[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1480 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 1480

    To amend the Securities Exchange Act of 1934 to reduce fees on 
                        securities transactions.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 4, 2001

  Mr. LaFalce (for himself, Mr. Kanjorski, Mr. Frank, Ms. Waters, Mr. 
  Towns, Mr. Dingell, and Mr. Markey) introduced the following bill; 
       which was referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
    To amend the Securities Exchange Act of 1934 to reduce fees on 
                        securities transactions.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fairness in Securities Transactions 
Act''.

SEC. 2. IMMEDIATE FEE REDUCTION.

    Section 31 of the Securities Exchange Act of 1934 (15 U.S.C. 78ee) 
is amended by striking ``1/300 of one percent'' each place it appears 
and inserting ``1/500 of one percent''.

SEC. 3. REVISION OF SECURITIES TRANSACTION FEE PROVISIONS; ADDITIONAL 
              FEE REDUCTIONS.

    (a) Pooling and Allocation of Collections.--Section 31 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78ee) is further amended--
            (1) in subsection (b)--
                    (A) by striking ``Every'' and inserting ``Subject 
                to subsection (i), each''; and
                    (B) by striking the last sentence;
            (2) by striking subsection (c);
            (3) in subsection (d)--
                    (A) by striking paragraphs (2) and (3);
                    (B) by striking the following:
    ``(d) Off-Exchange Trades of Last-Sale-Reported Securities.--
            ``(1) Covered transactions.--Each national securities''
                and inserting the following:
    ``(c) Off-Exchange Trades of Exchange Registered and Last-Sale-
Reported Securities.--Subject to subsection (i), each national 
securities'';
                    (C) by inserting ``registered on a national 
                securities exchange or'' after ``security futures 
                products)'';
                    (D) by striking ``, excluding any sales for which a 
                fee is paid under subsection (c)'';
            (4) by redesignating subsections (e) through (h) as 
        subsections (d) through (g), respectively;
            (5) in subsection (e) (as redesignated by paragraph (4)), 
        by striking ``(b), (c), and (d)'' and inserting ``(b) and 
        (c)''; and
            (6) by adding at the end the following new subsection:
    ``(h) Deposit of Fees.--
            ``(1) Offsetting collections.--Fees collected pursuant to 
        subsections (b) and (c) for any fiscal year--
                    ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Commission, except that the amount so deposited and 
                credited for fiscal years 2007 through 2011 shall not 
                exceed the target offsetting collection amount for such 
                fiscal year; and
                    ``(B) shall not be collected for any fiscal year 
                except to the extent provided in advance in 
                appropriation Acts.
            ``(2) General revenues.--Fees collected pursuant to 
        subsections (b) and (c) for fiscal years 2007 through 2011 in 
        excess of the amount deposited and credited as offsetting 
        collections pursuant to paragraph (1) for such fiscal year 
        shall be deposited and credited as general revenue of the 
        Treasury. No fees collected pursuant to such subsections for 
        fiscal years 2002 through 2006, fiscal year 2012, or any 
        succeeding fiscal year shall be deposited and credited as 
        general revenue of the Treasury.''.
    (b) Additional Reductions of Fees.--
            (1) Amendment.--Section 31 of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78ee) is further amended by adding after 
        subsection (h) (as added by subsection (a)(6)) the following 
        new subsections:
    ``(i) Recapture of Projection Windfalls for Further Rate 
Reductions.--
            ``(1) Annual adjustment.--For each of the fiscal years 2003 
        through 2011, the Commission shall by order adjust each of the 
        rates applicable under subsections (b) and (c) for such fiscal 
        year to a uniform adjusted rate that, when applied to the 
        baseline estimate of the aggregate dollar amount of sales for 
        such fiscal year, is reasonably likely to produce aggregate fee 
        collections under this section that are equal to the sum of--
                    ``(A) the target offsetting collection amount for 
                such fiscal year; and
                    ``(B) the target general revenue amount for such 
                fiscal year.
            ``(2) Final rate adjustment.--For fiscal year 2012 and all 
        of the succeeding fiscal years, the Commission shall by order 
        adjust each of the rates applicable under subsections (b) and 
        (c) for all of such fiscal years to a uniform adjusted rate 
        that, when applied to the baseline estimate of the aggregate 
        dollar amount of sales for fiscal year 2012, is reasonably 
        likely to produce aggregate fee collections under this section 
        in fiscal year 2012 equal to the target offsetting collection 
        amount for fiscal year 2011.
            ``(3) Limitation on rate adjustment.--Notwithstanding 
        paragraphs (1) and (2), no adjusted rate established under this 
        subsection for any fiscal year shall exceed the rate that would 
        otherwise be applicable under subsections (b) and (c) for such 
        fiscal year.
            ``(4) Review and effective date.--An adjusted rate 
        prescribed under paragraph (1) or (2) and published under 
        subsection (g) shall not be subject to judicial review. Subject 
        to subsections (h)(1)(B) and (j), an adjusted rate prescribed 
        under paragraph (1) shall take effect on the first day of the 
        fiscal year to which such rate applies and an adjusted rate 
        prescribed under paragraph (2) shall take effect on the first 
        day of fiscal year 2012.
    ``(j) Lapse of Appropriation.--If on the first day of a fiscal year 
a regular appropriation to the Commission has not been enacted, the 
Commission shall continue to collect fees (as offsetting collections) 
under subsections (b) and (c) at the rate in effect during the 
preceding fiscal year, until such a regular appropriation is enacted.
    ``(k) Definitions.--For purposes of this section:
            ``(1) Target offsetting collection amount.--The target 
        offsetting collection amount is an amount equal to--
                    ``(A) $976,000,000 for fiscal year 2002;
                    ``(B) $1,132,000,000 for fiscal year 2003;
                    ``(C) $1,370,000,000 for fiscal year 2004;
                    ``(D) $1,627,000,000 for fiscal year 2005;
                    ``(E) $1,913,000,000 for fiscal year 2006;
                    ``(F) $1,110,000,000 for fiscal year 2007;
                    ``(G) $1,144,000,000 for fiscal year 2008;
                    ``(H) $1,327,000,000 for fiscal year 2009;
                    ``(I) $1,523,000,000 for fiscal year 2010; and
                    ``(J) $1,745,000,000 for fiscal year 2011.
            ``(2) Target general revenue amount.--The target general 
        revenue amount is an amount equal to--
                    ``(A) zero for each of the fiscal years 2002 
                through 2006;
                    ``(B) $463,000,000 for fiscal year 2007;
                    ``(C) $449,000,000 for fiscal year 2008;
                    ``(D) $500,000,000 for fiscal year 2009;
                    ``(E) $551,000,000 for fiscal year 2010; and
                    ``(F) $614,000,000 for fiscal year 2011.
            ``(3) Baseline estimate of the aggregate dollar amount of 
        sales.--The baseline estimate of the aggregate dollar amount of 
        sales for any fiscal year is the baseline estimate of the 
        aggregate dollar amount of sales of securities (other than 
        bonds, debentures, other evidences of indebtedness, and 
        security futures products) to be transacted on each national 
        securities exchange and by or through any member of each 
        national securities association (otherwise than on a national 
        securities exchange) during such fiscal year as determined by 
        the Congressional Budget Office in making projections pursuant 
        to section 257 of the Balanced Budget and Emergency Deficit 
        Control Act of 1985 and as contained in the projection required 
        to be made in March of the preceding fiscal year.''.
            (2) Conforming amendment.--Section 31(g) of such Act is 
        amended by inserting before the period at the end the 
        following: ``not later than April 30 of the fiscal year 
        preceding the fiscal year to which such rate applies''.

SEC. 4. PAY PARITY PROVISIONS.

    (a) Securities and Exchange Commission Employees.--Section 4(b) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78d(b)) is amended--
            (1) by striking paragraphs (1) and (2) and by inserting the 
        following:
            ``(1) Appointment, compensation, and benefits.--
                    ``(A) In general.--The Commission may appoint and 
                fix the compensation of such officers, attorneys, 
                economists, examiners, and other employees as may be 
                necessary for carrying out its functions under this 
                Act.
                    ``(B) Rates of pay.--Rates of basic pay for all 
                employees of the Commission may be set and adjusted by 
                the Commission without regard to the provisions of 
                chapter 51 or subchapter III of chapter 53 of title 5, 
                United States Code.
                    ``(C) Additional compensation and benefits.--The 
                Commission may provide additional compensation and 
                benefits to employees of the Commission if the same 
                type of compensation or benefits are then being 
                provided by any agency referred to under section 1206 
                of the Financial Institutions Reform, Recovery, and 
                Enforcement Act of 1989 or, if not then being provided, 
                could be provided by such an agency under applicable 
                provisions of law, rule, or regulation.
            ``(2) Information; comparability.--In establishing and 
        adjusting schedules of compensation and additional benefits for 
        employees of the Commission, which are to be determined solely 
        by the Commission under this subsection, the Commission--
                    ``(A) shall consult with and inform the heads of 
                the agencies referred to under section 1206 of the 
                Financial Institutions Reform, Recovery, and 
                Enforcement Act of 1989;
                    ``(B) shall inform the Congress of such 
                compensation and benefits; and
                    ``(C) shall seek to maintain comparability with 
                such agencies regarding compensation and benefits.''.
    (b) Technical Amendments.--
            (1) Section 3132(a)(1) of title 5, United States Code, is 
        amended--
                    (A) in subparagraph (C), by striking ``or'' after 
                the semicolon;
                    (B) in subparagraph (D), by inserting `or` after 
                the semicolon; and
                    (C) by adding at the end of the following:
                    ``(E) the Securities and Exchange Commission.''.
            (2) Section 5373(a) of title 5, United States Code, is 
        amended--
                    (A) in paragraph (2), by striking ``or'' after the 
                semicolon;
                    (B) in paragraph (3), by striking the period and 
                inserting ``; or''; and
                    (C) by adding at the end the following:
            ``(4) section 4(b) of the Securities Exchange Act of 
        1934.''.

SEC. 5. EFFECTIVE DATES.

    (a) Fee Provisions.--The amendments made by sections 2 and 3 of 
this Act shall take effect on October 1, 2001.
    (b) Pay Parity.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by section 4 shall take effect on the date of 
        enactment of this Act.
            (2) Exception.--The amendments made by section 4(b)(1) 
        shall take effect as of such date as the Securities and 
        Exchange Commission shall (by order published in the Federal 
        Register) prescribe, but in no event later than 1 year after 
        the date of enactment of this Act.
                                 <all>