectively coordinate programs and ing Medicaid our Nation’s largest source of tors.’’ services payment for such services and supports. What these facts illustrate is that there is Collect and disseminate data and informa- Medicaid spent a total of $83.8 billion for tremendous stress on seniors and on their tion on seniors and their needs long-term care services in 2003. families to find, maintain and afford hous- Maintain an updated website with informa- Of those over age 85, roughly 55% are im- ing; to acquire and pay for personal care as- tion on how seniors can access housing and paired and require long-term care. sistance or long term care; and to access services that fit their needs A Florida study showed that more than other needed services that can keep them Work with States to coordinate programs 34% of seniors in government-assisted hous- independent and enable them to stay con- and services at the State and local level ing have no family to turn to if sick or dis- nected to their communities and age in Implement the recommendation of the 1999 abled. place. Congressionally established Seniors Commis- Many Seniors Are Not in a Financial Posi- Senator Sarbanes has introduced an Inter- sion that the federal government streamline tion to Pay for the Housing and/or Services agency Council on Meeting the Housing and and consolidate its programs and services for They Need. Service Needs of Seniors, to better coordi- seniors There are nearly six times as many seniors nate housing programs and related services This Interagency Council will be comprised in need of affordable housing as are cur- so that seniors can age in place and access of the Secretaries (or designees) of the agen- rently served in rent-assisted housing. needed services. cies which operate programs for seniors: 81% of seniors are homeowners, but: 44% of Mr. GRASSLEY. I ask unanimous HUD, HHS, DOT, Agriculture, Treasury, those have incomes of less than 50% of Area consent that the committee-reported Labor, Veterans Affairs, as well as the Com- Median Income; 40% have no savings; 26% amendment be agreed to, the bill as missioner of the Social Security Administra- have less than $25,000 saved. 35% of senior renters are severely rent bur- amended be read a third time and tion, the Administrator of the Centers for dened and pay more than 50% of their in- passed, the motion to reconsider be Medicare and Medicaid Services and the Ad- come for rent. laid on the table, and any statements ministrator of the Administration on Aging. The median income of older persons in 2002 be printed in the RECORD. The legislation authorizes $1.5 million per was $19,436 for males and $11,406 for females. The PRESIDING OFFICER. Without year for 5 years to pay for staff and other ex- In home support services are expensive and penses. . objection, it is so ordered. can cost from $140–$200 per day, or up to The committee amendment in the The legislation is supported by many orga- $73,000 per year. nizations involved in housing and services nature of a substitute was agreed to. Roughly one-third of seniors who enter a The bill (S. 705), as amended, was for seniors, including: AARP (American As- nursing home are eligible for Medicaid upon sociation of Retired Persons), NAHRO (the admission; another third deplete their assets read the third time and passed. National Association of Housing and Rede- paying for care and then turn to Medicaid to f velopment Officials), AAHSA (American As- pay for the portion of care that exceeds their UNANIMOUS CONSENT sociation of Homes and Services for the income. Aging), the Elderly Housing Coalition, and Nuring Homes: Without services, seniors AGREEMENT—H.J. RES. 72 the National Low Income Housing Coalition. find it difficult to remain outside of nursing Mr. FRIST. Mr. President, I ask AGING NEEDS IN THE UNITED STATES homes or other institutional settings. unanimous consent that when the Sen- Our Nation’s Senior Population is Rapidly One third of seniors leave their homes to ate proceeds to H.J. Res. 72 on Friday, Growing, and Americans are Living Longer go to nursing homes. Nursing home costs average $60,000 per that Senator HARKIN be recognized in Than Ever Before. order to offer an amendment related to The senior population (age 65 and older) is year; these costs are expected to rise at least 5% annually. CSBG, which is at the desk. I further expected to double by 2030, from 36 million to ask consent that there be 20 minutes 70 million, one-fifth of the Nation’s popu- Almost 20% of seniors over age 85 live in lation. nursing homes, compared with less than 2% for debate in relation to the amend- By 2050 there will be over 86 million sen- of seniors age 65–84. ment, no other amendments be in 65% of nursing home admissions are di- iors, an increase of 147% since 2000. order, and that following that debate rectly from hospitals, giving families little The average American life expectancy is the Senate proceed to a vote in rela- time to explore other options. anticipated to increase from 76 to 81 by 2060. The Congressionally established Seniors tion to the Harkin amendment; fur- By 2020 the number of seniors over age 85 is Commission found in their 2002 report that ther, that following that vote, the joint expected to double to 7 million and then dou- the unsynchronized federal housing and resolution be read a third time and the ble again to 14 million by 2040. health policies often lead to premature insti- Senate proceed to a vote on the joint Seniors Want to Age in Place. tutionalization. 82% of Americans age 45 and older say that resolution, with no intervening action Assisted Living Facilities: Many seniors even if they need help caring for themselves, or debate. could be well served in assisted living facili- they prefer receiving services that allow The PRESIDING OFFICER. Without ties, an immediate step between aging in them to stay in their current home. objection, it is so ordered. place and nursing homes. 89% of those 55 and older desire to age in Assisted living is the fastest growing type f place, up from 84% in 1992. of senior housing in the United States, ac- To Facilitate Aging in Place, Services WIRED FOR HEALTH CARE counting for roughly 75% of all new senior QUALITY ACT Must Be Connected to Housing. housing produced in recent years. While many seniors want to remain at The typical assisted living resident is a Mr. FRIST. Mr. President, I ask home, over 18% of seniors (over 5.8 million) widowed White woman, age 85. unanimous consent that the Senate who do not reside in nursing facilities have Roughly 50% of assisted living residents proceed to the immediate consider- difficulty performing their daily activities have Alzheimer’s disease or other cognitive ation of Calendar No. 178, S. 1418. without assistance, and over one million of impairment. these seniors are severely impaired, requir- The PRESIDING OFFICER. The In 2002, over 36,000 assisted living facilities clerk will report the bill by title. ing assistance with many of their basic served approximately 910,000 residents. tasks. Assisted living costs between $2,100 and The legislative clerk read as follows: Many other seniors, those that can per- $2,900 a month, and is primarily private pay. A bill (S. 1418) to enhance the adoption of form their daily functions, still require ac- Few people have private insurance coverage, a nationwide interoperable health informa- cess to health care, transportation and other and public subsidies are limited. tion technology system and to improve the services. In 2002, 41 states provided at least some quality and reduce the costs of health care in In fact, nearly 20% of seniors have signifi- Medicaid coverage for assisted living (serv- the United States. cant long-term care needs. ing about 102,000 elderly Medicaid bene- There being no objection, the Senate It is predicted that both shrinking family ficiaries), but this covered personal care proceeded to consider the bill, which size and increasing workforce participation services, not room and board. had been reported from the Committee by women could make informal care less Programs and Services for Seniors are on Health, Education, Labor, and Pen- available (women currently provide the ma- Fragmented: Regardless of where seniors jority of such care), leading to a greater reli- live, it is clear that housing and services sions, with an amendment. ance on care from other sources. must be linked. (Strike the part shown in black In 2005, $129 billion will be spent on paid The 1999 Congressionally established Sen- brackets and insert the part shown in care for seniors; roughly $15,000 per senior. iors Commission found that ‘‘the most strik- italic.)

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00114 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.107 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13261 S. 1418 ties to develop a nationwide interoperable ø‘‘(A) not interrupt or otherwise affect the Be it enacted by the Senate and House of Rep- health information technology infrastruc- civil service status or privileges of the Fed- resentatives of the United States of America in ture that— eral employee; and Congress assembled, ø‘‘(1) ensures that patients’ health infor- ø‘‘(B) be in addition to any other staff of the Department employed by the National øSECTION 1. SHORT TITLE. mation is secure and protected; Coordinator. øThis Act may be cited as the ‘‘Wired for ø‘‘(2) improves health care quality, reduces ø‘‘(3) ACCEPTANCE OF DETAILEES.—Notwith- Health Care Quality Act’’. medical errors, and advances the delivery of patient-centered medical care; standing any other provision of law, the Of- øSEC. 2. IMPROVING HEALTH CARE, QUALITY, ø‘‘(3) reduces health care costs resulting fice may accept detailed personnel from SAFETY, AND EFFICIENCY. other Federal agencies without regard to ø from inefficiency, medical errors, inappro- The Public Health Service Act (42 U.S.C. whether the agency described under para- 201 et seq.) is amended by adding at the end priate care, and incomplete information; ø graph (1) is reimbursed. the following: ‘‘(4) ensures that appropriate information to help guide medical decisions is available ø‘‘(e) RULE OF CONSTRUCTION.—Nothing in ‘‘TITLE XXIX—HEALTH INFORMATION at the time and place of care; this section shall be construed to require the TECHNOLOGY ø‘‘(5) promotes a more effective market- duplication of Federal efforts with respect to ø‘‘SEC. 2901. DEFINITIONS. place, greater competition, and increased the establishment of the Office, regardless of ø‘‘In this title: choice through the wider availability of ac- whether such efforts were carried out prior ø‘‘(1) HEALTH CARE PROVIDER.—The term curate information on health care costs, to or after the enactment of this title. ‘health care provider’ means a hospital, quality, and outcomes; ø‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— skilled nursing facility, home health entity, ø‘‘(6) improves the coordination of care and There are authorized to be appropriated such health care clinic, federally qualified health information among hospitals, laboratories, sums as may be necessary to carry out the center, group practice (as defined in section physician offices, and other entities through activities of the Office under this section for 1877(h)(4) of the Social Security Act), a phar- an effective infrastructure for the secure and each of fiscal years 2006 through 2010. macist, a pharmacy, a laboratory, a physi- authorized exchange of health care informa- ø cian (as defined in section 1861(r) of the So- ‘‘SEC. 2903. AMERICAN HEALTH INFORMATION tion; COLLABORATIVE. cial Security Act), a health facility operated ø‘‘(7) improves public health reporting and ø by or pursuant to a contract with the Indian facilitates the early identification and rapid ‘‘(a) PURPOSE.—The Secretary shall estab- Health Service, a rural health clinic, and any response to public health threats and emer- lish the public-private American Health In- other category of facility or clinician deter- gencies, including bioterror events and infec- formation Collaborative (referred to in this mined appropriate by the Secretary. tious disease outbreaks; section as the ‘Collaborative’) to— ø ø‘‘(2) HEALTH INFORMATION.—The term ø‘‘(8) facilitates health research; and ‘‘(1) advise the Secretary and recommend ‘health information’ has the meaning given ø‘‘(9) promotes prevention of chronic dis- specific actions to achieve a nationwide such term in section 1171(4) of the Social Se- eases. interoperable health information technology curity Act. infrastructure; ø‘‘(c) DUTIES OF THE NATIONAL COORDI- ø‘‘(3) HEALTH INSURANCE PLAN.—The term ø‘‘(2) serve as a forum for the participation ‘health insurance plan’ means— NATOR.—The National Coordinator shall— of a broad range of stakeholders to provide ø ø‘‘(A) a health insurance issuer (as defined ‘‘(1) serve as a member of the public-pri- input on achieving the interoperability of in section 2791(b)(2)); vate American Health Information Collabo- health information technology; and ø‘‘(B) a group health plan (as defined in rative established under section 2903; ø‘‘(3) recommend standards (including con- ø section 2791(a)(1)); and ‘‘(2) serve as the principal advisor to the tent, communication, and security stand- ø‘‘(C) a health maintenance organization Secretary concerning the development, ap- ards) for the electronic exchange of health (as defined in section 2791(b)(3)). plication, and use of health information information for adoption by the Federal Gov- technology, and coordinate and oversee the ø‘‘(4) LABORATORY.—The term ‘laboratory’ ernment and voluntary adoption by private has the meaning given that term in section health information technology programs of entities. the Department; 353. ø‘‘(b) COMPOSITION.— ø‘‘(3) facilitate the adoption of a nation- ø‘‘(5) PHARMACIST.—The term ‘pharmacist’ ø‘‘(1) IN GENERAL.—The Collaborative shall has the meaning given that term in section wide, interoperable system for the electronic be composed of— 804 of the Federal Food, Drug, and Cosmetic exchange of health information; ø‘‘(A) the Secretary, who shall serve as the ø Act. ‘‘(4) ensure the adoption and implementa- chairperson of the Collaborative; tion of standards for the electronic exchange ø‘‘(6) QUALIFIED HEALTH INFORMATION TECH- ø‘‘(B) the Secretary of Defense, or his or of health information to reduce cost and im- NOLOGY.—The term ‘qualified health infor- her designee; mation technology’ means a computerized prove health care quality; ø‘‘(C) the Secretary of Veterans Affairs, or ø system (including hardware, software, and ‘‘(5) ensure that health information tech- his or her designee; training) that— nology policy and programs of the Depart- ø‘‘(D) the Secretary of Commerce, or his or ø‘‘(A) protects the privacy and security of ment are coordinated with those of relevant her designee; health information; executive branch agencies (including Federal ø‘‘(E) the National Coordinator for Health ø‘‘(B) maintains and provides permitted ac- commissions) with a goal of avoiding dupli- Information Technology; cess to health information in an electronic cation of efforts and of helping to ensure ø‘‘(F) representatives of other relevant format; that each agency undertakes health informa- Federal agencies, as determined appropriate ø‘‘(C) incorporates decision support to re- tion technology activities primarily within by the Secretary; and duce medical errors and enhance health care the areas of its greatest expertise and tech- ø‘‘(G) representatives from each of the fol- quality; nical capability; lowing categories to be appointed by the Sec- ø ø‘‘(D) complies with the standards adopted ‘‘(6) to the extent permitted by law, co- retary from nominations submitted by the by the Federal Government under section ordinate outreach and consultation by the public— 2903; and relevant executive branch agencies (includ- ø‘‘(i) consumer and patient organizations; ø‘‘(E) allows for the reporting of quality ing Federal commissions) with public and ø‘‘(ii) experts in health information pri- measures under section 2908. private parties of interest, including con- vacy and security; sumers, payers, employers, hospitals and ø‘‘(7) STATE.—The term ‘State’ means each ø‘‘(iii) health care providers; of the several States, the District of Colum- other health care providers, physicians, com- ø‘‘(iv) health insurance plans or other third bia, Puerto Rico, the Virgin Islands, Guam, munity health centers, laboratories, vendors party payors; American Samoa, and the Northern Mariana and other stakeholders; ø‘‘(v) standards development organizations; ø Islands. ‘‘(7) advise the President regarding spe- ø‘‘(vi) information technology vendors; cific Federal health information technology ø‘‘SEC. 2902. OFFICE OF THE NATIONAL COORDI- ø‘‘(vii) purchasers or employers; and programs; and ø‘‘(viii) State or local government agencies NATOR OF HEALTH INFORMATION ø TECHNOLOGY. ‘‘(8) submit the reports described under or Indian tribe or tribal organizations. section 2903(i) (excluding paragraph (4) of ø‘‘(a) OFFICE OF NATIONAL HEALTH INFOR- ø‘‘(2) CONSIDERATIONS.—In appointing such section). MATION TECHNOLOGY.—There is established members under paragraph (1)(G), the Sec- within the Office of the Secretary an Office ø‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— retary shall select individuals with expertise of the National Coordinator of Health Infor- ø‘‘(1) IN GENERAL.—Upon the request of the in— mation Technology (referred to in this sec- National Coordinator, the head of any Fed- ø‘‘(A) health information privacy; tion as the ‘Office’). The Office shall be head- eral agency is authorized to detail, with or ø‘‘(B) health information security; ed by a National Coordinator who shall be without reimbursement from the Office, any ø‘‘(C) health care quality and patient safe- appointed by the President, in consultation of the personnel of such agency to the Office ty, including those individuals with experi- with the Secretary, and shall report directly to assist it in carrying out its duties under ence in utilizing health information tech- to the Secretary. this section. nology to improve health care quality and ø‘‘(b) PURPOSE.—It shall be the purpose of ø‘‘(2) EFFECT OF DETAIL.—Any detail of per- patient safety; the Office to carry out programs and activi- sonnel under paragraph (1) shall— ø‘‘(D) data exchange; and

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ø‘‘(E) developing health information tech- recommendations. The Secretary shall pro- ø‘‘(b) CERTIFICATION.— nology standards and new health informa- vide for the adoption by the Federal Govern- ø‘‘(1) IN GENERAL.—The Secretary, based tion technology. ment of any standard or standards contained upon the recommendations of the Collabo- ø‘‘(3) TERMS.—Members appointed under in such recommendation. rative, shall develop criteria to ensure and paragraph (1)(G) shall serve for 2 year terms, ø‘‘(f) COORDINATION OF FEDERAL SPEND- certify that hardware, software, and support except that any member appointed to fill a ING.—Not later than 1 year after the adop- services that claim to be in compliance with vacancy for an unexpired term shall be ap- tion by the Federal Government of a rec- any standard for the electronic exchange of pointed for the remainder of such term. A ommendation as provided for in subsection health information adopted under this title member may serve for not to exceed 180 days (e), and in compliance with chapter 113 of have established and maintained such com- after the expiration of such member’s term title 40, United States Code, no Federal agen- pliance in technical conformance with such or until a successor has been appointed. cy shall expend Federal funds for the pur- standards. ø‘‘(c) RECOMMENDATIONS AND POLICIES.— chase of any form of health information ø‘‘(2) CERTIFICATION ASSISTANCE.—The Sec- The Collaborative shall make recommenda- technology or health information technology retary may recognize a private entity or en- tions to identify uniform national policies system for clinical care or for the electronic tities to assist in the certification described for adoption by the Federal Government and retrieval, storage, or exchange of health in- under paragraph (1) using the criteria devel- formation that is not consistent with appli- voluntary adoption by private entities to oped by the Secretary under this section. cable standards adopted by the Federal Gov- support the widespread adoption of health ø‘‘(c) DELEGATION AUTHORITY.—The Sec- information technology, including— ernment under subsection (e). retary, through consultation with the Col- ø‘‘(g) COORDINATION OF FEDERAL DATA COL- ø‘‘(1) protection of health information laborative, may delegate the development of LECTION.—Not later than 3 years after the through privacy and security practices; the criteria under subsections (a) and (b) to adoption by the Federal Government of a ø‘‘(2) measures to prevent unauthorized ac- a private entity. cess to health information; recommendation as provided for in sub- ø section (e), all Federal agencies collecting ‘‘SEC. 2905. GRANTS TO FACILITATE THE WIDE- ø‘‘(3) methods to facilitate secure patient SPREAD ADOPTION OF INTEROPER- access to health information; health data for the purposes of surveillance, ABLE HEALTH INFORMATION TECH- ø‘‘(4) the ongoing harmonization of indus- epidemiology, adverse event reporting, re- NOLOGY. try-wide health information technology search, or for other purposes determined ap- ø‘‘(a) COMPETITIVE GRANTS TO FACILITATE standards; propriate by the Secretary shall comply with THE WIDESPREAD ADOPTION OF HEALTH INFOR- ø‘‘(5) recommendations for a nationwide standards adopted under subsection (e). MATION TECHNOLOGY.— ø‘‘(h) VOLUNTARY ADOPTION.—Any stand- interoperable health information technology ø‘‘(1) IN GENERAL.—The Secretary may ards adopted by the Federal Government infrastructure; award competitive grants to eligible entities under subsection (e) shall be voluntary with ø‘‘(6) the identification and prioritization to facilitate the purchase and enhance the respect to private entities. utilization of qualified health information of specific use cases for which heath infor- ø ‘‘(i) REPORTS.—The Secretary shall sub- technology systems to improve the quality mation technology is valuable, beneficial, mit to the Committee on Health, Education, and efficiency of health care. and feasible; Labor, and Pensions and the Committee on ø ø‘‘(2) ELIGIBILITY.—To be eligible to receive ‘‘(7) recommendations for the establish- Finance of the Senate and the Committee on a grant under paragraph (1) an entity shall— ment of an entity to ensure the continuation Energy and Commerce and the Committee on ø‘‘(A) submit to the Secretary an applica- of the functions of the Collaborative; and Ways and Means of the House of Representa- tion at such time, in such manner, and con- ø‘‘(8) other policies determined to be nec- tives, on an annual basis, a report that— taining such information as the Secretary essary by the Collaborative. ø‘‘(1) describes the specific actions that ø may require; ‘‘(d) STANDARDS.— have been taken by the Federal Government ø ø‘‘(B) submit to the Secretary a strategic ‘‘(1) EXISTING STANDARDS.—The standards and private entities to facilitate the adop- plan for the implementation of data sharing adopted by the Consolidated Health tion of an interoperable nationwide system and interoperability measures; Informatics Initiative shall be deemed to for the electronic exchange of health infor- ø‘‘(C) be a— have been recommended by the Collaborative mation; ø‘‘(i) not for profit hospital; under this section. ø‘‘(2) describes barriers to the adoption of ø ø‘‘(ii) group practice (including a single ‘‘(2) FIRST YEAR REVIEW.—Not later than 1 such a nationwide system; physician); or year after the date of enactment of this title, ø‘‘(3) contains recommendations to achieve ø‘‘(iii) another health care provider not de- the Collaborative shall— full implementation of such a nationwide ø scribed in clause (i) or (ii); ‘‘(A) review existing standards (including system; and ø‘‘(D) adopt the standards adopted by the content, communication, and security stand- ø‘‘(4) contains a plan and progress toward Federal Government under section 2903; ards) for the electronic exchange of health the establishment of an entity to ensure the ø‘‘(E) require that health care providers re- information, including such standards adopt- continuation of the functions of the Collabo- ceiving such grants implement the measure- ed by the Secretary under paragraph (2)(A); rative. ø ment system adopted under section 2908 and ‘‘(B) identify deficiencies and omissions in ø‘‘(j) APPLICATION OF FACA.—The Federal such existing standards; and Advisory Committee Act (5 U.S.C. App.) report to the Secretary on such measures; ø ø‘‘(C) identify duplication and overlap in shall apply to the Collaborative, except that ‘‘(F) demonstrate significant financial such existing standards; the term provided for under section 14(a)(2) need; and ø and recommend modifications to such stand- shall be 5 years. ‘‘(G) provide matching funds in accord- ards as necessary. ø‘‘(k) RULE OF CONSTRUCTION.—Nothing in ance with paragraph (4). ø‘‘(3) ONGOING REVIEW.—Beginning 1 year this section shall be construed to require the ø‘‘(3) USE OF FUNDS.—Amounts received after the date of enactment of this title, and duplication of Federal efforts with respect to under a grant under this subsection shall be annually thereafter, the Collaborative the establishment of the Collaborative, re- used to facilitate the purchase and enhance shall— gardless of whether such efforts were carried the utilization of qualified health informa- ø‘‘(A) review existing standards (including out prior to or after the enactment of this tion technology systems. content, communication, and security stand- title. ø‘‘(4) MATCHING REQUIREMENT.—To be eligi- ards) for the electronic exchange of health ø‘‘(l) AUTHORIZATION OF APPROPRIATIONS.— ble for a grant under this subsection an enti- information, including such standards adopt- There are authorized to be appropriated such ty shall contribute non-Federal contribu- ed by the Secretary under paragraph (2)(A); sums as may be necessary to carry out this tions to the costs of carrying out the activi- ø‘‘(B) identify deficiencies and omissions in section for each of fiscal years 2006 through ties for which the grant is awarded in an such existing standards; and 2010. amount equal to $1 for each $3 of Federal ø‘‘(C) identify duplication and overlap in ø‘‘SEC. 2904. IMPLEMENTATION AND CERTIFI- funds provided under the grant. such existing standards; CATION OF HEALTH INFORMATION ø‘‘(5) PREFERENCE IN AWARDING GRANTS.—In and recommend modifications to such stand- STANDARDS. awarding grants under this subsection the ards as necessary. ø‘‘(a) IMPLEMENTATION.— Secretary shall give preference to— ø ø‘‘(4) LIMITATION.—The standards described ‘‘(1) IN GENERAL.—The Secretary, based ø‘‘(A) eligible entities that are located in in this section shall be consistent with any upon the recommendations of the Collabo- rural, frontier, and other underserved areas standards developed pursuant to the Health rative, shall develop criteria to ensure uni- as determined by the Secretary; and Insurance Portability and Accountability form and consistent implementation of any ø‘‘(B) eligible entities that will link, to the Act of 1996. standards for the electronic exchange of extent practicable, the qualified health in- ø‘‘(e) FEDERAL ACTION.—Not later than 60 health information voluntarily adopted by formation system to local or regional health days after the issuance of a recommendation private entities in technical conformance information networks. from the Collaborative under subsection with such standards adopted under this title. ø‘‘(b) COMPETITIVE GRANTS TO STATES FOR (d)(2), the Secretary of Health and Human ø‘‘(2) IMPLEMENTATION ASSISTANCE.—The THE DEVELOPMENT OF STATE LOAN PROGRAMS Services, the Secretary of Veterans Affairs, Secretary may recognize a private entity or TO FACILITATE THE WIDESPREAD ADOPTION OF and the Secretary of Defense, in collabora- entities to assist private entities in the im- HEALTH INFORMATION TECHNOLOGY.— tion with representatives of other relevant plementation of the standards adopted under ø‘‘(1) IN GENERAL.—The Secretary may Federal agencies, as determined appropriate this title using the criteria developed by the award competitive grants to States for the by the Secretary, shall jointly review such Secretary under this section. establishment of State programs for loans to

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health care providers to facilitate the pur- ø‘‘(ii) to conduct activities for which Fed- ø‘‘(A) IN GENERAL.—The Secretary may not chase and enhance the utilization of quali- eral funds are expended under this title, or make a grant under paragraph (1) to a State fied health information technology. the amendments made by the Wired for unless the State agrees to make available ø‘‘(2) ESTABLISHMENT OF FUND.—To be eligi- Health Care Quality Act; or (directly or through donations from public or ble to receive a competitive grant under this ø‘‘(iii) for any purpose other than making private entities) non-Federal contributions subsection, a State shall establish a quali- loans to eligible entities under this section. in cash toward the costs of the State pro- fied health information technology loan fund ø‘‘(6) TYPES OF ASSISTANCE.—Except as oth- gram to be implemented under the grant in (referred to in this subsection as a ‘State erwise limited by applicable State law, an amount equal to not less than $1 for each loan fund’) and comply with the other re- amounts deposited into a State loan fund $1 of Federal funds provided under the grant. quirements contained in this section. A under this subsection may only be used for ø‘‘(B) DETERMINATION OF AMOUNT OF NON- grant to a State under this subsection shall the following: FEDERAL CONTRIBUTION.—In determining the be deposited in the State loan fund estab- ø‘‘(A) To award loans that comply with the amount of non-Federal contributions that a lished by the State. No funds authorized by following: State has provided pursuant to subparagraph other provisions of this title to be used for ø‘‘(i) The interest rate for each loan shall (A), the Secretary may not include any other purposes specified in this title shall be be less than or equal to the market interest amounts provided to the State by the Fed- deposited in any State loan fund. rate. eral Government. ø‘‘(3) ELIGIBILITY.—To be eligible to receive ø‘‘(ii) The principal and interest payments ø‘‘(9) PREFERENCE IN AWARDING GRANTS.— a grant under paragraph (1) a State shall— on each loan shall commence not later than ø‘‘(A) submit to the Secretary an applica- The Secretary may give a preference in 1 year after the loan was awarded, and each tion at such time, in such manner, and con- awarding grants under this subsection to loan shall be fully amortized not later than taining such information as the Secretary States that adopt value-based purchasing 10 years after the date of the loan. may require; programs to improve health care quality. ø‘‘(iii) The State loan fund shall be cred- ø‘‘(B) submit to the Secretary a strategic ø‘‘(10) REPORTS.—The Secretary shall an- ited with all payments of principal and inter- plan in accordance with paragraph (4); nually submit to the Committee on Health, est on each loan awarded from the fund. ø‘‘(C) establish a qualified health informa- Education, Labor, and Pensions and the ø‘‘(B) To guarantee, or purchase insurance tion technology loan fund in accordance with Committee on Finance of the Senate, and paragraph (2); for, a local obligation (all of the proceeds of the Committee on Energy and Commerce and ø‘‘(D) require that health care providers re- which finance a project eligible for assist- the Committee on Ways and Means of the ceiving such loans— ance under this subsection) if the guarantee House of Representatives, a report summa- or purchase would improve credit market ac- ø‘‘(i) link, to the extent practicable, the rizing the reports received by the Secretary cess or reduce the interest rate applicable to qualified health information system to a from each State that receives a grant under local or regional health information net- the obligation involved. ø this subsection. work; and ‘‘(C) As a source of revenue or security for ø‘‘(c) GRANTS FOR THE IMPLEMENTATION OF ø‘‘(ii) consult with the Center for Best the payment of principal and interest on rev- Practices established in section 914(d) to ac- enue or general obligation bonds issued by REGIONAL OR LOCAL HEALTH INFORMATION cess the knowledge and experience of exist- the State if the proceeds of the sale of the TECHNOLOGY PLANS.— ing initiatives regarding the successful im- bonds will be deposited into the State loan ø‘‘(1) IN GENERAL.—The Secretary may plementation and effective use of health in- fund. award competitive grants to eligible entities formation technology; ø‘‘(D) To earn interest on the amounts de- to implement regional or local health infor- ø‘‘(E) require that health care providers re- posited into the State loan fund. mation plans to improve health care quality ceiving such loans adopt the standards ø‘‘(7) ADMINISTRATION OF STATE LOAN and efficiency through the electronic ex- adopted by the Federal Government under FUNDS.— change of health information pursuant to section 2903(d); ø‘‘(A) COMBINED FINANCIAL ADMINISTRA- the standards, protocols, and other require- ø‘‘(F) require that health care providers re- TION.—A State may (as a convenience and to ments adopted by the Secretary under sec- ceiving such loans implement the measure- avoid unnecessary administrative costs) tions 2903 and 2908. ment system adopted under section 2908 and combine, in accordance with State law, the ø‘‘(2) ELIGIBILITY.—To be eligible to receive report to the Secretary on such measures; financial administration of a State loan fund a grant under paragraph (1) an entity shall— and established under this subsection with the fi- ø‘‘(A) demonstrate financial need to the ø‘‘(G) provide matching funds in accord- nancial administration of any other revolv- Secretary; ing fund established by the State if other- ance with paragraph (8). ø‘‘(B) demonstrate that one of its principal ø wise not prohibited by the law under which ‘‘(4) STRATEGIC PLAN.— missions or purposes is to use information ø the State loan fund was established. ‘‘(A) IN GENERAL.—A State that receives a technology to improve health care quality ø‘‘(B) COST OF ADMINISTERING FUND.—Each grant under this subsection shall annually and efficiency; prepare a strategic plan that identifies the State may annually use not to exceed 4 per- ø‘‘(C) adopt bylaws, memoranda of under- intended uses of amounts available to the cent of the funds provided to the State under standing, or other charter documents that State loan fund of the State. a grant under this subsection to pay the rea- demonstrate that the governance structure ø‘‘(B) CONTENTS.—A strategic plan under sonable costs of the administration of the subparagraph (A) shall include— programs under this section, including the and decisionmaking processes of such entity ø‘‘(i) a list of the projects to be assisted recovery of reasonable costs expended to es- allow for participation on an ongoing basis through the State loan fund in the first fis- tablish a State loan fund which are incurred by multiple stakeholders within a commu- cal year that begins after the date on which after the date of enactment of this title. nity, including— ø the plan is submitted; ø‘‘(C) GUIDANCE AND REGULATIONS.—The ‘‘(i) physicians (as defined in section ø‘‘(ii) a description of the criteria and Secretary shall publish guidance and pro- 1861(r) of the Social Security Act), including methods established for the distribution of mulgate regulations as may be necessary to physicians that provide services to low in- funds from the State loan fund; and carry out the provisions of this subsection, come and underserved populations; ø‘‘(iii) a description of the financial status including— ø‘‘(ii) hospitals (including hospitals that of the State loan fund and the short-term ø‘‘(i) provisions to ensure that each State provide services to low income and under- and long-term goals of the State loan fund. commits and expends funds allotted to the served populations); ø ø‘‘(5) USE OF FUNDS.— State under this subsection as efficiently as ‘‘(iii) pharmacists or pharmacies; ø‘‘(A) IN GENERAL.—Amounts deposited in a possible in accordance with this title and ap- ø‘‘(iv) health insurance plans; State loan fund, including loan repayments plicable State laws; and ø‘‘(v) health centers (as defined in section and interest earned on such amounts, shall ø‘‘(ii) guidance to prevent waste, fraud, and 330(b)) and Federally qualified health centers be used only for awarding loans or loan guar- abuse. (as defined in section 1861(aa)(4) of the Social antees, or as a source of reserve and security ø‘‘(D) PRIVATE SECTOR CONTRIBUTIONS.— Security Act); for leveraged loans, the proceeds of which ø‘‘(i) IN GENERAL.—A State loan fund estab- ø‘‘(vi) rural health clinics (as defined in are deposited in the State loan fund estab- lished under this subsection may accept con- section 1861(aa) of the Social Security Act); lished under paragraph (1). Loans under this tributions from private sector entities, ex- ø‘‘(vii) patient or consumer organizations; section may be used by a health care pro- cept that such entities may not specify the ø‘‘(viii) employers; and vider to facilitate the purchase and enhance recipient or recipients of any loan issued ø‘‘(ix) any other health care providers or the utilization of qualified health informa- under this subsection. other entities, as determined appropriate by tion technology. ø‘‘(ii) AVAILABILITY OF INFORMATION.—A the Secretary; ø‘‘(B) LIMITATION.—Amounts received by a State shall make publically available the ø‘‘(D) adopt nondiscrimination and conflict State under this subsection may not be identity of, and amount contributed by, any of interest policies that demonstrate a com- used— private sector entity under clause (i) and mitment to open, fair, and nondiscrim- ø‘‘(i) for the purchase or other acquisition may issue letters of commendation or make inatory participation in the health informa- of any health information technology system other awards (that have no financial value) tion plan by all stakeholders; that is not a qualified health information to any such entity. ø‘‘(E) adopt the standards adopted by the technology system; ø‘‘(8) MATCHING REQUIREMENTS.— Secretary under section 2903;

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00117 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.094 S17NOPT2 S13264 CONGRESSIONAL RECORD — SENATE November 17, 2005 ø‘‘(F) require that health care providers re- under this section, and annually thereafter only if the entity agrees to make available ceiving such loans implement the measure- during the grant period, an entity that re- non-Federal contributions toward the costs ment system adopted under section 2908 and ceives a grant under this section shall sub- of the program to be funded under the grant report to the Secretary on such measures; mit to the Secretary a report on the activi- in an amount that is not less than $1 for each ø‘‘(G) facilitate the electronic exchange of ties carried out under the grant involved. $2 of Federal funds provided under the grant. health information within the local or re- Each such report shall include— ø‘‘(2) DETERMINATION OF AMOUNT CONTRIB- gional area and among local and regional ø‘‘(1) a description of the financial costs UTED.—Non-Federal contributions under areas; and benefits of the project involved and of paragraph (1) may be in cash or in kind, fair- ø‘‘(H) prepare and submit to the Secretary the entities to which such costs and benefits ly evaluated, including equipment or serv- an application in accordance with paragraph accrue; ices. Amounts provided by the Federal Gov- (3); and ø‘‘(2) an analysis of the impact of the ernment, or services assisted or subsidized to ø‘‘(I) agree to provide matching funds in project on health care quality and safety; any significant extent by the Federal Gov- accordance with paragraph (5). ø‘‘(3) a description of any reduction in du- ernment, may not be included in deter- ø‘‘(3) APPLICATION.— plicative or unnecessary care as a result of mining the amount of such contributions. ø‘‘(A) IN GENERAL.—To be eligible to re- the project involved; ø‘‘(e) EVALUATION.—The Secretary shall ceive a grant under paragraph (1), an entity ø‘‘(4) a description of the efforts of recipi- take such action as may be necessary to shall submit to the Secretary an application ents under this section to facilitate secure evaluate the projects funded under this sec- at such time, in such manner, and con- patient access to health information; and tion and publish, make available, and dis- taining such information as the Secretary ø‘‘(5) other information as required by the seminate the results of such evaluations on may require. Secretary. as wide a basis as is practicable. ø ø‘‘(B) REQUIRED INFORMATION.—At a min- ø‘‘(e) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(f) REPORTS.—Not later than 1 year after imum, an application submitted under this ø‘‘(1) IN GENERAL.—For the purpose of car- the date of enactment of this title, and annu- paragraph shall include— rying out this section, there is authorized to ally thereafter, the Secretary shall submit ø‘‘(i) clearly identified short-term and be appropriated $125,000,000 for fiscal year to the Committee on Health, Education, long-term objectives of the regional or local 2006, $150,000,000 for fiscal year 2007, and such Labor, and Pensions and the Committee on Finance of the Senate, and the Committee health information plan; sums as may be necessary for each of fiscal on Energy and Commerce and the Committee ø‘‘(ii) a technology plan that complies with years 2008 through 2010. on Ways and Means of the House of Rep- the standards adopted under section 2903 and ø‘‘(2) AVAILABILITY.—Amounts appro- resentatives a report that— that includes a descriptive and reasoned esti- priated under paragraph (1) shall remain ø‘‘(1) describes the specific projects estab- mate of costs of the hardware, software, available through fiscal year 2010. lished under this section; and training, and consulting services necessary ø ‘‘SEC. 2906. DEMONSTRATION PROGRAM TO IN- ø‘‘(2) contains recommendations for Con- to implement the regional or local health in- TEGRATE INFORMATION TECH- formation plan; NOLOGY INTO CLINICAL EDU- gress based on the evaluation conducted ø‘‘(iii) a strategy that includes initiatives CATION. under subsection (e). ø to improve health care quality and effi- ø‘‘(a) IN GENERAL.—The Secretary may ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— ciency, including the use and reporting of award grants under this section to carry out There is authorized to be appropriated to health care quality measures adopted under demonstration projects to develop academic carry out this section, $5,000,000 for fiscal section 2908; curricula integrating qualified health infor- year 2007, and such sums as may be necessary ø‘‘(iv) a plan that describes provisions to mation technology systems in the clinical for each of fiscal years 2008 through 2010. ø‘‘(h) SUNSET.—This section shall not apply encourage the implementation of the elec- education of health professionals. Such after September 30, 2010. tronic exchange of health information by all awards shall be made on a competitive basis ø physicians, including single physician prac- and pursuant to peer review. ‘‘SEC. 2907. LICENSURE AND THE ELECTRONIC EXCHANGE OF HEALTH INFORMA- ø LIGIBILITY tices and small physician groups partici- ‘‘(b) E .—To be eligible to re- TION. ceive a grant under subsection (a), an entity pating in the health information plan; ø‘‘(a) IN GENERAL.—The Secretary shall ø ‘‘(v) a plan to ensure the privacy and se- shall— carry out, or contract with a private entity ø curity of personal health information that is ‘‘(1) submit to the Secretary an applica- to carry out, a study that examines— consistent with Federal and State law; tion at such time, in such manner, and con- ø‘‘(1) the variation among State laws that ø ‘‘(vi) a governance plan that defines the taining such information as the Secretary relate to the licensure, registration, and cer- manner in which the stakeholders shall may require; tification of medical professionals; and ø jointly make policy and operational deci- ‘‘(2) submit to the Secretary a strategic ø‘‘(2) how such variation among State laws sions on an ongoing basis; and plan for integrating qualified health infor- impacts the secure electronic exchange of ø ‘‘(vii) a financial or business plan that de- mation technology in the clinical education health information— scribes— of health professionals and for ensuring the ø‘‘(A) among the States; and ø ‘‘‘(I) the sustainability of the plan; consistent utilization of decision support ø‘‘(B) between the States and the Federal ø ‘‘‘(II) the financial costs and benefits of software to reduce medical errors and en- Government. the plan; and hance health care quality; ø‘‘(b) REPORT AND RECOMMENDATIONS.—Not ø‘‘‘(III) the entities to which such costs ø‘‘(3) be— later than 1 year after the date of enactment and benefits will accrue. ø‘‘(A) a health professions school; of this title, the Secretary shall publish a re- ø‘‘(4) USE OF FUNDS.—Amounts received ø‘‘(B) a school of nursing; or port that— under a grant under paragraph (1) shall be ø‘‘(C) a graduate medical education pro- ø‘‘(1) describes the results of the study car- used to establish and implement a regional gram; ried out under subsection (a); and or local health information plan in accord- ø‘‘(4) provide for the collection of data re- ø‘‘(2) makes recommendations to States re- ance with this subsection. garding the effectiveness of the demonstra- garding the harmonization of State laws ø‘‘(5) MATCHING REQUIREMENT.— tion project to be funded under the grant in based on the results of such study. ø ‘‘(A) IN GENERAL.—The Secretary may not improving the safety of patients, the effi- ø‘‘SEC. 2908. QUALITY MEASUREMENT SYSTEMS. make a grant under this subsection to an en- ciency of health care delivery, and in in- ø‘‘(a) IN GENERAL.—The Secretary of tity unless the entity agrees that, with re- creasing the likelihood that graduates of the Health and Human Services, the Secretary of spect to the costs to be incurred by the enti- grantee will adopt and incorporate health in- Veterans Affairs, the Secretary of Defense, ty in carrying out the infrastructure pro- formation technology in the delivery of and representatives of other relevant Federal gram for which the grant was awarded, the health care services; and agencies, as determined appropriate by the entity will make available (directly or ø‘‘(5) provide matching funds in accordance Secretary, (referred to in the section as the through donations from public or private en- with subsection (c). ‘Secretaries’) shall jointly develop a quality tities) non-Federal contributions toward ø‘‘(c) USE OF FUNDS.— measurement system for the purpose of such costs in an amount equal to not less ø‘‘(1) IN GENERAL.—With respect to a grant measuring the quality of care patients re- than 50 percent of such costs ($1 for each $2 under subsection (a), an eligible entity ceive. of Federal funds provided under the grant). shall— ø‘‘(b) REQUIREMENTS.—The Secretaries ø‘‘(B) DETERMINATION OF AMOUNT CONTRIB- ø‘‘(A) use grant funds in collaboration with shall ensure that the quality measurement UTED.—Non-Federal contributions required 2 or more disciplines; and system developed under subsection (a) com- under subparagraph (A) may be in cash or in ø‘‘(B) use grant funds to integrate qualified ply with the following: kind, fairly evaluated, including equipment, health information technology into commu- ø‘‘(1) MEASURES.— technology, or services. Amounts provided nity-based clinical education. ø‘‘(A) IN GENERAL.—Subject to subpara- by the Federal Government, or services as- ø‘‘(2) LIMITATION.—An eligible entity shall graph (B), the Secretaries shall select meas- sisted or subsidized to any significant extent not use amounts received under a grant ures of quality to be used by the Secretaries by the Federal Government, may not be in- under subsection (a) to purchase hardware, under the systems. cluded in determining the amount of such software, or services. ø‘‘(B) REQUIREMENTS.—In selecting the non-Federal contributions. ø‘‘(d) MATCHING FUNDS.— measures to be used under each system pur- ø‘‘(d) REPORTS.—Not later than 1 year after ø‘‘(1) IN GENERAL.—The Secretary may suant to subparagraph (A), the Secretaries the date on which the first grant is awarded award a grant to an entity under this section shall, to the extent feasible, ensure that—

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ø‘‘(i) such measures are evidence based, re- ø‘‘(e) ARRANGEMENT WITH AN ENTITY TO ø‘‘(2) COLLABORATIVE AGREEMENTS.—With liable and valid; PROVIDE ADVICE AND RECOMMENDATIONS.— respect to activities conducted or supported ø‘‘(ii) such measures include measures of ø‘‘(1) ARRANGEMENT.—On and after July 1, by the Secretary under this Act, the Sec- process, structure, patient experience, effi- 2006, the Secretaries shall have in place an retary may establish collaborative agree- ciency, and equity; and arrangement with an entity that meets the ments with private entities, including group ø‘‘(iii) such measures include measures of requirements described in paragraph (2) health plans and health insurance issuers, overuse, underuse, and misuse of health care under which such entity provides the Secre- providers, purchasers, consumer organiza- items and services. taries with advice on, and recommendations tions, and entities receiving a grant under ø‘‘(2) PRIORITIES.—In developing the sys- with respect to, the development and updat- section 2908, to— tem under subsection (a), the Secretaries ing of the quality measurement systems ø‘‘(A) encourage the use of the health care shall ensure that priority is given to— under this section, including the assigning of quality measures adopted by the Secretary ø‘‘(A) measures with the greatest potential weights to the measures under subsection under this section; and impact for improving the quality and effi- (b)(2). ø‘‘(B) foster uniformity between the health ciency of care provided under Federal pro- ø‘‘(2) REQUIREMENTS DESCRIBED.—The re- care quality measures utilized by private en- grams; quirements described in this paragraph are tities. ø‘‘(B) measures that may be rapidly imple- the following: ø‘‘(g) DISSEMINATION OF INFORMATION.—Be- mented by group health plans, health insur- ø‘‘(A) The entity is a private nonprofit en- ginning on January 1, 2008, in order to make ance issuers, physicians, hospitals, nursing tity governed by an executive director and a comparative quality information available homes, long-term care providers, and other board. to health care consumers, health profes- providers; and ø‘‘(B) The members of the entity include sionals, public health officials, researchers, ø‘‘(C) measures which may inform health representatives of— and other appropriate individuals and enti- care decisions made by consumers and pa- ø‘‘(i) health insurance plans and providers ties, the Secretary shall provide for the ag- gregation and analysis of quality measures tients. with experience in the care of individuals collected under section 2905 and the dissemi- ø‘‘(3) WEIGHTS OF MEASURES.—The Secre- with multiple complex chronic conditions or nation of recommendations and best prac- taries shall assign weights to the measures groups representing such health insurance tices derived in part from such analysis. used by the Secretaries under each system plans and providers; ø‘‘(h) TECHNICAL ASSISTANCE.—The Sec- established under subsection (a). ø‘‘(ii) groups representing patients and ø‘‘(4) RISK ADJUSTMENT.—The Secretaries retary shall provide technical assistance to consumers; public and private entities to enable such en- shall establish procedures to account for dif- ø‘‘(iii) purchasers and employers or groups ferences in patient health status, patient tities to— representing purchasers or employers; ø‘‘(1) implement and use evidence-based characteristics, and geographic location. To ø‘‘(iv) organizations that focus on quality the extent practicable, such procedures shall guidelines with the greatest potential to im- improvement as well as the measurement prove health care quality, efficiency, and pa- recognize existing procedures. and reporting of quality measures; ø tient safety; and ‘‘(5) MAINTENANCE.—The Secretaries shall, ø‘‘(v) State government health programs; ø as determined appropriate, but in no case ‘‘(2) establish mechanisms for the rapid ø‘‘(vi) individuals or entities skilled in the dissemination of information regarding evi- more often than once during each 12-month conduct and interpretation of biomedical, dence-based guidelines with the greatest po- period, update the quality measurement sys- health services, and health economics re- tential to improve health care quality, effi- tems developed under subsection (a), includ- search and with expertise in outcomes and ciency, and patient safety. ing through— effectiveness research and technology assess- ø ø‘‘(A) the addition of more accurate and ‘‘SEC. 2909. APPLICABILITY OF PRIVACY AND SE- ment; and CURITY REGULATIONS. precise measures under the systems and the ø‘‘(vii) individuals or entities involved in ø‘‘The regulations promulgated by the Sec- retirement of existing outdated measures the development and establishment of stand- retary under part C of title XI of the Social under the systems; and ards and certification for health information Security Act and sections 261, 262, 263, and ø ‘‘(B) the refinement of the weights as- technology systems and clinical data. 264 of the Health Insurance Portability and signed to measures under the systems. ø‘‘(C) The membership of the entity is rep- Accountability Act of 1996 with respect to ø ‘‘(c) REQUIRED CONSIDERATIONS IN DEVEL- resentative of individuals with experience the privacy, confidentiality, and security of OPING AND UPDATING THE SYSTEMS.—In devel- with urban health care issues and individuals health information shall— oping and updating the quality measurement with experience with rural and frontier ø‘‘(1) apply to any health information systems under this section, the Secretaries health care issues. stored or transmitted in an electronic for- shall— ø‘‘(D) If the entity requires a fee for mem- mat on or after the date of enactment of this ø‘‘(1) consult with, and take into account bership, the entity shall provide assurances title; and the recommendations of, the entity that the to the Secretaries that such fees are not a ø‘‘(2) apply to the implementation of Secretaries has an arrangement with under substantial barrier to participation in the standards, programs, and activities under subsection (e); entity’s activities related to the arrange- this title. ø‘‘(2) consult with representatives of ment with the Secretaries. ø‘‘SEC. 2910. STUDY OF REIMBURSEMENT INCEN- health care providers, consumers, employers, ø‘‘(E) The entity— TIVES. and other individuals and groups that are in- ø‘‘(i) permits any member described in sub- ø‘‘The Secretary shall carry out, or con- terested in the quality of health care; and paragraph (B) to vote on matters of the enti- tract with a private entity to carry out, a ø‘‘(3) take into account— ty related to the arrangement with the Sec- study that examines methods to create effi- ø‘‘(A) any demonstration or pilot program retary under paragraph (1); and cient reimbursement incentives for improv- conducted by the Secretaries relating to ø‘‘(ii) ensures that member voting provides ing health care quality in Federally qualified measuring and rewarding quality and effi- a balance among disparate stakeholders, so health centers, rural health clinics, and free ciency of care; that no member organization described in clinics.’’. ø‘‘(B) any existing activities conducted by subparagraph (B) unduly influences the out- øSEC. 3. HEALTH INFORMATION TECHNOLOGY the Secretaries relating to measuring and re- come. RESOURCE CENTER. warding quality and efficiency; øSection 914 of the Public Health Service ø‘‘(F) With respect to matters related to ø‘‘(C) any existing activities conducted by Act (42 U.S.C. 299b–3) is amended by adding the arrangement with the Secretary under private entities including health insurance at the end the following: paragraph (1), the entity conducts its busi- plans and payors; and ø‘‘(d) CENTER FOR BEST PRACTICES.— ness in an open and transparent manner and ø‘‘(D) the report by the Institute of Medi- ø‘‘(1) IN GENERAL.—The Secretary, acting provides the opportunity for public com- cine of the National Academy of Sciences through the Director, shall develop a Center ment. under section 238(b) of the Medicare Pre- for Best Practices to provide technical as- ø‘‘(G) The entity operates as a voluntary scription Drug, Improvement, and Mod- sistance and develop best practices to sup- consensus standards setting organization as ernization Act of 2003. port and accelerate efforts to adopt, imple- defined for purposes of section 12(d) of the ø‘‘(d) REQUIRED CONSIDERATIONS IN IMPLE- ment, and effectively use interoperable MENTING THE SYSTEMS.—In implementing the National Technology Transfer and Advance- health information technology in compli- quality measurement systems under this sec- ment Act of 1995 (Public Law 104–113) and Of- ance with section 2903 and 2908. tion, the Secretaries shall take into account fice of Management and Budget Revised Cir- ø‘‘(2) CENTER FOR BEST PRACTICES.— the recommendations of public-private enti- cular A–119 (published in the Federal Reg- ø‘‘(A) IN GENERAL.—The Center shall sup- ties— ister on February 10, 1998). port activities to meet goals, including— ø‘‘(1) that are established to examine ø‘‘(f) USE OF QUALITY MEASUREMENT SYS- ø‘‘(i) providing for the widespread adoption issues of data collection and reporting, in- TEM.— of interoperable health information tech- cluding the feasibility of collecting and re- ø‘‘(1) IN GENERAL.—For purposes of activi- nology; porting data on measures; and ties conducted or supported by the Secretary ø‘‘(ii) providing for the establishment of re- ø‘‘(2) that involve representatives of health under this Act, the Secretary shall, to the gional and local health information net- care providers, consumers, employers, and extent practicable, adopt and utilize the works to facilitate the development of inter- other individuals and groups that are inter- measurement system developed under this operability across health care settings and ested in quality of care. section. improve the quality of health care;

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ø‘‘(iii) the development of solutions to bar- ‘‘(2) HEALTH INFORMATION.—The term ‘health ‘‘(3) facilitate the adoption of a nationwide, riers to the exchange of electronic health in- information’ has the meaning given such term in interoperable system for the electronic exchange formation; or section 1171(4) of the Social Security Act. of health information; ø‘‘(iv) other activities identified by the ‘‘(3) HEALTH INSURANCE PLAN.—The term ‘‘(4) ensure the adoption and implementation States, local or regional health information ‘health insurance plan’ means— of standards for the electronic exchange of networks, or health care stakeholders as a ‘‘(A) a health insurance issuer (as defined in health information to reduce cost and improve focus for developing and sharing best prac- section 2791(b)(2)); health care quality; tices. ‘‘(B) a group health plan (as defined in sec- ‘‘(5) ensure that health information tech- ø‘‘(B) PURPOSES.—The purpose of the Cen- tion 2791(a)(1)); and nology policy and programs of the Department ter is to— ‘‘(C) a health maintenance organization (as are coordinated with those of relevant executive ø‘‘(i) provide a forum for the exchange of defined in section 2791(b)(3)). branch agencies (including Federal commis- knowledge and experience; ‘‘(4) LABORATORY.—The term ‘laboratory’ has sions) with a goal of avoiding duplication of ef- ø‘‘(ii) accelerate the transfer of lessons the meaning given that term in section 353. forts and of helping to ensure that each agency learned from existing public and private sec- ‘‘(5) PHARMACIST.—The term ‘pharmacist’ has undertakes health information technology ac- tor initiatives, including those currently re- the meaning given that term in section 804 of the tivities primarily within the areas of its greatest ceiving Federal financial support; Federal Food, Drug, and Cosmetic Act. expertise and technical capability; ø‘‘(iii) assemble, analyze, and widely dis- ‘‘(6) QUALIFIED HEALTH INFORMATION TECH- ‘‘(6) to the extent permitted by law, coordinate seminate evidence and experience related to NOLOGY.—The term ‘qualified health informa- outreach and consultation by the relevant exec- the adoption, implementation, and effective tion technology’ means a computerized system utive branch agencies (including Federal com- use of interoperable health information tech- (including hardware and software) that— missions) with public and private parties of in- ‘‘(A) protects the privacy and security of nology; and terest, including consumers, payers, employers, health information; ø‘‘(iv) assure the timely provision of tech- hospitals and other health care providers, phy- ‘‘(B) maintains and provides permitted access nical and expert assistance from the Agency sicians, community health centers, laboratories, to health information in an electronic format; and its contractors. vendors and other stakeholders; ‘‘(C) incorporates decision support to reduce ‘‘(7) advise the President regarding specific ø‘‘(C) SUPPORT FOR ACTIVITIES.—To provide medical errors and enhance health care quality; Federal health information technology pro- support for the activities of the Center, the ‘‘(D) complies with the standards adopted by Director shall modify the requirements, if grams; and the Federal Government under section 2903; and ‘‘(8) submit the reports described under section necessary, that apply to the National Re- ‘‘(E) allows for the reporting of quality meas- 2903(i) (excluding paragraph (4) of such sec- source Center for Health Information Tech- ures under section 2908. tion). nology to provide the necessary infrastruc- ‘‘(7) STATE.—The term ‘State’ means each of ‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— ture to support the duties and activities of the several States, the District of Columbia, ‘‘(1) IN GENERAL.—Upon the request of the Na- the Center and facilitate information ex- Puerto Rico, the Virgin Islands, Guam, Amer- tional Coordinator, the head of any Federal change across the public and private sectors. ican Samoa, and the Northern Mariana Islands. agency is authorized to detail, with or without ø ‘‘(3) TECHNICAL ASSISTANCE TELEPHONE ‘‘SEC. 2902. OFFICE OF THE NATIONAL COORDI- reimbursement from the Office, any of the per- NUMBER OR WEBSITE.—The Secretary shall es- NATOR OF HEALTH INFORMATION sonnel of such agency to the Office to assist it tablish a toll-free telephone number or Inter- TECHNOLOGY. in carrying out its duties under this section. net website to provide health care providers ‘‘(a) OFFICE OF NATIONAL HEALTH INFORMA- ‘‘(2) EFFECT OF DETAIL.—Any detail of per- and patients with a single point of contact TION TECHNOLOGY.—There is established within sonnel under paragraph (1) shall— to— the Office of the Secretary an Office of the Na- ‘‘(A) not interrupt or otherwise affect the civil ø‘‘(A) learn about Federal grants and tech- tional Coordinator of Health Information Tech- service status or privileges of the Federal em- nical assistance services related to inter- nology (referred to in this section as the ‘Of- ployee; and operable health information technology; fice’). The Office shall be headed by a National ‘‘(B) be in addition to any other staff of the ø‘‘(B) learn about qualified health informa- Coordinator who shall be appointed by the Department employed by the National Coordi- tion technology and the quality measure- President, in consultation with the Secretary, nator. ment system adopted by the Federal Govern- and shall report directly to the Secretary. ‘‘(3) ACCEPTANCE OF DETAILEES.—Notwith- ment under sections 2903 and 2908; ‘‘(b) PURPOSE.—It shall be the purpose of the standing any other provision of law, the Office ø‘‘(C) learn about regional and local health Office to coordinate and oversee programs and may accept detailed personnel from other Fed- information networks for assistance with activities to develop a nationwide interoperable eral agencies without regard to whether the health information technology; and health information technology infrastructure agency described under paragraph (1) is reim- ø‘‘(D) disseminate additional information that— bursed. determined by the Secretary. ‘‘(1) ensures that patients’ health information ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this ø‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— is secure and protected; section shall be construed to require the dupli- There are authorized to be appropriated to ‘‘(2) improves health care quality, reduces cation of Federal efforts with respect to the es- carry out this subsection, such sums as may medical errors, and advances the delivery of pa- tablishment of the Office, regardless of whether be necessary for each of fiscal years 2006 tient-centered medical care; such efforts were carried out prior to or after through 2010.’’. ‘‘(3) reduces health care costs resulting from the enactment of this title. øSEC. 4. REAUTHORIZATION OF INCENTIVE inefficiency, medical errors, inappropriate care, ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— GRANTS REGARDING TELEMEDI- and incomplete information; There are authorized to be appropriated to carry CINE. ‘‘(4) ensures that appropriate information to out this section, $5,000,000 for fiscal year 2006, øSection 330L(b) of the Public Health Serv- help guide medical decisions is available at the $5,000,000 for fiscal year 2007, and such sums as ice Act (42 U.S.C. 254c–18(b)) is amended by time and place of care; may be necessary for each of fiscal years 2008 striking ‘‘2002 through 2006’’ and inserting ‘‘(5) promotes a more effective marketplace, through 2010. ‘‘2006 through 2010’’.¿ greater competition, and increased choice ‘‘SEC. 2903. AMERICAN HEALTH INFORMATION SECTION 1. SHORT TITLE. through the wider availability of accurate infor- COLLABORATIVE. This Act may be cited as the ‘‘Wired for mation on health care costs, quality, and out- ‘‘(a) PURPOSE.—The Secretary shall establish Health Care Quality Act’’. comes; the public-private American Health Information ‘‘(6) improves the coordination of care and in- SEC. 2. IMPROVING HEALTH CARE QUALITY, Collaborative (referred to in this section as the SAFETY, AND EFFICIENCY. formation among hospitals, laboratories, physi- ‘Collaborative’) to— The Public Health Service Act (42 U.S.C. 201 cian offices, and other entities through an effec- ‘‘(1) advise the Secretary and recommend spe- et seq.) is amended by adding at the end the fol- tive infrastructure for the secure and authorized cific actions to achieve a nationwide interoper- lowing: exchange of health care information; able health information technology infrastruc- ‘‘(7) improves public health reporting and fa- ture; ‘‘TITLE XXIX—HEALTH INFORMATION cilitates the early identification and rapid re- ‘‘(2) serve as a forum for the participation of TECHNOLOGY AND QUALITY sponse to public health threats and emergencies, a broad range of stakeholders to provide input ‘‘SEC. 2901. DEFINITIONS. including bioterror events and infectious disease on achieving the interoperability of health in- ‘‘In this title: outbreaks; formation technology; and ‘‘(1) HEALTH CARE PROVIDER.—The term ‘‘(8) facilitates health research; and ‘‘(3) recommend standards (including content, ‘health care provider’ means a hospital, skilled ‘‘(9) promotes prevention of chronic diseases. communication, and security standards) for the nursing facility, home health entity, health care ‘‘(c) DUTIES OF THE NATIONAL COORDI- electronic exchange of health information (in- clinic, federally qualified health center, group NATOR.—The National Coordinator shall— cluding for the reporting of quality data under practice (as defined in section 1877(h)(4) of the ‘‘(1) serve as a member of the public-private section 2908) for adoption by the Federal Gov- Social Security Act), a pharmacist, a pharmacy, American Health Information Collaborative es- ernment and voluntary adoption by private en- a laboratory, a physician (as defined in section tablished under section 2903; tities. 1861(r) of the Social Security Act), a health fa- ‘‘(2) serve as the principal advisor to the Sec- ‘‘(b) COMPOSITION.— cility operated by or pursuant to a contract with retary concerning the development, application, ‘‘(1) IN GENERAL.—The Collaborative shall be the Indian Health Service, a rural health clinic, and use of health information technology, and composed of— and any other category of facility or clinician coordinate and oversee the health information ‘‘(A) the Secretary, who shall serve as the determined appropriate by the Secretary. technology programs of the Department; chairperson of the Collaborative;

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‘‘(B) the Secretary of Defense, or his or her ‘‘(d) STANDARDS.— ‘‘(3) LIMITATION.—Private entities that enter designee; ‘‘(1) EXISTING STANDARDS.—The standards into a contract with the Federal Government ‘‘(C) the Secretary of Veterans Affairs, or his adopted by the Consolidated Health Informatics shall adopt the standards adopted by the Fed- or her designee; Initiative shall be deemed to have been rec- eral Government under section 2903 for the pur- ‘‘(D) the Secretary of Commerce, or his or her ommended by the Collaborative under this sec- pose of activities under such Federal contract. tion. designee; ‘‘(i) REPORTS.—The Secretary shall submit to ‘‘(2) FIRST YEAR REVIEW.—Not later than 1 ‘‘(E) the National Coordinator for Health In- the Committee on Health, Education, Labor, year after the date of enactment of this title, the formation Technology; and Pensions and the Committee on Finance of Collaborative shall— ‘‘(F) representatives of other relevant Federal the Senate and the Committee on Energy and ‘‘(A) review existing standards (including con- agencies, as determined appropriate by the Sec- Commerce and the Committee on Ways and tent, communication, and security standards) retary; and Means of the House of Representatives, on an for the electronic exchange of health informa- ‘‘(G) representatives from each of the fol- annual basis, a report that— tion, including such standards adopted by the lowing categories to be appointed by the Sec- Secretary under paragraph (2)(A); ‘‘(1) describes the specific actions that have retary from nominations submitted by the pub- ‘‘(B) identify deficiencies and omissions in been taken by the Federal Government and pri- lic— such existing standards; and vate entities to facilitate the adoption of an ‘‘(i) consumer and patient organizations; ‘‘(C) identify duplication and overlap in such interoperable nationwide system for the elec- ‘‘(ii) experts in health information privacy existing standards; tronic exchange of health information; and security; ‘‘(iii) health care providers; and recommend new standards and modifica- ‘‘(2) describes barriers to the adoption of such tions to such existing standards as necessary. ‘‘(iv) health insurance plans or other third a nationwide system; party payors; ‘‘(3) ONGOING REVIEW.—Beginning 1 year after ‘‘(3) contains recommendations to achieve full ‘‘(v) standards development organizations; the date of enactment of this title, and annually implementation of such a nationwide system; ‘‘(vi) information technology vendors; thereafter, the Collaborative shall— and ‘‘(A) review existing standards (including con- ‘‘(vii) purchasers or employers; and tent, communication, and security standards) ‘‘(4) contains a plan and progress toward the ‘‘(viii) State or local government agencies or for the electronic exchange of health informa- establishment of an entity to ensure the con- Indian tribe or tribal organizations. tion, including such standards adopted by the tinuation of the functions of the Collaborative. ‘‘(2) CONSIDERATIONS.—In appointing members Secretary under paragraph (2)(A); ‘‘(j) APPLICATION OF FACA.—The Federal Ad- under paragraph (1)(G), the Secretary shall se- ‘‘(B) identify deficiencies and omissions in visory Committee Act (5 U.S.C. App.) shall lect individuals with expertise in— such existing standards; and apply to the Collaborative, except that the term ‘‘(A) health information privacy; ‘‘(C) identify duplication and overlap in such provided for under section 14(a)(2) shall be 5 ‘‘(B) health information security; existing standards; years. ‘‘(C) health care quality and patient safety, and recommend new standards and modifica- ‘‘(k) RULE OF CONSTRUCTION.—Nothing in this including those individuals with expertise in tions to such existing standards as necessary. section shall be construed to require the dupli- utilizing health information technology to im- ‘‘(4) LIMITATION.—The standards and time- cation of Federal efforts with respect to the es- prove health care quality and patient safety; frame for adoption described in this section tablishment of the Collaborative, regardless of ‘‘(D) data exchange; and shall be consistent with any standards devel- whether such efforts were carried out prior to or ‘‘(E) developing health information tech- oped pursuant to the Health Insurance Port- after the enactment of this title. nology standards and new health information ability and Accountability Act of 1996. technology. ‘‘(e) FEDERAL ACTION.—Not later than 60 days ‘‘(l) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(3) PARTICIPATION.—Membership and proce- after the issuance of a recommendation from the There are authorized to be appropriated to carry dures of the Collaborative shall ensure a bal- Collaborative under subsection (d)(2), the Sec- out this section, $4,000,000 for fiscal year 2006, ance among various sectors of the healthcare retary of Health and Human Services, the Sec- $4,000,000 for fiscal year 2007, and such sums as system so that no single sector unduly influ- retary of Veterans Affairs, and the Secretary of may be necessary for each of fiscal years 2008 ences the recommendations of the Collaborative. Defense, in collaboration with representatives of through 2010. other relevant Federal agencies, as determined ‘‘(4) TERMS.—Members appointed under para- ‘‘SEC. 2904. IMPLEMENTATION AND CERTIFI- graph (1)(G) shall serve for 2 year terms, except appropriate by the Secretary, shall jointly re- CATION OF HEALTH INFORMATION that any member appointed to fill a vacancy for view such recommendations. The Secretary shall STANDARDS. an unexpired term shall be appointed for the re- provide for the adoption by the Federal Govern- ‘‘(a) IMPLEMENTATION.— mainder of such term. A member may serve for ment of any standard or standards contained in not to exceed 180 days after the expiration of such recommendation. ‘‘(1) IN GENERAL.—The Secretary, based upon such member’s term or until a successor has ‘‘(f) COORDINATION OF FEDERAL SPENDING.— the recommendations of the Collaborative, shall been appointed. Not later than 1 year after the adoption by the develop criteria to ensure uniform and con- ‘‘(c) RECOMMENDATIONS AND POLICIES.—Not Federal Government of a recommendation as sistent implementation of any standards for the later than 1 year after the date of enactment of provided for in subsection (e), and in compli- electronic exchange of health information vol- this title, and annually thereafter, the Collabo- ance with chapter 113 of title 40, United States untarily adopted by private entities in technical rative shall recommend to the Secretary uniform Code, no Federal agency shall expend Federal conformance with such standards adopted national policies for adoption by the Federal funds for the purchase of any form of health in- under this title. formation technology or health information Government and voluntary adoption by private ‘‘(2) IMPLEMENTATION ASSISTANCE.—The Sec- entities to support the widespread adoption of technology system for clinical care or for the retary may recognize a private entity or entities health information technology, including— electronic retrieval, storage, or exchange of to assist private entities in the implementation ‘‘(1) protection of health information through health information that is not consistent with of the standards adopted under this title using privacy and security practices; applicable standards adopted by the Federal the criteria developed by the Secretary under Government under subsection (e). ‘‘(2) measures to prevent unauthorized access this section. ‘‘(g) COORDINATION OF FEDERAL DATA COL- to health information; LECTION.—Not later than 3 years after the adop- ‘‘(b) CERTIFICATION.— ‘‘(3) methods to facilitate secure patient access tion by the Federal Government of a rec- to health information; ‘‘(1) IN GENERAL.—The Secretary, based upon ommendation as provided for in subsection (e), the recommendations of the Collaborative, shall ‘‘(4) fostering the public understanding of all Federal agencies collecting health data for health information technology; develop criteria to ensure and certify that hard- the purposes of quality reporting, surveillance, ware and software that claim to be in compli- ‘‘(5) the ongoing harmonization of industry- epidemiology, adverse event reporting, research, ance with any standard for the electronic ex- wide health information technology standards; or for other purposes determined appropriate by change of health information adopted under ‘‘(6) recommendations for a nationwide inter- the Secretary, shall comply with standards this title have established and maintained such operable health information technology infra- adopted under subsection (e). compliance in technical conformance with such structure; ‘‘(h) VOLUNTARY ADOPTION.— standards. ‘‘(7) the identification and prioritization of ‘‘(1) IN GENERAL.—Any standards adopted by specific use cases for which health information the Federal Government under subsection (e) ‘‘(2) CERTIFICATION ASSISTANCE.—The Sec- technology is valuable, beneficial, and feasible; shall be voluntary with respect to private enti- retary may recognize a private entity or entities ‘‘(8) recommendations for the establishment of ties. to assist in the certification described under paragraph (1) using the criteria developed by an entity to ensure the continuation of the ‘‘(2) RULE OF CONSTRUCTION.—Nothing in this functions of the Collaborative; and section shall be construed to require that a pri- the Secretary under this section. ‘‘(9) other policies (including recommenda- vate entity that enters into a contract with the ‘‘(c) DELEGATION AUTHORITY.—The Secretary, tions for incorporating health information tech- Federal Government adopt the standards adopt- through consultation with the Collaborative, nology into the provision of care and the orga- ed by the Federal Government under section may accept recommendations on the develop- nization of the health care workplace) deter- 2903 with respect to activities not related to the ment of the criteria under subsections (a) and mined to be necessary by the Collaborative. contract. (b) from a Federal agency or private entity.

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00121 Fmt 0624 Sfmt 6333 E:\CR\FM\A17NO6.094 S17NOPT2 S13268 CONGRESSIONAL RECORD — SENATE November 17, 2005 ‘‘SEC. 2905. GRANTS TO FACILITATE THE WIDE- ‘‘(A) submit to the Secretary an application at ‘‘(iii) The State loan fund shall be credited SPREAD ADOPTION OF INTEROPER- such time, in such manner, and containing such with all payments of principal and interest on ABLE HEALTH INFORMATION TECH- information as the Secretary may require; each loan awarded from the fund. NOLOGY. ‘‘(B) submit to the Secretary a strategic plan ‘‘(B) To guarantee, or purchase insurance for, ‘‘(a) COMPETITIVE GRANTS TO FACILITATE THE in accordance with paragraph (4); a local obligation (all of the proceeds of which WIDESPREAD ADOPTION OF HEALTH INFORMA- ‘‘(C) establish a qualified health information finance a project eligible for assistance under TION TECHNOLOGY.— technology loan fund in accordance with para- this subsection) if the guarantee or purchase ‘‘(1) IN GENERAL.—The Secretary may award graph (2); competitive grants to eligible entities to facilitate would improve credit market access or reduce ‘‘(D) require that health care providers receiv- the purchase and enhance the utilization of the interest rate applicable to the obligation in- ing such loans— qualified health information technology systems volved. ‘‘(i) link, to the extent practicable, the quali- to improve the quality and efficiency of health fied health information system to a local or re- ‘‘(C) As a source of revenue or security for the care. gional health information network; and payment of principal and interest on revenue or ‘‘(2) ELIGIBILITY.—To be eligible to receive a ‘‘(ii) consult with the Health Information general obligation bonds issued by the State if grant under paragraph (1) an entity shall— Technology Resource Center established in sec- the proceeds of the sale of the bonds will be de- ‘‘(A) submit to the Secretary an application at tion 914(d) to access the knowledge and experi- posited into the State loan fund. such time, in such manner, and containing such ence of existing initiatives regarding the suc- information as the Secretary may require; ‘‘(D) To earn interest on the amounts depos- cessful implementation and effective use of ‘‘(B) submit to the Secretary a strategic plan ited into the State loan fund. health information technology; for the implementation of data sharing and ‘‘(E) require that health care providers receiv- ‘‘(7) ADMINISTRATION OF STATE LOAN FUNDS.— interoperability measures; ing such loans adopt the standards adopted by ‘‘(C) be a— ‘‘(A) COMBINED FINANCIAL ADMINISTRATION.— the Federal Government under section 2903; ‘‘(i) not for profit hospital; A State may (as a convenience and to avoid un- ‘‘(F) require that health care providers receiv- ‘‘(ii) individual or group practice; or necessary administrative costs) combine, in ac- ing such loans implement the measurement sys- ‘‘(iii) another health care provider not de- cordance with State law, the financial adminis- tem adopted under section 2908 and report to the scribed in clause (i) or (ii); tration of a State loan fund established under Secretary on such measures; and ‘‘(D) adopt the standards adopted by the Fed- this subsection with the financial administra- ‘‘(G) provide matching funds in accordance eral Government under section 2903; tion of any other revolving fund established by with paragraph (8). ‘‘(E) implement the measurement system the State if otherwise not prohibited by the law ‘‘(4) STRATEGIC PLAN.— adopted under section 2908 and report to the under which the State loan fund was estab- Secretary on such measures; ‘‘(A) IN GENERAL.—A State that receives a lished. grant under this subsection shall annually pre- ‘‘(F) demonstrate significant financial need; ‘‘(B) COST OF ADMINISTERING FUND.—Each pare a strategic plan that identifies the intended and State may annually use not to exceed 4 percent uses of amounts available to the State loan fund ‘‘(G) provide matching funds in accordance of the funds provided to the State under a grant of the State. with paragraph (4). under this subsection to pay the reasonable ‘‘(B) CONTENTS.—A strategic plan under sub- ‘‘(3) USE OF FUNDS.—Amounts received under costs of the administration of the programs paragraph (A) shall include— a grant under this subsection shall be used to under this section, including the recovery of facilitate the purchase and enhance the utiliza- ‘‘(i) a list of the projects to be assisted through reasonable costs expended to establish a State tion of qualified health information technology the State loan fund in the first fiscal year that loan fund which are incurred after the date of systems and training personnel in the use of begins after the date on which the plan is sub- enactment of this title. such technology. mitted; ‘‘(C) GUIDANCE AND REGULATIONS.—The Sec- ‘‘(4) MATCHING REQUIREMENT.—To be eligible ‘‘(ii) a description of the criteria and methods retary shall publish guidance and promulgate for a grant under this subsection an entity shall established for the distribution of funds from the regulations as may be necessary to carry out the contribute non-Federal contributions to the State loan fund; and provisions of this subsection, including— costs of carrying out the activities for which the ‘‘(iii) a description of the financial status of grant is awarded in an amount equal to $1 for the State loan fund and the short-term and ‘‘(i) provisions to ensure that each State com- each $3 of Federal funds provided under the long-term goals of the State loan fund. mits and expends funds allotted to the State grant. ‘‘(5) USE OF FUNDS.— under this subsection as efficiently as possible ‘‘(5) PREFERENCE IN AWARDING GRANTS.—In ‘‘(A) IN GENERAL.—Amounts deposited in a in accordance with this title and applicable awarding grants under this subsection the Sec- State loan fund, including loan repayments and State laws; and retary shall give preference to— interest earned on such amounts, shall be used only for awarding loans or loan guarantees, or ‘‘(ii) guidance to prevent waste, fraud, and ‘‘(A) eligible entities that are located in rural, abuse. frontier, and other underserved areas as deter- as a source of reserve and security for leveraged mined by the Secretary; loans, the proceeds of which are deposited in ‘‘(D) PRIVATE SECTOR CONTRIBUTIONS.— the State loan fund established under para- ‘‘(B) eligible entities that will link, to the ex- ‘‘(i) IN GENERAL.—A State loan fund estab- graph (1). Loans under this section may be used tent practicable, the qualified health informa- lished under this subsection may accept con- by a health care provider to facilitate the pur- tion system to local or regional health informa- tributions from private sector entities, except chase and enhance the utilization of qualified tion plan or plans; and that such entities may not specify the recipient health information technology and training of ‘‘(C) with respect to an entity described in or recipients of any loan issued under this sub- personnel in the use of such technology. subsection (a)(2)(C)(iii), a nonprofit health care section. provider. ‘‘(B) LIMITATION.—Amounts received by a ‘‘(b) COMPETITIVE GRANTS TO STATES FOR THE State under this subsection may not be used— ‘‘(ii) AVAILABILITY OF INFORMATION.—A State DEVELOPMENT OF STATE LOAN PROGRAMS TO ‘‘(i) for the purchase or other acquisition of shall make publicly available the identity of, FACILITATE THE WIDESPREAD ADOPTION OF any health information technology system that and amount contributed by, any private sector HEALTH INFORMATION TECHNOLOGY.— is not a qualified health information technology entity under clause (i) and may issue letters of ‘‘(1) IN GENERAL.—The Secretary may award system; commendation or make other awards (that have competitive grants to States for the establish- ‘‘(ii) to conduct activities for which Federal no financial value) to any such entity. ment of State programs for loans to health care funds are expended under this title, or the ‘‘(8) MATCHING REQUIREMENTS.— providers to facilitate the purchase and enhance amendments made by the Wired for Health Care the utilization of qualified health information Quality Act; or ‘‘(A) IN GENERAL.—The Secretary may not technology. ‘‘(iii) for any purpose other than making make a grant under paragraph (1) to a State unless the State agrees to make available (di- ‘‘(2) ESTABLISHMENT OF FUND.—To be eligible loans to eligible entities under this section. rectly or through donations from public or pri- to receive a competitive grant under this sub- ‘‘(6) TYPES OF ASSISTANCE.—Except as other- vate entities) non-Federal contributions in cash section, a State shall establish a qualified wise limited by applicable State law, amounts toward the costs of the State program to be im- health information technology loan fund (re- deposited into a State loan fund under this sub- plemented under the grant in an amount equal ferred to in this subsection as a ‘State loan section may only be used for the following: to not less than $1 for each $1 of Federal funds fund’) and comply with the other requirements ‘‘(A) To award loans that comply with the fol- provided under the grant. contained in this section. A grant to a State lowing: under this subsection shall be deposited in the ‘‘(i) The interest rate for each loan shall be ‘‘(B) DETERMINATION OF AMOUNT OF NON-FED- State loan fund established by the State. No less than or equal to the market interest rate. ERAL CONTRIBUTION.—In determining the funds authorized by other provisions of this title ‘‘(ii) The principal and interest payments on amount of non-Federal contributions that a to be used for other purposes specified in this each loan shall commence not later than 1 year State has provided pursuant to subparagraph title shall be deposited in any State loan fund. after the loan was awarded, and each loan shall (A), the Secretary may not include any amounts ‘‘(3) ELIGIBILITY.—To be eligible to receive a be fully amortized not later than 10 years after provided to the State by the Federal Govern- grant under paragraph (1) a State shall— the date of the loan. ment.

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‘‘(9) PREFERENCE IN AWARDING GRANTS.—The ‘‘(A) IN GENERAL.—To be eligible to receive a ‘‘(3) a description of any reduction in duplica- Secretary may give a preference in awarding grant under paragraph (1), an entity shall sub- tive or unnecessary care as a result of the grants under this subsection to States that mit to the Secretary an application at such time, project involved; adopt value-based purchasing programs to im- in such manner, and containing such informa- ‘‘(4) a description of the efforts of recipients prove health care quality. tion as the Secretary may require. under this section to facilitate secure patient ac- ‘‘(10) REPORTS.—The Secretary shall annually ‘‘(B) REQUIRED INFORMATION.—At a minimum, cess to health information; and submit to the Committee on Health, Education, an application submitted under this paragraph Labor, and Pensions and the Committee on Fi- shall include— ‘‘(5) other information as required by the Sec- nance of the Senate, and the Committee on En- ‘‘(i) clearly identified short-term and long- retary. ergy and Commerce and the Committee on Ways term objectives of the regional or local health in- ‘‘(e) REQUIREMENT TO ACHIEVE QUALITY IM- and Means of the House of Representatives, a formation plan; PROVEMENT.—The Secretary shall annually report summarizing the reports received by the ‘‘(ii) a technology plan that complies with the evaluate the activities conducted under this sec- Secretary from each State that receives a grant standards adopted under section 2903 and that tion and shall, in awarding grants, implement under this subsection. includes a descriptive and reasoned estimate of the lessons learned from such evaluation in a ‘‘(c) COMPETITIVE GRANTS FOR THE IMPLEMEN- costs of the hardware, software, training, and manner so that awards made subsequent to each TATION OF REGIONAL OR LOCAL HEALTH INFOR- consulting services necessary to implement the such evaluation are made in a manner that, in MATION TECHNOLOGY PLANS.— regional or local health information plan; the determination of the Secretary, will result in ‘‘(1) IN GENERAL.—The Secretary may award ‘‘(iii) a strategy that includes initiatives to im- the greatest improvement in quality measure- competitive grants to eligible entities to imple- prove health care quality and efficiency, includ- ment systems under section 2908. ment regional or local health information plans ing the use and reporting of health care quality ‘‘(f) LIMITATION.—An eligible entity may only to improve health care quality and efficiency measures adopted under section 2908; receive one non-renewable grant under sub- through the electronic exchange of health infor- ‘‘(iv) a plan that describes provisions to en- section (a), one non-renewable grant under sub- mation pursuant to the standards, protocols, courage the implementation of the electronic ex- section (b), and one non-renewable grant under and other requirements adopted by the Sec- change of health information by all physicians, subsection (c). retary under sections 2903 and 2908. including single physician practices and small ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(2) ELIGIBILITY.—To be eligible to receive a physician groups participating in the health in- grant under paragraph (1) an entity shall— formation plan; ‘‘(1) IN GENERAL.—For the purpose of carrying ‘‘(A) demonstrate financial need to the Sec- ‘‘(v) a plan to ensure the privacy and security out this section, there is authorized to be appro- retary; of personal health information that is consistent priated $116,000,000 for fiscal year 2006, ‘‘(B) demonstrate that one of its principal mis- with Federal and State law; $141,000,000 for fiscal year 2007, and such sums sions or purposes is to use information tech- ‘‘(vi) a governance plan that defines the man- as may be necessary for each of fiscal years 2008 nology to improve health care quality and effi- ner in which the stakeholders shall jointly make through 2010. policy and operational decisions on an ongoing ciency; ‘‘(2) AVAILABILITY.—Amounts appropriated ‘‘(C) adopt bylaws, memoranda of under- basis; under paragraph (1) shall remain available standing, or other charter documents that dem- ‘‘(vii) a financial or business plan that de- through fiscal year 2010. onstrate that the governance structure and deci- scribes— sionmaking processes of such entity allow for ‘‘(I) the sustainability of the plan; ‘‘SEC. 2906. DEMONSTRATION PROGRAM TO INTE- ‘‘(II) the financial costs and benefits of the GRATE INFORMATION TECHNOLOGY participation on an ongoing basis by multiple INTO CLINICAL EDUCATION. stakeholders within a community, including— plan; and ‘‘(i) physicians (as defined in section 1861(r) ‘‘(III) the entities to which such costs and ‘‘(a) IN GENERAL.—The Secretary may award of the Social Security Act), including physicians benefits will accrue; and grants under this section to carry out dem- that provide services to low income and under- ‘‘(viii) if the case of an applicant entity that onstration projects to develop academic cur- served populations; is unable to demonstrate the participation of all ricula integrating qualified health information ‘‘(ii) hospitals (including hospitals that pro- stakeholders pursuant to paragraph (2)(C), the technology systems in the clinical education of vide services to low income and underserved justification from the entity for any such non- health professionals. Such awards shall be made populations); participation. on a competitive basis and pursuant to peer re- ‘‘(iii) pharmacists or pharmacies; ‘‘(4) USE OF FUNDS.—Amounts received under view. a grant under paragraph (1) shall be used to es- ‘‘(iv) health insurance plans; ‘‘(b) ELIGIBILITY.—To be eligible to receive a tablish and implement a regional or local health ‘‘(v) health centers (as defined in section grant under subsection (a), an entity shall— information plan in accordance with this sub- 330(b)) and Federally qualified health centers section. ‘‘(1) submit to the Secretary an application at (as defined in section 1861(aa)(4) of the Social ‘‘(5) MATCHING REQUIREMENT.— such time, in such manner, and containing such Security Act); ‘‘(A) IN GENERAL.—The Secretary may not information as the Secretary may require; ‘‘(vi) rural health clinics (as defined in section make a grant under this subsection to an entity ‘‘(2) submit to the Secretary a strategic plan 1861(aa) of the Social Security Act); unless the entity agrees that, with respect to the for integrating qualified health information ‘‘(vii) patient or consumer organizations; costs to be incurred by the entity in carrying out technology in the clinical education of health ‘‘(viii) employers; and the infrastructure program for which the grant professionals and for ensuring the consistent ‘‘(ix) any other health care providers or other was awarded, the entity will make available (di- utilization of decision support software to re- entities, as determined appropriate by the Sec- rectly or through donations from public or pri- duce medical errors and enhance health care retary; vate entities) non-Federal contributions toward quality; ‘‘(D) demonstrate the participation, to the ex- such costs in an amount equal to not less than ‘‘(3) be— tent practicable, of stakeholders in the elec- 50 percent of such costs ($1 for each $2 of Fed- tronic exchange of health information within eral funds provided under the grant). ‘‘(A) a health professions school; the local or regional plan pursuant to para- ‘‘(B) DETERMINATION OF AMOUNT CONTRIB- ‘‘(B) a school of nursing; or graph (2)(C); UTED.—Non-Federal contributions required ‘‘(E) adopt nondiscrimination and conflict of ‘‘(C) an institution with a graduate medical under subparagraph (A) may be in cash or in education program; interest policies that demonstrate a commitment kind, fairly evaluated, including equipment, to open, fair, and nondiscriminatory participa- technology, or services. Amounts provided by ‘‘(4) provide for the collection of data regard- tion in the health information plan by all stake- the Federal Government, or services assisted or ing the effectiveness of the demonstration holders; subsidized to any significant extent by the Fed- project to be funded under the grant in improv- ‘‘(F) adopt the standards adopted by the Sec- eral Government, may not be included in deter- ing the safety of patients, the efficiency of retary under section 2903; mining the amount of such non-Federal con- health care delivery, and in increasing the like- ‘‘(G) require that health care providers receiv- tributions. lihood that graduates of the grantee will adopt ing such grants implement the measurement sys- ‘‘(d) REPORTS.—Not later than 1 year after the and incorporate health information technology, tem adopted under section 2908 and report to the date on which the first grant is awarded under and implement the quality measurement system Secretary on such measures; this section, and annually thereafter during the adopted under section 2908, in the delivery of ‘‘(H) facilitate the electronic exchange of grant period, an entity that receives a grant health care services; and health information within the local or regional under this section shall submit to the Secretary ‘‘(5) provide matching funds in accordance area and among local and regional areas; a report on the activities carried out under the with subsection (c). ‘‘(I) prepare and submit to the Secretary an grant involved. Each such report shall include— ‘‘(c) USE OF FUNDS.— application in accordance with paragraph (3); ‘‘(1) a description of the financial costs and and benefits of the project involved and of the enti- ‘‘(1) IN GENERAL.—With respect to a grant ‘‘(J) agree to provide matching funds in ac- ties to which such costs and benefits accrue; under subsection (a), an eligible entity shall— cordance with paragraph (5). ‘‘(2) an analysis of the impact of the project ‘‘(A) use grant funds in collaboration with 2 ‘‘(3) APPLICATION.— on health care quality and safety; or more disciplines; and

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00123 Fmt 0624 Sfmt 6333 E:\CR\FM\A17NO6.095 S17NOPT2 S13270 CONGRESSIONAL RECORD — SENATE November 17, 2005

‘‘(B) use grant funds to integrate qualified ‘‘(b) REQUIREMENTS.—The Secretary shall en- quality measurement systems under this section, health information technology into community- sure that the quality measurement system devel- the Secretary shall take into account the rec- based clinical education. oped under subsection (a) comply with the fol- ommendations of public-private entities— ‘‘(2) LIMITATION.—An eligible entity shall not lowing: ‘‘(1) that are established to examine issues of use amounts received under a grant under sub- ‘‘(1) MEASURES.— data collection and reporting, including the fea- section (a) to purchase hardware, software, or ‘‘(A) IN GENERAL.—Subject to subparagraph sibility of collecting and reporting data on meas- services. (B), the Secretary shall select measures of qual- ures; and ‘‘(d) MATCHING FUNDS.— ity to be used by the Secretary under the sys- ‘‘(1) IN GENERAL.—The Secretary may award a tems. ‘‘(2) that involve representatives of health grant to an entity under this section only if the ‘‘(B) REQUIREMENTS.—In selecting the meas- care providers (including physicians, phar- entity agrees to make available non-Federal ures to be used under each system pursuant to macists, nurses, and other health care profes- contributions toward the costs of the program to subparagraph (A), the Secretary shall, to the ex- sionals), consumers, employers, and other indi- be funded under the grant in an amount that is tent feasible, ensure that— viduals and groups that are interested in qual- not less than $1 for each $2 of Federal funds ‘‘(i) such measures are evidence based, reliable ity of care. provided under the grant. and valid; ‘‘(e) ARRANGEMENT WITH AN ENTITY TO PRO- ‘‘(2) DETERMINATION OF AMOUNT CONTRIB- ‘‘(ii) such measures include measures of clin- VIDE ADVICE AND RECOMMENDATIONS.— UTED.—Non-Federal contributions under para- ical processes and outcomes, patient experience, ‘‘(1) ARRANGEMENT.—On and after July 1, graph (1) may be in cash or in kind, fairly eval- efficiency, and equity; and 2006, the Secretary shall have in place an ar- uated, including equipment or services. Amounts ‘‘(iii) such measures include measures of over- rangement with an entity that meets the re- provided by the Federal Government, or services use and underuse of health care items and serv- quirements described in paragraph (2) under assisted or subsidized to any significant extent ices. which such entity provides the Secretary with by the Federal Government, may not be in- ‘‘(2) PRIORITIES.—In developing the system advice on, and recommendations with respect to, cluded in determining the amount of such con- under subsection (a), the Secretary shall ensure the development and updating of the quality tributions. that priority is given to— measurement systems under this section, includ- ‘‘(e) EVALUATION.—The Secretary shall take ‘‘(A) measures with the greatest potential im- ing the assigning of weights to the measures such action as may be necessary to evaluate the pact for improving the quality and efficiency of under subsection (b)(2). projects funded under this section and publish, care provided under Federal programs; make available, and disseminate the results of ‘‘(B) measures that may be rapidly imple- ‘‘(2) REQUIREMENTS DESCRIBED.—The require- such evaluations on as wide a basis as is prac- mented by group health plans, health insurance ments described in this paragraph are the fol- ticable. issuers, physicians, hospitals, nursing homes, lowing: ‘‘(f) REPORTS.—Not later than 1 year after the long-term care providers, and other providers; ‘‘(A) The entity is a private nonprofit entity date of enactment of this title, and annually and governed by an executive director and a board. thereafter, the Secretary shall submit to the ‘‘(C) measures which may inform health care ‘‘(B) The members of the entity include rep- Committee on Health, Education, Labor, and decisions made by consumers and patients. resentatives of— Pensions and the Committee on Finance of the ‘‘(3) WEIGHTS OF MEASURES.—The Secretary Senate, and the Committee on Energy and Com- shall assign weights to the measures used by the ‘‘(i) health insurance plans and health care merce and the Committee on Ways and Means of Secretary under each system established under providers with experience in the care of individ- the House of Representatives a report that— subsection (a). uals with multiple complex chronic conditions or ‘‘(1) describes the specific projects established ‘‘(4) RISK ADJUSTMENT.—The Secretary shall groups representing such health insurance under this section; and establish procedures to account for differences plans and providers; ‘‘(2) contains recommendations for Congress in patient health status, patient characteristics, ‘‘(ii) groups representing patients and con- based on the evaluation conducted under sub- and geographic location. To the extent prac- sumers; section (e). ticable, such procedures shall recognize existing ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— procedures. ‘‘(iii) purchasers and employers or groups rep- resenting purchasers or employers; There is authorized to be appropriated to carry ‘‘(5) MAINTENANCE.—The Secretary shall, as out this section, $5,000,000 for fiscal year 2007, determined appropriate, but in no case more ‘‘(iv) organizations that focus on quality im- and such sums as may be necessary for each of often than once during each 12-month period, provement as well as the measurement and re- fiscal years 2008 through 2010. update the quality measurement systems devel- porting of quality measures; ‘‘(h) SUNSET.—This section shall not apply oped under subsection (a), including through— ‘‘(v) State government health programs; after September 30, 2010. ‘‘(A) the addition of more accurate and pre- ‘‘(vi) individuals or entities skilled in the con- ‘‘SEC. 2907. LICENSURE AND THE ELECTRONIC cise measures under the systems and the retire- EXCHANGE OF HEALTH INFORMA- ment of existing outdated measures under the duct and interpretation of biomedical, health TION. systems; and services, and health economics research and ‘‘(a) IN GENERAL.—The Secretary shall carry ‘‘(B) the refinement of the weights assigned to with expertise in outcomes and effectiveness re- out, or contract with a private entity to carry measures under the systems. search and technology assessment; and out, a study that examines— ‘‘(c) REQUIRED CONSIDERATIONS IN DEVEL- ‘‘(vii) individuals or entities involved in the ‘‘(1) the variation among State laws that re- OPING AND UPDATING THE SYSTEMS.—In devel- development and establishment of standards late to the licensure, registration, and certifi- oping and updating the quality measurement and certification for health information tech- cation of medical professionals; and systems under this section, the Secretary shall— nology systems and clinical data. ‘‘(2) how such variation among State laws im- ‘‘(1) consult with, and take into account the ‘‘(C) The membership of the entity is rep- pacts the secure electronic exchange of health recommendations of, the entity that the Sec- resentative of individuals with experience with information— retary has an arrangement with under sub- urban health care issues and individuals with ‘‘(A) among the States; and section (e); experience with rural and frontier health care ‘‘(B) between the States and the Federal Gov- ‘‘(2) consult with representatives of health issues. ernment. care providers (including physicians, phar- ‘‘(b) REPORT AND RECOMMENDATIONS.—Not macists, nurses, and other health care profes- ‘‘(D) If the entity requires a fee for member- later than 1 year after the date of enactment of sionals), consumers, employers, and other indi- ship, the entity shall provide assurances to the this title, the Secretary shall publish a report viduals and groups that are interested in the Secretary that such fees are not a substantial that— quality of health care; and barrier to participation in the entity’s activities ‘‘(1) describes the results of the study carried ‘‘(3) take into account— related to the arrangement with the Secretary. out under subsection (a); and ‘‘(A) any demonstration or pilot program con- ‘‘(E) The entity— ‘‘(2) makes recommendations to States regard- ducted by the Secretary relating to measuring ‘‘(i) permits any member described in subpara- ing the harmonization of State laws based on and rewarding quality and efficiency of care; graph (B) to vote on matters of the entity re- the results of such study. ‘‘(B) any existing activities conducted by the lated to the arrangement with the Secretary ‘‘SEC. 2908. QUALITY MEASUREMENT SYSTEM. Secretary relating to measuring and rewarding under paragraph (1); and ‘‘(a) IN GENERAL.—The Secretary, in consulta- quality and efficiency; tion with the Secretary of Veterans Affairs, the ‘‘(C) any existing activities conducted by pri- ‘‘(ii) ensures that member voting provides a Secretary of Defense, and representatives of vate entities including health insurance plans balance among disparate stakeholders, so that other relevant Federal agencies, as determined and payors; and no member organization described in subpara- appropriate by the Secretary, shall develop or ‘‘(D) the report by the Institute of Medicine of graph (B) unduly influences the outcome. adopt a quality measurement system, including the National Academy of Sciences under section ‘‘(F) With respect to matters related to the ar- measures to assess that effectiveness, timeliness, 238(b) of the Medicare Prescription Drug, Im- rangement with the Secretary under paragraph patient self-management, patient centeredness, provement, and Modernization Act of 2003. (1), the entity conducts its business in an open efficiency, and safety, for the purpose of meas- ‘‘(d) REQUIRED CONSIDERATIONS IN IMPLE- and transparent manner and provides the op- uring the quality of care patients receive. MENTING THE SYSTEMS.—In implementing the portunity for public comment.

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00124 Fmt 0624 Sfmt 6333 E:\CR\FM\A17NO6.095 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13271 ‘‘(G) The entity operates as a voluntary con- ‘‘(1) IN GENERAL.—The Secretary, acting laid upon the table, and that any state- sensus standards setting organization as defined through the Director, shall develop a Health In- ments relating to the bill be printed in for purposes of section 12(d) of the National formation Technology Resource Center to pro- the RECORD. Technology Transfer and Advancement Act of vide technical assistance and develop best prac- The PRESIDING OFFICER. Without 1995 (Public Law 104–113) and Office of Man- tices to support and accelerate efforts to adopt, agement and Budget Revised Circular A–119 implement, and effectively use interoperable objection, it is so ordered. (published in the Federal Register on February health information technology in compliance The amendment (No. 2671) was agreed 10, 1998). with section 2903 and 2908. to. ‘‘(f) USE OF QUALITY MEASUREMENT SYS- ‘‘(2) HEALTH INFORMATION TECHNOLOGY RE- (The amendment is printed in today’s TEM.— SOURCE CENTER.— RECORD under ‘‘Text of Amendments.’’) ‘‘(1) IN GENERAL.—For purposes of activities ‘‘(A) IN GENERAL.—The Center shall support The committee amendment in the conducted or supported by the Secretary under activities to meet goals, including— nature of a substitute, as amended, was this Act, the Secretary shall, to the extent prac- ‘‘(i) providing for the widespread adoption of agreed to. ticable, adopt and utilize the measurement sys- interoperable health information technology; The bill (S. 1418), as amended, was tem developed under this section. ‘‘(ii) providing for the establishment of re- read the third time and passed. ‘‘(2) COLLABORATIVE AGREEMENTS.—With re- gional and local health information networks to spect to activities conducted or supported by the facilitate the development of interoperability Mr. FRIST. Mr. President, the Sen- Secretary under this Act, the Secretary may es- across health care settings and improve the ate just passed a bill that takes a tablish collaborative agreements with private quality of health care; major step—major step—to bringing entities, including group health plans and ‘‘(iii) the development of solutions to barriers health care into the information age, health insurance issuers, providers, purchasers, to the exchange of electronic health informa- finally. This bill, the Wired for Health consumer organizations, and entities receiving a tion; or Care Quality Act, reflects the hard grant under section 2905, to— ‘‘(iv) other activities identified by the States, work by Senator ENZI, to whom I will ‘‘(A) encourage the use of the health care local or regional health information networks, turn the floor over shortly, myself, quality measures adopted by the Secretary or health care stakeholders as a focus for devel- under this section; and oping and sharing best practices. Senator KENNEDY, Senator CLINTON, ‘‘(B) foster uniformity between the health care ‘‘(B) PURPOSES.—The purpose of the Center is and many others. quality measures utilized by private entities. to— This bill will do as much as anything ‘‘(3) REPORTING.—The Secretary shall imple- ‘‘(i) provide a forum for the exchange of we have done in this Congress and the ment procedures to enable the Department of knowledge and experience; last Congress and the Congress before Health and Human Services to accept the elec- ‘‘(ii) accelerate the transfer of lessons learned that to cut waste and inefficiency out tronic submission of data for purposes of quality from existing public and private sector initia- of our health care system. What the measurement using the quality measurement tives, including those currently receiving Fed- bill does is encourage the use of secure system adopted under this section and using the eral financial support; and and interoperable health care records, standards adopted by the Federal Government ‘‘(iii) assemble, analyze, and widely dissemi- under section 2903. nate evidence and experience related to the electronic records, electronic medical ‘‘(g) DISSEMINATION OF INFORMATION.—Begin- adoption, implementation, and effective use of records. ning on January 1, 2008, in order to make com- interoperable health information technology. This has a huge benefit for every parative quality information available to health ‘‘(C) SUPPORT FOR ACTIVITIES.—To provide American. It reduces waste and ineffi- care consumers, health professionals, public support for the activities of the Center, the Di- ciency. It reduces medical errors. It health officials, researchers, and other appro- rector shall modify the requirements, if nec- improves the quality of health care. It priate individuals and entities, the Secretary essary, that apply to the National Resource reduces health care costs throughout shall provide for the dissemination, aggregation, Center for Health Information Technology to the system, raising quality. When you and analysis of quality measures collected provide the necessary infrastructure to support under section 2905 and the dissemination of rec- the duties and activities of the Center and fa- lower costs and you raise quality, by ommendations and best practices derived in part cilitate information exchange across the public definition, you improve access as well. from such analysis. and private sectors. This bill will help empower patients ‘‘(h) TECHNICAL ASSISTANCE.—The Secretary ‘‘(3) TECHNICAL ASSISTANCE TELEPHONE NUM- to become full partners in what we all shall provide technical assistance to public and BER OR WEBSITE.—The Secretary shall establish have as a vision; and that is, a patient- private entities to enable such entities to— a toll-free telephone number or Internet website centered, provider-friendly, consumer- ‘‘(1) implement and use evidence-based guide- to provide health care providers and patients driven system that will be driven by in- lines with the greatest potential to improve with a single point of contact to— formation, and be driven by choice, and health care quality, efficiency, and patient safe- ‘‘(A) learn about Federal grants and technical ty; and assistance services related to interoperable be driven by control. ‘‘(2) establish mechanisms for the rapid dis- health information technology; Patient privacy is protected. This se- semination of information regarding evidence- ‘‘(B) learn about qualified health information cure exchange of lifesaving informa- based guidelines with the greatest potential to technology and the quality measurement system tion improves efficiency throughout improve health care quality, efficiency, and pa- adopted by the Federal Government under sec- the system. It will allow, for the first tient safety. tions 2903 and 2908; time, because there are interoperable ‘‘SEC. 2909. ENSURING PRIVACY AND SECURITY. ‘‘(C) learn about regional and local health in- standards that are set, the exchange of ‘‘Nothing in this title shall be construed to af- formation networks for assistance with health information, which will seamlessly information technology; and fect the scope or substance of— help integrate health care delivery ‘‘(1) section 264 of the Health Insurance Port- ‘‘(D) disseminate additional information de- termined by the Secretary. from the time a patient first presents ability and Accountability Act of 1996; to see a physician or a nurse to ulti- ‘‘(2) sections 1171 through 1179 of the Social ‘‘(4) RULE OF CONSTRUCTION.—Nothing in this mate discharge and treatment. Security Act; and subsection shall be construed to require the du- ‘‘(3) any regulation issued pursuant to any plication of Federal efforts with respect to the So this really is a pivotal moment. I such section; establishment of the Center, regardless of encourage the House to act quickly on whether such efforts were carried out prior to or and such sections shall remain in effect. the legislation. after the enactment of this subsection.’’. ‘‘SEC. 2910. STUDY OF REIMBURSEMENT INCEN- Again, I thank Senator ENZI for his TIVES. SEC. 4. REAUTHORIZATION OF INCENTIVE leadership. Without it, this moment GRANTS REGARDING TELEMEDI- ‘‘The Secretary shall carry out, or contract CINE. simply would not be possible. I thank with a private entity to carry out, a study that Section 330L(b) of the Public Health Service Senator CLINTON who has stressed, examines methods to create efficient reimburse- Act (42 U.S.C. 254c–18(b)) is amended by striking from day one, the importance of having ment incentives for improving health care qual- ‘‘2002 through 2006’’ and inserting ‘‘2006 quality injected into this bill, and Sen- ity in Federally qualified health centers, rural through 2010’’. ator KENNEDY. I thank them all for health clinics, and free clinics.’’. Mr. FRIST. Mr. President, I ask their commitment to this effort. SEC. 3. HEALTH INFORMATION TECHNOLOGY RE- unanimous consent that the Enzi sub- I thank the staff who have worked SOURCE CENTER. stitute at the desk be agreed to, the many hours: Andrea Palm, Katy Barr, Section 914 of the Public Health Service Act (42 U.S.C. 299b–3) is amended by adding at the committee-reported amendment, as Steve Northrup, and David Bowen, and end the following: amended, be agreed to, the bill, as many others. ‘‘(d) HEALTH INFORMATION TECHNOLOGY RE- amended, be read a third time and Mr. President, I do want to at least SOURCE CENTER.— passed, the motion to reconsider be turn to my colleague to thank him and

VerDate Aug 31 2005 02:21 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00125 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.095 S17NOPT2 S13272 CONGRESSIONAL RECORD — SENATE November 17, 2005 so he can make a few comments be- of legislation we just passed, and I add Secretary Leavitt, and Dr. Brailer have cause this is truly historic legislation. the encouragement to have the House done a lot to advance the health IT in- And although it is mighty early in the act on it quickly. frastructure, and I am glad that Con- morning now—late at night or early in Mr. President, I rise today to applaud gress is finally stepping up to the the morning—this really is a historic the Senate passage of S. 1418, the Wired plate. time for health care and health care for Health Care Quality Act. As chair- In order to address the health infor- delivery. man of the Committee on Health, Edu- mation technology ‘‘adoption gap’’ in The PRESIDING OFFICER. The Sen- cation, Labor, and Pensions, I have the United States, S. 1418 authorizes ator from Wyoming. been working to improve the quality three grant programs that will care- Mr. ENZI. Mr. President, I thank the and reduce the cost of health care in fully target financial support to health leader for his kind comments but much this Nation. care providers and consortia for the more so for his diligent work and lead- Some of the most serious challenges purpose of facilitating the adoption of ership on this issue. As the heart doc- facing health care today—medical er- interoperable health information tech- tor of the Senate, and the doctor with rors, inconsistent quality, and rising nology. To maximize the Secretary of a lot of heart, he understands the need costs—can be addressed through the ef- Health and Human Service’s flexi- for health information technology and fective application of available health bility, the bill leaves to the discretion worked in a very bipartisan way with information technology linking all ele- of the Secretary the allocation of the Senator CLINTON to come up with some ments of the health care system. Infor- authorization among the three pro- of the precepts we have in this bill. mation-sharing networks have the po- grams. In addition, the greatest improve- Senator KENNEDY and I were working tential to enable decision support any- ments in quality of health care and on some other aspects of it. And we where at any time, thus improving the cost savings will be realized when all merged those two to come up with a quality of health care and reducing elements of the health care system are much more comprehensive health IT costs. electronically connected and speak a bill. Health IT allows medical data to This will make a huge difference in move with people as they move. When common technical language—that is they are interoperable. For this reason, the country. A RAND study that was they go to the doctor’s office they each grant program requires that each recently released said this will save won’t have to take the clipboard and grant recipient acquire only qualified about $162 billion a year in medical write down everything they can re- health information technology systems costs. In my opinion, that is not even member about themselves. This system that are capable of supporting common going to be the biggest benefit. The also benefits travelers. If a tourist were technical standards adopted by the biggest benefit is that it is going to to get in a car wreck or hurt in some Federal Government. other way, the doctor would be able to allow medical data to move with the Another barrier to widespread adop- people as they move. find out everything he or she needs to tion of interoperable health informa- When they go to the doctor’s office, know. If in a coma this technology tion is cultural. I recognize that many they will not have to take that little could save a person’s life and if they physicians and hospitals are hesitant clipboard and fill out whatever it is happen to be on medications, it could to move from paper-based systems to they can remember about their health. prevent adverse drug reactions. This electronic systems. Some physicians And it will not matter because a lot system could also cut down on medical have been writing prescriptions by more information will be available to errors with prescriptions—instead of hand for many years and may resist the doctor so he can make the right deciphering the doctor’s handwriting, changing to electronic prescribing. One kinds of decisions and choices. the information could be given to the way to address this cultural barrier to It will also benefit travelers. If a pharmacist electronically. the widespread adoption of health in- tourist is out on the road and has a A RAND study recently released sug- formation technology is to support wreck and has to see a doctor, they gested that health IT has the potential teaching hospitals and continuing edu- will have their information with them. to save $162 billion a year. In order for cation programs that integrate health They will have access to it so the doc- these savings to be realized, we must information technology in the clinical tor will know what medications they create an infrastructure for interoper- education of health care professionals. are on, even if they are in a coma, and ability. S. 1418 is the first step in build- Exposing students and residents to ef- can make sure they are taken care of ing that infrastructure. fective everyday uses of health IT will properly. And yes, it will reduce med- Most folks agree that there are sig- lead to a greater adoption by these stu- ical errors and eliminate some adverse nificant barriers to widespread adop- dents and residents when they grad- reactions from medications or even tion of interoperable health informa- uate and begin practicing on their own. missed medications. tion technology. One of the primary The bill authorizes the Secretary to So this will make a huge difference barriers is the current lack of agreed- award demonstration grants to health to the people of this country. The dif- upon standards and common implemen- professions centers and academic ficulty with doing something by unani- tation guides and a certification proc- health centers to integrate health IT mous consent is that a lot of times peo- ess. This bill addresses those factors in into clinical education in community ple think there is not much to it, or if a way that appropriately incorporates settings. there wasn’t much controversy, that involvement of both the public and pri- The issue of health IT is also critical nothing really happened. But there has vate sectors. for effective response in public health been controversy that has been taken This legislation brings the govern- emergencies. Interoperable health IT care of behind the scenes, where people ment and the private sector together systems will help to track infectious got together and actually realized how to make health care better, safer and disease outbreaks and increase the important this was. So they worked to- more efficient by accelerating the Federal Government’s rapid response gether to come up with solutions, and widespread adoption of interoperable in emergency situations. came up with a truly bipartisan solu- health information technology and I thank all of my Senate colleagues tion in this instance. quality measurement across our health for their support of this very important So it is almost too bad that it has to care system. The legislation formalizes legislation, which will help facilitate go through unanimous consent, that we involvement of private entities in the the widespread adoption of electronic cannot have some very heated debates standards and policy-setting process by health records to ultimately result in on the floor so people will realize the directing the Secretary to establish fewer mistakes, lower costs, better intensity and the interest in the bill. and chair the public-private American care, and greater patient participation But there is not anything bad about Health Information Collaborative, in their health and well-being. This is a the bill. This was a teamwork effort which shall be composed of representa- great stride forward in the journey to from both sides of the aisle. I appre- tives of the public and private sectors. improve our Nation’s health care sys- ciate the leader mentioning a number S. 1418 also codifies the Office of the tem. I look forward to seeing meaning- of the people who were involved in this National Coordinator for Health Infor- ful health information technology leg- bill. This is a truly monumental piece mation Technology. President Bush, islation signed into law this Congress.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00126 Fmt 0624 Sfmt 0634 E:\CR\FM\G17NO6.178 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13273 I would like to commend various for every patient, and this legislation The need to reduce medical errors is staff for the hard work they did in owes much to her ability and commit- especially urgent. It is already 6 years bringing this bill to fruition. First, I ment. since the Institute of Medicine re- want to recognize my fine staff from This legislation is urgently needed, ported that medical errors cause 98,000 the Senate HELP Committee, who have because we live in a new era of medical deaths every year. According to the doggedly worked with many interested miracles and rapid changes in medi- National Patient Safety Foundation, 42 parties over many months—Stephen cine. percent of Americans have been af- Northrup and Katy Barr. I would also Modern electronics have given doc- fected by a medical error, either per- like to recognize David Bowen from tors implantable pacemakers to save sonally or through a friend or relative. Senator KENNEDY’s office for his dedi- patients from sudden cardiac failure. One out of every three of those affected cation to this legislation. Elizabeth The sequencing of the human genome said that the error had a permanent Hall of Senator FRIST’s office did a offers extraordinary opportunities for negative effect on the patient’s health. good job providing leadership support new cures and better treatments. The exact figures may be the subject of throughout the process. I should also But there is another medical miracle debate, but it is undeniable that pre- mention Andrea Palm from Senator to add to the list. ventable deaths occur in our health Modern information technology can CLINTON’s office and Michelle Spence care system all too often. For even one transform health care as profoundly as with Senator ENSIGN’s office for ensur- patient to die needlessly in our health any of these discoveries. ing that the health care quality provi- care system ought to be unacceptable. We have a moral responsibility to Our response should be broad based. sions stayed strong. Secondly, I want make the miracles of modern medicine to recognize the work of the Senate Fi- New technology, new ideas, aud new available to every American—but we ways of practicing medicine all have a nance Committee and the complemen- have failed to meet that responsibility. tary bill supporting improvements in role in improving the quality of care Costs are crushing our health care sys- and saving lives. We no longer expect health care quality in the Medicaid and tem. Premiums are going through the Medicare programs that has contrib- airline pilots to navigate by looking at roof. The ranks of the uninsured grow the stars or local landmarks. Engineers uted to our success today. Mark Hayes every day. Families are forced to and Ted Totman from the Senate Fi- no longer rely on slide rules to design choose between paying the cost of strong buildings. In virtually every nance Committee were very dedicated health care or paying for food, rent, to seeing this bill pass. And finally, field except medicine, professionals use and college tuition. That is not the computers to expand their skills. Yet without the dedication and patience of American dream. Bill Baird of Senate Legislative Coun- in medicine, we expect doctors to keep Information technology alone can’t in their heads the possible interactions sel, we would not have the bill that solve these problems, but it can help will pass here today. of the dozens of medications that a pa- substantially. Electronic medical tient may be receiving. Under these Mr. KENNEDY. Mr. President, today records. Software to warn if a treat- the Senate has passed legislation that circumstances, the wonder is not that ment could harm a patient. Computer errors occur, but that they don’t occur can help transform our health care sys- prescribing. These and many other ap- tem and save lives. The Wired for even more frequently. plications of information technology The evidence that information tech- Health Care Quality Act will improve can save lives and dramatically reduce nology can save lives is undeniable. In the use of lifesaving health informa- costs. terms of drug safety alone, a recent tion technology in hospitals and doc- Despite the wonders of modern medi- analysis by the RAND Corporation es- tors’ offices across the country. In so cine, too many patients today are timates that by using computerized doing, we will improve the quality of harmed by preventable mishaps. They data, the nation could prevent 2.2 mil- care, lower administrative costs, and waste hours and face new risk when lion adverse drug events, and 1 million reduce medical errors. tests must be duplicated, because a additional days in the hospital. This legislation is being considered crucial record is locked in another ar- What we have today, in the words of by the Senate because of the leadership chive. Too many doctors only guess at the Institute of Medicine, is a ‘‘quality and commitment of the chairman of the right course of treatment, because chasm.’’ Doctors repeat tests that have our Health Committee, Senator ENZI. they don’t know a patient’s medical already been performed. Residents take He made health information tech- history. Millions of patients are need- medical histories that have already nology a priority for our committee, lessly put at risk, and billions of dol- been taken. Patients show up for doc- and he has guided this legislation to lars are wasted. tor’s appointments that are essentially the Senate floor. Successful legislation When so many Americans are already a waste of time because the tests have takes creative thinking and hard struggling to afford health care for been performed but the results have work—and Senator ENZI has supplied their families, it is profoundly wrong not yet been delivered. an abundance of both to this measure. to squander more than half a trillion Information technology can help I also thank our partners in this leg- dollars each year on administrative ex- close this gap by improving the coordi- islation, Senator FRIST and Senator penses. nation of care, providing guidance on CLINTON. As a surgeon, Senator FRIST The Department of Health and the best methods of care and reminding knows firsthand the importance of Human Services estimates that better busy physicians when it’s time to making sure that doctors have the in- use of information technology will save schedule preventive screenings. The formation they need to provide the $140 billion every year. Such savings Veterans Administration is a national best possible care for patients—and would produce a technology dividend leader in using IT to improve quality, that they get that information in time worth over $700 on the cost of an aver- and patients get better preventive serv- for it to be of value. It is inconceivable age family’s insurance policy. That is ices there than almost any other pa- that in the 21st century, doctors are like getting 1 month free every year. tient group in America gets, especially asked to treat patients in life or death Other nations are already using this in areas such as proper cholesterol situations without knowing their med- extraordinary technology to cut costs screening, eye exams for diabetic pa- ical histories or even the medications and save lives—but America lags be- tients, and proper immunization they are taking—but that happens hind. We can’t continue to allow the against pneumonia. every hour of every day in hospitals high cost of health care to price Amer- Electronic medical records improve and emergency rooms around the coun- ican goods and services out of the glob- the quality of care, and can also im- try. Senator FRIST has been tireless in al marketplace. prove our ability to monitor drug safe- his commitment to correcting this un- The need to invest in this technology ty, detect outbreaks of disease before acceptable situation. is urgent. In the words of Secretary they become epidemics and decide Senator CLINTON has done an excel- Leavitt, ‘‘Every day that we delay, which treatments are most effective lent job as well. She has championed lives are lost.’’ The time to act is now. for patients. better studies of the comparative effec- The bill before us will improve care, Electronic medical records can be tiveness of medications, she is dedi- save lives and make health care more critical in a natural disaster. The dev- cated to improving the quality of care affordable for every American. astation of Hurricane Katrina was

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00127 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.086 S17NOPT2 S13274 CONGRESSIONAL RECORD — SENATE November 17, 2005 compounded because most hospitals ability and other technical measures when lost hours can mean countless kept their records on paper. As a re- for health information technology, and lost lives. sult, medical histories of tens of thou- it establishes a public-private con- Senator REED of Rhode Island had sands of hurricane survivors were sultation to develop those standards. the innovative idea of including a 1–800 irretrievably lost. It would be inexcus- But standards without Federal re- number to help providers on technical able if we didn’t make the investments sources are not enough to achieve the questions. Senator HARKIN contributed needed for the nation to benefit from goal of a modern health care system important proposals to use the tech- these innovations. that we all share. That is why the leg- nology to improve the treatment of Information technology doesn’t sim- islation includes financial assistance chronic diseases. ply improve the quality of care—it re- to hard pressed providers to meet the Senator REID of Nevada has shown duces costs as well. According to the technical standards. It provides this as- impressive leadership in making sure Institute of Medicine, each prescrip- sistance in three ways in recognizing technology improves the lives of Amer- tion error that is prevented saves $4,000 the fact that different health care pro- ican families, and I thank him for his in additional care. This isn’t just a the- viders and different communities will strong support. ory. Since 1996, when the Veterans Ad- have different needs. It authorizes di- ministration began investing signifi- rect grants to needy providers. It au- Senator SNOWE and Senator cantly in information technology, its thorizes financial assistance to estab- STABENOW have a major commitment costs per patient have actually de- lish regional networks. And it creates to effective funding for this tech- creased by 7 percent while private sec- an innovative Federal-State, public- nology, and I look forward to working tor costs per patient have increased by private partnership to modernize with them on this issue in the days to 62 percent. health care by enabling states to fund come. I also commend Senator SNOWE Excessive administrative costs are low interest loans to help health pro- for her strong commitment to pro- weighing down our health care system. fessionals in financial need to acquire tecting the privacy of electronic med- We are spending over $500 billion a year the technology to improve the quality ical data. on such costs—nearly 33 cents out of and efficiency of health care. I also commend Steve Northrup and every health care dollar. These already Getting the right hardware and soft- Katy Barr of Senator ENZI’s staff, An- high costs are also growing 50 percent ware into the hands of doctors is only drea Palm of Senator CLINTON’s staff, faster than other health costs. It can half the battle. It is also essential to Liz Hall of Senator FRIST’s staff, and cost as much as $20 to process a single see that doctors have access to the my own health staff, for their effective insurance claim using antiquated paper knowledge necessary to make the tech- work on this issue for so many months. records—and nearly half the 18 billion nology a success. The legislation estab- I thank these and all our Senate col- insurance claims in America are still lishes a Best Practices Center where leagues who contributed to the legisla- settled in this old-fashioned way every technology users can learn from the ex- tion we consider today. I look forward year. We know that paper-based perience of others who have established to working with all of you and with our records are prone to error. About one such networks. It sets up a Help line at colleagues in the House to see this in four health insurance claims is ini- the Department of Health and Human needed measure signed into law as soon tially rejected because of errors. By Services to answer technical questions as possible. contrast, in the financial industry, and help meet technical requirements. Mr. ENZI. Mr. President, I rise today only 1 in 10,000 ATM transactions has To assist doctors in sorting through to speak about the passage of 1418, the an error. the confusing array of options for this Wired for Health Care Quality Act. As Despite clear evidence that health IT technology, the legislation establishes chairman of the Committee on Health, saves lives and cuts costs, its use is a certification program, so that pro- Education, Labor, and Pensions, I have still scandalously low. Our health care viders can quickly determine whether been working to improve the quality system should be the envy of the world, particular systems meet the applicable and reduce the cost of health care in but nations from Australia to Scan- technical standards. this Nation. I commend the ranking dinavia are outpacing us in this tech- There are many Senate colleagues member of my committee for his dedi- nology. In Sweden and Holland, nine who deserve great credit for their cation to this great cause. out of ten primary care physicians use thoughtful contributions to this legis- I want to commend my colleague electronic medical records. In Britain, lation and for their leadership in get- from Maine, Senator SNOWE, and my Austria, Finland and many other na- ting to this moment. colleague from Michigan, Senator tions, it is over half. But in the United Again, I commend the chairman of STABENOW, for their leadership on the States, less than a quarter of all doc- our Health Committee, Senator ENZI, issue of health information technology. tors use electronic medical records. for his impressive leadership on this Obviously, there are significant bar- They have made a major contribution issue. It has been a privilege to work to the debate, and I look forward to riers to the adoption of health informa- closely with him and his staff since the tion technology that Congress should working with them as we continue to beginning of this year and to deal with consider this important issue. also address. Many providers don’t this priority. have the financial ability to absorb the The pending legislation combines the I see the legislation we consider costs of buying the equipment, making bill that Chairman ENZI and I intro- today as the first step toward more ef- the transition to computer systems, duced and the bill that Senator FRIST fective use of information technology and training staff. It costs a physi- and Senator CLINTON introduced. We in health care. This proposal will pro- cian’s office $30,000 and significant ag- have also had broad input from many vide the framework to improve the use gravation to install the system. The other committee members, and we of health IT. Senator SNOWE and Sen- savings from its use tend to come over have produced a better bill because of ator STABENOW have several thoughtful the longer term, while the costs are it. proposals on providing additional fi- immediate, which is a major financial Senator DODD was a leader on the nancial incentives through Medicare barrier to hospitals, physicians, and issue in the last Congress as well, and for the use of health information tech- nursing homes already drowning in red our bill includes many of his ideas, es- nology. ink. Providers get savings over the pecially on making sure that standards Providing adequate funding for long run, but the largest share of the are widely available. health IT is a critically important savings goes to payers, not providers. If Senator ENSIGN made sure that best issue, and I believe that it should be a diabetic is kept out of the hospital by practices are front and center in imple- carefully considered in our committee better management of his condition as menting this technology. and by the Senate. I look forward to the result of information technology, Our subcommittee chairman, Senator working with my colleagues on the that’s a loss of revenue to the hospital. BURR, has a strong interest in using in- committee and with Senator SNOWE This bipartisan legislation will help formation technology to improve our and Senator STABENOW to see that overcome these barriers. It requires the ability to respond to bioterrorist at- health IT receives an appropriate level development of standards on interoper- tacks or other disease emergencies, of funding.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00128 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.088 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13275 I also believe it is important to ex- proposals on this important issue in majority leader for his assistance. The amine carefully the privacy protec- the very near future. issue of adoption certainly multiple tions that apply to individually identi- Ms. SNOWE. Mr. President, I want to committees, and we appreciate his ef- fiable health information maintained commend Senators ENZI, KENNEDY, forts in helping the full Senate to con- in electronic databases. The manager’s FRIST, and CLINTON for their work in sider promising financing proposals to amendment to S. 1418 contains several addressing the inadequate state of our assure broad adoption. important provisions relating to pri- individual health records today. The As we move forward together, we vacy, including a GAO investigation on Wired for Health Care Quality Act will should also remember to follow the methods to enhance privacy protec- accelerate the development of essential physician’s adage—certainly one the tions for electronically stored and standards to protect investment in leader knows so well—to ‘‘first do no transmitted health information. health information technology. Very harm’’. We are all agreed that genetic I believe it is important to examine soon the Federal Government will re- information, which may indicate prob- the issues surrounding implementation quire compliance with these standards ability of disease, must be protected. and adoption of health IT systems for its purchases—a long overdue step One’s medical record includes even carefully. To that end, I intend to hold in modernizing health care information more than probability—it is indis- a hearing by the Memorial Day recess management. putable evidence of the presence of dis- next year on the essential issue of I began work with on this issue in the ease, the drugs one uses, your full funding to promote wide adoption of last Congress when we learned from the physical and mental health history. health information technology. We will Institute of Medicine that an estimated Consequently, Americans are worried also examine the report of the GAO to 98,000 Americans die each year as a re- about their health records. A recent address the critical issue of protections sult of medical errors. Technology can survey demonstrates that two-thirds of for the privacy of health information help us prevent these deaths and inju- all consumers have substantial con- cerns about the privacy of their med- that must be part of health IT systems ries from medical mistakes. That is ical records. The same proportion say and practices. I will work closely with one reason I joined with Senator that recent reports of privacy breaches my colleagues, Senator SNOWE and STABENOW to assure that we implement have actually increased these concerns. Senator STABENOW, as well as with the live saving technology. So it comes as no surprise that con- ranking member on this hearing. A second reason for our work is that I will also work with the Finance information technology, IT, will help sumers engage in behaviors to avoid such data from even being created— Committee, the committee with juris- us reduce the cost of health care. As such as paying out-of-pocket for med- diction over Medicare, and with Sen- health care costs increase far more rap- ical expenses, using a different physi- ators STABENOW and SNOWE on legisla- idly than inflation, care becomes less cian on occasion, or simply asking that tion to spur the widespread adoption of affordable and the ranks of the unin- vital information not be included in interoperable health information tech- sured grow. Each of us appreciates that their chart. Patients even forgo treat- nology through such innovative financ- technology will help us reduce that ment altogether in fear of disclosure. ing mechanisms, and we will work to unsustainable trend. Recent reports This compromises health, so we simply achieve passage of that legislation be- demonstrate that the cost of imple- must provide Americans with con- fore the end of this Congress. menting health IT is exceeded by a sin- fidence in the security of their health I happen to be an original sponsor of gle year of savings. That is a remark- record. able return on investment, but since an legislation in the Finance Committee We simply must have the highest lev- to reward high-quality health care estimated 89 percent of savings accrues els of data security. So first we must through value based purchasing under to payers, not providers, standards see procedures established to assure Medicare. By rewarding doctors and alone will not spur adoption. that inappropriate disclosure does not Since the rewards for adoption pri- hospitals for the quality of care they occur. Next, if a data breach does marily accrue to payers and patients, provide, not just the quantity of care, occur, the patient must be informed. it is wholly appropriate that payers— we can improve health care quality in To do otherwise is unconscionable. a fiscally responsible way. including the Federal Government—act I am pleased to see that the man- I look forward to working with Sen- in their best interest to reduce costs. agers amendment requires such notifi- ators KENNEDY, GRASSLEY, BAUCUS, That means we must ensure adoption cation for those handling data under SNOWE, STABENOW, FRIST, and CLINTON not just by those providers for whom the programs established by this legis- on these important proposals, and I investment is relatively easy, but by lation, and the bill also establishes a commend them for their leadership on those with lesser resources, such as the process to address concerns on medical this important field of health IT. many who provide care for our Medi- data privacy by directing a GAO study Mr. KENNEDY. I thank the distin- care, Medicaid, and SCHIP bene- to guide us in providing the assurance guished chairman of our Health Com- ficiaries. I look forward to working all Americans must have that their mittee for his impressive leadership on with my colleagues to see that we im- medical data is protected. I thank my the issue of health information tech- plement financing—including grants colleagues for including these essential nology. Health information technology and tax incentives—to allow all pro- provisions. can revolutionize health care, with viders to adopt this promising tech- Today marks the beginning of a proc- lasting benefits in areas from improv- nology. Otherwise we will see a two- ess to offer all Americans a safer, more ing quality to better detection of bio- tiered system develop. affordable system of health care. I look terrorist attacks and epidemics. If some patients do not receive the forward with Senator STABENOW to I also commend my colleagues, Sen- benefits of the electronic health record working with the majority leader and ator STABENOW and Senator SNOWE, for the President has set as a goal, their Senators ENZI, KENNEDY, and CLINTON, their commitment to seeing that we care will suffer. In fact, if their pro- as well as Senators GRASSLEY and BAU- provide adequate financial support for viders cannot adopt technology, their CUS, as we move forward to realizing doctors and hospitals to use health in- clinical data may not be not properly the full potential of health IT become formation technology systems. I will integrated in pay-for-performance reality for our constituents. The re- work closely with them, and with our methodologies. If the resulting criteria wards in lives and dollars saved com- chairman and our colleagues on the don’t account for such patients, they pels us to act promptly. health committee, to see that we build then pose the risk of inadequate com- Ms. STABENOW. Mr. President, I on the legislation under consideration pensation to providers, and many may want to commend the leadership of today in order to assist health care decline to serve them. So it is critical Senators ENZI, KENNEDY, FRIST, and providers to meet the cost of acquiring that we assure all providers can adopt CLINTON in this critically important health IT. health IT. arena. Their diligent work in intro- Senator SNOWE and Senator I thank Chairman ENZI and the Sen- ducing and passing S. 1418 establishes STABENOW have made a major contribu- ator KENNEDY for their commitment to the groundwork necessary to begin to tion to our debate, and I look forward a hearing next spring on the adoption realize the promises of health informa- to working with them on additional and financing issue. I also thank the tion technology, IT.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00129 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.091 S17NOPT2 S13276 CONGRESSIONAL RECORD — SENATE November 17, 2005 The evidence showing the ability of Nor should we limit funds to pro- ago: on paper, in manila folders in file health IT to reduce costs and improve viders in networks. We should work to- cabinets, in the basements of clinics quality of care is simply over- wards a system where all health care and hospitals. Yet computers, and com- whelming. Dr. David Brailer’s office at- providers are linked, but we do not puter technology, is everywhere, both tributes savings from widespread adop- need to wait for those networks to be inside and outside the hospitals and tion of electronic health records in the formed to see the benefits of health IT. clinics. From bedside monitors to mas- range of 7.5 percent to 30 percent of an- Standalone e-prescribing systems could sive MRI machines, computers power nual health care spending that is be- reduce medication errors by 50 percent; almost all of the diagnostic devices we tween $135 and $540 billion annually. there is no reason to delay the quality, rely on. Manufacturers in Michigan and safety, and financial savings possible S. 1418 represents an important and across the country are struggling to re- through immediate health IT adoption crucial first step towards recognizing main competitive in a global market by individual providers. the importance of computers and the with skyrocketing health care costs. In addition to funding, we must pay electronic medical record in contem- Health IT can, and should, play a key careful attention to privacy and con- porary health care. Establishing inter- role in managing these costs. fidentiality rights and concerns. A pa- operability of the electronic medical Equally compelling is the promise tient’s right to health information pri- record, an essential hurdle towards ef- health IT holds for improving the qual- vacy is paramount, and an essential fective use of health information tech- ity of our health care system by ensur- component of the health care provider- nology, is a priority. Proposals for pro- ing that patients get the care they patient relationship. According to a viding Federal financial incentives for need, at the right time, and in the best survey recently released by the Cali- physicians, community health centers, setting. fornia HealthCare Foundation, CHCF, community mental health centers, hos- To realize these promises, however, 67 percent of Americans remain con- pitals and skilled nursing facilities like Congress must enact legislation pro- cerned about the privacy of their per- that introduced by Senator SNOWE and viding meaningful resources through sonal health information. The survey Senator STABENOW need to be consid- Federal financial incentives, both man- also reports that many consumers may ered. datory grants and tax incentives, to be putting their health at risk by Assuring proper funding of health IT physicians, hospitals, skilled nursing avoiding their regular doctor or for- is an issue of major importance for the facilities, and community health and going needed tests over privacy con- Senate to consider in the coming con- mental health centers for health infor- cerns. Apprehension over privacy and gressional session. I will work with the mation technology. confidentiality, if not addressed chairman and ranking member of the Health care providers are struggling thoughtfully, could pose enormous bar- Finance Committee and the chairman to keep up with their daily needs at the riers to the savings and health care im- and ranking member of the HELP com- same time they are anticipating cuts provements possible through adoption mittee as well as Senators SNOWE and in their rates. A major barrier to wide- of health information technologies. STABENOW to encourage these commit- spread use of IT is the initial invest- Strong, enforceable privacy safeguards tees to schedule, at the earliest oppor- ment cost: the costs of procuring and based on a patient’s right to health in- tunity, consideration of legislative pro- implementing health IT can be stag- formation privacy are absolutely crit- posals to ensure creative and reason- gering. ical as we move towards a nationwide, able Federal funding for such an impor- Every day we delay providing Federal interoperable electronic health care tant and relevant mission. I will also seed money through a grant program system. work with relevant committees to en- and accelerated depreciation of health I appreciate provisions included in courage consideration of legislation information technology expenses, we the managers’ amendment addressing that would enable providers to connect delay getting health information tech- the need for patients to be notified if to a secure, interoperable network for nology systems in place, and busi- their individually identifiable health the electronic exchange of health infor- nesses, taxpayers and patients pay in information is wrongfully disclosed and mation. both dollars and lives. a study by the General Accounting Of- Mrs. CLINTON. I would like to com- I appreciate the majority leader’s fice examining the issue as it relates to mend Chairman ENZI and Senator KEN- commitment to encourage the chair- all Americans. NEDY for all of their work on this legis- man and ranking member of the Fi- I look forward to working with the lation. I would also like to recognize nance Committee and the chairman majority leader, and Senators SNOWE, the commitment and leadership of the and ranking member of the HELP Com- ENZI, KENNEDY, and CLINTON, as well as majority leader, who I have been work- mittee to schedule, at the earliest op- Senator GRASSLEY and BAUCUS to en- ing closely with on this issue. Today’s portunity, consideration of legislative sure passage of legislation this Con- passage of S. 1418, the Wired for Health proposals to ensure federal funding to gress providing meaningful, substantial Care Quality Act, is a fundamental accelerate adoption of health IT. Federal financial incentives to accel- first step in establishing a nationwide, A meaning Federal investment must erate adoption of life and dollar saving interoperable health IT infrastructure. be robust, funded with mandatory, health information technologies. Our legislation provides the frame- rather than discretionary, dollars, and Mr. FRIST. Mr. President, I am work and authorizes several grant pro- available to individual providers and pleased to speak in support of S. 1418. I grams to begin the process of funding health care systems. share an important goal with Senators health IT projects that are compliant This is not the place to skimp on dol- ENZI, KENNEDY, SNOWE, STABENOW, and with the framework established in the lars; we know every dollar we spend CLINTON—to improve health care qual- bill. The legislation introduced by Sen- will come back to us many times over. ity and reduce costs through the use of ators SNOWE and STABENOW and their Federal investments, through grants health information technology tools. work more broadly on this issue will be and tax incentives, in health informa- I spent 20 years as a physician and critical as we work on additional fi- tion technology will result in lower heart surgeon before coming to the nancing mechanisms. I am anxious to Medicare, Medicaid and SCHIP spend- Senate. Like most physicians, I wanted begin that work and am committed to ing, reduced medical errors, and great- the latest and best medical technology, working closely with them, and my er quality and efficiency in our health anything that could make my patients colleagues on the HELP and Finance care system. We must provide a level of healthier or more comfortable, while committees to ensure that physicians funding that will allow a significant reducing health care costs and increas- and hospitals are able to afford to par- percentage of our health care providers ing efficiency. ticipate in a 21st century health care to adopt and use health IT systems. But amidst the artificial heart assist system. Additionally, funding must not be lim- devices, lasers, CT Scan machines, Mr. ENZI. I see this bill as the first ited to authorizations of appropria- endoscopic devices, digital X-Rays, and step of many in improving the health tions. We must actually provide the digital thermometers, doctors today care in the United States. I look for- dollars needed to begin realizing the keep patient records the same way I ward to working with my friends on benefits of health IT. did and the way my father did 50 years the Finance Committee as well as

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00130 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.092 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13277 working with Senators SNOWE and ø(2) INSURED LOSSES.—Section 102(5) of the ø(2) in subparagraph (C), by striking the STABENOW to look at creative financing Terrorism Risk Insurance Act of 2002 (15 period at the end and inserting a semicolon; mechanisms to help doctors and hos- U.S.C. 6701 note, 116 Stat. 2324) is amended— and ø ø pitals go on line. (A) by inserting ‘‘on or before December (3) by adding at the end the following: 31, 2007, as required by this title,’’ before ‘‘if ‘‘ø(D) for Program Year 4, the lesser of— Mr. FRIST. Mr. President, in closing such loss’’; ‘‘ø(i) $17,500,000,000; and our comments on this bill, I also thank ø(B) by striking ‘‘(A) occurs within’’ and ‘‘ø(ii) the aggregate amount, for all insur- my staff who have been shepherding inserting the following: ers, of insured losses during such Program this for me for the last 3 years, Liz ‘‘ø(A) occurs on or before the earlier of the Year; and Hall, Jennifer Romans, and many oth- expiration date of the insurance policy or ‘‘ø(E) for Program Year 5, the lesser of— ers. The real significance is that pa- December 31, 2008; and ‘‘ø(i) $20,000,000,000; and tient care will be improved. It will get ‘‘ø(B) occurs— ‘‘ø(ii) the aggregate amount, for all insur- ø the waste and abuse out of the system. ‘‘ (i) within’’; and ers, of insured losses during such Program ø(C) by striking ‘‘occurs to an air carrier’’ Year.’’. It makes the health care system more and inserting the following: øSEC. 4. COVERAGE OF GROUP LIFE INSURANCE. efficient. I am excited about it. Having ‘‘ø(ii) to an air carrier’’. øSection 103 of the Terrorism Risk Insur- interoperable standards that people ø(3) CONFORMING AMENDMENTS.—Section 102 ance Act of 2002 (15 U.S.C. 6701 note, 116 Stat. begin to agree with means you will of the Terrorism Risk Insurance Act of 2002 2327) is amended by striking subsection (h) have an influx of private capital which (15 U.S.C. 6701 note, 116 Stat. 2323) is amend- and inserting the following: will help with the spreading of this in- ed— ø‘‘(h) APPLICABILITY TO GROUP LIFE INSUR- formation technology infrastructure ø(A) in paragraph (1)(A)(iii)(I), by striking ANCE.— over time. ‘‘(5)(B)’’ and inserting ‘‘(5)(B)(ii)’’; and ø‘‘(1) IN GENERAL.—The Secretary shall, by ø(B) in paragraph (4), by striking ‘‘subpara- rule, apply the provisions of this title to pro- f graphs (A) and (B)’’ and inserting ‘‘subpara- viders of group life insurance, in the manner TERRORISM RISK INSURANCE graph (B)’’. determined appropriate by the Secretary, ø EXTENSION ACT OF 2005 (b) APPLICABLE INSURER DEDUCTIBLES.— consistent with the purposes of this title. Section 102(7) of the Terrorism Risk Insur- ø‘‘(2) CONSISTENT APPLICATION.—The rules Mr. FRIST. Mr. President, I ask ance Act of 2002 (15 U.S.C. 6701 note, 116 Stat. of the Secretary under this subsection shall, unanimous consent that the Senate 2325) is amended— to the extent practicable, apply the provi- proceed to the immediate consider- ø(1) in subparagraph (D)— sions of this title to providers of group life ation of Calendar No. 287, S. 467. ø(A) by inserting ‘‘and each Program Year insurance in a similar manner as those pro- The PRESIDING OFFICER. The thereafter’’ before ‘‘, the value’’; and visions apply to an insurer otherwise under ø clerk will report the bill by title. (B) by striking ‘‘preceding Program Year this title. 3’’ and inserting ‘‘preceding that Program ø‘‘(3) CONSIDERATIONS.—In determining the The legislative clerk read as follows: Year’’; and applicability of this title to providers of A bill (S. 467) to extend the applicability of ø(2) in subparagraph (E), by striking ‘‘for group life insurance, and the manner of such the Terrorism Risk Insurance Act of 2002. the Transition’’ and all that follows through application, the Secretary shall consider the There being no objection, the Senate ‘‘Program Year 3’’ and inserting the fol- overall group life insurance market size, and proceeded to consider the bill which lowing: ‘‘for the Transition Period or any shall consider the establishment of separate had been reported from the Committee Program Year’’. retention amounts for such providers. ø(c) CONTINUATION OF MANDATORY AVAIL- ø on Banking, Housing, and Urban Af- ‘‘(4) RULEMAKING REQUIRED.—Not later ABILITY.—Section 103(c)(1) of the Terrorism than 90 days after the date of enactment of fairs with an amendment, as follows: Risk Insurance Act of 2002 (15 U.S.C. 6701 the Terrorism Risk Insurance Extension Act (Strike the part shown in black note, 116 Stat. 2327) is amended— of 2005, the Secretary shall issue final regula- brackets and insert the part shown in ø(1) by striking ‘‘last day of Program Year tions to carry out this subsection. italic.) 2’’ and inserting ‘‘termination date estab- ø‘‘(5) RULE OF CONSTRUCTION.—Nothing in S. 467 lished under section 108(a)’’; and this subsection may be construed to affect or ø(2) by striking the paragraph heading and otherwise alter the applicability of this title Be it enacted by the Senate and House of Rep- inserting ‘‘IN GENERAL.—’’. to any insurer, as defined in section 102. resentatives of the United States of America in ø(d) DURATION OF POLICIES.—Section 103(c) ø‘‘(6) DEFINITION.—As used in this sub- Congress assembled, of the Terrorism Risk Insurance Act of 2002 section, the term ‘group life insurance’ ø SECTION 1. SHORT TITLE. (15 U.S.C. 6701 note, 116 Stat. 2327) is amend- means an insurance contract that provides øThis Act may be cited as the ‘‘Terrorism ed— term life insurance coverage, accidental Risk Insurance Extension Act of 2005.’’. ø(1) by redesignating paragraph (2) as para- death coverage, or a combination thereof, for øSEC. 2. EXTENSION OF TERRORISM RISK INSUR- graph (3); and a number of persons under a single contract, ANCE PROGRAM. ø(2) by inserting after paragraph (1) the fol- on the basis of a group selection of risks.’’. ø(a) EXTENSION OF PROGRAM YEARS.—Sec- lowing: øSEC. 5. RECOMMENDATIONS FOR LONG-TERM tion 108(a) of the Terrorism Risk Insurance ‘‘ø(2) MANDATORY DURATION.—Coverage for SOLUTIONS. Act of 2002 (15 U.S.C. 6701 note, 116 Stat. 2336) insured losses required by paragraph (1) øSection 108 of the Terrorism Risk Insur- is amended by striking ‘‘2005’’ and inserting under a policy issued at any time during ance Act of 2002 (15 U.S.C. 6701 note, 116 Stat. ‘‘2007’’. Program Year 5 shall remain in effect for not 2328) is amended by adding at the end the fol- ø(b) CONTINUING AUTHORITY OF THE SEC- less than 1 year following the date of lowing: RETARY.—Section 108(b) of the Terrorism issuance of the policy, except that no loss oc- ø‘‘(e) RECOMMENDATIONS FOR LONG-TERM Risk Insurance Act of 2002 (15 U.S.C. 6701 curring after the earlier of the expiration SOLUTIONS.—The Presidential Working note, 116 Stat. 2336) is amended by striking date of the subject insurance policy or De- Group on Financial Markets shall, in con- ‘‘arising out of’’ and all that follows through cember 31, 2008, shall be considered to be an sultation with the NAIC, representatives of ‘‘this title’’. insured loss for purposes of this title.’’. the insurance industry, and representatives øSEC. 3. CONFORMING AMENDMENTS. ø(e) INSURED LOSS SHARED COMPENSA- of policy holders, not later than June 30, ø(a) DEFINITIONS.— TION.—Section 103(e) of the Terrorism Risk 2006, submit a report to Congress containing ø(1) PROGRAM YEARS.—Section 102(11) of the Insurance Act of 2002 (15 U.S.C. 6701 note, 116 recommendations for legislation to address Terrorism Risk Insurance Act of 2002 (15 Stat. 2328) is amended— the long-term availability and affordability U.S.C. 6701 note, 116 Stat. 2326) is amended by ø(1) in paragraph (2)(A), by striking ‘‘end- of insurance for terrorism risk.’’. adding at the end the following: ing on’’ and all that follows through ‘‘Pro- SECTION 1. SHORT TITLE. ‘‘ø(E) PROGRAM YEAR 4.—The term ‘Pro- gram Year 3’’ and inserting ‘‘ending on the This Act may be cited as the ‘‘Terrorism Risk gram Year 4’ means the period beginning on termination date established under section Insurance Extension Act of 2005’’. January 1, 2006 and ending on December 31, 108(a)’’; and SEC. 2. EXTENSION OF TERRORISM RISK INSUR- 2006. ø(2) in paragraph (3), by striking ‘‘ending ANCE PROGRAM. ‘‘ø(F) PROGRAM YEAR 5.—The term ‘Pro- on’’ and all that follows through ‘‘Program (a) PROGRAM EXTENSION.—Section 108(a) of gram Year 5’ means the period beginning on Year 3’’ and inserting ‘‘ending on the termi- the Terrorism Risk Insurance Act of 2002 (15 January 1, 2007 and ending on December 31, nation date established under section U.S.C. 6701 note; 116 Stat. 2336) is amended by 2007. 108(a)’’. striking ‘‘2005’’ and inserting ‘‘2007’’. ‘‘ø(G) OTHER PROGRAM YEARS.—Except ø(f) AGGREGATE RETENTION AMOUNT.—Sec- (b) MANDATORY AVAILABILITY.—Section 103(c) when used as provided in subparagraphs (B) tion 103(e)(6) of the Terrorism Risk Insur- of the Terrorism Risk Insurance Act of 2002 (15 through (F), the term ‘Program Year’ means, ance Act of 2002 (15 U.S.C. 6701 note, 116 Stat. U.S.C. 6701 note; 116 Stat. 2327) is amended— as the context requires, any of Program Year 2328) is amended— (1) by striking paragraph (2); 1, Program Year 2, Program Year 3, Program ø(1) in subparagraph (B), by striking ‘‘and’’ (2) by striking ‘‘AVAILABILITY.—’’ and all that Year 4, or Program Year 5.’’. at the end; follows through ‘‘each entity’’ and inserting

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00131 Fmt 0624 Sfmt 6333 E:\CR\FM\A17NO6.093 S17NOPT2 S13278 CONGRESSIONAL RECORD — SENATE November 17, 2005 ‘‘AVAILABILITY.—During each Program Year, (2) in subparagraph (C), by striking the period curred as a result of the hurricanes, in- each entity’’; and at the end and inserting a semicolon; and surer capital has grown tremendously (3) by redesignating subparagraphs (A) and (3) by adding at the end the following: and now greatly exceeds pre-September (B) as paragraphs (1) and (2), respectively, and ‘‘(D) for Program Year 4, the lesser of— 11 levels. moving the margins 2 ems to the left. ‘‘(i) $17,500,000,000; and While the private insurance markets SEC. 3. AMENDMENTS TO DEFINED TERMS. ‘‘(ii) the aggregate amount, for all insurers, of have made tremendous strides during (a) COVERED ACTS OF TERRORISM.—Section insured losses during such Program Year; and 102(1)(B)(ii) of the Terrorism Risk Insurance Act ‘‘(E) for Program Year 5, the lesser of— the course of the TRIA program, how- of 2002 (15 U.S.C. 6701 note; 116 Stat. 2324) is ‘‘(i) $20,000,000,000; and ever, the private insurance market- amended by inserting before the period ‘‘, with ‘‘(ii) the aggregate amount, for all insurers, of place has not yet entirely stabilized. respect to an act occurring before Program Year insured losses during such Program Year.’’. As a result, without some form of 4, $50,000,000 with respect to an act occurring in (b) RECOUPMENT OF FEDERAL SHARE.—Section backstop, it is very likely that there Program Year 4, or $100,000,000 with respect to 103(e)(7) of the Terrorism Risk Insurance Act of would be gaps in some terrorism insur- an act occurring in Program Year 5’’. 2002 (15 U.S.C. 6701 note; 116 Stat. 2329) is ance coverage. (b) PROGRAM YEARS.—Section 102(11) of the amended— S. 467 extends the TRIA program and Terrorism Risk Insurance Act of 2002 (15 U.S.C. (1) in subparagraph (A), by striking ‘‘, (B), 6701 note; 116 Stat. 2326) is amended by adding and (C)’’ and inserting ‘‘through (E)’’; and addresses this market dysfunction. Ad- at the end the following: (2) in each of subparagraphs (B) and (C), by ditionally and importantly, it also rec- ‘‘(E) PROGRAM YEAR 4.—The term ‘Program striking ‘‘subparagraph (A), (B), or (C)’’ each ognizes the positive developments in Year 4’ means the period beginning on January place that term appears and inserting ‘‘any of the insurance markets and contains re- 1, 2006 and ending on December 31, 2006. subparagraphs (A) through (E)’’. forms to the original law intended to ‘‘(F) PROGRAM YEAR 5.—The term ‘Program SEC. 6. LITIGATION MANAGEMENT. require more private sector responsi- Year 5’ means the period beginning on January Section 107(a) of the Terrorism Risk Insurance bility and to facilitate further recovery 1, 2007 and ending on December 31, 2007.’’. Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2335) in the insurance markets. It strikes (c) EXCLUSIONS FROM COVERED LINES.— is amended by adding at the end the following: (1) IN GENERAL.—Section 102(12)(B) of the Ter- the proper balance between ensuring ‘‘(6) AUTHORITY OF THE SECRETARY.—Proce- that terrorism insurance remains rorism Risk Insurance Act of 2002 (15 U.S.C. dures and requirements established by the Sec- 6701 note; 116 Stat. 2326) is amended— retary under section 50.82 of part 50 of title 31 available and affordable, while also (A) in clause (vi), by striking ‘‘or’’ at the end; of the Code of Federal Regulations (as in effect protecting the American taxpayer. (B) in clause (vii), by striking the period at on the date of issuance of that section in final I note that I did not support enact- the end and inserting a semicolon; and form) shall apply to any cause of action de- ment of TRIA when it was first consid- (C) by adding at the end the following: scribed in paragraph (1) of this subsection.’’. ‘‘(viii) commercial automobile insurance; ered 4 years ago. My reservations were ‘‘(ix) burglary and theft insurance; SEC. 7. ANALYSIS AND REPORT ON TERRORISM based on concerns about the Govern- ‘‘(x) surety insurance; RISK COVERAGE CONDITIONS AND ment intruding into private markets. ‘‘(xi) professional liability insurance; or SOLUTIONS. While my concerns are not entirely di- Section 108 of the Terrorism Risk Insurance ‘‘(xii) farm owners multiple peril insurance.’’. minished, I believe that the Banking (2) CONFORMING AMENDMENTS.—Section Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2336) is amended by adding at the end the following: Committee has produced a responsible, 102(12)(A) of the Terrorism Risk Insurance Act targeted product that will help the of 2002 (15 U.S.C. 6701 note; 116 Stat. 2326) is ‘‘(e) ANALYSIS OF MARKET CONDITIONS FOR amended— TERRORISM RISK INSURANCE.— marketplace smoothly transition to ef- (A) by striking ‘‘, and surety insurance’’; and ‘‘(1) IN GENERAL.—The President’s Working ficient function. (B) by striking ‘‘, worker’s’’ and inserting Group on Financial Markets, in consultation This bill, this bipartisan compromise ‘‘and worker’s’’. with the National Association of Insurance package, could never have been (d) INSURER DEDUCTIBLES.—Section 102(7) of Commissioners, representatives of the insurance achieved without the cooperation and the Terrorism Risk Insurance Act of 2002 (15 industry, representatives of the securities indus- commitment of the members of the try, and representatives of policy holders, shall U.S.C. 6701 note; 116 Stat. 2325) is amended— Banking Committee. Specifically, I (1) in subparagraph (D), by striking ‘‘and’’ at perform an analysis regarding the long-term the end; availability and affordability of insurance for commend Senators DODD and BENNETT, (2) by redesignating subparagraph (E) as sub- terrorism risk, including— the original cosponsors of this bill, for paragraph (G); ‘‘(A) group life coverage; and their leadership, their effort and their (3) by inserting after subparagraph (D), the ‘‘(B) coverage for chemical, nuclear, biologi- willingness to work together. I also following: cal, and radiological events. thank Senator SARBANES, who, in his ‘‘(E) for Program Year 4, the value of an in- ‘‘(2) REPORT.—Not later than September 30, usual manner, was extremely helpful to surer’s direct earned premiums over the calendar 2006, the President’s Working Group on Finan- achieving this result. cial Markets shall submit a report to the Com- year immediately preceding Program Year 4, Additionally, I thank the various multiplied by 17.5 percent; mittee on Banking, Housing, and Urban Affairs ‘‘(F) for Program Year 5, the value of an in- of the Senate and the Committee on Financial staffers whose hard work behind the surer’s direct earned premiums over the calendar Services of the House of Representatives on its scenes helped get this bill done. Par- year immediately preceding Program Year 5, findings pursuant to the analysis conducted ticularly, I want to commend the ef- multiplied by 20 percent; and’’; and under subsection (a).’’. forts of Alex Sternhell from Senator (4) in subparagraph (G), as so redesignated, Mr. SHELBY. Mr. President, I rise DODD’s staff, Sarah Kline and Steve by striking ‘‘through (D)’’ and all that follows today in support of S. 467, the Ter- Harris from Senator SARBANES’s staff, through ‘‘Year 3’’and inserting the following: rorism Risk Insurance Extension Act Mike Nielsen from Senator BENNETT’s ‘‘through (F), for the Transition Period or any of 2005, introduced by my colleagues on Program Year’’. staff, and Jim Johnson, Andrew the Banking Committee, Senators SEC. 4. INSURED LOSS SHARED COMPENSATION. Olmem, Mark Oesterle and Kathy Section 103(e) of the Terrorism Risk Insurance DODD and BENNETT and reported out Casey from my staff. Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2328) unanimously by the Banking Com- Mr. SARBANES. Mr. President, I join is amended— mittee. my colleagues in support of the Ter- (1) in paragraph (1)— In the wake of the events of Sep- rorism Risk Insurance Extension Act (A) by inserting ‘‘through Program Year 4’’ tember 11, Congress passed the Ter- of 2005. Three years ago, we passed the before ‘‘shall be equal’’; and rorism Risk Insurance Act, also known Terrorism Risk Insurance Act to sta- (B) by inserting ‘‘, and during Program Year as ‘‘TRIA.’’ The law was intended to bilize the insurance marketplace after 5 shall be equal to 85 percent,’’ after ‘‘90 per- cent’’; and ensure the continued availability and the shock of the September 11 attacks. (2) in each of paragraphs (2) and (3), by strik- affordability of property and casualty TRIA, as that Act became known, es- ing ‘‘Program Year 2 or Program Year 3’’ each insurance for terrorism risk, and to tablished a partnership between the in- place that term appears and inserting ‘‘any of provide for a transitional period to surance industry and the Federal Gov- Program Years 2 through 5’’. allow private markets to stabilize. ernment to share the risk of significant SEC. 5. AGGREGATE RETENTION AMOUNTS AND At this point in time, it seems that losses from terrorism. TRIA is sched- RECOUPMENT OF FEDERAL SHARE. this program has largely achieved both uled to expire at the end of this year. (a) AGGREGATE RETENTION AMOUNTS.—Section of its stated objectives. Over the last 3 The bill that is now pending before the 103(e)(6) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2329) is years, the property and casualty insur- Senate would extend TRIA for an addi- amended— ance market has rebounded and is now tional 2 years while requiring the in- (1) in subparagraph (B), by striking ‘‘and’’ at far more profitable and competitive. surance industry to take on progres- the end; Indeed, despite the enormous losses in- sively more of the terrorism risk.

VerDate Aug 31 2005 00:55 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00132 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.090 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13279 This bill is the product of a great examination of the issues which will the legislation is perfect. But it is a se- deal of effort by the Banking Com- help us answer the question of how to rious effort to address the concerns we mittee to accommodate the widely dif- insure against terrorism over the have heard raised regarding TRIA and fering views of many members on the longterm. the potential effects of its expiration, structure of a TRIA extension. I thank To allow time for that examination and I urge my colleagues to join me in the chairman of the Committee, Sen- to take place, the pending legislation supporting it. ator SHELBY, for his willingness to continues the TRIA program for two Mr. REID. Mr. President, yesterday reach across the aisle in developing additional years, with certain modi- the Senate Banking Committee re- this bill. Under his skillful guidance, fications, which I will briefly summa- ported the Terrorism Risk Insurance we have been able to develop a product rize. Extension Act of 2005, and I look for- that has won unanimous support in the This bill narrows the scope of the ward to the full Senate passing this Banking Committee. I also want to rec- TRIA program, further targeting the legislation that is so vital to the eco- ognize Senator DODD for his dedication program toward the types of terrorism nomic well-being of this country. to this issue. He was instrumental in insurance that are the most difficult to In 2002 I cosponsored, and Congress 2002 in the development and passage of provide. Under the terms of the exten- passed, the Terrorism Risk Insurance the original TRIA legislation, and he sion, the Federal backstop will no Act, commonly referred to as TRIA. has been a strong and effective leader longer be available for insurance poli- This important legislation provided a this year as well. cies covering commercial automobiles, Government backstop for the terrorism The original TRIA was designed to professional liability, burglary and insurance market that disappeared address the adverse impact on the ter- theft, farmowners’ multiple peril, and after the attacks of September 11. rorism insurance marketplace of the surety. The primary purpose behind TRIA, sudden lack of terrorism reinsurance Just as the original TRIA did, this and the reason it needs to be extended, after the September 11 attacks. Rein- exteusion places more of the risk on is to make sure that the American surance is a mechanism by which in- the insurance industry, and cor- economy and markets function in the surance companies spread their own respondingly less on the federal gov- face of a terrorist threat. September 11 risks, allowing them to write more ernment, in each year. For example, in proved that there needs to be a mecha- policies. Without it, insurers’ capacity 2005, under the current program, the nism in place to allow the economy to to offer coverage for losses due to ter- amount of terrorism losses that an in- rebound more quickly and to protect rorism shrank considerably. By all ac- surer must cover before Federal assist- American jobs in the unfortunate event counts, the Federal backstop provided ance becomes available is 15 percent of of another terrorist attack here in the by TRIA achieved its goal of making the premiums collected by that insurer United States. Since it became law, terrorism insurance coverage available in lines covered by the TRIA program. TRIA has proven to be an effective pro- and affordable once again. The Treas- Under this extension, this ‘‘insurance gram that has made terrorism risk in- ury Department reported this summer, company deductible’’ will rise to 17.5 surance available and provided busi- ‘‘TRIA was effective in terms of the percent of premiums in 2006, and 20 per- nesses meaningful access to coverage purposes it was designed to achieve. cent of premiums in 2007. Moreover, the in a post-9/11 world. TRIA provided a transitional period amount that insurers must pay above during which insurers had enhanced fi- their deductible also increases, rising TRIA is a temporary program set to nancial capacity to write terrorism from 10 percent of losses in 2006, to 15 expire at the end of this year, which risk insurance coverage. . . . More gen- percent of losses in 2007. created significant uncertainty in the erally, TRIA provided an adjustment In addition to the individual insur- terrorism insurance market and period allowing both insurers and pol- ance companies’ deductible, tbe insur- threatened to stall construction and icyholders to adjust to the post-Sep- ance industry as a whole must cover a building projects across the country. tember 11th view of terrorism risk.’’ certain amount of losses before federal Most lenders who finance these As discussions began over a possible assistance becomes available. In 2005, projects require borrowers to have ter- extension of TRIA, it became clear the last year of the current TRIA pro- rorism risk coverage, but in the face of that there are serious disagreements as gram, that amount is $15 billion. Under TRIA’s looming expiration, that cov- to what would be the most efficient, ef- this legislation, that will rise to $17.5 erage became more difficult and expen- fective, and equitable way to assure billion in 2006, and $20 billion in 2007. sive to get, making those projects in- the continued availability of terrorism Also, starting in 2006, no Federal as- feasible. Recognizing these problems insurance. A number of studies have sistance will be available at all under early in the year, Senator DODD and concluded that the reinsurance market tbe program for a terrorist attack in Senator BENNETT drafted TRIA exten- has not rebounded to any great extent which total losses do not exceed $50 sion legislation, which I cosponsored. since the attacks of 2001. These studies million, a level which rises to $100 mil- Mr. President, although slightly dif- conclude that if the backstop provided lion in 2007. ferent from the bill that Senator DODD by the Federal Government does not Finally, I want to emphasize that the introduced earlier this Congress, and continue, insurers will write fewer ter- extension retains a critically impor- that I and other Democrats cospon- rorism policies or charge much higher tant piece of the current TRIA pro- sored, the legislation that passed out of prices for them, creating a drag on our gram: the requirement that insurers the committee yesterday essentially nation’s economy and leaving compa- make terrorism coverage available to maintains the structure of TRIA and nies uninsured against a terrorist at- policyholders in all of the lines covered extends the program through the end tack. On the other hand, the adminis- by TRIA. of 2007. I am disappointed that group tration and others argue that the in- These provisions follow the frame- life insurance will not be covered under surance industry is now better pre- work of the existing TRIA program, the program and that other lines origi- pared to handle the risk of terrorism keeping the Federal backstop in place nally covered have been excluded. But than it was three years ago, and that so that insurers will continue writing my colleagues, Senators DODD, SAR- any extension of TRIA should therefore terrorism policies, while placing pro- BANES, SHELBY, and BENNETT, worked be significantly narrower than the cur- gressively more of the costs onto the closely with others on the Banking rent program to avoid crowding out ad- industry itself. I want to take just a Committee to construct a product that ditional private sector activity. moment to acknowledge the hard work all of us in the Senate should be able to These are issues that deserve careful that the staff has put into this bill, support. I am hopeful the Senate ac- analysis, which is why this extension particularly Sarah Kline from my tion on this bill today will break the bill contains a requirement for a study Banking Committee staff, Alex logjam over this legislation so it can be by the President’s Working Group on Sternhell with Senator DODD, Kathy signed into law before the Congress ad- Financial Markets on the long-term Casey and Mark Oesterle with Chair- journs this year. availability and affordability of ter- man SHELBY, and Mike Nielson with Mr. DODD. Mr President, I rise to rorism risk insurance. I hope that this Senator BENNETT. As with any com- lend my strong support for S. 467, the requirement will result in a thorough promise product, no one would say that Terrorism Risk Insurance Extension

VerDate Aug 31 2005 02:25 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00133 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.097 S17NOPT2 S13280 CONGRESSIONAL RECORD — SENATE November 17, 2005 Act of 2005, which I originally intro- Industries as diverse as commercial years we need to find a long-term solu- duced with Senator BENNETT and 34 co- real estate, shipping, construction, tion to this issue. It may be deter- sponsors earlier this year. Our legisla- manufacturing, and even ‘‘mom and mined that this is an unwritable risk tion was amended in committee with pop’’ retailers require insurance to ob- for the private sector, and that a con- the hard work and leadership of Bank- tain credit, loans, and investments nec- tinued Federal role is needed or we ing Committee Chairman SHELBY and essary for their normal business oper- may find that insurers are able to re- Ranking Member SARBANES to develop ations. TRIA was designed to do just turn to underwriting this risk without the product before the Senate today. that—restore ‘‘business as usual’’ in a Federal backstop. But we need to I would like to commend the mem- every State across our Nation. start work on developing this informa- bers on the Banking Committee: Sen- I believe that the greatest indicator tion and potential solutions as soon as ators JOHNSON, REED, SCHUMER, BAYH, of the success of TRIA is what we have possible. CARPER, STABENOW, CORZINE, HAGEL, not heard over the past 3 years since Since the enactment of TRIA, our BUNNING, and DOLE as well as the other the enactment of TRIA public outcry Nation has been fortunate enough not cosponsors of the legislation for recog- from businesses and workers whose to suffer the tremendous loss of life or nizing—very early on—how important livelihoods are threatened by their in- destruction of property that we en- extending the Terrorism Risk Insur- ability to purchase coverage against dured on September 11, 2001. But by no ance Act, TRIA, was to our Nation’s acts of terror. means has the political climate, either economy and for their efforts on this Construction projects are no longer domestically or abroad, returned to a legislation. stalled, mortgages are no longer in sense of normalcy. We are engaged in a I would especially like to commend doubt, and jobs are no longer in jeop- violent conflict in Iraq and we have Chairman SHELBY for his work on this ardy as a result of the inability to re- seen despicable terrorist attacks legislation. This is not the bill I would ceive terrorism insurance. abroad in Europe and elsewhere. have written, nor is it the bill that he Insurance isn’t something we think We have heard repeated dire warn- would have written. For example, it about every day, yet it is vital to the ings that terrorism will return to U.S. was my hope that we could have in- overall health of our economy. By pro- soil. We must be prepared against this cluded group life as a covered line in tecting people and property, goods and threat. Providing insurance against this legislation. However, I am acutely services in every sector of America’s terrorist attacks, which allows our aware that the chairman has had con- $10 trillion-plus economy, insurance economy to function, is a critical part cerns about the TRIA program and provides the stability and certainty re- of our preparedness. what the role of the Federal Govern- quired to keep our economic engine But we cannot fail to extend TRIA. ment should be in this area—and I humming. Every prospective home- We cannot afford—and we should do ev- would like to thank him and his staff owner needs insurance to obtain a erything in our power to avoid—restor- for helping to craft a compromise that mortgage from a bank. Insurance of all ing the tremendous uncertainty and in- not only adheres to his principles but types is a critical component of our stability to businesses and workers and also satisfies the concerns of so many capital markets. our economy as a whole. Members of this body who believe it is Not only has TRIA been effective in The enactment of this legislation imperative to pass an extension of ensuring that terrorism is available will ensure that our Nation and its TRIA. and affordable, and that our economy economy are best prepared to deal with Like many bills, this legislation is a remains vibrant, it is also an incred- a future terrorist attack. I urge the my document of compromise. We have ibly important taxpayer protection colleagues to support this legislation. carefully taken into consideration the law. With relatively little money nec- Mr. REED. Mr. President, the Senate recommendations of policyholders, in- essary to fund the administration of is undertaking a long awaited debate surers, consumers, academics, think- the TRIA program, we have ensured on S. 467, Terrorism Risk Insurance Ex- tanks, the Treasury Department and that insurers and policyholders take tension Act of 2005. This bill extends others to craft this important exten- the important program that allows for sion legislation. the first $30 to $40 billion of losses of a the Federal Government to share the And I think that this product is very potential terrorist attack. good one. According to a recent study con- risk of loss from future terrorist at- Let me take a few brief moments to ducted by the RAND Institute, ‘‘Based tacks with the insurance industry for 2 provide my colleagues with a little on our analysis (of TRIA), the role of more years, to 2007. background on TRIA and why it needs taxpayers is expected to be minimal, As we all know, terrorism remains a to be extended today. unless there is are several large events clear and present danger. The need for As a result of the tragic terrorist in a single year.’’ terrorism insurance is real, pressing, acts of 9/11, we repeatedly heard from TRIA has essentially provided that in and a long-term issue. In the post-9/11 businesses, large and small, from labor the unfortunate event of a future ter- world, it is important to keep the ex- unions and manufacturers, from hos- rorist attack a $30 to $40 billion check isting TRIA program in place, while pitals to hotels, from professional is written to U.S. taxpayers. TRIA has continuing to work with the private sports teams to utility companies, not only worked to help provide avail- sector—both policyholders and insur- from insurers and the insured about able and affordable terrorism risk in- ers—to craft a longer term program the need for the Federal Government surance, it has also protected our Na- that addresses all the needs of policy- to act to help them receive financial tion’s taxpayers. holders. protection from future terrorist at- With the expiration of TRIA in less I want to particularly commend Mi- tacks. than 45 days, and this session near nority Leader REID, Chairman SHELBY, Congress listened, and we acted—cre- completion, it is essential that Con- Senators SARBANES, DODD, BENNETT, ating the Terrorism Risk Insurance gress extend TRIA immediately. and their staffs for their tireless efforts Act—TRIA. I would like to bring to your atten- in bringing this issue to the forefront In November 2002, TRIA was passed tion a letter from 28 Governors across of the Senate’s legislative agenda. by both the House and Senate by sig- the Nation urging us to extend the The need for terrorism insurance cov- nificant margins and was signed into TRIA program. erage has been widely established as an law. It created 3-year program estab- There is one provision in this legisla- economic issue, rather than just sim- lishing a Federal backstop against cat- tion that I believe is an important ply an insurance issue. In the past astrophic losses in the property and component—the mandate for the Presi- year, we have heard that many Amer- casualty insurance marketplace. dent’s Working Group—our Nation’s ican businesses—policyholders—are al- And we heard an overwhelming re- Federal financial regulators—to do an ready receiving exclusion notices from sponse from policyholders across the analysis of the long-term availability insurers informing them that they will country—TRIA has worked. It has and affordability of terrorism risk in- not be covered on policies beyond achieved its primary goal—continued surance. TRIA’s sunset date. As a result, there availability and affordability of insur- This legislation provides for a 2-year has been increasing uncertainty about ance against future terrorist attacks. extension of TRIA—and in these next 2 the availability of adequate terrorism

VerDate Aug 31 2005 01:03 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00134 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.115 S17NOPT2 November 17, 2005 CONGRESSIONAL RECORD — SENATE S13281 coverage beyond 2005. Clearly, a Fed- surance Extension Act of 2005, intro- today, we will be sending a message to eral backstop is vital to ensuring the duced by my friend, Senator DODD of the world that our financial markets ongoing availability of terrorism risk Connecticut. will be protected, that our country will coverage. I would like to commend Senators be able to bounce back in the event of The other key reason to act on this DODD, BENNETT, SHELBY and SARBANES any disruptions or financial dislocation issue is the fact that should another for getting a bill done that we can all caused by another possible terrorist at- catastrophic event occur, the Federal stand here and be proud to support. A tack. Government will likely be on the hook bill that is good for this country and It is still my strong belief that there for the total amount of the damage. good for the State of New York. needs to be a long-term solution—a An important aspect of this debate is We still live in America, and particu- permanent program. The President has making certain that terrorism insur- larly in my city of New York, in the continued to say that we are fighting a ance coverage is available in the work- shadow of 9/11, of the terrorism that oc- war on terrorism. ers’ compensation market. Workers’ curred. Obviously, the thousands of The bombing in Jordan last week, compensation is unique insurance cov- families who have had a loved one the London bombings this past July, erage in that law requires that it cover taken from their midst live with it and the recent threat to the New York acts of terrorism and war. For close to every moment of their remaining lives, subway system are a few examples of a century now, workers’ compensation but the rest of us live with it, too, not why we must continue fighting this has been a safety net available to all only in empathy for them but also in war on terrorism. workers and their families, replacing terms of the economic consequences of So it would have been my preference lost wages, and paying for medical terrorism. to get a bill that extended beyond 2 needs and death benefits regardless of The bottom line is very simple, and years. But I am at least pleased to the cause of the workplace injury or that is, because of terrorism, the insur- know that there was a serious effort to death. A strong workers’ compensation ance industry, in terms of insuring risk address this concern by including a system is integral to helping victims of large structures in America—wheth- provision to create a commission that and their families rebuild their lives. er it be large buildings that make us so would begin to analyze the long-term In my State of Rhode Island, the bur- proud of the Manhattan skyline or availability and affordability of insur- den of providing workers’ compensa- large arenas such as the football sta- ance for terrorism risk. tion falls to one mutual insurance diums that dot America or larger fa- I would particularly like to thank compan, Beacon Mutual, which was cilities such as Disneyland, Disney Chairman DODD and SHELBY for specifi- created by the State to ensure that World, and amusement parks—all have cally including the language I re- there will always be workers’ com- difficulty getting insurance. quested which directs the President’s pensation available to companies in Insurers are worried that if, God for- working group to analyze the long- the State. With less availability of re- bid, another terrorist act occurs, it will term affordability and availability of insurance, the concern for one com- be so devastating that it will put them coverage for chemical, nuclear, biologi- pany conceivably underwriting the en- out of business. cal, and radiological events. tire market for workers’ compensation So 2 years ago, the Senate, House, This is an issue of great importance was significant and would have created and the President got together at sort to many New Yorkers. Many retailers a very tenuous situation for the com- of the end of the day, just like today, and business owners in Lower Manhat- pany, the State, and its residents. Ex- and passed terrorism risk insurance. tan are afraid of a possible dirty bombs tending TRIA will address the various It has been a large success. That, no attack and the availability of insur- problems that employers, insurance one can dispute. ance for such an event. This must be companies, and State workers com- Insurance rates have come down, ter- addressed and right away. pensation pools alike have had to en- rorism insurance is available, and in- The bottom line is that financial dis- dure in the absence of a Federal back- surance companies know, if, God for- location caused by another possible stop. bid, the worst happens, there will be a terrorist attack—God forbid—is too I would note, however, that although backstop, and they are willing to issue much for our country to risk. I urge S. 467 is an improvement on the admin- policies. the entire Senate to pass this legisla- istration’s proposal for the trigger for In turn, that meant developers, tion today. It is only right that we let a terrorist incident—$50 million in the builders who wanted to build new large the markets, let the insurance world, first year of the extension and $100 mil- structures in America, did so, employ- and, most of all, let jobs and construc- lion in the last, down from $500 million, ing thousands and thousands of people, tion go forth. I remain concerned that because of the creating profits and new businesses as Mr. FRIST. Mr. President, very brief- concentration of risk and their small well. ly, I want to comment on this bill as capitalization, a higher trigger level Well, today we are all here to do the well. This is the Terrorism Risk Insur- for State fund companies put these right thing. Yesterday, the Banking ance Extension Act of 2005. We are funds uniquely at risk. A number of Committee, of which I am member, doing this by unanimous consent which terrorist targets could create a result passed unanimously a bill to extend reflects a tremendous amount of work where workers’ compensation losses the TRIA. In this bill, we have kept the by a range of Senators over the course could exceed property losses, but still trigger levels manageable for the pol- of the last several months, weeks, not reach the proposed higher trigger. icyholder community. We kept the re- days, and especially over the last few As we move towards finding a long- tention levels at a responsible level for hours. This is a bill that has been sub- term solution to terrorism insurance the private market, retaining the pub- jected to a lot of debate, and that de- coverage, I hope we can work to better lic/private nature of the program. bate has culminated in a lot of agree- address this issue. The bottom line is that we have ment. I appreciate the great work of There remains a great need to do made some necessary modifications to Senator SHELBY, Senator DODD, and so something because, as it has been stat- the program without losing the major many others. The House hopefully will ed very plainly during this debate, the protections. We did not all agree what act on terrorism risk insurance short- situation without a Federal terrorism should have been in the bill. Many of ly. It is a very important bill to our risk insurance program could be very us felt strongly about including group economy. dire. Extending TRIA is absolutely the life and protections against nuclear, bi- I ask unanimous consent that the right thing to do to protect the eco- ological, chemical and radiological at- amendment at the desk be agreed to; nomic security of our country. I urge tacks. But the beauty of the process is the committee reported amendment, as my colleagues to support this bill, and that it is a negotiation where we all amended, be agreed to; the bill, as I look forward to its speedy adoption give and take. amended, be read a third time and and signature into law. This bill is a good compromise. passed; the motion to reconsider be Mr. SCHUMER. Mr. President, I rise The continuation of this program is laid upon the table; and that any state- today to express my unwavering sup- vital to our Nation’s economic sta- ments relating to the bill be printed in port for S. 467, the Terrorism Risk In- bility. By passing this bill on the floor the RECORD.

VerDate Aug 31 2005 01:03 Nov 19, 2005 Jkt 049060 PO 00000 Frm 00135 Fmt 0624 Sfmt 0634 E:\CR\FM\A17NO6.117 S17NOPT2 S13282 CONGRESSIONAL RECORD — SENATE November 17, 2005 The PRESIDING OFFICER. Without fication are voted upon, the motion to PROGRAM objection, it is so ordered. reconsider be laid upon the table, the Mr. FRIST. Mr. President, tomorrow The amendment (No. 2600) was agreed President be notified of the Senate’s morning after we convene, we will im- to as follows: action; and that following disposition mediately proceed to the continuing Modify section 3(c)(2) of the bill to read as of the treaties the Senate return to resolution. Senator HARKIN will have follows: legislative session. an amendment which will require a (2) CONFORMING AMENDMENT.—Section The PRESIDING OFFICER. Without vote. Therefore, Senators should expect 102(12)(A) of the Terrorism Risk Insurance objection, it is so ordered. a couple votes early in the morning. Act of 2002 (15 U.S.C. 6701 note; 116 Stat. 2326) Those votes will occur at approxi- is amended by striking ‘‘surety insurance’’ Mr. FRIST. I ask for a division vote and inserting ‘‘directors and officers liability on the resolutions of ratification. mately 9:30 in the morning. insurance’’. The PRESIDING OFFICER. A divi- Following those votes, we expect to The committee amendment in the sion vote is requested. Senators in have a better idea of what additional nature of a substitute, as amended, was favor of the resolutions of ratification business will be available on Friday. agreed to. please stand and be counted. There are a couple of appropriations conference reports that will likely be The bill (S. 467), as amended, was Those opposed to the resolutions of read the third time and passed. ratification please stand and be count- available, the PATRIOT conference re- port, the House message on the spend- (The bill will be printed in a future ed. On this vote, two-thirds of the Sen- ing reconciliation bill, as well as other edition of the RECORD.) legislative and executive items we are f ators present having voted in the af- firmative, the resolutions of ratifica- trying to clear. Therefore, additional U.S.S. ‘‘CARL VINSON’’ tion are agreed to. votes may occur and will occur, and we Mr. FRIST. Mr. President, I ask The resolutions of ratification agreed will try to clarify Friday’s schedule as unanimous consent that the Senate to are as follows: early as possible. proceed to the immediate consider- I remind everyone that a weekend AGREEMENT WITH CANADA ON PACIFIC HAKE/ ation of H.R. 4326, which was received WHITING (TREATY DOC. 108–24) session is expected and Senators should from the House. remain available Friday and Saturday Resolved (two-thirds of the Senators present The PRESIDING OFFICER. The concurring therein), That the Senate advises and beyond until we finish our remain- clerk will report the bill by title. and consents to the ratification of the Agree- ing work. I will have to say, starting The legislative clerk read as follows: ment between the Government of the United now about 3 weeks ago we set out a States of America and the Government of very aggressive agenda, and to date we A bill (H.R. 4326) to authorize the Sec- Canada on Pacific Hake/Whiting, done at Se- have stayed right on target to accom- retary of the Navy to enter into a contract attle, November 21, 2003 (Treaty Doc. 108–24). for the nuclear refueling and complex over- plish that agenda. The House is in ses- haul of the U.S.S. Carl Vinson. CONVENTION STRENGTHENING INTER-AMERICAN sion right now and is voting actually TUNA COMMISSION (TREATY DOC. 109–2) right now, and I understand they will There being no objection, the Senate Resolved (two-thirds of the Senators present proceeded to consider the bill. be conducting more business tonight concurring therein), That the Senate advises and in the morning that we will have Mr. FRIST. I ask unanimous consent and consents to the ratification of the Con- to act on after they act on much of the the bill be read a third time and vention for the Strengthening of the Inter- American Tropical Tuna Commission Estab- legislation they are considering. So it passed, the motion to reconsider be will be a full day tomorrow. I expect to laid upon the table, and that any state- lished by the 1949 Convention Between the United States of America and the Republic have a number of votes over the course ments relating to the bill be printed in of Costa Rica, with Annexes, adopted on of tomorrow. And again, as we have the RECORD. June 27, 2003, in Antigua, Guatemala, and said for the last 3 weeks, it will be im- The PRESIDING OFFICER. Without signed by the United States on November 14, portant for our colleagues to keep their objection, it is so ordered. 2003 (Treaty Doc. 109–2). schedules flexible through tomorrow The bill (H.R. 4326) was read the third CONVENTION CONCERNING MIGRATORY FISH and Saturday, Sunday, and possibly be- time and passed. STOCK IN THE PACIFIC OCEAN (TREATY DOC. yond that. 109–1) f f Resolved, (two-thirds of the Senators present EXECUTIVE SESSION concurring therein), That the Senate advises ADJOURNMENT UNTIL 9 A.M. and consents to the ratification of the Con- TOMORROW vention on the Conservation and Manage- AGREEMENT WITH CANADA ON ment of the Highly Migratory Fish Stocks in Mr. FRIST. Mr. President, if there is PACIFIC HAKE/WHITING the Western and Central Pacific Ocean, with no further business to come before the Annexes, adopted at Honolulu on September Senate, I ask unanimous consent that 5, 2000, by the Multilateral High Level Con- the Senate stand in adjournment under CONVENTION STRENGTHENING ference on the Highly Migratory Fish Stocks the previous order. INTER-AMERICAN TUNA COMMIS- in the Western and Central Pacific Ocean, There being no objection, the Senate, SION and signed by the United States on that date (Treaty Doc. 109–1). at 12:58 p.m., adjourned until Friday, November 18, 2005 at 9 a.m. f CONVENTION CONCERNING MIGRA- f TORY FISH STOCK IN THE PA- LEGISLATIVE SESSION CIFIC OCEAN The PRESIDING OFFICER. The Sen- NOMINATIONS Mr. FRIST. I ask unanimous consent ate will return to legislative session. Executive nominations received by the Senate November 17, 2005. the Senate proceed to executive session f to consider the following treaties on TENNESSEE VALLEY AUTHORITY today’s executive calendar: Nos. 4, 6 ORDERS FOR FRIDAY, NOVEMBER 18, 2005 DENNIS BOTTORFF, OF TENNESSEE, TO BE A MEMBER and 7. I further ask unanimous consent OF THE BOARD OF DIRECTORS OF THE TENNESSEE VAL- that the treaties be considered as hav- Mr. FRIST. I ask unanimous consent LEY AUTHORITY FOR A TERM EXPIRING MAY 18, 2011. (NEW POSITION) ing passed through their various par- that when the Senate completes its ROBERT M. DUNCAN, OF KENTUCKY, TO BE A MEMBER business today, it stand in adjourn- OF THE BOARD OF DIRECTORS OF THE TENNESSEE VAL- liamentary stages up to and including LEY AUTHORITY FOR A TERM EXPIRING MAY 18, 2011. the presentation of the resolutions of ment until 9 a.m. on Friday, November (NEW POSITION) WILLIAM B. SANSOM, OF TENNESSEE TO BE A MEMBER ratification; that any committee con- 18. I further ask unanimous consent OF THE BOARD OF DIRECTORS OF THE TENNESSEE VAL- ditions, declarations, or reservations that following the prayer and pledge, LEY AUTHORITY FOR A TERM EXPIRING MAY 18, 2009. (NEW POSITION) be agreed to as applicable; that any the morning hour be deemed expired, HOWARD A. THRAILKILL, OF ALABAMA, TO BE A MEM- the Journal of proceedings be approved BER OF THE BOARD OF DIRECTORS OF THE TENNESSEE statements be inserted in the RECORD VALLEY AUTHORITY FOR A TERM EXPIRING MAY 18, 2007. as if read; and that the Senate take one to date, and the time for the two lead- (NEW POSITION) SUSAN RICHARDSON WILLIAMS, OF TENNESSEE, TO BE vote on the resolutions of ratification ers be reserved. A MEMBER OF THE BOARD OF DIRECTORS OF THE TEN- to be considered as separate votes; fur- The PRESIDING OFFICER. Without NESSEE VALLEY AUTHORITY FOR THE A TERM PRE- SCRIBED BY LAW, VICE GLENN L. MC CULLOUGH, JR., ther, that when the resolutions of rati- objection, it is so ordered. TERM EXPIRED.

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