[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 1072 Engrossed in Senate (ES)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
108th CONGRESS
  2d Session
                                S. 1072

_______________________________________________________________________

                                 AN ACT


 
 To authorize funds for Federal-aid highways, highway safety programs, 
             and transit programs, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Safe, Accountable, 
Flexible, and Efficient Transportation Equity Act of 2004''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. General definitions.
Sec. 3. Definitions for title 23.
                     TITLE I--FEDERAL-AID HIGHWAYS

                          Subtitle A--Funding

Sec. 1101. Authorization of appropriations.
Sec. 1102. Obligation ceiling.
Sec. 1103. Apportionments.
Sec. 1104. Equity bonus programs.
Sec. 1105. Revenue aligned budget authority.
                        Subtitle B--New Programs

Sec. 1201. Infrastructure performance and maintenance program.
Sec. 1202. Future of surface transportation system.
Sec. 1203. Freight transportation gateways; freight intermodal 
                            connections.
Sec. 1204. Construction of ferry boats and ferry terminal and 
                            maintenance facilities; coordination of 
                            ferry construction and maintenance.
Sec. 1205. Designation of Daniel Patrick Moynihan Interstate Highway.
Sec. 1206. State-by-State comparison of highway construction costs.
                          Subtitle C--Finance

Sec. 1301. Federal share.
Sec. 1302. Transfer of highway and transit funds.
Sec. 1303. Transportation Infrastructure Finance and Innovation Act 
                            Amendments.
Sec. 1304. Facilitation of international registration plans and 
                            international fuel tax agreements.
Sec. 1305. National Commission on Future Revenue Sources to Support the 
                            Highway Trust Fund and Finance the Needs of 
                            the Surface Transportation System.
Sec. 1306. State infrastructure banks.
Sec. 1307. Public-private partnerships pilot program.
Sec. 1308. Wagering.
                           Subtitle D--Safety

Sec. 1401. Highway safety improvement program.
Sec. 1402. Operation lifesaver.
Sec. 1403. License suspension.
Sec. 1404. Bus axle weight exemption.
Sec. 1405. Safe routes to schools program.
Sec. 1406. Purchases of equipment.
Sec. 1407. Workzone safety.
Sec. 1408. Worker injury prevention and free flow of vehicular traffic.
Sec. 1409. Identity authentication standards.
Sec. 1410. Open container requirements.
             Subtitle E--Environmental Planning and Review

                   Chapter 1--Transportation Planning

Sec. 1501. Integration of natural resource concerns into State and 
                            metropolitan transportation planning.
Sec. 1502. Consultation between transportation agencies and resource 
                            agencies in transportation planning.
Sec. 1503. Integration of natural resource concerns into transportation 
                            project planning.
Sec. 1504. Public involvement in transportation planning and projects.
Sec. 1505. Project mitigation.
         Chapter 2--Transportation Project Development Process

Sec. 1511. Transportation project development process.
Sec. 1512. Assumption of responsibility for categorical exclusions.
Sec. 1513. Surface transportation project delivery pilot program.
Sec. 1514. Parks, recreation areas, wildlife and waterfowl refuges, and 
                            historic sites.
Sec. 1515. Regulations.
                        Chapter 3--Miscellaneous

Sec. 1521. Critical real property acquisition.
Sec. 1522. Planning capacity building initiative.
                        Subtitle F--Environment

Sec. 1601. Environmental restoration and pollution abatement; control 
                            of invasive plant species and establishment 
                            of native species.
Sec. 1602. National scenic byways program.
Sec. 1603. Recreational trails program.
Sec. 1604. Exemption of Interstate System.
Sec. 1605. Standards.
Sec. 1606. Use of high occupancy vehicle lanes.
Sec. 1607. Bicycle transportation and pedestrian walkways.
Sec. 1608. Idling reduction facilities in Interstate rights-of-way.
Sec. 1609. Toll programs.
Sec. 1610. Federal reference method.
Sec. 1611. Addition of particulate matter areas to CMAQ.
Sec. 1612. Addition to CMAQ-eligible projects.
Sec. 1613. Improved interagency consultation.
Sec. 1614. Evaluation and assessment of CMAQ projects.
Sec. 1615. Synchronized planning and conformity timelines, 
                            requirements, and horizon.
Sec. 1616. Transition to new air quality standards.
Sec. 1617. Reduced barriers to air quality improvements.
Sec. 1618. Air quality monitoring data influenced by exceptional 
                            events.
Sec. 1619. Conforming amendments.
Sec. 1620. Highway stormwater discharge mitigation program.
Sec. 1621. Exemption from certain hazardous materials transportation 
                            requirements.
Sec. 1622. Funds for rebuilding fish stocks.
                         Subtitle G--Operations

Sec. 1701. Transportation systems management and operations.
Sec. 1702. Real-time system management information program.
Sec. 1703. Contracting for engineering and design services.
Sec. 1704. Off-duty time for drivers of commercial vehicles.
Sec. 1705. Designation of transportation management areas.
                  Subtitle H--Federal-Aid Stewardship

Sec. 1801. Future Interstate System routes.
Sec. 1802. Stewardship and oversight.
Sec. 1803. Design-build contracting.
Sec. 1804. Program efficiencies--finance.
Sec. 1805. Set-asides for interstate discretionary projects.
Sec. 1806. Federal lands highways program.
Sec. 1807. Highway bridge program.
Sec. 1808. Appalachian development highway system.
Sec. 1809. Multistate corridor program.
Sec. 1810. Border planning, operations, technology, and capacity 
                            program.
Sec. 1811. Puerto Rico highway program.
Sec. 1812. National historic covered bridge preservation.
Sec. 1813. Transportation and community and system preservation 
                            program.
Sec. 1814. Parking pilot programs.
Sec. 1815. Interstate oasis program.
Sec. 1816. Tribal-State road maintenance agreements.
Sec. 1817. National forest system roads.
Sec. 1818. Territorial highway program.
Sec. 1819. Magnetic levitation transportation technology deployment 
                            program.
Sec. 1820. Donations and credits.
Sec. 1821. Disadvantaged business enterprises.
Sec. 1822. Emergency relief.
Sec. 1823. Priority for pedestrian and bicycle facility enhancement 
                            projects.
Sec. 1824. The Delta Regional Authority.
Sec. 1825. Multistate international corridor development program.
Sec. 1826. Authorization of contract authority for States with Indian 
                            Reservations.
                   Subtitle I--Technical Corrections

Sec. 1901. Repeal or update of obsolete text.
Sec. 1902. Clarification of date.
Sec. 1903. Inclusion of requirements for signs identifying funding 
                            sources in title 23.
Sec. 1904. Inclusion of Buy America requirements in title 23.
Sec. 1905. Technical amendments to nondiscrimination section.
                   TITLE II--TRANSPORTATION RESEARCH

                          Subtitle A--Funding

Sec. 2001. Authorization of appropriations.
Sec. 2002. Obligation ceiling.
Sec. 2003. Notice.
                  Subtitle B--Research and Technology

Sec. 2101. Research and technology program.
Sec. 2102. Study of data collection and statistical analysis efforts.
Sec. 2103. Centers for surface transportation excellence.
Sec. 2104. Motorcycle crash causation study grants.
Sec. 2105. Transportation technology innovation and demonstration 
                            program
         Subtitle C--Intelligent Transportation System Research

Sec. 2201. Intelligent transportation system research and technical 
                            assistance program.
                    TITLE III--PUBLIC TRANSPORTATION

Sec. 3001. Short title.
Sec. 3002. Amendments to title 49, United States Code; updated 
                            terminology.
Sec. 3003. Policies, findings, and purposes.
Sec. 3004. Definitions.
Sec. 3005. Metropolitan transportation planning.
Sec. 3006. Statewide transportation planning.
Sec. 3007. Transportation management areas.
Sec. 3008. Private enterprise participation.
Sec. 3009. Urbanized area formula grants.
Sec. 3010. Planning programs.
Sec. 3011. Capital investment program.
Sec. 3012. New freedom for elderly persons and persons with 
                            disabilities.
Sec. 3013. Formula grants for other than urbanized areas.
Sec. 3014. Research, development, demonstration, and deployment 
                            projects.
Sec. 3015. Transit cooperative research program.
Sec. 3016. National research programs.
Sec. 3017. National transit institute.
Sec. 3018. Bus testing facility.
Sec. 3019. Bicycle facilities.
Sec. 3020. Suspended light rail technology pilot project.
Sec. 3021. Crime prevention and security.
Sec. 3022. General provisions on assistance.
Sec. 3023. Special provisions for capital projects.
Sec. 3024. Contract requirements.
Sec. 3025. Project management oversight and review.
Sec. 3026. Project review.
Sec. 3027. Investigations of safety and security risk.
Sec. 3028. State safety oversight.
Sec. 3029. Sensitive security information.
Sec. 3030. Terrorist attacks and other acts of violence against public 
                            transportation systems.
Sec. 3031. Controlled substances and alcohol misuse testing.
Sec. 3032. Employee protective arrangements.
Sec. 3033. Administrative procedures.
Sec. 3034. Reports and audits.
Sec. 3035. Apportionments of appropriations for formula grants.
Sec. 3036. Apportionments for fixed guideway modernization.
Sec. 3037. Authorizations.
Sec. 3038. Apportionments based on growing States formula factors.
Sec. 3039. Job access and reverse commute grants.
Sec. 3040. Over-the-road bus accessibility program.
Sec. 3041. Alternative transportation in parks and public lands.
Sec. 3042. Obligation ceiling.
Sec. 3043. Adjustments for the Surface Transportation Extension Act of 
                            2003.
Sec. 3044. Disadvantaged business enterprise.
Sec. 3045. Intermodal passenger facilities.
                TITLE IV--SURFACE TRANSPORTATION SAFETY

Sec. 4001. Short title.
                       Subtitle A--Highway Safety

                  Part I--Highway Safety Grant Program

Sec. 4101. Short title; amendment of title 23, United States Code.
Sec. 4102. Authorization of appropriations.
Sec. 4103. Highway safety programs.
Sec. 4104. Highway safety research and outreach programs.
Sec. 4105. National Highway Safety Advisory Committee technical 
                            correction.
Sec. 4106. Occupant protection grants.
Sec. 4107. School bus driver training.
Sec. 4108. Emergency medical services.
Sec. 4109. Repeal of authority for alcohol traffic safety programs.
Sec. 4110. Impaired driving program.
Sec. 4111. State traffic safety information system improvements.
Sec. 4112. NHTSA accountability.
            Part II--Specific Vehicle Safety-Related Rulings

Sec. 4151. Amendment of title 49, United States Code.
Sec. 4152. Vehicle crash ejection prevention.
Sec. 4153. Vehicle backover avoidance technology study.
Sec. 4154. Vehicle backover data collection.
Sec. 4155. Aggressivity and incompatibility reduction standard.
Sec. 4156. Improved crashworthiness.
Sec. 4157. 15-passenger vans.
Sec. 4158. Additional safety performance criteria for tires.
Sec. 4159. Safety belt use reminders.
Sec. 4160. Missed deadlines reports.
Sec. 4161. Grants for improving child passenger safety programs.
Sec. 4162. Authorization of appropriations.
                   Part III--Miscellaneous Provisions

Sec. 4171. Driver licensing and education.
Sec. 4172. Amendment of Automobile Information Disclosure Act.
Sec. 4173. Child safety.
Sec. 4174. Safe intersections.
Sec. 4175. Study on increased speed limits.
   Subtitle B--Motor Carrier Safety and Unified Carrier Registration

                     Part I--Administrative Matters

Sec. 4201. Short title; amendment of title 49, United States Code.
Sec. 4202. Required completion of overdue reports, studies, and 
                            rulemakings.
Sec. 4203. Contract authority.
                     Part II--Motor Carrier Safety

Sec. 4221. Minimum guarantee.
Sec. 4222. Authorization of appropriations.
Sec. 4223. Motor carrier safety grants.
Sec. 4224. CDL working group.
Sec. 4225. CDL learner's permit program.
Sec. 4226. Hobbs Act.
Sec. 4227. Penalty for denial of access to records.
Sec. 4228. Medical program.
Sec. 4229. Operation of commercial motor vehicles by individuals who 
                            use insulin to treat diabetes mellitus.
Sec. 4230. Financial responsibility for private motor carriers.
Sec. 4231. Increased penalties for out-of-service violations and false 
                            records.
Sec. 4232. Elimination of commodity and service exemptions.
Sec. 4233. Intrastate operations of interstate motor carriers.
Sec. 4234. Authority to stop commercial motor vehicles.
Sec. 4235. Revocation of operating authority.
Sec. 4236. Pattern of safety violations by motor carrier management.
Sec. 4237. Motor carrier research and technology program.
Sec. 4238. Review of commercial zone exemption provision.
Sec. 4239. International cooperation.
Sec. 4240. Performance and registration information system management.
Sec. 4241. Commercial vehicle information systems and networks 
                            deployment. 
Sec. 4242. Outreach and education.
Sec. 4243. Operation of restricted property-carrying units on national 
                            highway system.
Sec. 4244. Operation of longer combination vehicles on national highway 
                            system.
Sec. 4245. Application of safety standards to certain foreign motor 
                            carriers.
Sec. 4246. Background checks for Mexican and Canadian drivers hauling 
                            hazardous materials.
Sec. 4247. Exemption of drivers of utility service vehicles.
Sec. 4248. Operation of commercial motor vehicles transporting 
                            agricultural commodities and farm supplies.
Sec. 4249. Safety performance history screening.
Sec. 4250. Compliance review audit.
                 Part III--Unified Carrier Registration

Sec. 4261. Short title.
Sec. 4262. Relationship to other laws.
Sec. 4263. Inclusion of motor private and exempt carriers.
Sec. 4264. Unified carrier registration system.
Sec. 4265. Registration of motor carriers by States.
Sec. 4266. Identification of vehicles.
Sec. 4267. Use of UCR agreement revenues as matching funds.
Sec. 4268. Clerical amendments.
                   Subtitle C--Household Goods Movers

Sec. 4301. Short title; amendment of title 49, United States Code.
Sec. 4302. Findings; sense of Congress.
Sec. 4303. Definitions.
Sec. 4304. Payment of rates.
Sec. 4305. Household goods carrier operations.
Sec. 4306. Liability of carriers under receipts and bills of lading.
Sec. 4307. Dispute settlement for shipments of household goods.
Sec. 4308. Enforcement of regulations related to transportation of 
                            household goods.
Sec. 4309. Working group for development of practices and procedures to 
                            enhance Federal-State relations.
Sec. 4310. Consumer handbook on DOT website.
Sec. 4311. Information about household goods transportation on 
                            carriers' websites.
Sec. 4312. Consumer complaints.
Sec. 4313. Review of liability of carriers.
Sec. 4314. Civil penalties relating to household goods brokers.
Sec. 4315. Civil and criminal penalty for failing to give up possession 
                            of household goods.
Sec. 4316. Progress report.
Sec. 4317. Additional registration requirements for motor carriers of 
                            household goods.
   Subtitle D--Hazardous Materials Transportation Safety and Security

Sec. 4401. Short title.
Sec. 4402. Amendment of title 49, United States Code.
  Part I--General Authorities on Transportation of Hazardous Materials

Sec. 4421. Purpose.
Sec. 4422. Definitions.
Sec. 4423. General regulatory authority.
Sec. 4424. Limitation on issuance of hazmat licenses.
Sec. 4425. Representation and tampering.
Sec. 4426. Transporting certain highly radioactive material.
Sec. 4427. Hazmat employee training requirements and grants.
Sec. 4428. Registration.
Sec. 4429. Shipping papers and disclosure.
Sec. 4430. Rail tank cars.
Sec. 4431. Highway routing of hazardous material.
Sec. 4432. Unsatisfactory safety ratings.
Sec. 4433. Air transportation of ionizing radiation material.
Sec. 4434. Training curriculum for the public sector.
Sec. 4435. Planning and training grants; emergency preparedness fund.
Sec. 4436. Special permits and exclusions.
Sec. 4437. Uniform forms and procedures.
Sec. 4438. International uniformity of standards and requirements.
Sec. 4439. Hazardous materials transportation safety and security.
Sec. 4440. Enforcement.
Sec. 4441. Civil penalties.
Sec. 4442. Criminal penalties.
Sec. 4443. Preemption.
Sec. 4444. Relationship to other laws.
Sec. 4445. Judicial review.
Sec. 4446. Authorization of appropriations.
Sec. 4447. Additional civil and criminal penalties.
                         Part II--Other Matters

Sec. 4461. Administrative authority for research and special programs 
                            administration.
Sec. 4462. Mailability of hazardous materials.
Sec. 4463. Criminal matters.
Sec. 4464. Cargo inspection program.
Sec. 4465. Information on hazmat registrations.
Sec. 4466. Report on applying hazardous materials regulations to 
                            persons who reject hazardous materials.
                 Part III--Sanitary Food Transportation

Sec. 4481. Short title.
Sec. 4482. Responsibilities of the Secretary of Health and Human 
                            Services.
Sec. 4483. Department of Transportation requirements.
Sec. 4484. Effective date.
            Subtitle E--Recreational Boating Safety Programs

Sec. 4501. Short title.
      Part I--Federal Aid in Sport Fish Restoration Act Amendments

Sec. 4521. Amendment of Federal aid in Fish Restoration Act.
Sec. 4522. Authorization of appropriations.
Sec. 4523. Division of annual appropriations.
Sec. 4524. Maintenance of projects.
Sec. 4525. Boating infrastructure.
Sec. 4526. Requirements and restrictions concerning use of amounts for 
                            expenses for administration.
Sec. 4527. Payments of funds to and cooperation with Puerto Rico, the 
                            District of Columbia, Guam, American Samoa, 
                            the Commonwealth of the Northern Mariana 
                            Islands, and the Virgin Islands.
Sec. 4528. Multistate conservation grant program.
                  Part II--Clean Vessel Act Amendments

Sec. 4541. Grant program.
        Part III--Recreational Boating Safety Program Amendments

Sec. 4561. State matching funds requirement.
Sec. 4562. Availability of allocations.
Sec. 4563. Authorization of appropriations for State recreational 
                            boating safety programs.
Sec. 4564. Maintenance of effort for State recreational boating safety 
                            programs.
                         Part IV--Miscellaneous

Sec. 4581. Technical correction to Homeland Security Act.
                    Subtitle F--Rail Transportation

                             Part I--Amtrak

Sec. 4601. Authorization of appropriations.
Sec. 4602. Establishment of Build America Corporation.
Sec. 4603. Federal bonds for transportation infrastructure.
                 Part II--Railroad Track Modernization

Sec. 4631. Short title.
Sec. 4632. Capital grants for railroad track.
Sec. 4633. Regulations.
Sec. 4634. Study of grant-funded projects.
Sec. 4635. Authorization of appropriations.
         Part III--Other Rail Transportation-Related Provisions

Sec. 4661. Capital grants for rail line relocation projects.
Sec. 4662. Use of congestion mitigation and air quality improvement 
                            funds for Boston to Portland passenger rail 
                            service.
     TITLE V--HIGHWAY REAUTHORIZATION AND EXCISE TAX SIMPLIFICATION

Sec. 5000. Short title; amendment of 1986 code.
                 Subtitle A--Trust Fund Reauthorization

Sec. 5001. Extension of Highway Trust Fund and Aquatic Resources Trust 
                            Fund expenditure authority and related 
                            taxes.
Sec. 5002. Full accounting of funds received by the Highway Trust Fund.
Sec. 5003. Modification of adjustments of apportionments.
            Subtitle B--Volumetric Ethanol Excise Tax Credit

Sec. 5101. Short title.
Sec. 5102. Alcohol and biodiesel excise tax credit and extension of 
                            alcohol fuels income tax credit.
Sec. 5103. Biodiesel income tax credit.
                   Subtitle C--Fuel Fraud Prevention

Sec. 5200. Short title.
                       Part I--Aviation Jet Fuel

Sec. 5211. Taxation of aviation-grade kerosene.
Sec. 5212. Transfer of certain amounts from the Airport and Airway 
                            Trust Fund to the Highway Trust Fund to 
                            reflect highway use of jet fuel.
                           Part II--Dyed Fuel

Sec. 5221. Dye injection equipment.
Sec. 5222. Elimination of administrative review for taxable use of dyed 
                            fuel. 
Sec. 5223. Penalty on untaxed chemically altered dyed fuel mixtures.
Sec. 5224. Termination of dyed diesel use by intercity buses.
       Part III--Modification of Inspection of Records Provisions

Sec. 5231. Authority to inspect on-site records.
Sec. 5232. Assessable penalty for refusal of entry.
            Part IV--Registration and Reporting Requirements

Sec. 5241. Registration of pipeline or vessel operators required for 
                            exemption of bulk transfers to registered 
                            terminals or refineries.
Sec. 5242. Display of registration.
Sec. 5243. Registration of persons within foreign trade zones, etc.
Sec. 5244. Penalties for failure to register and failure to report.
Sec. 5245. Information reporting for persons claiming certain tax 
                            benefits.
Sec. 5246. Electronic reporting.
                            Part V--Imports

Sec. 5251. Tax at point of entry where importer not registered.
Sec. 5252. Reconciliation of on-loaded cargo to entered cargo.
                   Part VI--Miscellaneous Provisions

Sec. 5261. Tax on sale of diesel fuel whether suitable for use or not 
                            in a diesel-powered vehicle or train.
Sec. 5262. Modification of ultimate vendor refund claims with respect 
                            to farming.
Sec. 5263. Taxable fuel refunds for certain ultimate vendors.
Sec. 5264. Two-party exchanges.
Sec. 5265. Modifications of tax on use of certain vehicles.
Sec. 5266. Dedication of revenues from certain penalties to the Highway 
                            Trust Fund.
Sec. 5267. Nonapplication of export exemption to delivery of fuel to 
                            motor vehicles removed from United States.
                     Part VII--Total Accountability

Sec. 5271. Total accountability.
Sec. 5272. Excise tax reporting.
Sec. 5273. Information reporting.
               Subtitle D--Definition of Highway Vehicle

Sec. 5301. Exemption from certain excise taxes for mobile machinery.
Sec. 5302. Modification of definition of off-highway vehicle.
            Subtitle E--Excise Tax Reform and Simplification

                      Part I--Highway Excise Taxes

Sec. 5401. Dedication of gas guzzler tax to Highway Trust Fund.
Sec. 5402. Repeal certain excise taxes on rail diesel fuel and inland 
                            waterway barge fuels.
                     Part II--Aquatic Excise Taxes

Sec. 5411. Elimination of Aquatic Resources Trust Fund and 
                            transformation of Sport Fish Restoration 
                            Account.
Sec. 5412. Exemption of LED devices from sonar devices suitable for 
                            finding fish.
Sec. 5413. Repeal of harbor maintenance tax on exports.
Sec. 5414. Cap on excise tax on certain fishing equipment.
Sec. 5415. Reduction in rate of tax on portable aerated bait 
                            containers.
                     Part III--Aerial Excise Taxes

Sec. 5421. Clarification of excise tax exemptions for agricultural 
                            aerial applicators and exemption for fixed-
                            wing aircraft engaged in forestry 
                            operations.
Sec. 5422. Modification of rural airport definition.
Sec. 5423. Exemption from ticket taxes for transportation provided by 
                            seaplanes.
Sec. 5424. Certain sightseeing flights exempt from taxes on air 
                            transportation.
                Part IV--Alcoholic Beverage Excise Taxes

Sec. 5431. Repeal of special occupational taxes on producers and 
                            marketers of alcoholic beverages.
Sec. 5432. Suspension of limitation on rate of rum excise tax cover 
                            over to Puerto Rico and Virgin Islands.
                       Part V--Sport Excise Taxes

Sec. 5441. Custom gunsmiths.
Sec. 5442. Modified taxation of imported archery products.
Sec. 5443. Treatment of tribal governments for purposes of Federal 
                            wagering excise and occupational taxes.
                       Part VI--Other Provisions

Sec. 5451. Income tax credit for distilled spirits wholesalers and for 
                            distilled spirits in control State bailment 
                            warehouses for costs of carrying Federal 
                            excise taxes on bottled distilled spirits.
Sec. 5452. Credit for taxpayers owning commercial power takeoff 
                            vehicles.
Sec. 5453. Credit for auxiliary power units installed on diesel-powered 
                            trucks.
                  Subtitle F--Miscellaneous Provisions

Sec. 5501. Motor Fuel Tax Enforcement Advisory Commission.
Sec. 5502. National Surface Transportation Infrastructure Financing 
                            Commission.
Sec. 5503. Treasury study of fuel tax compliance and interagency 
                            cooperation.
Sec. 5504. Expansion of Highway Trust Fund expenditure purposes to 
                            include funding for studies of supplemental 
                            or alternative financing for the Highway 
                            Trust Fund.
Sec. 5505. Treasury study of highway fuels used by trucks for non-
                            transportation purposes.
Sec. 5506. Delta regional transportation plan.
Sec. 5507. Treatment of employer-provided transit and van pooling 
                            benefits.
Sec. 5508. Study of incentives for production of biodiesel.
                      Subtitle G--Revenue Offsets

     Part I--Limitation on Expensing Certain Passengers Automobiles

Sec. 5601. Expansion of limitation on depreciation of certain passenger 
                            automobiles.
          Part II--Provisions Designed To Curtail Tax Shelters

Sec. 5611. Clarification of economic substance doctrine.
Sec. 5612. Penalty for failing to disclose reportable transaction.
Sec. 5613. Accuracy-related penalty for listed transactions and other 
                            reportable transactions having a 
                            significant tax avoidance purpose.
Sec. 5614. Penalty for understatements attributable to transactions 
                            lacking economic substance, etc.
Sec. 5615. Modifications of substantial understatement penalty for 
                            nonreportable transactions.
Sec. 5616. Tax shelter exception to confidentiality privileges relating 
                            to taxpayer communications.
Sec. 5617. Disclosure of reportable transactions.
Sec. 5618. Modifications to penalty for failure to register tax 
                            shelters.
Sec. 5619. Modification of penalty for failure to maintain lists of 
                            investors.
Sec. 5620. Modification of actions to enjoin certain conduct related to 
                            tax shelters and reportable transactions.
Sec. 5621. Understatement of taxpayer's liability by income tax return 
                            preparer.
Sec. 5622. Penalty on failure to report interests in foreign financial 
                            accounts.
Sec. 5623. Frivolous tax submissions.
Sec. 5624. Regulation of individuals practicing before the Department 
                            of Treasury.
Sec. 5625. Penalty on promoters of tax shelters.
Sec. 5626. Statute of limitations for taxable years for which required 
                            listed transactions not reported.
Sec. 5627. Denial of deduction for interest on underpayments 
                            attributable to nondisclosed reportable and 
                            noneconomic substance transactions.
Sec. 5628. Authorization of appropriations for tax law enforcement.
            Part III--Other Corporate Governance Provisions

Sec. 5631. Affirmation of consolidated return regulation authority.
Sec. 5632. Declaration by chief executive officer relating to Federal 
                            annual corporate income tax return.
Sec. 5633. Denial of deduction for certain fines, penalties, and other 
                            amounts.
Sec. 5634. Disallowance of deduction for punitive damages.
Sec. 5635. Increase in criminal monetary penalty limitation for the 
                            underpayment or overpayment of tax due to 
                            fraud.
Sec. 5636. Doubling of certain penalties, fines, and interest on 
                            underpayments related to certain offshore 
                            financial arrangements.
             Part IV--Enron-Related Tax Shelter Provisions

Sec. 5641. Limitation on transfer or importation of built-in losses.
Sec. 5642. No reduction of basis under section 734 in stock held by 
                            partnership in corporate partner.
Sec. 5643. Repeal of special rules for FASITs.
Sec. 5644. Expanded disallowance of deduction for interest on 
                            convertible debt.
Sec. 5645. Expanded authority to disallow tax benefits under section 
                            269.
Sec. 5646. Modification of interaction between subpart F and passive 
                            foreign investment company rules.
             Part V--Provisions To Discourage Expatriation

Sec. 5651. Tax treatment of inverted corporate entities.
Sec. 5652. Imposition of mark-to-market tax on individuals who 
                            expatriate.
Sec. 5653. Excise tax on stock compensation of insiders in inverted 
                            corporations.
Sec. 5654. Reinsurance of United States risks in foreign jurisdictions.
               Subtitle H--Additional Revenue Provisions

                   Part I--Administrative Provisions

Sec. 5671. Extension of IRS user fees.
Sec. 5672. Clarification of rules for payment of estimated tax for 
                            certain deemed asset sales.
Sec. 5673. Partial payment of tax liability in installment agreements.
                     Part II--Financial Instruments

Sec. 5675. Treatment of stripped interests in bond and preferred stock 
                            funds, etc.
Sec. 5676. Application of earnings stripping rules to partnerships and 
                            S corporations.
Sec. 5677. Recognition of cancellation of indebtedness income realized 
                            on satisfaction of debt with partnership 
                            interest.
Sec. 5678. Modification of straddle rules.
Sec. 5679. Denial of installment sale treatment for all readily 
                            tradeable debt.
                Part III--Corporations and Partnerships

Sec. 5680. Modification of treatment of transfers to creditors in 
                            divisive reorganizations.
Sec. 5681. Clarification of definition of nonqualified preferred stock.
Sec. 5682. Modification of definition of controlled group of 
                            corporations
Sec. 5683. Mandatory basis adjustments in connection with partnership 
                            distributions and transfers of partnership 
                            interests.
Sec. 5684. Class lives for utility grading costs.
Sec. 5685. Consistent amortization of periods for intangibles.
  Subtitle I--Tax-Exempt Financing of Highway Projects and Rail-Truck 
                          Transfer Facilities

Sec. 5691. Tax-exempt financing of highway projects and rail-truck 
                            transfer facilities.
Sec. 5692. Addition of vaccines against hepatitis A to list of taxable 
                            vaccines.
Sec. 5693. Addition of vaccines against influenza to list of taxable 
                            vaccines.
Sec. 5694. Extension of amortization of intangibles to sports 
                            franchises.
 TITLE VI--TRANSPORTATION DISCRETIONARY SPENDING GUARANTEE AND BUDGET 
                                OFFSETS

Sec. 6101. Sense of the Senate on overall Federal budget.
Sec. 6102. Discretionary spending categories.
Sec. 6103. Level of obligation limitations.
                  TITLE VII--MISCELLANEOUS PROVISIONS

Sec. 7001. Reimbursement of certain transportation costs incurred by 
                            members of the United States Armed Forces 
                            on rest and recuperation leave.
                    TITLE VIII--SOLID WASTE DISPOSAL

Sec. 8001. Increased use of recovered mineral component in federally 
                            funded projects involving procurement of 
                            cement or concrete.
Sec. 8002. Use of granular mine tailings.

SEC. 2. GENERAL DEFINITIONS.

    In this Act:
            (1) Department.--The term ``Department'' means the 
        Department of Transportation.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Transportation.

SEC. 3. DEFINITIONS FOR TITLE 23.

    Section 101 of title 23, United States Code, is amended by striking 
subsection (a) and inserting the following:
    ``(a) Definitions.--In this title:
            ``(1) Apportionment.--The term `apportionment' includes an 
        unexpended apportionment made under a law enacted before the 
        date of enactment of the Safe, Accountable, Flexible, and 
        Efficient Transportation Equity Act of 2004.
            ``(2) Carpool project.--
                    ``(A) In general.--The term `carpool project' means 
                any project to encourage the use of carpools and 
                vanpools.
                    ``(B) Inclusions.--The term `carpool project' 
                includes a project--
                            ``(i) to provide carpooling opportunities 
                        to the elderly and individuals with 
                        disabilities;
                            ``(ii) to develop and implement a system 
                        for locating potential riders and informing the 
                        riders of carpool opportunities;
                            ``(iii) to acquire vehicles for carpool 
                        use;
                            ``(iv) to designate highway lanes as 
                        preferential carpool highway lanes;
                            ``(v) to provide carpool-related traffic 
                        control devices; and
                            ``(vi) to designate facilities for use for 
                        preferential parking for carpools.
            ``(3) Construction.--
                    ``(A) In general.--The term `construction' means 
                the supervision, inspection, and actual building of, 
                and incurring of all costs incidental to the 
                construction or reconstruction of a highway, including 
                bond costs and other costs relating to the issuance in 
                accordance with section 122 of bonds or other debt 
                financing instruments and costs incurred by the State 
                in performing Federal-aid project related audits that 
                directly benefit the Federal-aid highway program.
                    ``(B) Inclusions.--The term `construction' 
                includes--
                            ``(i) locating, surveying, and mapping 
                        (including the establishment of temporary and 
                        permanent geodetic markers in accordance with 
                        specifications of the National Oceanic and 
                        Atmospheric Administration);
                            ``(ii) resurfacing, restoration, and 
                        rehabilitation;
                            ``(iii) acquisition of rights-of-way;
                            ``(iv) relocation assistance, acquisition 
                        of replacement housing sites, and acquisition 
                        and rehabilitation, relocation, and 
                        construction of replacement housing;
                            ``(v) elimination of hazards of railway 
                        grade crossings;
                            ``(vi) elimination of roadside obstacles;
                            ``(vii) improvements that directly 
                        facilitate and control traffic flow, such as--
                                    ``(I) grade separation of 
                                intersections;
                                    ``(II) widening of lanes;
                                    ``(III) channelization of traffic;
                                    ``(IV) traffic control systems; and
                                    ``(V) passenger loading and 
                                unloading areas;
                            ``(viii) capital improvements that directly 
                        facilitate an effective vehicle weight 
                        enforcement program, such as--
                                    ``(I) scales (fixed and portable);
                                    ``(II) scale pits;
                                    ``(III) scale installation; and
                                    ``(IV) scale houses;
                            ``(ix) improvements directly relating to 
                        securing transportation infrastructures for 
                        detection, preparedness, response, and 
                        recovery;
                            ``(x) operating costs relating to traffic 
                        monitoring, management, and control;
                            ``(xi) operational improvements; and
                            ``(xii) transportation system management 
                        and operations.
            ``(4) County.--The term `county' includes--
                    ``(A) a corresponding unit of government under any 
                other name in a State that does not have county 
                organizations; and
                    ``(B) in those States in which the county 
                government does not have jurisdiction over highways, 
                any local government unit vested with jurisdiction over 
                local highways.
            ``(5) Federal-aid highway.--
                    ``(A) In general.--The term `Federal-aid highway' 
                means a highway eligible for assistance under this 
                chapter.
                    ``(B) Exclusions.--The term `Federal-aid highway' 
                does not include a highway classified as a local road 
                or rural minor collector.
            ``(6) Federal-aid system.--The term `Federal-aid system' 
        means any of the Federal-aid highway systems described in 
        section 103.
            ``(7) Federal lands highway.--The term `Federal lands 
        highway' means--
                    ``(A) a forest highway;
                    ``(B) a recreation road;
                    ``(C) a public Forest Service road;
                    ``(D) a park road;
                    ``(E) a parkway;
                    ``(F) a refuge road;
                    ``(G) an Indian reservation road; and
                    ``(H) a public lands highway.
            ``(8) Forest highway.--The term `forest highway' means a 
        forest road that is--
                    ``(A) under the jurisdiction of, and maintained by, 
                a public authority; and
                    ``(B) is open to public travel.
            ``(9) Forest road or trail.--
                    ``(A) In general.--The term `forest road or trail' 
                means a road or trail wholly or partly within, or 
                adjacent to, and serving National Forest System land 
                that is necessary for the protection, administration, 
                use, and development of the resources of that land.
                    ``(B) Inclusions.--The term `forest road or trail' 
                includes--
                            ``(i) a classified forest road;
                            ``(ii) an unclassified forest road;
                            ``(iii) a temporary forest road; and
                            ``(iv) a public forest service road.
            ``(10) Freight transportation gateway.--
                    ``(A) In general.--The term `freight transportation 
                gateway' means a nationally or regionally significant 
                transportation port of entry or hub for domestic and 
                global trade or military mobilization.
                    ``(B) Inclusions.--The term `freight transportation 
                gateway' includes freight intermodal and Strategic 
                Highway Network connections that provide access to and 
                from a port or hub described in subparagraph (A).
            ``(11) Highway.--The term `highway' includes--
                    ``(A) a road, street, and parkway;
                    ``(B) a right-of-way, bridge, railroad-highway 
                crossing, tunnel, drainage structure, sign, guardrail, 
                and protective structure, in connection with a highway; 
                and
                    ``(C) a portion of any interstate or international 
                bridge or tunnel (including the approaches to the 
                interstate or international bridge or tunnel, and such 
                transportation facilities as may be required by the 
                United States Customs Service and the Bureau of 
                Citizenship and Immigration Services in connection with 
                the operation of an international bridge or tunnel), 
                the cost of which is assumed by a State transportation 
                department.
            ``(12) Highway safety improvement project.--The term 
        `highway safety improvement project' means a project that meets 
        the requirements of section 148.
            ``(13) Indian reservation road.--
                    ``(A) In general.--The term `Indian reservation 
                road' means a public road that is located within or 
                provides access to an area described in subparagraph 
                (B) on which or in which reside Indians or Alaskan 
                Natives that, as determined by the Secretary of the 
                Interior, are eligible for services generally available 
                to Indians under Federal laws specifically applicable 
                to Indians.
                    ``(B) Areas.--The areas referred to in subparagraph 
                (A) are--
                            ``(i) an Indian reservation;
                            ``(ii) Indian trust land or restricted 
                        Indian land that is not subject to fee title 
                        alienation without the approval of the Federal 
                        Government; and
                            ``(iii) an Indian or Alaska Native village, 
                        group, or community.
            ``(14) Interstate system.--The term `Interstate System' 
        means the Dwight D. Eisenhower National System of Interstate 
        and Defense Highways described in section 103(c).
            ``(15) Maintenance.--
                    ``(A) In general.--The term `maintenance' means the 
                preservation of a highway.
                    ``(B) Inclusions.--The term `maintenance' includes 
                the preservation of--
                            ``(i) the surface, shoulders, roadsides, 
                        and structures of a highway; and
                            ``(ii) such traffic-control devices as are 
                        necessary for safe, secure, and efficient use 
                        of a highway.
            ``(16) Maintenance area.--The term `maintenance area' means 
        an area that was designated as a nonattainment area, but was 
        later redesignated by the Administrator of the Environmental 
        Protection Agency as an attainment area, under section 107(d) 
        of the Clean Air Act (42 U.S.C. 7407(d)).
            ``(17) National forest system road or trail.--The term 
        `National Forest System road or trail' means a forest road or 
        trail that is under the jurisdiction of the Forest Service.
            ``(18) National highway system.--The term `National Highway 
        System' means the Federal-aid highway system described in 
        section 103(b).
            ``(19) Operating costs for traffic monitoring, management, 
        and control.--The term `operating costs for traffic monitoring, 
        management, and control' includes--
                    ``(A) labor costs;
                    ``(B) administrative costs;
                    ``(C) costs of utilities and rent;
                    ``(D) costs incurred by transportation agencies for 
                technology to monitor critical transportation 
                infrastructure for security purposes; and
                    ``(E) other costs associated with transportation 
                systems management and operations and the continuous 
                operation of traffic control, such as--
                            ``(i) an integrated traffic control system;
                            ``(ii) an incident management program; and
                            ``(iii) a traffic control center.
            ``(20) Operational improvement.--
                    ``(A) In general.--The term `operational 
                improvement' means--
                            ``(i) a capital improvement for 
                        installation or implementation of--
                                    ``(I) a transportation system 
                                management and operations program;
                                    ``(II) traffic and transportation 
                                security surveillance and control 
                                equipment;
                                    ``(III) a computerized signal 
                                system;
                                    ``(IV) a motorist information 
                                system;
                                    ``(V) an integrated traffic control 
                                system;
                                    ``(VI) an incident management 
                                program;
                                    ``(VII) equipment and programs for 
                                transportation response to manmade and 
                                natural disasters; or
                                    ``(VIII) a transportation demand 
                                management facility, strategy, or 
                                program; and
                            ``(ii) such other capital improvements to a 
                        public road as the Secretary may designate by 
                        regulation.
                    ``(B) Exclusions.--The term `operational 
                improvement' does not include--
                            ``(i) a resurfacing, restorative, or 
                        rehabilitative improvement;
                            ``(ii) construction of an additional lane, 
                        interchange, or grade separation; or
                            ``(iii) construction of a new facility on a 
                        new location.
            ``(21) Park road.--The term `park road' means a public road 
        (including a bridge built primarily for pedestrian use, but 
        with capacity for use by emergency vehicles) that is located 
        within, or provides access to, an area in the National Park 
        System with title and maintenance responsibilities vested in 
        the United States.
            ``(22) Parkway.--The term `parkway' means a parkway 
        authorized by an Act of Congress on land to which title is 
        vested in the United States.
            ``(23) Project.--The term `project' means--
                    ``(A)(i) an undertaking to construct a particular 
                portion of a highway; or
                    ``(ii) if the context so implies, a particular 
                portion of a highway so constructed; and
                    ``(B) any other undertaking eligible for assistance 
                under this title.
            ``(24) Project agreement.--The term `project agreement' 
        means the formal instrument to be executed by the Secretary and 
        recipient of funds under this title.
            ``(25) Public authority.--The term `public authority' means 
        a Federal, State, county, town, or township, Indian tribe, 
        municipal or other local government or instrumentality with 
        authority to finance, build, operate, or maintain toll or toll-
        free facilities.
            ``(26) Public forest service road.--The term `public Forest 
        Service road' means a classified forest road--
                    ``(A) that is open to public travel;
                    ``(B) for which title and maintenance 
                responsibility is vested in the Federal Government; and
                    ``(C) that has been designated a public road by the 
                Forest Service.
            ``(27) Public lands development roads and trails.--The term 
        `public lands development roads and trails' means roads and 
        trails that the Secretary of the Interior determines are of 
        primary importance for the development, protection, 
        administration, and use of public lands and resources under the 
        control of the Secretary of the Interior.
            ``(28) Public lands highway.--The term `public lands 
        highway' means--
                    ``(A) a forest road that is--
                            ``(i) under the jurisdiction of, and 
                        maintained by, a public authority; and
                            ``(ii) open to public travel; and
                    ``(B) any highway through unappropriated or 
                unreserved public land, nontaxable Indian land, or any 
                other Federal reservation (including a main highway 
                through such land or reservation that is on the 
                Federal-aid system) that is--
                            ``(i) under the jurisdiction of, and 
                        maintained by, a public authority; and
                            ``(ii) open to public travel.
            ``(29) Public road.--The term `public road' means any road 
        or street that is--
                    ``(A) under the jurisdiction of, and maintained by, 
                a public authority; and
                    ``(B) open to public travel.
            ``(30) Recreational road.--The term `recreational road' 
        means a public road--
                    ``(A) that provides access to a museum, lake, 
                reservoir, visitors center, gateway to a major 
                wilderness area, public use area, or recreational or 
                historic site; and
                    ``(B) for which title is vested in the Federal 
                Government.
            ``(31) Refuge road.--The term `refuge road' means a public 
        road--
                    ``(A) that provides access to or within a unit of 
                the National Wildlife Refuge System or a national fish 
                hatchery; and
                    ``(B) for which title and maintenance 
                responsibility is vested in the United States 
                Government.
            ``(32) Rural area.--The term `rural area' means an area of 
        a State that is not included in an urban area.
            ``(33) Secretary.--The term `Secretary' means the Secretary 
        of Transportation.
            ``(34) State.--The term `State' means--
                    ``(A) a State;
                    ``(B) the District of Columbia; and
                    ``(C) the Commonwealth of Puerto Rico.
            ``(35) State funds.--The term `State funds' includes funds 
        that are--
                    ``(A) raised under the authority of the State (or 
                any political or other subdivision of a State); and
                    ``(B) made available for expenditure under the 
                direct control of the State transportation department.
            ``(36) State transportation department.--The term `State 
        transportation department' means the department, agency, 
        commission, board, or official of any State charged by the laws 
        of the State with the responsibility for highway construction.
            ``(37) Territorial highway system.--The term `territorial 
        highway system' means the system of arterial highways, 
        collector roads, and necessary interisland connectors in 
        American Samoa, the Commonwealth of the Northern Mariana 
        Islands, Guam, and the United States Virgin Islands that have 
        been designated by the appropriate Governor or chief executive 
        officer of a territory, and approved by the Secretary, in 
        accordance with section 215.
            ``(38) Transportation enhancement activity.--The term 
        `transportation enhancement activity' means, with respect to 
        any project or the area to be served by the project, any of the 
        following activities as the activities relate to surface 
        transportation:
                    ``(A) Provision of facilities for pedestrians and 
                bicycles.
                    ``(B) Provision of safety and educational 
                activities for pedestrians and bicyclists.
                    ``(C) Acquisition of scenic easements and scenic or 
                historic sites (including historic battlefields).
                    ``(D) Scenic or historic highway programs 
                (including the provision of tourist and welcome center 
                facilities).
                    ``(E) Landscaping and other scenic beautification.
                    ``(F) Historic preservation.
                    ``(G) Rehabilitation and operation of historic 
                transportation buildings, structures, or facilities 
                (including historic railroad facilities and canals).
                    ``(H) Preservation of abandoned railway corridors 
                (including the conversion and use of the corridors for 
                pedestrian or bicycle trails).
                    ``(I) Control and removal of outdoor advertising.
                    ``(J) Archaeological planning and research.
                    ``(K) Environmental mitigation--
                            ``(i) to address water pollution due to 
                        highway runoff; or
                            ``(ii) reduce vehicle-caused wildlife 
                        mortality while maintaining habitat 
                        connectivity.
                    ``(L) Establishment of transportation museums.
            ``(39) Transportation systems management and operations.--
                    ``(A) In general.--The term `transportation systems 
                management and operations' means an integrated program 
                to optimize the performance of existing infrastructure 
                through the implementation of multimodal and 
                intermodal, cross-jurisdictional systems, services, and 
                projects designed to preserve capacity and improve 
                security, safety, and reliability of the transportation 
                system.
                    ``(B) Inclusions.--The term `transportation systems 
                management and operations' includes--
                            ``(i) regional operations collaboration and 
                        coordination activities between transportation 
                        and public safety agencies; and
                            ``(ii) improvements to the transportation 
                        system such as traffic detection and 
                        surveillance, arterial management, freeway 
                        management, demand management, work zone 
                        management, emergency management, electronic 
                        toll collection, automated enforcement, traffic 
                        incident management, roadway weather 
                        management, traveler information services, 
                        commercial vehicle operations, traffic control, 
                        freight management, and coordination of 
                        highway, rail, transit, bicycle, and pedestrian 
                        operations.
            ``(40) Urban area.--The term `urban area' means--
                    ``(A) an urbanized area (or, in the case of an 
                urbanized area encompassing more than 1 State, the 
                portion of the urbanized area in each State); and
                    ``(B) an urban place designated by the Bureau of 
                the Census that--
                            ``(i) has a population of 5,000 or more;
                            ``(ii) is not located within any urbanized 
                        area; and
                            ``(iii) is located within boundaries that--
                                    ``(I) are fixed cooperatively by 
                                responsible State and local officials, 
                                subject to approval by the Secretary; 
                                and
                                    ``(II) encompass, at a minimum, the 
                                entire urban place designated by the 
                                Bureau of the Census (except in the 
                                case of cities in the State of Maine 
                                and in the State of New Hampshire).
            ``(41) Urbanized area.--The term `urbanized area' means an 
        area that--
                    ``(A) has a population of 50,000 or more;
                    ``(B) is designated by the Bureau of the Census; 
                and
                    ``(C) is located within boundaries that--
                            ``(i) are fixed cooperatively by 
                        responsible State and local officials, subject 
                        to approval by the Secretary; and
                            ``(ii) encompass, at a minimum, the entire 
                        urbanized area within a State as designated by 
                        the Bureau of the Census.''.

                     TITLE I--FEDERAL-AID HIGHWAYS

                          Subtitle A--Funding

SEC. 1101. AUTHORIZATION OF APPROPRIATIONS.

    The following sums are authorized to be appropriated out of the 
Highway Trust Fund (other than the Mass Transit Account):
            (1) Interstate maintenance program.--For the Interstate 
        maintenance program under section 119 of title 23, United 
        States Code--
                    (A) $5,442,371,792 for fiscal year 2004;
                    (B) $6,425,168,342 for fiscal year 2005;
                    (C) $6,683,176,289 for fiscal year 2006;
                    (D) $6,702,365,186 for fiscal year 2007;
                    (E) $7,036,621,314 for fiscal year 2008; and
                    (F) $7,139,130,081 for fiscal year 2009.
            (2) National highway system.--For the National Highway 
        System under section 103 of that title--
                    (A) $6,593,922,257 for fiscal year 2004;
                    (B) $7,815,590,130 for fiscal year 2005;
                    (C) $8,125,241,450 for fiscal year 2006;
                    (D) $8,148,531,791 for fiscal year 2007;
                    (E) $8,554,231,977 for fiscal year 2008; and
                    (F) $8,678,591,297 for fiscal year 2009.
            (3) Bridge program.--For the bridge program under section 
        144 of that title--
                    (A) $4,650,754,076 for fiscal year 2004;
                    (B) $5,507,287,150 for fiscal year 2005;
                    (C) $5,713,860,644 for fiscal year 2006;
                    (D) $5,730,266,418 for fiscal year 2007;
                    (E) $6,016,042,650 for fiscal year 2008; and
                    (F) $6,103,714,622 for fiscal year 2009.
            (4) Surface transportation program.--For the surface 
        transportation program under section 133 of that title--
                    (A) $6,877,178,900 for fiscal year 2004;
                    (B) $8,107,950,527 for fiscal year 2005;
                    (C) $8,417,741,127 for fiscal year 2006;
                    (D) $8,441,910,349 for fiscal year 2007;
                    (E) $8,862,919,976 for fiscal year 2008; and
                    (F) $8,992,134,975 for fiscal year 2009.
            (5) Congestion mitigation and air quality improvement 
        program.--For the congestion mitigation and air quality 
        improvement program under section 149 of that title--
                    (A) $1,880,092,073 for fiscal year 2004;
                    (B) $2,192,716,180 for fiscal year 2005;
                    (C) $2,270,239,273 for fiscal year 2006;
                    (D) $2,276,757,639 for fiscal year 2007;
                    (E) $2,390,302,660 for fiscal year 2008; and
                    (F) $2,425,236,569 for fiscal year 2009.
            (6) Highway safety improvement program.--For the highway 
        safety improvement program under section 148 of that title--
                    (A) $1,187,426,572 for fiscal year 2004;
                    (B) $1,325,828,388 for fiscal year 2005;
                    (C) $1,377,448,548 for fiscal year 2006;
                    (D) $1,381,403,511 for fiscal year 2007;
                    (E) $1,450,295,996 for fiscal year 2008; and
                    (F) $1,471,607,029 for fiscal year 2009.
            (7) Appalachian development highway system program.--For 
        the Appalachian development highway system program under 
        section 170 of that title, $590,000,000 for each of fiscal 
        years 2004 through 2009.
            (8) Recreational trails program.--For the recreational 
        trails program under section 206 of that title, $60,000,000 for 
        each of fiscal years 2004 through 2009.
            (9) Federal lands highways program.--
                    (A) Indian reservation roads.--For Indian 
                reservation roads under section 204 of that title--
                            (i) $300,000,000 for fiscal year 2004;
                            (ii) $325,000,000 for fiscal year 2005;
                            (iii) $350,000,000 for fiscal year 2006;
                            (iv) $375,000,000 for fiscal year 2007;
                            (v) $400,000,000 for fiscal year 2008; and
                            (vi) $425,000,000 for fiscal year 2009.
                    (B) Recreation roads.--For recreation roads under 
                section 204 of that title, $50,000,000 for each of 
                fiscal years 2004 through 2009.
                    (C) Park roads and parkways.--For park roads and 
                parkways under section 204 of that title--
                            (i) $300,000,000 for fiscal year 2004;
                            (ii) $310,000,000 for fiscal year 2005; and
                            (iii) $320,000,000 for each of fiscal years 
                        2006 through 2009.
                    (D) Refuge roads.--For refuge roads under section 
                204 of that title, $30,000,000 for each of fiscal years 
                2004 through 2009.
                    (E) Public lands highways.--For Federal lands 
                highways under section 204 of that title, $300,000,000 
                for each of fiscal years 2004 through 2009.
                    (F) Safety.--For safety under section 204 of that 
                title, $40,000,000 for each of fiscal years 2004 
                through 2009.
            (10) Multistate corridor program.--For the multistate 
        corridor program under section 171 of that title--
                    (A) $112,500,000 for fiscal year 2004;
                    (B) $135,000,000 for fiscal year 2005;
                    (C) $157,500,000 for fiscal year 2006;
                    (D) $180,000,000 for fiscal year 2007;
                    (E) $202,500,000 for fiscal year 2008; and
                    (F) $225,000,000 for fiscal year 2009.
            (11) Border planning, operations, and technology program.--
        For the border planning, operations, and technology program 
        under section 172 of that title--
                    (A) $112,500,000 for fiscal year 2004;
                    (B) $135,000,000 for fiscal year 2005;
                    (C) $157,500,000 for fiscal year 2006;
                    (D) $180,000,000 for fiscal year 2007;
                    (E) $202,500,000 for fiscal year 2008; and
                    (F) $225,000,000 for fiscal year 2009.
            (12) National scenic byways program.--For the national 
        scenic byways program under section 162 of that title--
                    (A) $34,000,000 for fiscal year 2004;
                    (B) $35,000,000 for fiscal year 2005;
                    (C) $36,000,000 for fiscal year 2006;
                    (D) $37,000,000 for fiscal year 2007; and
                    (E) $39,000,000 for each of fiscal years 2008 and 
                2009.
            (13) Infrastructure performance and maintenance program.--
        For carrying out the infrastructure performance and maintenance 
        program under section 139 of that title $2,000,000,000 for 
        fiscal year 2004.
            (14) Construction of ferry boats and ferry terminal 
        facilities.--For construction of ferry boats and ferry terminal 
        facilities under section 147 of that title, $50,000,000 for 
        each of fiscal years 2004 through 2009.
            (15) Commonwealth of puerto rico highway program.--For the 
        Commonwealth of Puerto Rico highway program under section 173 
        of that title--
                    (A) $140,000,000 for fiscal year 2004;
                    (B) $145,000,000 for fiscal year 2005;
                    (C) $149,000,000 for fiscal year 2006;
                    (D) $154,000,000 for fiscal year 2007;
                    (E) $160,000,000 for fiscal year 2008; and
                    (F) $163,000,000 for fiscal year 2009.
            (16) Public-private partnerships pilot program.--For the 
        public-private partnerships pilot program under section 
        109(c)(3) of that title, $10,000,000 for each of fiscal years 
        2004 through 2009.
            (17) Denali access system.--For the Denali Access System 
        under section 309 of the Denali Commission Act of 1998 (42 
        U.S.C. 3121 note; Public Law 105-277), $30,000,000 for each of 
        fiscal years 2004 through 2009.
            (18) Delta region tranportation development program.--For 
        planning and construction activities authorized under the Delta 
        Regional Authority, $80,000,000 for each of fiscal years 2004 
        through 2009.

SEC. 1102. OBLIGATION CEILING.

    (a) General Limitation.--Subject to subsections (g) and (h), and 
notwithstanding any other provision of law, the obligations for 
Federal-aid highway and highway safety construction programs shall not 
exceed--
            (1) $33,643,326,300 for fiscal year 2004;
            (2) $37,900,000,000 for fiscal year 2005;
            (3) $39,100,000,000 for each of fiscal years 2006 and 2007;
            (4) $39,400,000,000 for fiscal year 2008; and
            (5) $44,400,000,000 for fiscal year 2009.
    (b) Exceptions.--The limitations under subsection (a) shall not 
apply to obligations under or for--
            (1) section 125 of title 23, United States Code;
            (2) section 147 of the Surface Transportation Assistance 
        Act of 1978 (23 U.S.C. 144 note; 92 Stat. 2714);
            (3) section 9 of the Federal-Aid Highway Act of 1981 
        (Public Law 97-134; 95 Stat. 1701);
            (4) subsections (b) and (j) of section 131 of the Surface 
        Transportation Assistance Act of 1982 (Public Law 97-424; 96 
        Stat. 2119);
            (5) subsections (b) and (c) of section 149 of the Surface 
        Transportation and Uniform Relocation Assistance Act of 1987 
        (Public Law 100-17; 101 Stat. 198);
            (6) sections 1103 through 1108 of the Intermodal Surface 
        Transportation Efficiency Act of 1991 (Public Law 102-240; 105 
        Stat. 2027);
            (7) section 157 of title 23, United States Code (as in 
        effect on June 8, 1998);
            (8) section 105 of title 23, United States Code (as in 
        effect for fiscal years 1998 through 2003, but only in an 
        amount equal to $639,000,000 for each of those fiscal years);
            (9) Federal-aid highway programs for which obligation 
        authority was made available under the Transportation Equity 
        Act for the 21st Century (Public Law 105-178; 112 Stat. 107) or 
        subsequent public laws for multiple years or to remain 
        available until used, but only to the extent that the 
        obligation authority has not lapsed or been used; and
            (10) section 105 of title 23, United States Code (but, for 
        each of fiscal years 2004 through 2009, only in an amount equal 
        to $439,000,000 per fiscal year).
    (c) Distribution of Obligation Authority.--For each of fiscal years 
2004 through 2009, the Secretary--
            (1) shall not distribute obligation authority provided by 
        subsection (a) for the fiscal year for--
                    (A) amounts authorized for administrative expenses 
                and programs by section 104(a) of title 23, United 
                States Code;
                    (B) programs funded from the administrative 
                takedown authorized by section 104(a)(1) of title 23, 
                United States Code; and
                    (C) amounts authorized for the highway use tax 
                evasion program and the Bureau of Transportation 
                Statistics;
            (2) shall not distribute an amount of obligation authority 
        provided by subsection (a) that is equal to the unobligated 
        balance of amounts made available from the Highway Trust Fund 
        (other than the Mass Transit Account) for Federal-aid highway 
        and highway safety programs for previous fiscal years the funds 
        for which are allocated by the Secretary;
            (3) shall determine the ratio that--
                    (A) the obligation authority provided by subsection 
                (a) for the fiscal year, less the aggregate of amounts 
                not distributed under paragraphs (1) and (2); bears to
                    (B) the total of the sums authorized to be 
                appropriated for the Federal-aid highway and highway 
                safety construction programs (other than sums 
                authorized to be appropriated for provisions of law 
                described in paragraphs (1) through (9) of subsection 
                (b) and sums authorized to be appropriated for section 
                105 of title 23, United States Code, equal to the 
                amount referred to in subsection (b)(10) for the fiscal 
                year), less the aggregate of the amounts not 
                distributed under paragraphs (1) and (2);
            (4) shall distribute the obligation authority provided by 
        subsection (a) less the aggregate amounts not distributed under 
        paragraphs (1) and (2), for section 14501 of title 40, United 
        States Code, so that the amount of obligation authority 
        available for that section is equal to the amount determined by 
        multiplying--
                    (A) the ratio determined under paragraph (3); by
                    (B) the sums authorized to be appropriated for that 
                section for the fiscal year;
            (5) shall distribute among the States the obligation 
        authority provided by subsection (a), less the aggregate 
        amounts not distributed under paragraphs (1) and (2), for each 
        of the programs that are allocated by the Secretary under this 
        Act and title 23, United States Code (other than to programs to 
        which paragraph (1) applies), by multiplying--
                    (A) the ratio determined under paragraph (3); by
                    (B) the amounts authorized to be appropriated for 
                each such program for the fiscal year; and
            (6) shall distribute the obligation authority provided by 
        subsection (a), less the aggregate amounts not distributed 
        under paragraphs (1) and (2) and the amounts distributed under 
        paragraphs (4) and (5), for Federal-aid highway and highway 
        safety construction programs (other than the amounts 
        apportioned for the equity bonus program, but only to the 
        extent that the amounts apportioned for the equity bonus 
        program for the fiscal year are greater than $439,000,000, and 
        the Appalachian development highway system program) that are 
        apportioned by the Secretary under this Act and title 23, 
        United States Code, in the ratio that--
                    (A) amounts authorized to be appropriated for the 
                programs that are apportioned to each State for the 
                fiscal year; bear to
                    (B) the total of the amounts authorized to be 
                appropriated for the programs that are apportioned to 
                all States for the fiscal year.
    (d) Redistribution of Unused Obligation Authority.--Notwithstanding 
subsection (c), the Secretary shall, after August 1 of each of fiscal 
years 2004 through 2009--
            (1) revise a distribution of the obligation authority made 
        available under subsection (c) if an amount distributed cannot 
        be obligated during that fiscal year; and
            (2) redistribute sufficient amounts to those States able to 
        obligate amounts in addition to those previously distributed 
        during that fiscal year, giving priority to those States having 
        large unobligated balances of funds apportioned under sections 
        104 and 144 of title 23, United States Code.
    (e) Applicability of Obligation Limitations to Transportation 
Research Programs.--
            (1) In general.--Except as provided in paragraph (2), 
        obligation limitations imposed by subsection (a) shall apply to 
        contract authority for transportation research programs carried 
        out under--
                    (A) chapter 5 of title 23, United States Code; and
                    (B) title II of this Act.
            (2) Exception.--Obligation authority made available under 
        paragraph (1) shall--
                    (A) remain available for a period of 3 fiscal 
                years; and
                    (B) be in addition to the amount of any limitation 
                imposed on obligations for Federal-aid highway and 
                highway safety construction programs for future fiscal 
                years.
    (f) Redistribution of Certain Authorized Funds.--
            (1) In general.--Not later than 30 days after the date of 
        distribution of obligation authority under subsection (c) for 
        each of fiscal years 2004 through 2009, the Secretary shall 
        distribute to the States any funds that--
                    (A) are authorized to be appropriated for the 
                fiscal year for Federal-aid highway programs; and
                    (B) the Secretary determines will not be allocated 
                to the States, and will not be available for 
                obligation, in the fiscal year due to the imposition of 
                any obligation limitation for the fiscal year.
            (2) Ratio.--Funds shall be distributed under paragraph (1) 
        in the same ratio as the distribution of obligation authority 
        under subsection (c)(6).
            (3) Availability.--Funds distributed under paragraph (1) 
        shall be available for any purpose described in section 133(b) 
        of title 23, United States Code.
    (g) Special Rule.--Obligation authority distributed for a fiscal 
year under subsection (c)(4) for the provision specified in subsection 
(c)(4) shall--
            (1) remain available until used for obligation of funds for 
        that provision; and
            (2) be in addition to the amount of any limitation imposed 
        on obligations for Federal-aid highway and highway safety 
        construction programs for future fiscal years.
    (h) Adjustment in Obligation Limit.--
            (1) In general.--A limitation on obligations imposed by 
        subsection (a) for a fiscal year shall be adjusted by an amount 
        equal to the amount determined in accordance with section 
        251(b)(1)(B) of the Balanced Budget and Emergency Deficit 
        Control Act of 1985 (2 U.S.C. 901(b)(1)(B)) for the fiscal 
        year.
            (2) Distribution.--An adjustment under paragraph (1) shall 
        be distributed in accordance with this section.
    (i) Limitations on Obligations for Administrative Expenses.--
Notwithstanding any other provision of law, the total amount of all 
obligations under section 104(a) of title 23, United States Code, shall 
not exceed--
            (1) $450,000,000 for fiscal year 2004;
            (2) $465,000,000 for fiscal year 2005;
            (3) $480,000,000 for fiscal year 2006;
            (4) $495,000,000 for fiscal year 2007;
            (5) $510,000,000 for fiscal year 2008; and
            (6) $525,000,000 for fiscal year 2009.
    (j) National Highway System Component.--Section 104(b)(1) of title 
23, United States Code, is amended by striking ``$36,400,000'' and 
insert ``$50,000,000''.

SEC. 1103. APPORTIONMENTS.

    (a) Administrative Expenses.--
            (1) In general.--Section 104 of title 23, United States 
        Code, is amended by striking subsection (a) and inserting the 
        following:
    ``(a) Administrative Expenses.--
            ``(1) In general.--There are authorized to be appropriated 
        from the Highway Trust Fund (other than the Mass Transit 
        Account) to be made available to the Secretary of 
        Transportation for administrative expenses of the Federal 
        Highway Administration--
                    ``(A) $450,000,000 for fiscal year 2004;
                    ``(B) $465,000,000 for fiscal year 2005;
                    ``(C) $480,000,000 for fiscal year 2006;
                    ``(D) $495,000,000 for fiscal year 2007;
                    ``(E) $510,000,000 for fiscal year 2008; and
                    ``(F) $525,000,000 for fiscal year 2009.
            ``(2) Purposes.--The funds authorized by this subsection 
        shall be used--
                    ``(A) to administer the provisions of law to be 
                financed from appropriations for the Federal-aid 
                highway program and programs authorized under chapter 
                2; and
                    ``(B) to make transfers of such sums as the 
                Secretary determines to be appropriate to the 
                Appalachian Regional Commission for administrative 
                activities associated with the Appalachian development 
                highway system.
            ``(3) Availability.--The funds made available under 
        paragraph (1) shall remain available until expended.''.
            (2) Conforming amendments.--Section 104 of title 23, United 
        States Code, is amended--
                    (A) in the matter preceding paragraph (1) of 
                subsection (b), by striking ``the deduction authorized 
                by subsection (a) and'';
                    (B) in the first sentence of subsection (e)(1), by 
                striking ``, and also'' and all that follows through 
                ``this section''; and
                    (C) in subsection (i), by striking ``deducted'' and 
                inserting ``made available''.
    (b) Metropolitan Planning.--Section 104(f) of title 23, United 
States Code, is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(1) Set-aside.--On October 1 of each fiscal year, the 
        Secretary shall set aside 1.5 percent of the funds authorized 
        to be appropriated for the Interstate maintenance, national 
        highway system, surface transportation, congestion mitigation 
        and air quality improvement, highway safety improvement, and 
        highway bridge programs authorized under this title to carry 
        out the requirements of section 134.'';
            (2) in paragraph (2), by striking ``per centum'' and 
        inserting ``percent'';
            (3) in paragraph (3)--
                    (A) by striking ``The funds'' and inserting the 
                following:
                    ``(A) In general.--The funds''; and
                    (B) by striking ``These funds'' and all that 
                follows and inserting the following:
                    ``(B) Unused funds.--Any funds that are not used to 
                carry out section 134 may be made available by a 
                metropolitan planning organization to the State to fund 
                activities under section 135.''; and
            (4) by adding at the end the following:
            ``(6) Federal share.--Funds apportioned to a State under 
        this subsection shall be matched in accordance with section 
        120(b) unless the Secretary determines that the interests of 
        the Federal-aid highway program would be best served without 
        the match.''.
    (c) Alaska Highway.--Section 104(b)(1)(A) of title 23, United 
States Code, is amended by striking ``1998 through 2002'' and inserting 
``2004 through 2009''.

SEC. 1104. EQUITY BONUS PROGRAM.

    (a) In General.--Section 105 of title 23, United States Code, is 
amended to read as follows:
``Sec. 105. Equity bonus program
    ``(a) Program.--
            ``(1) In general.--Subject to subsections (c) and (d), for 
        each of fiscal years 2004 through 2009, the Secretary shall 
        allocate among the States amounts sufficient to ensure that no 
        State receives a percentage of the total apportionments for the 
        fiscal year for the programs specified in paragraph (2) that is 
        less than the percentage calculated under subsection (b).
            ``(2) Specific programs.--The programs referred to in 
        subsection (a) are--
                    ``(A) the Interstate maintenance program under 
                section 119;
                    ``(B) the national highway system program under 
                section 103;
                    ``(C) the bridge program under section 144;
                    ``(D) the surface transportation program under 
                section 133;
                    ``(E) the highway safety improvement program under 
                section 148;
                    ``(F) the congestion mitigation and air quality 
                improvement program under section 149;
                    ``(G) metropolitan planning programs under section 
                104(f) (other than planning programs funded by amounts 
                provided under the equity bonus program under this 
                section);
                    ``(H) the infrastructure performance and 
                maintenance program under section 139;
                    ``(I) the equity bonus program under this section;
                    ``(J) the Appalachian development highway system 
                program under subtitle IV of title 40;
                    ``(K) the recreational trails program under section 
                206;
                    ``(L) the safe routes to schools program under 
                section 150; and
                    ``(M) the rail-highway grade crossing program under 
                section 130.
    ``(b) State Percentage.--
            ``(1) In general.--The percentage referred to in subsection 
        (a) for each State shall be--
                    ``(A) 95 percent of the quotient obtained by 
                dividing--
                            ``(i) the estimated tax payments 
                        attributable to highway users in the State paid 
                        into the Highway Trust Fund (other than the 
                        Mass Transit Account) in the most recent fiscal 
                        year for which data are available; by
                            ``(ii) the estimated tax payments 
                        attributable to highway users in all States 
                        paid into the Highway Trust Fund (other than 
                        the Mass Transit Account) for the fiscal year; 
                        or
                    ``(B) for a State with a total population density 
                of less than 20 persons per square mile, as reported in 
                the decennial census conducted by the Federal 
                Government in 2000, a total population of less than 
                1,000,000, as reported in that decennial census, or a 
                median household income of less than $35,000, as 
                reported in that decennial census, the greater of--
                            ``(i) the percentage under paragraph (1); 
                        or
                            ``(ii) the average percentage of the 
                        State's share of total apportionments for the 
                        period of fiscal years 1998 through 2003 for 
                        the programs specified in paragraph (2).
            ``(2) Specific programs.--The programs referred to in 
        paragraph (1)(B)(ii) are (as in effect on the day before the 
        date of enactment of the Safe, Accountable, Flexible, and 
        Efficient Transportation Equity Act of 2004)--
                    ``(A) the Interstate maintenance program under 
                section 119;
                    ``(B) the national highway system program under 
                section 103;
                    ``(C) the bridge program under section 144;
                    ``(D) the surface transportation program under 
                section 133;
                    ``(E) the recreational trails program under section 
                206;
                    ``(F) the high priority projects program under 
                section 117;
                    ``(G) the minimum guarantee provided under this 
                section;
                    ``(H) revenue aligned budget authority amounts 
                provided under section 110;
                    ``(I) the congestion mitigation and air quality 
                improvement program under section 149;
                    ``(J) the Appalachian development highway system 
                program under subtitle IV of title 40; and
                    ``(K) metropolitan planning programs under section 
                104(f).
    ``(c) Special Rules.--
            ``(1) Minimum combined allocation.--For each fiscal year, 
        before making the allocations under subsection (a)(1), the 
        Secretary shall allocate among the States amounts sufficient to 
        ensure that no State receives a combined total of amounts 
        allocated under subsection (a)(1), apportionments for the 
        programs specified in subsection (a)(2), and amounts allocated 
        under this subsection, that is less than 110 percent of the 
        average for fiscal years 1998 through 2003 of the annual 
        apportionments for the State for all programs specified in 
        subsection (b)(2).
            ``(2) No negative adjustment.--Notwithstanding subsection 
        (d), no negative adjustment shall be made under subsection 
        (a)(1) to the apportionment of any State.
            ``(3) Minimum share of tax payments.--Notwithstanding 
        subsection (d), for each fiscal year, the Secretary shall 
        allocate among the States amounts sufficient to ensure that no 
        State receives a percentage of apportionments for the fiscal 
        year for the programs specified in subsection (a)(2) that is 
        less than 90.5 percent of the percentage share of the State of 
        estimated tax payments attributable to highway users in the 
        State paid into the Highway Trust Fund (other than the Mass 
        Transit Account) in the most recent fiscal year for which data 
        are available.
    ``(d) Limitation on Adjustments.--
            ``(1) In general.--Except as provided in paragraphs (2) and 
        (3) of subsection (c), no State shall receive, for any fiscal 
        year, additional amounts under subsection (a)(1) if--
                    ``(A) the total apportionments of the State for the 
                fiscal year for the programs specified in subsection 
                (a)(2); exceed
                    ``(B) the percentage of the average, for the period 
                of fiscal years 1998 through 2003, of the annual 
                apportionments of the State for all programs specified 
                in subsection (b)(2), as specified in paragraph (2).
            ``(2) Percentages.--The percentages referred to in 
        paragraph (1)(B) are--
                    ``(A) for fiscal year 2004, 120 percent;
                    ``(B) for fiscal year 2005, 130 percent;
                    ``(C) for fiscal year 2006, 134 percent;
                    ``(D) for fiscal year 2007, 137 percent;
                    ``(E) for fiscal year 2008, 145 percent; and
                    ``(F) for fiscal year 2009, 250 percent.
    ``(e) Programmatic Distribution of Funds.--The Secretary shall 
apportion the amounts made available under this section so that the 
amount apportioned to each State under this section for each program 
referred to in subparagraphs (A) through (G) of subsection (a)(2) is 
equal to the amount determined by multiplying the amount to be 
apportioned under this section by the proportion that--
            ``(1) the amount of funds apportioned to each State for 
        each program referred to in subparagraphs (A) through (G) of 
        subsection (a)(2) for a fiscal year; bears to
            ``(2) the total amount of funds apportioned to each State 
        for all such programs for the fiscal year.
    ``(f) Metro Planning Set Aside.--Notwithstanding section 104(f), no 
set aside provided for under that section shall apply to funds 
allocated under this section.
    ``(g) Authorization of Appropriations.--There are authorized to be 
appropriated from the Highway Trust Fund (other than the Mass Transit 
Account) such sums as are necessary to carry out this section for each 
of fiscal years 2004 through 2009.''.
    (b) Conforming Amendments.--
            (1) The analysis for subchapter I of chapter 1 of title 23, 
        United States Code, is amended by striking the item relating to 
        section 105 and inserting the following:

``105. Equity bonus program.''
            (2) Section 104(a)(1) of title 23, United States Code, is 
        amended by striking ``minimum guarantee'' and inserting 
        ``equity bonus''.

SEC. 1105. REVENUE ALIGNED BUDGET AUTHORITY.

    Section 110 of title 23, United States Code, is amended--
            (1) in subsection (a)--
                    (A) in paragraphs (1) and (2), by striking ``2000'' 
                and inserting ``2006'';
                    (B) in paragraph (1), by inserting ``(as in effect 
                on September 30, 2002)'' after ``(2 U.S.C. 
                901(b)(2)(B)(ii)(I)(cc))''; and
                    (C) in paragraph (2)--
                            (i) by striking ``If the amount'' and 
                        inserting the following:
                    ``(A) In general.--Except as provided in 
                subparagraph (B), if the amount'';
                            (ii) by inserting ``(as in effect on 
                        September 30, 2002)'' after ``(2 U.S.C. 
                        901(b)(1)(B)(ii)(I)(cc)'';
                            (iii) by striking ``the succeeding'' and 
                        inserting ``that'';
                            (iv) by striking ``and the motor carrier 
                        safety grant program''; and
                            (v) by adding at the end the following:
                    ``(B) Limitation.--No reduction under subparagraph 
                (A) shall be made for a fiscal year if, as of October 1 
                of the fiscal year, the cash balance in the Highway 
                Trust Fund (other than the Mass Transit Account) 
                exceeds $6,000,000,000.'';
            (2) in subsection (b)(1), by striking subparagraph (A) and 
        inserting the following:
                    ``(A) the sums authorized to be appropriated from 
                the Highway Trust Fund (other than the Mass Transit 
                Account) for each of the Federal-aid highway and 
                highway safety construction programs (other than the 
                equity bonus program) and for which funds are allocated 
                from the Highway Trust Fund by the Secretary under this 
                title and the Safe, Accountable, Flexible, and 
                Efficient Transportation Equity Act of 2004; bears 
                to'';
            (3) in subsection (c), by inserting ``the highway safety 
        improvement program,'' after ``the surface transportation 
        program,''; and
            (4) by striking subsections (e), (f), and (g).

                        Subtitle B--New Programs

SEC. 1201. INFRASTRUCTURE PERFORMANCE AND MAINTENANCE PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code, is amended by inserting after section 138 the following:
``Sec. 139. Infrastructure performance and maintenance program
    ``(a) Establishment.--The Secretary shall establish and implement 
an infrastructure performance and maintenance program in accordance 
with this section.
    ``(b) Eligible Projects.--A State may obligate funds allocated to 
the State under this section only for projects eligible under the 
Interstate maintenance program under section 119, the National Highway 
System program under section 103, the surface transportation program 
under section 133, the highway safety improvement program under section 
148, the highway bridge program under section 144, and the congestion 
mitigation and air quality improvement program under section 149 that 
will--
            ``(1) preserve, maintain, or otherwise extend, in a cost-
        effective manner, the useful life of existing highway 
        infrastructure elements; or
            ``(2) provide operational improvements (including traffic 
        management and intelligent transportation system strategies and 
        limited capacity enhancements) at points of recurring highway 
        congestion.
    ``(c) Period of Availability.--
            ``(1) Obligation within 180 days.--
                    ``(A) In general.--Funds allocated to a State under 
                this section shall be obligated by the State not later 
                than 180 days after the date of apportionment.
                    ``(B) Unobligated funds.--Any amounts that remain 
                unobligated at the end of that period shall be 
                allocated in accordance with subsection (d).
            ``(2) Obligation by end of fiscal year.--
                    ``(A) In general.--All funds allocated or 
                reallocated under this section shall remain available 
                for obligation until the last day of the fiscal year 
                for which the funds are apportioned.
                    ``(B) Unobligated funds.--Any amounts allocated 
                that remain unobligated at the end of the fiscal year 
                shall lapse.
    ``(d) Redistribution of Allocated Funds and Obligation Authority.--
            ``(1) In general.--On the date that is 180 days after the 
        date of allocation, or as soon thereafter as practicable, for 
        each fiscal year, the Secretary shall--
                    ``(A) withdraw--
                            ``(i) any funds allocated to a State under 
                        this section that remain unobligated; and
                            ``(ii) an equal amount of obligation 
                        authority provided for the use of the funds in 
                        accordance with section 1101(13) of the Safe, 
                        Accountable, Flexible, and Efficient 
                        Transportation Equity Act of 2004; and
                    ``(B) reallocate the funds and redistribute the 
                obligation authority to those States that--
                            ``(i) have fully obligated all amounts 
                        allocated under this section for the fiscal 
                        year; and
                            ``(ii) demonstrate that the State is able 
                        to obligate additional amounts for projects 
                        eligible under this section before the end of 
                        the fiscal year.
            ``(2) Equity bonus.--The calculation and distribution of 
        funds under section 105 shall be adjusted as a result of the 
        allocation of funds under this subsection.
    ``(e) Federal Share Payable.--The Federal share payable for a 
project funded under this section shall be determined in accordance 
with section 120.''.
    (b) Conforming Amendment.--The analysis for chapter 1 of title 23, 
United States Code, is amended by adding after the item relating to 
section 138 the following:

``139. Infrastructure performance and maintenance program.''.

SEC. 1202. FUTURE OF SURFACE TRANSPORTATION SYSTEM.

    (a) Declaration of Policy.--Section 101 of title 23, United States 
Code, is amended--
            (1) by striking ``(b) It is hereby declared to be'' and 
        inserting the following:
    ``(b) Declaration of Policy.--
            ``(1) Acceleration of construction of federal-aid highway 
        systems.--Congress declares that it is'';
            (2) in the second paragraph, by striking ``It is hereby 
        declared'' and inserting the following:
            ``(2) Completion of interstate system.--Congress 
        declares''; and
            (3) by striking the last paragraph and inserting the 
        following:
            ``(3) Transportation needs of 21st century.--Congress 
        declares that--
                    ``(A) it is in the national interest to preserve 
                and enhance the surface transportation system to meet 
                the needs of the United States for the 21st Century;
                    ``(B) the current urban and long distance personal 
                travel and freight movement demands have surpassed the 
                original forecasts and travel demand patterns are 
                expected to change;
                    ``(C) continued planning for and investment in 
                surface transportation is critical to ensure the 
                surface transportation system adequately meets the 
                changing travel demands of the future;
                    ``(D) among the foremost needs that the surface 
                transportation system must meet to provide for a strong 
                and vigorous national economy are safe, efficient, and 
                reliable--
                            ``(i) national and interregional personal 
                        mobility (including personal mobility in rural 
                        and urban areas) and reduced congestion;
                            ``(ii) flow of interstate and international 
                        commerce and freight transportation; and
                            ``(iii) travel movements essential for 
                        national security;
                    ``(E) special emphasis should be devoted to 
                providing safe and efficient access for the type and 
                size of commercial and military vehicles that access 
                designated National Highway System intermodal freight 
                terminals;
                    ``(F) it is in the national interest to seek ways 
                to eliminate barriers to transportation investment 
                created by the current modal structure of 
                transportation financing;
                    ``(G) the connection between land use and 
                infrastructure is significant;
                    ``(H) transportation should play a significant role 
                in promoting economic growth, improving the 
                environment, and sustaining the quality of life; and
                    ``(I) the Secretary should take appropriate actions 
                to preserve and enhance the Interstate System to meet 
                the needs of the 21st Century.''.
    (b) National Surface Transportation System Study.--
            (1) In general.--The Secretary shall--
                    (A) conduct a complete investigation and study of 
                the current condition and future needs of the surface 
                transportation system of the United States, including--
                            (i) the National Highway System;
                            (ii) the Interstate System;
                            (iii) the strategic highway network;
                            (iv) congressional high priority corridors;
                            (v) intermodal connectors;
                            (vi) freight facilities;
                            (vii) navigable waterways;
                            (viii) mass transportation;
                            (ix) freight and intercity passenger rail 
                        infrastructure and facilities; and
                            (x) surface access to airports; and
                    (B) develop a conceptual plan, with alternative 
                approaches, for the future to ensure that the surface 
                transportation system will continue to serve the needs 
                of the United States, including specific 
                recommendations regarding design and operational 
                standards, Federal policies, and legislative changes.
            (2) Specific issues.--In conducting the investigation and 
        study, the Secretary shall specifically address--
                    (A) the current condition and performance of the 
                Interstate System (including the physical condition of 
                bridges and pavements and operational characteristics 
                and performance), relying primarily on existing data 
                sources;
                    (B) the future of the Interstate System, based on a 
                range of legislative and policy approaches for 15-, 30-
                , and 50-year time periods;
                    (C) the expected demographics and business uses 
                that impact the surface transportation system;
                    (D) the expected use of the surface transportation 
                system, including the effects of changing vehicle 
                types, modes of transportation, fleet size and weights, 
                and traffic volumes;
                    (E) desirable design policies and standards for 
                future improvements of the surface transportation 
                system, including additional access points;
                    (F) the identification of urban, rural, national, 
                and interregional needs for the surface transportation 
                system;
                    (G) the potential for expansion, upgrades, or other 
                changes to the surface transportation system, 
                including--
                            (i) deployment of advanced materials and 
                        intelligent technologies;
                            (ii) critical multistate, urban, and rural 
                        corridors needing capacity, safety, and 
                        operational enhancements;
                            (iii) improvements to intermodal linkages;
                            (iv) security and military deployment 
                        enhancements;
                            (v) strategies to enhance asset 
                        preservation; and
                            (vi) implementation strategies;
                    (H) the improvement of emergency preparedness and 
                evacuation using the surface transportation system, 
                including--
                            (i) examination of the potential use of all 
                        modes of the surface transportation system in 
                        the safe and efficient evacuation of citizens 
                        during times of emergency;
                            (ii) identification of the location of 
                        critical bottlenecks; and
                            (iii) development of strategies to improve 
                        system redundancy, especially in areas with a 
                        high potential for terrorist attacks;
                    (I) alternatives for addressing environmental 
                concerns associated with the future development of the 
                surface transportation system;
                    (J) the evaluation and assessment of the current 
                and future capabilities for conducting system-wide 
                real-time performance data collection and analysis, 
                traffic monitoring, and transportation systems 
                operations and management; and
                    (K) a range of policy and legislative alternatives 
                for addressing future needs for the surface 
                transportation system, including funding needs and 
                potential approaches to provide funds.
            (3) Technical advisory committee.--The Secretary shall 
        establish a technical advisory committee, in a manner 
        consistent with the Federal Advisory Committee Act (5 U.S.C. 
        App.), to collect and evaluate technical input from--
                    (A) the Department of Defense;
                    (B) appropriate Federal, State, and local officials 
                with responsibility for transportation;
                    (C) appropriate State and local elected officials;
                    (D) transportation and trade associations;
                    (E) emergency management officials;
                    (F) freight providers;
                    (G) the general public; and
                    (H) other entities and persons determined 
                appropriate by the Secretary to ensure a diverse range 
                of views.
            (4) Report.--Not later than 4 years after the date of 
        enactment of this Act, the Secretary shall submit to the 
        Committee on Environment and Public Works of the Senate and the 
        Committee on Transportation and Infrastructure of the House of 
        Representatives, and make readily available to the public, a 
        report on the results of the investigation and study conducted 
        under this subsection.

SEC. 1203. FREIGHT TRANSPORTATION GATEWAYS; FREIGHT INTERMODAL 
              CONNECTIONS.

    (a) Freight Transportation Gateways.--Chapter 3 of title 23, United 
States Code, is amended by adding at the end the following:
``Sec. 325. Freight transportation gateways
    ``(a) In General.--
            ``(1) Establishment.--The Secretary shall establish a 
        freight transportation gateways program to improve 
        productivity, security, and safety of freight transportation 
        gateways, while mitigating congestion and community impacts in 
        the area of the gateways.
            ``(2) Purposes.--The purposes of the freight transportation 
        gateways program shall be--
                    ``(A) to facilitate and support multimodal freight 
                transportation initiatives at the State and local 
                levels in order to improve freight transportation 
                gateways and mitigate the impact of congestion on the 
                environment in the area of the gateways;
                    ``(B) to provide capital funding to address 
                infrastructure and freight operational needs at freight 
                transportation gateways;
                    ``(C) to encourage adoption of new financing 
                strategies to leverage State, local, and private 
                investment in freight transportation gateways;
                    ``(D) to facilitate access to intermodal freight 
                transfer facilities; and
                    ``(E) to increase economic efficiency by 
                facilitating the movement of goods.
    ``(b) State Responsibilities.--
            ``(1) Project development process.--Each State, in 
        coordination with metropolitan planning organizations, shall 
        ensure that intermodal freight transportation, trade 
        facilitation, and economic development needs are adequately 
        considered and fully integrated into the project development 
        process, including transportation planning through final design 
        and construction of freight-related transportation projects.
            ``(2) Freight transportation coordinator.--
                    ``(A) In general.--Each State shall designate a 
                freight transportation coordinator.
                    ``(B) Duties.--The coordinator shall--
                            ``(i) foster public and private sector 
                        collaboration needed to implement complex 
                        solutions to freight transportation and freight 
                        transportation gateway problems, including--
                                    ``(I) coordination of metropolitan 
                                and statewide transportation activities 
                                with trade and economic interests;
                                    ``(II) coordination with other 
                                States, agencies, and organizations to 
                                find regional solutions to freight 
                                transportation problems; and
                                    ``(III) coordination with local 
                                officials of the Department of Defense 
                                and the Department of Homeland 
                                Security, and with other organizations, 
                                to develop regional solutions to 
                                military and homeland security 
                                transportation needs; and
                            ``(ii) promote programs that build 
                        professional capacity to better plan, 
                        coordinate, integrate, and understand freight 
                        transportation needs for the State.
    ``(c) Innovative Finance Strategies.--
            ``(1) In general.--States and localities are encouraged to 
        adopt innovative financing strategies for freight 
        transportation gateway improvements, including--
                    ``(A) new user fees;
                    ``(B) modifications to existing user fees, 
                including trade facilitation charges;
                    ``(C) revenue options that incorporate private 
                sector investment; and
                    ``(D) a blending of Federal-aid and innovative 
                finance programs.
            ``(2) Technical assistance.--The Secretary shall provide 
        technical assistance to States and localities with respect to 
        the strategies.
    ``(d) Intermodal Freight Transportation Projects.--
            ``(1) Use of surface transportation program funds.--A State 
        may obligate funds apportioned to the State under section 
        104(b)(3) for publicly-owned intermodal freight transportation 
        projects that provide community and highway benefits by 
        addressing economic, congestion, system reliability, security, 
        safety, or environmental issues associated with freight 
        transportation gateways.
            ``(2) Eligible projects.--A project eligible for funding 
        under this section--
                    ``(A) may include publicly-owned intermodal freight 
                transfer facilities, access to the facilities, and 
                operational improvements for the facilities (including 
                capital investment for intelligent transportation 
                systems), except that projects located within the 
                boundaries of port terminals shall only include the 
                surface transportation infrastructure modifications 
                necessary to facilitate direct intermodal interchange, 
                transfer, and access into and out of the port; and
                    ``(B) may involve the combining of private and 
                public funds.''.
    (b) Eligibility for Surface Transportation Program Funds.--Section 
133(b) of title 23, United States Code, is amended by inserting after 
paragraph (11) the following:
            ``(12) Intermodal freight transportation projects in 
        accordance with section 325(d)(2).''.
    (c) Freight Intermodal Connections to NHS.--Section 103(b) of title 
23, United States Code, is amended by adding at the end the following:
            ``(7) Freight intermodal connections to the nhs.--
                    ``(A) Funding set-aside.--Of the funds apportioned 
                to a State for each fiscal year under section 
                104(b)(1), an amount determined in accordance with 
                subparagraph (B) shall only be available to the State 
                to be obligated for projects on--
                            ``(i) National Highway System routes 
                        connecting to intermodal freight terminals 
                        identified according to criteria specified in 
                        the report to Congress entitled `Pulling 
                        Together: The National Highway System and its 
                        Connections to Major Intermodal Terminals' 
                        dated May 24, 1996, referred to in paragraph 
                        (1), and any modifications to the connections 
                        that are consistent with paragraph (4);
                            ``(ii) strategic highway network connectors 
                        to strategic military deployment ports; and
                            ``(iii) projects to eliminate railroad 
                        crossings or make railroad crossing 
                        improvements.
                    ``(B) Determination of amount.--The amount of funds 
                for each State for a fiscal year that shall be set 
                aside under subparagraph (A) shall be equal to the 
                greater of--
                            ``(i) the product obtained by multiplying--
                                    ``(I) the total amount of funds 
                                apportioned to the State under section 
                                104(b)(1); by
                                    ``(II) the percentage of miles that 
                                routes specified in subparagraph (A) 
                                constitute of the total miles on the 
                                National Highway System in the State; 
                                or
                            ``(ii) 2 percent of the annual 
                        apportionment to the State of funds under 
                        104(b)(1).
                    ``(C) Exemption from set-aside.--For any fiscal 
                year, a State may obligate the funds otherwise set 
                aside by this paragraph for any project that is 
                eligible under paragraph (6) and is located in the 
                State on a segment of the National Highway System 
                specified in paragraph (2), if the State certifies and 
                the Secretary concurs that--
                            ``(i) the designated National Highway 
                        System intermodal connectors described in 
                        subparagraph (A) are in good condition and 
                        provide an adequate level of service for 
                        military vehicle and civilian commercial 
                        vehicle use; and
                            ``(ii) significant needs on the designated 
                        National Highway System intermodal connectors 
                        are being met or do not exist.''.
    (d) Federal Share Payable.--Section 120 of title 23, United States 
Code, is amended by adding at the end the following:
    ``(m) Increased Federal Share for Connectors.--In the case of a 
project to support a National Highway System intermodal freight 
connection or strategic highway network connector to a strategic 
military deployment port described in section 103(b)(7), except as 
otherwise provided in section 120, the Federal share of the total cost 
of the project shall be 90 percent.''.
    (e) Length Limitations.--Section 31111(e) of title 49, United 
States Code, is amended--
            (1) by striking ``The'' and inserting the following:
            ``(1) In general.--The''; and
            (2) by adding at the end the following:
            ``(2) Length limitations.--In the interests of economic 
        competitiveness, security, and intermodal connectivity, not 
        later than 3 years after the date of enactment of this 
        paragraph, States shall update the list of those qualifying 
        highways to include--
                    ``(A) strategic highway network connectors to 
                strategic military deployment ports; and
                    ``(B) National Highway System intermodal freight 
                connections serving military and commercial truck 
                traffic going to major intermodal terminals as 
                described in section 103(b)(7)(A)(i).''.
    (f) Conforming Amendment.--The analysis of chapter 3 of title 23, 
United States Code, is amended by adding at the end the following:

``325. Freight transportation gateways.''.

SEC. 1204. CONSTRUCTION OF FERRY BOATS AND FERRY TERMINAL AND 
              MAINTENANCE FACILITIES; COORDINATION OF FERRY 
              CONSTRUCTION AND MAINTENANCE.

    (a) In General.--Section 147 of title 23, United States Code, is 
amended to read as follows:
``Sec. 147. Construction of ferry boats and ferry terminal and 
              maintenance facilities; coordination of ferry 
              construction and maintenance
    ``(a) Construction of Ferry Boats and Ferry Terminal Facilities.--
            ``(1) In general.--The Secretary shall carry out a program 
        for construction of ferry boats and ferry terminal facilities 
        in accordance with section 129(c).
            ``(2) Federal share.--The Federal share of the cost of 
        construction of ferry boats and ferry terminals and maintenance 
        facilities under this subsection shall be 80 percent.
            ``(3) Allocation of funds.--The Secretary shall give 
        priority in the allocation of funds under this subsection to 
        those ferry systems, and public entities responsible for 
        developing ferries, that--
                    ``(A) carry the greatest number of passengers and 
                vehicles;
                    ``(B) carry the greatest number of passengers in 
                passenger-only service; or
                    ``(C) provide critical access to areas that are not 
                well-served by other modes of surface transportation.
    ``(b) Non-Contract Authority Authorization of Appropriations.--
            ``(1) In general.--There are authorized to be appropriated 
        from the Highway Trust Fund (other than the Mass Transit 
        Account) $50,000,000 for each fiscal year to carry out this 
        section.
            ``(2) Availability.--Notwithstanding section 118(a), funds 
        made available under paragraph (1) shall be available in 
        advance of an annual appropriation.''.
    (b) Conforming Amendments.--
            (1) The analysis for subchapter I of chapter 1 of title 23, 
        United States Code, is amended by striking the item relating to 
        section 147 and inserting the following:

``147. Construction of ferry boats and ferry terminal and maintenance 
                            facilities.''.
            (2) Section 1064 of the Intermodal Surface Transportation 
        Efficiency Act of 1991 (105 Stat. 2005) is repealed.

SEC. 1205. DESIGNATION OF DANIEL PATRICK MOYNIHAN INTERSTATE HIGHWAY.

    (a) Designation.--Interstate Highway 86 in the State of New York, 
extending from the Pennsylvania border near Lake Erie through Orange 
County, New York, shall be known and designated as the ``Daniel Patrick 
Moynihan Interstate Highway''.
    (b) References.--Any reference in a law, map, regulation, document, 
paper, or other record of the United States to the highway referred to 
in subsection (a) shall be deemed to be a reference to the Daniel 
Patrick Moynihan Interstate Highway.

SEC. 1206. STATE-BY-STATE COMPARISON OF HIGHWAY CONSTRUCTION COSTS.

    (a) Collection of Data.--
            (1) In general.--The Administrator of the Federal Highway 
        Administration (referred to in this section as the 
        ``Administrator'') shall collect from States any bid price data 
        that is necessary to make State-by-State comparisons of highway 
        construction costs.
            (2) Data required.--In determining which data to collect 
        and the procedures for collecting data, the Administrator shall 
        take into account the data collection deficiencies identified 
        in the report prepared by the General Accounting Office 
        numbered GAO-04-113R.
    (b) Report.--
            (1) In general.--The Administrator shall submit to Congress 
        an annual report on the bid price data collected under 
        subsection (a).
            (2) Inclusions.--The report shall include--
                    (A) State-by-State comparisons of highway 
                construction costs for the previous fiscal year 
                (including the cost to construct a 1-mile road segment 
                of a standard design, as determined by the 
                Administrator); and
                    (B) a description of the competitive bidding 
                procedures used in each State; and
                    (C) a determination by Administrator as to whether 
                the competitive bidding procedures described under 
                subparagraph (B) are effective.

                          Subtitle C--Finance

SEC. 1301. FEDERAL SHARE.

    Section 120 of title 23, United States Code, is amended--
            (1) in subsection (a), by striking paragraph (1) and 
        inserting the following:
            ``(1) In general.--Except as otherwise provided in this 
        chapter, the Federal share payable on account of any project on 
        the Interstate System (including a project to add high 
        occupancy vehicle lanes and a project to add auxiliary lanes 
        but excluding a project to add any other lanes) shall be 90 
        percent of the total cost of the project.'';
            (2) in subsection (b)--
                    (A) by striking ``Except as otherwise'' and 
                inserting the following:
            ``(1) In general.--Except as otherwise'';
                    (B) by striking ``shall be--'' and all that follows 
                and inserting ``shall be 80 percent of the cost of the 
                project.''; and
                    (C) by adding at the end the following:
            ``(2) State-determined lower federal share.--In the case of 
        any project subject to this subsection, a State may determine a 
        lower Federal share than the Federal share determined under 
        paragraph (1).'';
            (3) by striking subsection (d) and inserting the following:
    ``(d) Increased Federal Share.--
            ``(1) In general.--The Federal share payable under 
        subsection (a) or (b) may be increased for projects and 
        activities in each State in which is located--
                    ``(A) nontaxable Indian land;
                    ``(B) public land (reserved or unreserved);
                    ``(C) a national forest; or
                    ``(D) a national park or monument.
            ``(2) Amount.--
                    ``(A) In general.--The Federal share for States 
                described in paragraph (1) shall be increased by a 
                percentage of the remaining cost that--
                            ``(i) is equal to the percentage that--
                                    ``(I) the area of all land 
                                described in paragraph (1) in a State; 
                                bears to
                                    ``(II) the total area of the State; 
                                but
                            ``(ii) does not exceed 95 percent of the 
                        total cost of the project or activity for which 
                        the Federal share is provided.
                    ``(B) Adjustment.--The Secretary shall adjust the 
                Federal share for States under subparagraph (A) as the 
                Secretary determines necessary, on the basis of data 
                provided by the Federal agencies that are responsible 
                for maintaining the data.''.

SEC. 1302. TRANSFER OF HIGHWAY AND TRANSIT FUNDS.

    Section 104 of title 23, United States Code, is amended by striking 
subsection (k) and inserting the following:
    ``(k) Transfer of Highway and Transit Funds.--
            ``(1) Transfer of highway funds for transit projects.--
                    ``(A) In general.--Subject to subparagraph (B), 
                funds made available for transit projects or 
                transportation planning under this title may be 
                transferred to and administered by the Secretary in 
                accordance with chapter 53 of title 49.
                    ``(B) Non-federal share.--The provisions of this 
                title relating to the non-Federal share shall apply to 
                the transferred funds.
            ``(2) Transfer of transit funds for highway projects.--
        Funds made available for highway projects or transportation 
        planning under chapter 53 of title 49 may be transferred to and 
        administered by the Secretary in accordance with this title.
            ``(3) Transfer of highway funds to other federal 
        agencies.--
                    ``(A) In general.--Except as provided in clauses 
                (i) and (ii) and subparagraph (B), funds made available 
                under this title or any other Act that are derived from 
                Highway Trust Fund (other than the Mass Transit 
                account) may be transferred to another Federal agency 
                if--
                            ``(i)(I) an expenditure is specifically 
                        authorized in Federal-aid highway legislation 
                        or as a line item in an appropriation act; or
                            ``(II) a State transportation department 
                        consents to the transfer of funds;
                            ``(ii) the Secretary determines, after 
                        consultation with the State transportation 
                        department (as appropriate), that the Federal 
                        agency should carry out a project with the 
                        funds; and
                            ``(iii) the other Federal agency agrees to 
                        accept the transfer of funds and to administer 
                        the project.
                    ``(B) Administration.--
                            ``(i) Procedures.--A project carried out 
                        with funds transferred to a Federal agency 
                        under subparagraph (A) shall be administered by 
                        the Federal agency under the procedures of the 
                        Federal agency.
                            ``(ii) Appropriations.--Funds transferred 
                        to a Federal agency under subparagraph (A) 
                        shall not be considered an augmentation of the 
                        appropriations of the Federal agency.
                            ``(iii) Non-federal share.--The provisions 
                        of this title, or an Act described in 
                        subparagraph (A), relating to the non-Federal 
                        share shall apply to a project carried out with 
                        the transferred funds, unless the Secretary 
                        determines that it is in the best interest of 
                        the United States that the non-Federal share be 
                        waived.
            ``(4) Transfer of funds among states or to federal highway 
        administration.--
                    ``(A) In general.--Subject to subparagraphs (B) 
                through (D), the Secretary may, at the request of a 
                State, transfer funds apportioned or allocated to the 
                State to another State, or to the Federal Highway 
                Administration, for the purpose of funding 1 or more 
                specific projects.
                    ``(B) Administration.--The transferred funds shall 
                be used for the same purpose and in the same manner for 
                which the transferred funds were authorized.
                    ``(C) Apportionment.--The transfer shall have no 
                effect on any apportionment formula used to distribute 
                funds to States under this section or section 105 or 
                144.
                    ``(D) Surface transportation program.--Funds that 
                are apportioned or allocated to a State under 
                subsection (b)(3) and attributed to an urbanized area 
                of a State with a population of over 200,000 
                individuals under section 133(d)(2) may be transferred 
                under this paragraph only if the metropolitan planning 
                organization designated for the area concurs, in 
                writing, with the transfer request.
            ``(5) Transfer of obligation authority.--Obligation 
        authority for funds transferred under this subsection shall be 
        transferred in the same manner and amount as the funds for the 
        projects are transferred under this subsection.''.

SEC. 1303. TRANSPORTATION INFRASTRUCTURE FINANCE AND INNOVATION ACT 
              AMENDMENTS.

    (a) Definitions.--Section 181 of title 23, United States Code, is 
amended--
            (1) in paragraph (3), by striking ``category'' and 
        ``offered into the capital markets'';
            (2) by striking paragraph (7) and redesignating paragraphs 
        (8) through (15) as paragraphs (7) through (14) respectively;
            (3) in paragraph (8) (as redesignated by paragraph (2))--
                    (A) in subparagraph (B), by striking the period at 
                the end and inserting a semicolon; and
                    (B) by striking subparagraph (D) and inserting the 
                following:
                    ``(D) a project that--
                            ``(i)(I) is a project for--
                                    ``(aa) a public freight rail 
                                facility or a private facility 
                                providing public benefit;
                                    ``(bb) an intermodal freight 
                                transfer facility;
                                    ``(cc) a means of access to a 
                                facility described in item (aa) or 
                                (bb);
                                    ``(dd) a service improvement for a 
                                facility described in item (aa) or (bb) 
                                (including a capital investment for an 
                                intelligent transportation system); or
                            ``(II) comprises a series of projects 
                        described in subclause (I) with the common 
                        objective of improving the flow of goods;
                            ``(ii) may involve the combining of private 
                        and public sector funds, including investment 
                        of public funds in private sector facility 
                        improvements; and
                            ``(iii) if located within the boundaries of 
                        a port terminal, includes only such surface 
                        transportation infrastructure modifications as 
                        are necessary to facilitate direct intermodal 
                        interchange, transfer, and access into and out 
                        of the port.''; and
            (4) in paragraph (10) (as redesignated by paragraph (2)) by 
        striking ``bond'' and inserting ``credit''.
    (b) Determination of Eligibility and Project Selection.--Section 
182 of title 23, United States Code, is amended--
            (1) in subsection (a)--
                    (A) by striking paragraphs (1) and (2) and 
                inserting the following:
            ``(1) Inclusion in transportation plans and programs.--The 
        project shall satisfy the applicable planning and programming 
        requirements of sections 134 and 135 at such time as an 
        agreement to make available a Federal credit instrument is 
        entered into under this subchapter.
            ``(2) Application.--A State, local government, public 
        authority, public-private partnership, or any other legal 
        entity undertaking the project and authorized by the Secretary 
        shall submit a project application to the Secretary.'';
                    (B) in paragraph (3)(A)--
                            (i) in clause (i), by striking 
                        ``$100,000,000'' and inserting ``$50,000,000''; 
                        and
                            (ii) in clause (ii), by striking ``50'' and 
                        inserting ``20''; and
                    (C) in paragraph (4)--
                            (i) by striking ``Project financing'' and 
                        inserting ``The Federal credit instrument''; 
                        and
                            (ii) by inserting before the period at the 
                        end the following: ``that also secure the 
                        project obligations''; and
            (2) in subsection (b)--
                    (A) in paragraph (1), by striking ``criteria'' the 
                second place it appears and inserting ``requirements''; 
                and
                    (B) in paragraph (2)(B), by inserting ``(which may 
                be the Federal credit instrument)'' after 
                ``obligations''.
    (c) Secured Loans.--Section 183 of title 23, United States Code, is 
amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)--
                            (i) by striking ``of any project selected 
                        under section 182.'' at the end;
                            (ii) in subparagraphs (A) and (B), by 
                        inserting ``of any project selected under 
                        section 182'' after ``costs'' ; and
                            (iii) in subparagraph (B), by striking the 
                        semicolon at the end and inserting a period; 
                        and
                    (B) in paragraph (4)--
                            (i) by striking ``funding'' and inserting 
                        ``execution''; and
                            (ii) by striking ``rating,'' and all that 
                        follows and inserting a period;
            (2) in subsection (b)--
                    (A) by striking paragraph (2) and inserting the 
                following:
            ``(2) Maximum amount.--The amount of the secured loan shall 
        not exceed the lesser of--
                    ``(A) 33 percent of the reasonably anticipated 
                eligible project costs; or
                    ``(B) the amount of the senior project 
                obligations.'';
                    (B) in paragraph (3)(A)(i), by inserting ``that 
                also secure the senior project obligations'' after 
                ``sources''; and
                    (C) in paragraph (4), by striking ``marketable''; 
                and
            (3) in subsection (c)--
                    (A) by striking paragraph (3);
                    (B) by redesignating paragraphs (4) and (5) as 
                paragraphs (3) and (4), respectively; and
                    (C) in paragraph (3) (as redesignated by 
                subparagraph (B))--
                            (i) in subparagraph (A), by striking 
                        ``during the 10 years''; and
                            (ii) in subparagraph (B)(ii), by striking 
                        ``loan'' and all that follows and inserting 
                        ``loan.''.
    (d) Lines of Credit.--Section 184 of title 23, United States Code, 
is amended--
            (1) in subsection (b)--
                    (A) in paragraph (3), by striking ``interest, any 
                debt service reserve fund, and any other available 
                reserve'' and inserting ``interest (but not including 
                reasonably required financing reserves)'';
                    (B) in paragraph (4), by striking ``marketable 
                United States Treasury securities as of the date on 
                which the line of credit is obligated'' and inserting 
                `` United States Treasury securities as of the date of 
                execution of the line of credit agreement''; and
                    (C) in paragraph (5)(A)(i), by inserting ``that 
                also secure the senior project obligations'' after 
                ``sources''; and
            (2) in subsection (c)--
                    (A) in paragraph (2)--
                            (i) by striking ``scheduled'';
                            (ii) by inserting ``be scheduled to'' after 
                        ``shall''; and
                            (iii) by striking ``be fully repaid, with 
                        interest,'' and inserting ``to conclude, with 
                        full repayment of principal and interest,''; 
                        and
                    (B) by striking paragraph (3).
    (e) Program Administration.--Section 185 of title 23, United States 
Code, is amended to read as follows:
``Sec. 185. Program administration
    ``(a) Requirement.--The Secretary shall establish a uniform system 
to service the Federal credit instruments made available under this 
subchapter.
    ``(b) Fees.--The Secretary may establish fees at a level to cover 
all or a portion of the costs to the Federal government of servicing 
the Federal credit instruments.
    ``(c) Servicer.--
            ``(1) In general.--The Secretary may appoint a financial 
        entity to assist the Secretary in servicing the Federal credit 
        instruments.
            ``(2) Duties.--The servicer shall act as the agent for the 
        Secretary.
            ``(3) Fee.--The servicer shall receive a servicing fee, 
        subject to approval by the Secretary.
    ``(d) Assistance From Expert Firms.--The Secretary may retain the 
services of expert firms, including counsel, in the field of municipal 
and project finance to assist in the underwriting and servicing of 
Federal credit instruments.''.
    (f) Funding.--Section 188 of title 23, United States Code, is 
amended to read as follows:
``Sec. 188. Funding
    ``(a) Funding.--
            ``(1) In general.--There is authorized to be appropriated 
        from the Highway Trust Fund (other than the Mass Transit 
        Account) to carry out this subchapter $130,000,000 for each of 
        fiscal years 2004 through 2009.
            ``(2) Administrative costs.--Of amounts made available 
        under paragraph (1), the Secretary may use for the 
        administration of this subchapter not more than $2,000,000 for 
        each of fiscal years 2004 through 2009.
            ``(3) Collected fees and services.--In addition to funds 
        provided under paragraph (2)--
                    ``(A) all fees collected under this subchapter 
                shall be made available without further appropriation 
                to the Secretary until expended, for use in 
                administering this subchapter; and
                    ``(B) the Secretary may accept and use payment or 
                services provided by transaction participants, or third 
                parties that are paid by participants from transaction 
                proceeds, for due diligence, legal, financial, or 
                technical services.
            ``(4) Availability.--Amounts made available under paragraph 
        (1) shall remain available until expended.
    ``(b) Contract Authority.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, approval by the Secretary of a Federal credit instrument 
        that uses funds made available under this subchapter shall be 
        deemed to be acceptance by the United States of a contractual 
        obligation to fund the Federal credit investment.
            ``(2) Availability.--Amounts authorized under this section 
        for a fiscal year shall be available for obligation on October 
        1 of the fiscal year.''.
    (g) Repeal.--Section 189 of title 23, United States code, is 
repealed.
    (h) Conforming Amendments.--The analysis for chapter 1 of title 23, 
United States Code, is amended--
            (1) by striking the item relating to section 185 and 
        inserting the following:

``185. Program administration.'';
        and
            (2) by striking the item relating to section 189.

SEC. 1304. FACILITATION OF INTERNATIONAL REGISTRATION PLANS AND 
              INTERNATIONAL FUEL TAX AGREEMENTS.

    (a) In General.--Chapter 317 of title 49, United States Code, is 
amended by adding at the end the following:
``Sec. 31708. Facilitation of international registration plans and 
              international fuel tax agreements
    ``The Secretary may provide assistance to any State that is 
participating in the International Registration Plan and International 
Fuel Tax Agreement, as provided in sections 31704 and 31705, 
respectively, and that serves as a base jurisdiction for motor carriers 
that are domiciled in Mexico, to assist the State with administrative 
costs resulting from serving as a base jurisdiction for motor carriers 
from Mexico.''.
    (b) Conforming Amendment.--The analysis for chapter 317 of title 
49, United States Code, is amended by adding at the end the following:

``31708. Facilitation of international registration plans and 
                            international fuel tax agreements.''.

SEC. 1305. NATIONAL COMMISSION ON FUTURE REVENUE SOURCES TO SUPPORT THE 
              HIGHWAY TRUST FUND AND FINANCE THE NEEDS OF THE SURFACE 
              TRANSPORTATION SYSTEM.

    (a) Establishment.--There is established a commission to be known 
as the ``National Commission on Future Revenue Sources to Support the 
Highway Trust Fund and Finance the Needs of the Surface Transportation 
System'' (referred to in this section as the ``Commission'').
    (b) Membership.--
            (1) Composition.--The Commission shall be composed of 11 
        members, of whom--
                    (A) 3 members shall be appointed by the President;
                    (B) 2 members shall be appointed by the Speaker of 
                the House of Representatives;
                    (C) 2 members shall be appointed by the minority 
                leader of the House of Representatives;
                    (D) 2 members shall be appointed by the majority 
                leader of the Senate; and
                    (E) 2 members shall be appointed by the minority 
                leader of the Senate.
            (2) Qualifications.--Members appointed under paragraph (1) 
        shall have experience in or represent the interests of--
                    (A) public finance, including experience in 
                developing State and local revenue resources;
                    (B) surface transportation program administration;
                    (C) organizations that use surface transportation 
                facilities;
                    (D) academic research into related issues; or
                    (E) other activities that provide unique 
                perspectives on current and future requirements for 
                revenue sources to support the Highway Trust Fund.
            (3) Date of appointments.--The appointment of a member of 
        the Commission shall be made not later than 120 days after the 
        date of establishment of the Commission.
            (4) Terms.--A member shall be appointed for the life of the 
        Commission.
            (5) Vacancies.--A vacancy on the Commission--
                    (A) shall not affect the powers of the Commission; 
                and
                    (B) shall be filled in the same manner as the 
                original appointment was made.
            (6) Initial meeting.--Not later than 30 days after the date 
        on which all members of the Commission have been appointed, the 
        Commission shall hold the initial meeting of the Commission.
            (7) Meetings.--The Commission shall meet at the call of the 
        Chairperson.
            (8) Quorum.--A majority of the members of the Commission 
        shall constitute a quorum, but a lesser number of members may 
        hold hearings.
            (9) Chairperson and vice chairperson.--The Commission shall 
        select a Chairperson and Vice Chairperson from among the 
        members of the Commission.
    (c) Duties.--
            (1) In general.--The Commission shall--
                    (A) conduct a comprehensive study of alternatives 
                to replace or to supplement the fuel tax as the 
                principal revenue source to support the Highway Trust 
                Fund and suggest new or alternative sources of revenue 
                to fund the needs of the surface transportation system 
                over at least the next 30 years;
                    (B) conduct the study in a manner that builds on--
                            (i) findings, conclusions, and 
                        recommendations of the recent study conducted 
                        by the Transportation Research Board on 
                        alternatives to the fuel tax to support highway 
                        program financing; and
                            (ii) other relevant prior research;
                    (C) consult with the Secretary and the Secretary of 
                the Treasury in conducting the study to ensure that the 
                views of the Secretaries concerning essential 
                attributes of Highway Trust Fund revenue alternatives 
                are considered;
                    (D) consult with representatives of State 
                Departments of Transportation and metropolitan planning 
                organizations and other key interested stakeholders in 
                conducting the study to ensure that--
                            (i) the views of the stakeholders on 
                        alternative revenue sources to support State 
                        transportation improvement programs are 
                        considered; and
                            (ii) any recommended Federal financing 
                        strategy takes into account State financial 
                        requirements; and
                    (E) based on the study, make specific 
                recommendations regarding--
                            (i) actions that should be taken to develop 
                        alternative revenue sources to support the 
                        Highway Trust Fund; and
                            (ii) the time frame for taking those 
                        actions.
            (2) Specific matters.--The study shall address 
        specifically--
                    (A) the advantages and disadvantages of alternative 
                revenue sources to meet anticipated Federal surface 
                transportation financial requirements;
                    (B) recommendations concerning the most promising 
                revenue sources to support long-term Federal surface 
                transportation financing requirements;
                    (C) development of a broad transition strategy to 
                move from the current tax base to new funding 
                mechanisms, including the time frame for various 
                components of the transition strategy;
                    (D) recommendations for additional research that 
                may be needed to implement recommended alternatives; 
                and
                    (E) the extent to which revenues should reflect the 
                relative use of the highway system.
            (3) Related work.--To the maximum extent practicable, the 
        study shall build on related work that has been done by--
                    (A) the Secretary of Transportation;
                    (B) the Secretary of Energy;
                    (C) the Transportation Research Board; and
                    (D) other entities and persons.
            (4) Factors.--In developing recommendations under this 
        subsection, the Commission shall consider--
                    (A) the ability to generate sufficient revenues 
                from all modes to meet anticipated long-term surface 
                transportation financing needs;
                    (B) the roles of the various levels of government 
                and the private sector in meeting future surface 
                transportation financing needs;
                    (C) administrative costs (including enforcement 
                costs) to implement each option;
                    (D) the expected increase in non-taxed fuels and 
                the impact of taxing those fuels;
                    (E) the likely technological advances that could 
                ease implementation of each option;
                    (F) the equity and economic efficiency of each 
                option;
                    (G) the flexibility of different options to allow 
                various pricing alternatives to be implemented; and
                    (H) potential compatibility issues with State and 
                local tax mechanisms under each alternative.
            (5) Report and recommendations.--Not later than September 
        30, 2007, the Commission shall submit to Congress a final 
        report that contains--
                    (A) a detailed statement of the findings and 
                conclusions of the Commission; and
                    (B) the recommendations of the Commission for such 
                legislation and administrative actions as the 
                Commission considers appropriate.
    (d) Powers.--
            (1) Hearings.--The Commission may hold such hearings, meet 
        and act at such times and places, take such testimony, and 
        receive such evidence as the Commission considers advisable to 
        carry out this section.
            (2) Information from federal agencies.--
                    (A) In general.--The Commission may secure directly 
                from a Federal agency such information as the 
                Commission considers necessary to carry out this 
                section.
                    (B) Provision of information.--On request of the 
                Chairperson of the Commission, the head of the agency 
                shall provide the information to the Commission.
            (3) Postal services.--The Commission may use the United 
        States mails in the same manner and under the same conditions 
        as other agencies of the Federal Government.
            (4) Donations.--The Commission may accept, use, and dispose 
        of donations of services or property.
    (e) Commission Personnel Matters.--
            (1) Members.--A member of the Commission shall serve 
        without pay but shall be allowed travel expenses, including per 
        diem in lieu of subsistence, at rates authorized for an 
        employee of an agency under subchapter I of chapter 57 of title 
        5, United States Code, while away from the home or regular 
        place of business of the member in the performance of the 
        duties of the Commission.
            (2) Contractor.--The Commission may contract with an 
        appropriate organization, agency, or entity to conduct the 
        study required under this section, under the strategic guidance 
        of the Commission.
            (3) Administrative support.--On the request of the 
        Commission, the Administrator of the Federal Highway 
        Administration shall provide to the Commission, on a 
        reimbursable basis, the administrative support and services 
        necessary for the Commission to carry out the duties of the 
        Commission under this section.
            (4) Detail of department personnel.--
                    (A) In general.--On the request of the Commission, 
                the Secretary may detail, on a reimbursable basis, any 
                of the personnel of the Department to the Commission to 
                assist the Commission in carrying out the duties of the 
                Commission under this section.
                    (B) Civil service status.--The detail of the 
                employee shall be without interruption or loss of civil 
                service status or privilege.
            (5) Cooperation.--The staff of the Secretary shall 
        cooperate with the Commission in the study required under this 
        section, including providing such nonconfidential data and 
        information as are necessary to conduct the study.
    (f) Relationship to Other Laws.--
            (1) In general.--Except as provided in paragraphs (2) and 
        (3), funds made available to carry out this section shall be 
        available for obligation in the same manner as if the funds 
        were apportioned under chapter 1 of title 23, United States 
        Code.
            (2) Federal share.--The Federal share of the cost of the 
        study and the Commission under this section shall be 100 
        percent.
            (3) Availability.--Funds made available to carry out this 
        section shall remain available until expended.
    (g) Authorization of Appropriations.--There is authorized to be 
appropriated from the Highway Trust Fund (other than the Mass Transit 
Account) to carry out this section $3,000,000 for fiscal year 2004.
    (h) Termination.--
            (1) In general.--The Commission shall terminate on the date 
        that is 180 days after the date on which the Commission submits 
        the report of the Commission under subsection (c)(5).
            (2) Records.--Not later than the termination date for the 
        Commission, all records and papers of the Commission shall be 
        delivered to the Archivist of the United States for deposit in 
        the National Archives.

SEC. 1306. STATE INFRASTRUCTURE BANKS.

    Section 1511(b)(1)(A) of the Transportation Equity Act for the 21st 
Century (23 U.S.C. 181 note; 112 Stat. 251) is amended by striking 
``Missouri,'' and all that follows through ``for the establishment'' 
and inserting ``Missouri, Rhode Island, Texas, and any other State that 
seeks such an agreement for the establishment''.

SEC. 1307. PUBLIC-PRIVATE PARTNERSHIPS PILOT PROGRAM.

    Section 109(c) of title 23, United States Code, is amended by 
adding at the end the following:
            ``(3) Public-private partnerships pilot program.--
                    ``(A) In general.--The Secretary may undertake a 
                pilot program to demonstrate the advantages of public-
                private partnerships for critical capital development 
                projects, including highway, bridge, and freight 
                intermodal connector projects authorized under this 
                title.
                    ``(B) Projects.--In carrying out the program, the 
                Secretary shall--
                            ``(i) select not less than 10 qualified 
                        public-private partnership projects that are 
                        authorized under applicable State and local 
                        laws; and
                            ``(ii) use funds made available to carry 
                        out the program to provide to sponsors of the 
                        projects assistance for development phase 
                        activities described in section 181(1)(A), to 
                        enhance project delivery and reduce overall 
                        costs.''.

SEC. 1308. WAGERING.

    (a) In General.--Chapter 35 of the Internal Revenue Code of 1986 is 
repealed.
    (b) Conforming Amendments.--
            (1) Section 4901 of the Internal Revenue Code is amended to 
        read as follows:

``SEC. 4901. PAYMENT OF TAX.

    ``All special taxes shall be imposed as of on the first day of July 
in each year, or on commencing any trade or business on which such tax 
is imposed. In the former case the tax shall be reckoned for 1 year, 
and in the latter case it shall be reckoned proportionately, from the 
first day of the month in which the liability to a special tax 
commenced, to and including the 30th day of June following.''.
            (2) Section 4903 of such Code is amended by striking ``, 
        other than the tax imposed by section 4411,''.
            (3) Section 4905 of such Code is amended to read as 
        follows:

``SEC. 4905. LIABILITY IN CASE OF DEATH OR CHANGE OF LOCATION.

    ``When any person who has paid the special tax for any trade or 
business dies, his spouse or child, or executors or administrators or 
other legal representatives, may occupy the house or premises, and in 
like manner carry on, for the residue of the term for which the tax is 
paid, the same trade or business as the deceased before carried on, in 
the same house and upon the same premises, without the payment of any 
additional tax. When any person removes from the house or premises for 
which any trade or business was taxed to any other place, he may carry 
on the trade or business specified in the register kept in the office 
of the official in charge of the internal revenue district at the place 
to which he removes, without the payment of any additional tax: 
Provided, That all cases of death, change, or removal, as aforesaid, 
with the name of the successor to any person deceased, or of the person 
making such change or removal, shall be registered with the Secretary, 
under regulations to be prescribed by the Secretary.''.
            (4) Section 4907 of such Code is amended by striking ``, 
        except the tax imposed by section 4411,''.
            (5) Section 6103(i)(8)(A) of such Code is amended--
                    (A) by striking ``, except to the extent authorized 
                by subsection (f) or (p)(6), disclose to any person, 
                other than another officer or employee of such office 
                whose official duties require such disclosure, any 
                return or return information described in section 
                4424(a) in a form which can be associated with, or 
                otherwise identify, directly or indirectly, a 
                particular taxpayer, nor shall such officer or employee 
                disclose any other'' and inserting ``disclose any'', 
                and
                    (B) by striking ``such other officer'' and 
                inserting ``such officer''.
            (6) Section 6103(o) of such Code is amended to read as 
        follows:
    ``(o) Disclosure of Returns and Return Information With Respect to 
Taxes Imposed by Subtitle E.--Returns and return information with 
respect to taxes imposed by subtitle E (relating to taxes on alcohol, 
tobacco, and firearms) shall be open to inspection by or disclosure to 
officers and employees of a Federal agency whose official duties 
require such inspection or disclosure.''.
            (7)(A) Subchapter B of chapter 65 of such Code is amended 
        by striking section 6419 (relating to excise tax on wagering).
            (B) The table of section of subchapter B of chapter 65 of 
        such Code is amended by striking the item relating to section 
        6419.
            (8) Section 6806 of such Code is amended by striking 
        ``under subchapter B of chapter 35, under subchapter B of 
        chapter 36,'' and inserting ``under subchapter B of chapter 
        36''.
            (9) Section 7012 of such Code is amended by striking 
        paragraph (2) and by redesignating paragraphs (3), (4), and (5) 
        as paragraphs (2), (3), and (4), respectively.
            (10)(A) Subchapter B of chapter 75 of such Code is amended 
        by striking section 7262 (relating to violation of occupational 
        tax laws relating to wagering-failure to pay special tax).
            (B) The table of sections of subchapter B of chapter 75 of 
        such Code is amended by striking the item relating to section 
        7262.
            (11) Section 7272 of such Code, as amended by section 5244 
        of this Act, is amended to read as follows:

``SEC. 7272. PENALTY FOR FAILURE TO REGISTER.

    ``Any person (other than persons required to register under 
subtitle E, or persons engaging in a trade or business on which a 
special tax is imposed by such subtitle) who fails to register with the 
Secretary as required by this title or by regulations issued thereunder 
shall be liable to a penalty of $50 ($10,000 in the case of a failure 
to register under section 4101).''.
            (12) Section 7613(a) is amended by striking ``or other data 
        in the case of'' and all that follows and inserting ``or other 
        data in the case of alcohol, tobacco, and firearms taxes, see 
        subtitle E.''.
            (13) The table of chapters of subtitle D of such Code is 
        amended by striking the item relating to chapter 35.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to wagers placed 
        after the date of the enactment of this Act.
            (2) Special taxes.--In the case of amendments made by this 
        section relating to special taxes imposed by subchapter B of 
        chapter 35, the amendments made by this section shall take 
        effect on July 1, 2004.

                           Subtitle D--Safety

SEC. 1401. HIGHWAY SAFETY IMPROVEMENT PROGRAM.

    (a) Safety Improvement.--
            (1) In general.--Section 148 of title 23, United States 
        Code, is amended to read as follows:
``Sec. 148. Highway safety improvement program
    ``(a) Definitions.--In this section:
            ``(1) Highway safety improvement program.--The term 
        `highway safety improvement program' means the program carried 
        out under this section.
            ``(2) Highway safety improvement project.--
                    ``(A) In general.--The term `highway safety 
                improvement project' means a project described in the 
                State strategic highway safety plan that--
                            ``(i) corrects or improves a hazardous road 
                        location or feature; or
                            ``(ii) addresses a highway safety problem.
                    ``(B) Inclusions.--The term `highway safety 
                improvement project' includes a project for--
                            ``(i) an intersection safety improvement;
                            ``(ii) pavement and shoulder widening 
                        (including addition of a passing lane to remedy 
                        an unsafe condition);
                            ``(iii) installation of rumble strips or 
                        another warning device, if the rumble strips or 
                        other warning devices do not adversely affect 
                        the safety or mobility of bicyclists and 
                        pedestrians;
                            ``(iv) installation of a skid-resistant 
                        surface at an intersection or other location 
                        with a high frequency of accidents;
                            ``(v) an improvement for pedestrian or 
                        bicyclist safety;
                            ``(vi)(I) construction of any project for 
                        the elimination of hazards at a railway-highway 
                        crossing that is eligible for funding under 
                        section 130, including the separation or 
                        protection of grades at railway-highway 
                        crossings;
                            ``(II) construction of a railway-highway 
                        crossing safety feature; or
                            ``(III) the conduct of a model traffic 
                        enforcement activity at a railway-highway 
                        crossing;
                            ``(vii) construction of a traffic calming 
                        feature;
                            ``(viii) elimination of a roadside 
                        obstacle;
                            ``(ix) improvement of highway signage and 
                        pavement markings;
                            ``(x) installation of a priority control 
                        system for emergency vehicles at signalized 
                        intersections;
                            ``(xi) installation of a traffic control or 
                        other warning device at a location with high 
                        accident potential;
                            ``(xii) safety-conscious planning;
                            ``(xiii) improvement in the collection and 
                        analysis of crash data;
                            ``(xiv) planning, integrated, interoperable 
                        emergency communications, equipment, 
                        operational activities, or traffic enforcement 
                        activities (including police assistance) 
                        relating to workzone safety;
                            ``(xv) installation of guardrails, barriers 
                        (including barriers between construction work 
                        zones and traffic lanes for the safety of 
                        motorists and workers), and crash attenuators;
                            ``(xvi) the addition or retrofitting of 
                        structures or other measures to eliminate or 
                        reduce accidents involving vehicles and 
                        wildlife; or
                            ``(xvii) installation and maintenance of 
                        signs (including fluorescent, yellow-green 
                        signs) at pedestrian-bicycle crossings and in 
                        school zones.
            ``(3) Safety project under any other section.--
                    ``(A) In general.--The term `safety project under 
                any other section' means a project carried out for the 
                purpose of safety under any other section of this 
                title.
                    ``(B) Inclusion.--The term `safety project under 
                any other section' includes a project to--
                            ``(i) promote the awareness of the public 
                        and educate the public concerning highway 
                        safety matters; or
                            ``(ii) enforce highway safety laws.
            ``(4) State highway safety improvement program.--The term 
        `State highway safety improvement program' means projects or 
        strategies included in the State strategic highway safety plan 
        carried out as part of the State transportation improvement 
        program under section 135(f).
            ``(5) State strategic highway safety plan.--The term `State 
        strategic highway safety plan' means a plan developed by the 
        State transportation department that--
                    ``(A) is developed after consultation with--
                            ``(i) a highway safety representative of 
                        the Governor of the State;
                            ``(ii) regional transportation planning 
                        organizations and metropolitan planning 
                        organizations, if any;
                            ``(iii) representatives of major modes of 
                        transportation;
                            ``(iv) State and local traffic enforcement 
                        officials;
                            ``(v) persons responsible for administering 
                        section 130 at the State level;
                            ``(vi) representatives conducting Operation 
                        Lifesaver;
                            ``(vii) representatives conducting a motor 
                        carrier safety program under section 31104 or 
                        31107 of title 49;
                            ``(viii) motor vehicle administration 
                        agencies; and
                            ``(ix) other major State and local safety 
                        stakeholders;
                    ``(B) analyzes and makes effective use of State, 
                regional, or local crash data;
                    ``(C) addresses engineering, management, operation, 
                education, enforcement, and emergency services elements 
                (including integrated, interoperable emergency 
                communications) of highway safety as key factors in 
                evaluating highway projects;
                    ``(D) considers safety needs of, and high-fatality 
                segments of, public roads;
                    ``(E) considers the results of State, regional, or 
                local transportation and highway safety planning 
                processes;
                    ``(F) describes a program of projects or strategies 
                to reduce or eliminate safety hazards;
                    ``(G) is approved by the Governor of the State or a 
                responsible State agency; and
                    ``(H) is consistent with the requirements of 
                section 135(f).
    ``(b) Program.--
            ``(1) In general.--The Secretary shall carry out a highway 
        safety improvement program.
            ``(2) Purpose.--The purpose of the highway safety 
        improvement program shall be to achieve a significant reduction 
        in traffic fatalities and serious injuries on public roads.
    ``(c) Eligibility.--
            ``(1) In general.--To obligate funds apportioned under 
        section 104(b)(5) to carry out this section, a State shall have 
        in effect a State highway safety improvement program under 
        which the State--
                    ``(A) develops and implements a State strategic 
                highway safety plan that identifies and analyzes 
                highway safety problems and opportunities as provided 
                in paragraph (2);
                    ``(B) produces a program of projects or strategies 
                to reduce identified safety problems;
                    ``(C) evaluates the plan on a regular basis to 
                ensure the accuracy of the data and priority of 
                proposed improvements; and
                    ``(D) submits to the Secretary an annual report 
                that--
                            ``(i) describes, in a clearly 
                        understandable fashion, not less than 5 percent 
                        of locations determined by the State, using 
                        criteria established in accordance with 
                        paragraph (2)(B)(ii), as exhibiting the most 
                        severe safety needs; and
                            ``(ii) contains an assessment of--
                                    ``(I) potential remedies to 
                                hazardous locations identified;
                                    ``(II) estimated costs associated 
                                with those remedies; and
                                    ``(III) impediments to 
                                implementation other than cost 
                                associated with those remedies.
            ``(2) Identification and analysis of highway safety 
        problems and opportunities.--As part of the State strategic 
        highway safety plan, a State shall--
                    ``(A) have in place a crash data system with the 
                ability to perform safety problem identification and 
                countermeasure analysis;
                    ``(B) based on the analysis required by 
                subparagraph (A)--
                            ``(i) identify hazardous locations, 
                        sections, and elements (including roadside 
                        obstacles, railway-highway crossing needs, and 
                        unmarked or poorly marked roads) that 
                        constitute a danger to motorists, bicyclists, 
                        pedestrians, and other highway users; and
                            ``(ii) using such criteria as the State 
                        determines to be appropriate, establish the 
                        relative severity of those locations, in terms 
                        of accidents, injuries, deaths, traffic volume 
                        levels, and other relevant data;
                    ``(C) adopt strategic and performance-based goals 
                that--
                            ``(i) address traffic safety, including 
                        behavioral and infrastructure problems and 
                        opportunities on all public roads;
                            ``(ii) focus resources on areas of greatest 
                        need; and
                            ``(iii) are coordinated with other State 
                        highway safety programs;
                    ``(D) advance the capabilities of the State for 
                traffic records data collection, analysis, and 
                integration with other sources of safety data (such as 
                road inventories) in a manner that--
                            ``(i) complements the State highway safety 
                        program under chapter 4 and the commercial 
                        vehicle safety plan under section 31102 of 
                        title 49;
                            ``(ii) includes all public roads;
                            ``(iii) identifies hazardous locations, 
                        sections, and elements on public roads that 
                        constitute a danger to motorists, bicyclists, 
                        pedestrians, and other highway users; and
                            ``(iv) includes a means of identifying the 
                        relative severity of hazardous locations 
                        described in clause (iii) in terms of 
                        accidents, injuries, deaths, and traffic volume 
                        levels;
                    ``(E)(i) determine priorities for the correction of 
                hazardous road locations, sections, and elements 
                (including railway-highway crossing improvements), as 
                identified through crash data analysis;
                    ``(ii) identify opportunities for preventing the 
                development of such hazardous conditions; and
                    ``(iii) establish and implement a schedule of 
                highway safety improvement projects for hazard 
                correction and hazard prevention; and
                    ``(F)(i) establish an evaluation process to analyze 
                and assess results achieved by highway safety 
                improvement projects carried out in accordance with 
                procedures and criteria established by this section; 
                and
                    ``(ii) use the information obtained under clause 
                (i) in setting priorities for highway safety 
                improvement projects.
    ``(d) Eligible Projects.--
            ``(1) In general.--A State may obligate funds apportioned 
        to the State under section 104(b)(5) to carry out--
                    ``(A) any highway safety improvement project on any 
                public road or publicly owned bicycle or pedestrian 
                pathway or trail; or
                    ``(B) as provided in subsection (e), for other 
                safety projects.
            ``(2) Use of other funding for safety.--
                    ``(A) Effect of section.--Nothing in this section 
                prohibits the use of funds made available under other 
                provisions of this title for highway safety improvement 
                projects.
                    ``(B) Use of other funds.--States are encouraged to 
                address the full scope of their safety needs and 
                opportunities by using funds made available under other 
                provisions of this title (except a provision that 
                specifically prohibits that use).
    ``(e) Flexible Funding for States With a Strategic Highway Safety 
Plan.--
            ``(1) In general.--To further the implementation of a State 
        strategic highway safety plan, a State may use up to 25 percent 
        of the amount of funds made available under this section for a 
        fiscal year to carry out safety projects under any other 
        section as provided in the State strategic highway safety plan.
            ``(2) Other transportation and highway safety plans.--
        Nothing in this subsection requires a State to revise any State 
        process, plan, or program in effect on the date of enactment of 
        this section.
    ``(f) Reports.--
            ``(1) In general.--A State shall submit to the Secretary a 
        report that--
                    ``(A) describes progress being made to implement 
                highway safety improvement projects under this section;
                    ``(B) assesses the effectiveness of those 
                improvements; and
                    ``(C) describes the extent to which the 
                improvements funded under this section contribute to 
                the goals of--
                            ``(i) reducing the number of fatalities on 
                        roadways;
                            ``(ii) reducing the number of roadway-
                        related injuries;
                            ``(iii) reducing the occurrences of 
                        roadway-related crashes;
                            ``(iv) mitigating the consequences of 
                        roadway-related crashes; and
                            ``(v) reducing the occurrences of roadway-
                        railroad grade crossing crashes.
            ``(2) Contents; schedule.--The Secretary shall establish 
        the content and schedule for a report under paragraph (1).
            ``(3) Transparency.--The Secretary shall make reports under 
        subsection (c)(1)(D) available to the public through--
                    ``(A) the Internet site of the Department; and
                    ``(B) such other means as the Secretary determines 
                to be appropriate.
            ``(4) Discovery and admission into evidence of certain 
        reports, surveys, and information.--Notwithstanding any other 
        provision of law, reports, surveys, schedules, lists, or data 
        compiled or collected for any purpose directly relating to 
        paragraph (1) or subsection (c)(1)(D), or published by the 
        Secretary in accordance with paragraph (3), shall not be 
        subject to discovery or admitted into evidence in a Federal or 
        State court proceeding or considered for other purposes in any 
        action for damages arising from any occurrence at a location 
        identified or addressed in such reports, surveys, schedules, 
        lists, or other data.
    ``(g) Federal Share of Highway Safety Improvement Projects.--Except 
as provided in sections 120 and 130, the Federal share of the cost of a 
highway safety improvement project carried out with funds made 
available under this section shall be 90 percent.
    ``(h) Funds for Bicycle and Pedestrian Safety.--A State shall 
allocate for bicycle and pedestrian improvements in the State a 
percentage of the funds remaining after implementation of sections 
130(e) and 150, in an amount that is equal to or greater than the 
percentage of all fatal crashes in the States involving bicyclists and 
pedestrians.
    ``(i) Roadway Safety Improvements for Older Drivers and 
Pedestrians.--For each of fiscal years 2004 through 2009, $25,000,000 
is authorized to be appropriated out of the Highway Trust Fund (other 
than the Mass Transit Account) for projects in all States to improve 
traffic signs and pavement markings in a manner consistent with the 
recommendations included in the publication of the Federal Highway 
Administration entitled `Guidelines and Recommendations to Accommodate 
Older Drivers and Pedestrians (FHWA-RD-01-103)' and dated October 
2001.''.
            (2) Allocations of apportioned funds.--Section 133(d) of 
        title 23, United States Code, is amended--
                    (A) by striking paragraph (1);
                    (B) by redesignating paragraphs (2) through (5) as 
                paragraphs (1) through (4), respectively;
                    (C) in paragraph (2) (as redesignated by 
                subparagraph (B))--
                            (i) in the first sentence of subparagraph 
                        (A)--
                                    (I) by striking ``subparagraphs (C) 
                                and (D)'' and inserting ``subparagraph 
                                (C)''; and
                                    (II) by striking ``80 percent'' and 
                                inserting ``90 percent'';
                            (ii) in subparagraph (B), by striking 
                        ``tobe'' and inserting ``to be'';
                            (iii) by striking subparagraph (C);
                            (iv) by redesignating subparagraphs (D) and 
                        (E) as subparagraphs (C) and (D), respectively; 
                        and
                            (v) in subparagraph (C) (as redesignated by 
                        clause (iv)), by adding a period at the end; 
                        and
                    (D) in paragraph (4)(A) (as redesignated by 
                subparagraph (B)), by striking ``paragraph (2)'' and 
                inserting ``paragraph (1)''.
            (3) Administration.--Section 133(e) of title 23, United 
        States Code, is amended in each of paragraphs (3)(B)(i), 
        (5)(A), and (5)(B) of subsection (e), by striking ``(d)(2)'' 
        each place it appears and inserting ``(d)(1)''.
            (4) Conforming amendments.--
                    (A) The analysis for chapter 1 of title 23, United 
                States Code, is amended by striking the item relating 
                to section 148 and inserting the following:

``148. Highway safety improvement program.''.
                    (B) Section 104(g) of title 23, United States Code, 
                is amended in the first sentence by striking ``sections 
                130, 144, and 152 of this title'' and inserting 
                ``sections 130 and 144''.
                    (C) Section 126 of title 23, United States Code, is 
                amended--
                            (i) in subsection (a), by inserting 
                        ``under'' after ``State's apportionment''; and
                            (ii) in subsection (b)--
                                    (I) in the first sentence, by 
                                striking ``the last sentence of section 
                                133(d)(1) or to section 104(f) or to 
                                section 133(d)(3)'' and inserting 
                                ``section 104(f) or 133(d)(2)''; and
                                    (II) in the second sentence, by 
                                striking ``or 133(d)(2)''.
                    (D) Sections 154, 164, and 409 of title 23, United 
                States Code, are amended by striking ``152'' each place 
                it appears and inserting ``148''.
    (b) Apportionment of Highway Safety Improvement Program Funds.--
Section 104(b) of title 23, United States Code, is amended--
            (1) in the matter preceding paragraph (1), by inserting 
        after ``Improvement program,'' the following: ``the highway 
        safety improvement program,''; and
            (2) by adding at the end the following:
            ``(5) Highway safety improvement program.--
                    ``(A) In general.--For the highway safety 
                improvement program, in accordance with the following 
                formula:
                            ``(i) 25 percent of the apportionments in 
                        the ratio that--
                                    ``(I) the total lane miles of 
                                Federal-aid highways in each State; 
                                bears to
                                    ``(II) the total lane miles of 
                                Federal-aid highways in all States.
                            ``(ii) 40 percent of the apportionments in 
                        the ratio that--
                                    ``(I) the total vehicle miles 
                                traveled on lanes on Federal-aid 
                                highways in each State; bears to
                                    ``(II) the total vehicle miles 
                                traveled on lanes on Federal-aid 
                                highways in all States.
                            ``(iii) 35 percent of the apportionments in 
                        the ratio that--
                                    ``(I) the estimated tax payments 
                                attributable to highway users in each 
                                State paid into the Highway Trust Fund 
                                (other than the Mass Transit Account) 
                                in the latest fiscal year for which 
                                data are available; bears to
                                    ``(II) the estimated tax payments 
                                attributable to highway users in all 
                                States paid into the Highway Trust Fund 
                                (other than the Mass Transit Account) 
                                in the latest fiscal year for which 
                                data are available.
                    ``(B) Minimum apportionment.--Notwithstanding 
                subparagraph (A), each State shall receive a minimum of 
                \1/2\ of 1 percent of the funds apportioned under this 
                paragraph.''.
    (c) Elimination of Hazards Relating to Railway-Highway Crossings.--
            (1) Funds for railway-highway crossings.--Section 130(e) of 
        title 23, United States Code, is amended by inserting before 
        ``At least'' the following: ``For each fiscal year, at least 
        $200,000,000 of the funds authorized and expended under section 
        148 shall be available for the elimination of hazards and the 
        installation of protective devices at railway-highway 
        crossings.''.
            (2) Biennial reports to congress.--Section 130(g) of title 
        23, United States Code, is amended in the third sentence--
                    (A) by inserting ``and the Committee on Commerce, 
                Science, and Transportation,'' after ``Public Works''; 
                and
                    (B) by striking ``not later than April 1 of each 
                year'' and inserting ``every other year''.
            (3) Expenditure of funds.--Section 130 of title 23, United 
        States Code, is amended by adding at the end the following:
    ``(k) Expenditure of Funds.--Funds made available to carry out this 
section shall be--
            ``(1) available for expenditure on compilation and analysis 
        of data in support of activities carried out under subsection 
        (g); and
            ``(2) apportioned in accordance with section 104(b)(5).''.
    (d) Transition.--
            (1) Implementation.--Except as provided in paragraph (2), 
        the Secretary shall approve obligations of funds apportioned 
        under section 104(b)(5) of title 23, United States Code (as 
        added by subsection (b)) to carry out section 148 of that 
        title, only if, not later than October 1 of the second fiscal 
        year after the date of enactment of this Act, a State has 
        developed and implemented a State strategic highway safety plan 
        as required under section 148(c) of that title.
            (2) Interim period.--
                    (A) In general.--Before October 1 of the second 
                fiscal year after the date of enactment of this Act and 
                until the date on which a State develops and implements 
                a State strategic highway safety plan, the Secretary 
                shall apportion funds to a State for the highway safety 
                improvement program and the State may obligate funds 
                apportioned to the State for the highway safety 
                improvement program under section 148 for projects that 
                were eligible for funding under sections 130 and 152 of 
                that title, as in effect on the day before the date of 
                enactment of this Act.
                    (B) No strategic highway safety plan.--If a State 
                has not developed a strategic highway safety plan by 
                October 1 of the second fiscal year after the date of 
                enactment of this Act, but demonstrates to the 
                satisfaction of the Secretary that progress is being 
                made toward developing and implementing such a plan, 
                the Secretary shall continue to apportion funds for 1 
                additional fiscal year for the highway safety 
                improvement program under section 148 of title 23, 
                United States Code, to the State, and the State may 
                continue to obligate funds apportioned to the State 
                under this section for projects that were eligible for 
                funding under sections 130 and 152 of that title, as in 
                effect on the day before the date of enactment of this 
                Act.
                    (C) Penalty.--If a State has not adopted a 
                strategic highway safety plan by the date that is 2 
                years after the date of enactment of this Act, funds 
                made available to the State under section 1101(6) shall 
                be redistributed to other States in accordance with 
                section 104(b)(3) of title 23, United States Code.

SEC. 1402. OPERATION LIFESAVER.

    Section 104(d)(1) of title 23, United States Code, is amended--
            (1) by striking ``subsection (b)(3)'' and inserting 
        ``subsection (b)(5)''; and
            (2) by striking ``$500,000'' and inserting ``$600,000''.

SEC. 1403. LICENSE SUSPENSION.

    Section 164(a) of title 23, United States Code, is amended by 
striking paragraph (3) and inserting the following:
            ``(3) License suspension.--The term `license suspension' 
        means--
                    ``(A) the suspension of all driving privileges of 
                an individual for the duration of the suspension 
                period; or
                    ``(B) a combination of suspension of all driving 
                privileges of an individual for the first 90 days of 
                the suspension period, followed by reinstatement of 
                limited driving privileges requiring the individual to 
                operate only motor vehicles equipped with an ignition 
                interlock system or other device approved by the 
                Secretary during the remainder of the suspension 
                period.''.

SEC. 1404. BUS AXLE WEIGHT EXEMPTION.

    Section 1023 of the Intermodal Surface Transportation Efficiency 
Act of 1991 (23 U.S.C. 127 note; 105 Stat. 1951) is amended by striking 
subsection (h) and inserting the following:
    ``(h) Over-the-Road Bus and Public Transit Vehicle Exemption.--
            ``(1) In general.--The second sentence of section 127 of 
        title 23, United States Code (relating to axle weight 
        limitations for vehicles using the Dwight D. Eisenhower System 
        of Interstate and Defense Highways), shall not apply to--
                    ``(A) any over-the-road bus (as defined in section 
                301 of the Americans With Disabilities Act of 1990 (42 
                U.S.C. 12181)); or
                    ``(B) any vehicle that is regularly and exclusively 
                used as an intrastate public agency transit passenger 
                bus.
            ``(2) State action.--No State or political subdivision of a 
        State, or any political authority of 2 or more States, shall 
        impose any axle weight limitation on any vehicle described in 
        paragraph (1) in any case in which such a vehicle is using the 
        Dwight D. Eisenhower System of Interstate and Defense 
        Highways.''.

SEC. 1405. SAFE ROUTES TO SCHOOLS PROGRAM.

    (a) In General.--Subchapter I of chapter I of title 23, United 
States Code, is amended by inserting after section 149 the following:
``Sec. 150. Safe routes to schools program
    ``(a) Definitions.--In this section:
            ``(1) Primary and secondary school.--The term `primary and 
        secondary school' means a school that provides education to 
        children in any of grades kindergarten through 12.
            ``(2) Program.--The term `program' means the safe routes to 
        schools program established under subsection (b).
            ``(3) Vicinity of a school.--The term `vicinity of a 
        school' means the area within 2 miles of a primary or secondary 
        school.
    ``(b) Establishment.--The Secretary shall establish and carry out a 
safe routes to school program for the benefit of children in primary 
and secondary schools in accordance with this section.
    ``(c) Purposes.--The purposes of the program shall be--
            ``(1) to enable and to encourage children to walk and 
        bicycle to school;
            ``(2) to encourage a healthy and active lifestyle by making 
        walking and bicycling to school safer and more appealing 
        transportation alternatives; and
            ``(3) to facilitate the planning, development, and 
        implementation of projects and activities that will improve 
        safety in the vicinity of schools.
    ``(d) Eligible Recipients.--A State shall use amounts apportioned 
under this section to provide financial assistance to State, regional, 
and local agencies that demonstrate an ability to meet the requirements 
of this section.
    ``(e) Eligible Projects and Activities.--
            ``(1) Infrastructure-related projects.--
                    ``(A) In general.--Amounts apportioned to a State 
                under this section may be used for the planning, 
                design, and construction of infrastructure-related 
                projects to encourage walking and bicycling to school, 
                including--
                            ``(i) sidewalk improvements;
                            ``(ii) traffic calming and speed reduction 
                        improvements;
                            ``(iii) pedestrian and bicycle crossing 
                        improvements;
                            ``(iv) on-street bicycle facilities;
                            ``(v) off-street bicycle and pedestrian 
                        facilities;
                            ``(vi) secure bicycle parking facilities;
                            ``(vii) traffic signal improvements; and
                            ``(viii) pedestrian-railroad grade crossing 
                        improvements.
                    ``(B) Location of projects.--Infrastructure-related 
                projects under subparagraph (A) may be carried out on--
                            ``(i) any public road in the vicinity of a 
                        school; or
                            ``(ii) any bicycle or pedestrian pathway or 
                        trail in the vicinity of a school.
            ``(2) Behavioral activities.--
                    ``(A) In general.--In addition to projects 
                described in paragraph (1), amounts apportioned to a 
                State under this section may be used for behavioral 
                activities to encourage walking and bicycling to 
                school, including--
                            ``(i) public awareness campaigns and 
                        outreach to press and community leaders;
                            ``(ii) traffic education and enforcement in 
                        the vicinity of schools; and
                            ``(iii) student sessions on bicycle and 
                        pedestrian safety, health, and environment.
                    ``(B) Allocation.--Of the amounts apportioned to a 
                State under this section for a fiscal year, not less 
                than 10 percent shall be used for behavioral activities 
                under this paragraph.
    ``(f) Funding.--
            ``(1) Set aside.--Before apportioning amounts to carry out 
        section 148 for a fiscal year, the Secretary shall set aside 
        and use $70,000,000 to carry out this section.
            ``(2) Apportionment.--Amounts made available to carry out 
        this section shall be apportioned to States in accordance with 
        section 104(b)(5).
            ``(3) Administration of amounts.--Amounts apportioned to a 
        State under this section shall be administered by the State 
        transportation department.
            ``(4) Federal share.--Except as provided in sections 120 
        and 130, the Federal share of the cost of a project or activity 
        funded under this section shall be 90 percent.
            ``(5) Period of availability.--Notwithstanding section 
        118(b)(2), amounts apportioned under this section shall remain 
        available until expended.''.
    (b) Conforming Amendments.--The analysis for subchapter I of 
chapter 1 of title 23, United States Code is amended by inserting after 
the item relating to section 149 the following:

``150. Safe routes to school program.''.

SEC. 1406. PURCHASES OF EQUIPMENT.

    (a) In General.--Section 152 of title 23, United States Code is 
amended to read as follows:
``Sec. 152. Purchases of equipment
    ``(a) In General.--Subject to subsection (b), a State carrying out 
a project under this chapter shall purchase device, tool or other 
equipment needed for the project only after completing and providing a 
written analysis demonstrating the cost savings associated with 
purchasing the equipment compared with renting the equipment from a 
qualified equipment rental provider before the project commences
    ``(b) Applicability.--This section shall apply to--
            ``(1) earth moving, road machinery, and material handling 
        equipment, or any other item, with a purchase price in excess 
        of $75,000; and
            ``(2) aerial work platforms with a purchase price in excess 
        of $25,000.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code, is amended by striking the item 
relating to section 152 and inserting the following:

``152. Purchases of equipment.''.

SEC. 1407. WORKZONE SAFETY.

    Section 358(b) of the National Highway System Designation Act of 
1995 (109 Stat. 625) is amended by adding at the end the following:
            ``(7) Recommending all federally-assisted projects in 
        excess of $15,000,000 to enter into contracts only with work 
        zone safety services contractors, traffic control contractors, 
        and trench safety and shoring contractors that carry general 
        liability insurance in an amount not less than $15,000,000.
            ``(8) Recommending federally-assisted projects the costs of 
        which exceed $15,000,000 to include work zone intelligent 
        transportation systems that are--
                    ``(A) provided by a qualified vendor; and
                    ``(B) monitored continuously.
            ``(9) Recommending federally-assisted projects to fully 
        fund not less than 5 percent of project costs for work zone 
        safety and temporary traffic control measures, in addition to 
        the cost of the project, which measures shall be provided by a 
        qualified work zone safety or traffic control provider.
            ``(10) Ensuring that any recommendation made under any of 
        paragraphs (7) through (9) provides for an exemption for 
        applicability to a State, with respect to a project or class of 
        projects, to the extent that a State notifies the Secretary in 
        writing that safety is not expected to be adversely affected by 
        nonapplication of the requirement to the project or class of 
        projects.''.

SEC. 1408. WORKER INJURY PREVENTION AND FREE FLOW OF VEHICULAR TRAFFIC.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary shall promulgate regulations--
            (1) to decrease the probability of worker injury;
            (2) to maintain the free flow of vehicular traffic by 
        requiring workers whose duties place the workers on, or in 
        close proximity to, a Federal-aid highway (as defined in 
        section 101 of title 23, United States Code) to wear high-
        visibility clothing; and
            (3) to require such other worker-safety measures for 
        workers described in paragraph (2) as the Secretary determines 
        appropriate.

SEC. 1409. IDENTITY AUTHENTICATION STANDARDS.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1815(a)), is amended by adding at 
the end the following:
``Sec. 178. Identity authentication standards
    ``(a) Definition of Information-Based Identity Authentication.--In 
this section, the term `information-based identity authentication' 
means the determination of the identity of an individual, through the 
comparison of information provided by a person, with other information 
pertaining to that individual with a system using scoring models and 
algorithms.
    ``(b) Standards.--Not later than 180 days after the date of 
enactment of this section, the Secretary, in consultation with the 
Secretary of Homeland Security and the Federal Motor Carrier Safety 
Administration, shall promulgate regulations establishing minimum 
standards for State departments of motor vehicles regarding the use of 
information-based identity authentication to determine the identity of 
an applicant for a commercial driver's license, or the renewal, 
transfer or upgrading, of a commercial driver's license.
    ``(c) Minimum Standards.--The regulations shall, at a minimum, 
require State departments of motor vehicles to implement, and 
applicants for commercial driver's licenses, (or the renewal, transfer, 
or upgrading of commercial driver's licenses), to comply with, 
reasonable procedures for operating an information-based identity 
authentication program before issuing, renewing, transferring, or 
upgrading a commercial driver's license.
    ``(d) Key Factors.--In promulgating regulations under this section, 
the Secretary shall require that an information-based identity 
authentication program carried out under this section establish 
processes that--
            ``(1) use multiple sources of matching information;
            ``(2) enable the measurement of the accuracy of the 
        determination of an applicant's identity;
            ``(3) support continuous auditing of compliance with 
        applicable laws, policies, and practices governing the 
        collection, use, and distribution of information in the 
        operation of the program; and
            ``(4) incorporate industry best practices to protect 
        significant privacy interests in the information used in the 
        program and the appropriate safeguarding of the storage of the 
        information.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
I of title 23, United States Code (as amended by section 1815(b)), is 
amended by adding at the end the following:

``178. Identity authentication standards.''.

SEC. 1410. OPEN CONTAINER REQUIREMENTS.

    Section 154 of title 23, United States Code, is amended by striking 
subsection (c) and inserting the following:
    ``(c) Transfer of Funds.--
            ``(1) In general.--The Secretary shall withhold the 
        applicable percentage for the fiscal year of the amount 
        required to be apportioned for Federal-aid highways to any 
        State under each of paragraphs (1), (3), and (4) of section 
        104(b), if a State has not enacted or is not enforcing a 
        provision described in subsection (b), as follows:

``For:                              The applicable percentage is:
    Fiscal year 2008...............
                                        2 percent.
    Fiscal year 2009...............
                                        2 percent.
    Fiscal year 2010...............
                                        2 percent.
    Fiscal year 2011 and each 
        subsequent fiscal year.
                                        2 percent.
            ``(2) Restoration.--If (during the 4-year period beginning 
        on the date the apportionment for any State is reduced in 
        accordance with this subsection) the Secretary determines that 
        the State has enacted and is enforcing a provision described in 
        subsection (b), the apportionment of the State shall be 
        increased by an amount equal to the amount of the reduction 
        made during the 4-year period.''.

             Subtitle E--Environmental Planning and Review

                   CHAPTER 1--TRANSPORTATION PLANNING

SEC. 1501. INTEGRATION OF NATURAL RESOURCE CONCERNS INTO STATE AND 
              METROPOLITAN TRANSPORTATION PLANNING.

    (a) Metropolitan Planning.--Section 134(f) of title 23, United 
States Code, is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (D)--
                            (i) by inserting after ``environment'' the 
                        following: ``(including the protection of 
                        habitat, water quality, and agricultural and 
                        forest land, while minimizing invasive 
                        species)''; and
                            (ii) by inserting before the semicolon the 
                        following: ``(including minimizing adverse 
                        health effects from mobile source air pollution 
                        and promoting the linkage of the transportation 
                        and development goals of the metropolitan 
                        area)''; and
                    (B) in subparagraph (G), by inserting ``and 
                efficient use'' after ``preservation'';
            (2) by redesignating paragraph (2) as paragraph (3); and
            (3) by inserting after paragraph (1) the following:
            ``(2) Selection of factors.--After soliciting and 
        considering any relevant public comments, the metropolitan 
        planning organization shall determine which of the factors 
        described in paragraph (1) are most appropriate for the 
        metropolitan area to consider.''.
    (b) Statewide Planning.--Section 135(c) of title 23, United States 
Code, is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (D)--
                            (i) by inserting after ``environment'' the 
                        following: ``(including the protection of 
                        habitat, water quality, and agricultural and 
                        forest land, while minimizing invasive 
                        species)''; and
                            (ii) by inserting before the semicolon the 
                        following: ``(including minimizing adverse 
                        health effects from mobile source air pollution 
                        and promoting the linkage of the transportation 
                        and development goals of the State)''; and
                    (B) in subparagraph (G), by inserting ``and 
                efficient use'' after ``preservation'';
            (2) by redesignating paragraph (2) as paragraph (3); and
            (3) by inserting after paragraph (1) the following:
            ``(2) Selection of projects and strategies.--After 
        soliciting and considering any relevant public comments, the 
        State shall determine which of the projects and strategies 
        described in paragraph (1) are most appropriate for the State 
        to consider.''.

SEC. 1502. CONSULTATION BETWEEN TRANSPORTATION AGENCIES AND RESOURCE 
              AGENCIES IN TRANSPORTATION PLANNING.

    (a) In General.--Section 134(g) of title 23, United States Code, is 
amended--
            (1) in paragraph (2)--
                    (A) by redesignating subparagraphs (B) through (D) 
                as subparagraphs (C) through (E), respectively; and
                    (B) by inserting after subparagraph (A) the 
                following:
                    ``(B) Mitigation activities.--
                            ``(i) In general.--A long-range 
                        transportation plan shall include a discussion 
                        of--
                                    ``(I) types of potential habitat, 
                                hydrological, and environmental 
                                mitigation activities that may assist 
                                in compensating for loss of habitat, 
                                wetland, and other environmental 
                                functions; and
                                    ``(II) potential areas to carry out 
                                these activities, including a 
                                discussion of areas that may have the 
                                greatest potential to restore and 
                                maintain the habitat types and 
                                hydrological or environmental functions 
                                affected by the plan.
                            ``(ii) Consultation.--The discussion shall 
                        be developed in consultation with Federal, 
                        State, and tribal wildlife, land management, 
                        and regulatory agencies.'';
            (2) by redesignating paragraphs (4), (5), and (6) as 
        paragraphs (5), (6), and (7), respectively; and
            (3) by inserting after paragraph (3) the following:
            ``(4) Consultation.--
                    ``(A) In general.--In each metropolitan area, the 
                metropolitan planning organization shall consult, as 
                appropriate, with State and local agencies responsible 
                for land use management, natural resources, 
                environmental protection, conservation, and historic 
                preservation concerning the development of a long-range 
                transportation plan.
                    ``(B) Issues.--The consultation shall involve--
                            ``(i) comparison of transportation plans 
                        with State conservation plans or with maps, if 
                        available;
                            ``(ii) comparison of transportation plans 
                        to inventories of natural or historic 
                        resources, if available; or
                            ``(iii) consideration of areas where 
                        wildlife crossing structures may be needed to 
                        ensure connectivity between wildlife habitat 
                        linkage areas.''.
    (b) Improved Consultation During State Transportation Planning.--
            (1) In general.--Section 135(e)(2) of title 23, United 
        States Code, is amended by adding at the end the following:
                    ``(D) Consultation, comparison, and 
                consideration.--
                            ``(i) In general.--The long-range 
                        transportation plan shall be developed, as 
                        appropriate, in consultation with State and 
                        local agencies responsible for--
                                    ``(I) land use management;
                                    ``(II) natural resources;
                                    ``(III) environmental protection;
                                    ``(IV) conservation; and
                                    ``(V) historic preservation.
                            ``(ii) Comparison and consideration.--
                        Consultation under clause (i) shall involve--
                                    ``(I) comparison of transportation 
                                plans to State conservation plans or 
                                maps, if available;
                                    ``(II) comparison of transportation 
                                plans to inventories of natural or 
                                historic resources, if available; or
                                    ``(III) consideration of areas 
                                where wildlife crossing structures may 
                                be needed to ensure connectivity 
                                between wildlife habitat linkage 
                                areas.''.
            (2) Additional requirements.--Section 135(e) of title 23, 
        United States Code, is amended--
                    (A) by redesignating paragraphs (4) and (5) as 
                paragraphs (6) and (7), respectively; and
                    (B) by inserting after paragraph (3) the following:
            ``(4) Mitigation activities.--
                    ``(A) In general.--A long-range transportation plan 
                shall include a discussion of--
                            ``(i) types of potential habitat, 
                        hydrological, and environmental mitigation 
                        activities that may assist in compensating for 
                        loss of habitat, wetlands, and other 
                        environmental functions; and
                            ``(ii) potential areas to carry out these 
                        activities, including a discussion of areas 
                        that may have the greatest potential to restore 
                        and maintain the habitat types and hydrological 
                        or environmental functions affected by the 
                        plan.
                    ``(B) Consultation.--The discussion shall be 
                developed in consultation with Federal, State, and 
                tribal wildlife, land management, and regulatory 
                agencies.
            ``(5) Transportation strategies.--A long-range 
        transportation plan shall identify transportation strategies 
        necessary to efficiently serve the mobility needs of people.''.

SEC. 1503. INTEGRATION OF NATURAL RESOURCE CONCERNS INTO TRANSPORTATION 
              PROJECT PLANNING.

    Section 109(c)(2) of title 23, United States Code, is amended--
            (1) by striking ``consider the results'' and inserting 
        ``consider--
                    ``(A) the results'';
            (2) by striking the period at the end and inserting a 
        semicolon; and
            (3) by adding at the end the following:
                    ``(B) the publication entitled `Flexibility in 
                Highway Design' of the Federal Highway Administration;
                    ``(C) `Eight Characteristics of Process to Yield 
                Excellence and the Seven Qualities of Excellence in 
                Transportation Design' developed by the conference held 
                during 1998 entitled `Thinking Beyond the Pavement 
                National Workshop on Integrating Highway Development 
                with Communities and the Environment while Maintaining 
                Safety and Performance'; and
                    ``(D) any other material that the Secretary 
                determines to be appropriate.''.

SEC. 1504. PUBLIC INVOLVEMENT IN TRANSPORTATION PLANNING AND PROJECTS.

    (a) Metropolitan Planning.--
            (1) Participation by interested parties.--Section 134(g)(5) 
        of title 23, United States Code (as redesignated by section 
        1502(a)(1)), is amended--
                    (A) by striking ``Before approving'' and inserting 
                the following:
                    ``(A) In general.--Before approving''; and
                    (B) by adding at the end the following:
                    ``(B) Methods.--In carrying out subparagraph (A), 
                the metropolitan planning organization shall, to the 
                maximum extent practicable--
                            ``(i) hold any public meetings at 
                        convenient and accessible locations and times;
                            ``(ii) employ visualization techniques to 
                        describe plans; and
                            ``(iii) make public information available 
                        in electronically accessible format and means, 
                        such as the World Wide Web.''.
            (2) Publication of long-range transportation plans.--
        Section 134(g)(6)(i) of title 23, United States Code (as 
        redesignated by section 1502(a)(1)), is amended by inserting 
        before the semicolon the following: ``, including (to the 
        maximum extent practicable) in electronically accessible 
        formats and means such as the World Wide Web''.
    (b) Statewide Planning.--
            (1) Participation by interested parties.--Section 135(e)(3) 
        of title 23, United States Code, is amended by striking 
        subparagraph (B) and inserting the following:
                    ``(B) Methods.--In carrying out subparagraph (A), 
                the State shall, to the maximum extent practicable--
                            ``(i) hold any public meetings at 
                        convenient and accessible locations and times;
                            ``(ii) employ visualization techniques to 
                        describe plans; and
                            ``(iii) make public information available 
                        in electronically accessible format and means, 
                        such as the World Wide Web.''.
            (2) Publication of long-range transportation plans.--
        Section 135(e) of title 23, United States Code (as amended by 
        section 1502(b)(2)), is amended by adding at the end the 
        following:
            ``(8) Publication of long-range transportation plans.--Each 
        long-range transportation plan prepared by a State shall be 
        published or otherwise made available, including (to the 
        maximum extent practicable) in electronically accessible 
        formats and means, such as the World Wide Web.''.

SEC. 1505. PROJECT MITIGATION.

    (a) Mitigation for National Highway System Projects.--Section 
103(b)(6)(M) of title 23, United States Code, is amended--
            (1) by inserting ``(i)'' after ``(M); and
            (2) by adding at the end the following:
                    ``(ii) State habitat, streams, and wetlands 
                mitigation efforts under section 155.''.
    (b) Mitigation for Surface Transportation Program Projects.--
Section 133(b)(11) of title 23, United States Code, is amended--
            (1) by inserting ``(A)'' after ``(11)''; and
            (2) by adding at the end the following:
            ``(B) State habitat, streams, and wetlands mitigation 
        efforts under section 155.''.
    (c) State Habitat, Streams, and Wetlands Mitigation Funds.--Section 
155 of title 23, United States Code, is amended to read as follows:
``Sec. 155. State habitat, streams, and wetlands mitigation funds
    ``(a) Establishment.--A State should establish a habitat, streams, 
and wetlands mitigation fund (referred to in this section as a `State 
fund').
    ``(b) Purpose.--The purpose of a State fund is to encourage efforts 
for habitat, streams, and wetlands mitigation in advance of or in 
conjunction with highway or transit projects to--
            ``(1) ensure that the best habitat, streams, and wetland 
        mitigation sites now available are used; and
            ``(2) accelerate transportation project delivery by making 
        high-quality habitat, streams, and wetland mitigation credits 
        available when needed.
    ``(c) Funds.--A State may deposit into a State fund part of the 
funds apportioned to the State under--
            ``(1) section 104(b)(1) for the National Highway System; 
        and
            ``(2) section 104(b)(3) for the surface transportation 
        program.
    ``(d) Use.--
            ``(1) In general.--Amounts deposited in a State fund shall 
        be used (in a manner consistent with this section) for habitat, 
        streams, or wetlands mitigation related to 1 or more projects 
        funded under this title, including a project under the 
        transportation improvement program of the State developed under 
        section 135(f).
            ``(2) Endangered species.--In carrying out this section, a 
        State and cooperating agency shall give consideration to 
        mitigation projects, on-site or off-site, that restore and 
        preserve the best available sites to conserve biodiversity and 
        habitat for--
                    ``(A) Federal or State listed threatened or 
                endangered species of plants and animals; and
                    ``(B) plant or animal species warranting listing as 
                threatened or endangered, as determined by the 
                Secretary of the Interior in accordance with section 
                4(b)(3)(B) of the Endangered Species Act of 1973 (16 
                U.S.C. 1533(b)(3)(B)).
    ``(e) Consistency With Applicable Requirements.--Contributions from 
the State fund to mitigation efforts may occur in advance of project 
construction only if the efforts are consistent with all applicable 
requirements of Federal law (including regulations).''.
    (d) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code, is amended by striking the item 
relating to section 155 and inserting the following:

``155. State habitat, streams, and wetlands mitigation funds.''.

         CHAPTER 2--TRANSPORTATION PROJECT DEVELOPMENT PROCESS

SEC. 1511. TRANSPORTATION PROJECT DEVELOPMENT PROCESS.

    (a) In General.--Chapter 3 of title 23, United States Code (as 
amended by section 1203(a)), is amended by inserting after section 325 
the following:
``Sec. 326. Transportation project development process
    ``(a) Definitions.--In this section:
            ``(1) Agency.--The term `agency' means any agency, 
        department, or other unit of Federal, State, local, or 
        federally recognized tribal government.
            ``(2) Environmental impact statement.--The term 
        `environmental impact statement' means a detailed statement of 
        the environmental impacts of a project required to be prepared 
        under the National Environmental Policy Act of 1969 (42 U.S.C. 
        4321 et seq.).
            ``(3) Environmental review process.--
                    ``(A) In general.--The term `environmental review 
                process' means the process for preparing, for a 
                project--
                            ``(i) an environmental impact statement; or
                            ``(ii) any other document or analysis 
                        required to be prepared under the National 
                        Environmental Policy Act of 1969 (42 U.S.C. 
                        4321 et seq.)
                    ``(B) Inclusions.--The term `environmental review 
                process' includes the process for and completion of any 
                environmental permit, approval, review, or study 
                required for a project under any Federal law other than 
                the National Environmental Policy Act of 1969 (42 
                U.S.C. 4321 et seq.).
            ``(4) Project.--The term `project' means any highway or 
        transit project that requires the approval of the Secretary.
            ``(5) Project sponsor.--The term `project sponsor' means an 
        agency or other entity (including any private or public-private 
        entity), that seeks approval of the Secretary for a project.
            ``(6) State transportation department.--The term `State 
        transportation department' means any statewide agency of a 
        State with responsibility for transportation.
    ``(b) Process.--
            ``(1) Lead agency.--
                    ``(A) In general.--The Department of Transportation 
                shall be the lead Federal agency in the environmental 
                review process for a project.
                    ``(B) Joint lead agencies.--Nothing in this section 
                precludes another agency from being a joint lead agency 
                in accordance with regulations under the National 
                Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
                seq.).
                    ``(C) Concurrence of project sponsor.--The lead 
                agency may carry out the environmental review process 
                in accordance with this section only with the 
                concurrence of the project sponsor.
            ``(2) Request for process.--
                    ``(A) In general.--A project sponsor may request 
                that the lead agency carry out the environmental review 
                process for a project or group of projects in 
                accordance with this section.
                    ``(B) Grant of request; public notice.--The lead 
                agency shall--
                            ``(i) grant a request under subparagraph 
                        (A); and
                            ``(ii) provide public notice of the 
                        request.
            ``(3) Effective date.--The environmental review process 
        described in this section may be applied to a project only 
        after the date on which public notice is provided under 
        subparagraph (B)(ii).
    ``(c) Roles and Responsibility of Lead Agency.--With respect to the 
environmental review process for any project, the lead agency shall 
have authority and responsibility to--
                    ``(A) identify and invite cooperating agencies in 
                accordance with subsection (d);
                    ``(B) develop an agency coordination plan with 
                review, schedule, and timelines in accordance with 
                subsection (e);
                    ``(C) determine the purpose and need for the 
                project in accordance with subsection (f);
                    ``(D) determine the range of alternatives to be 
                considered in accordance with subsection (g);
                    ``(E) convene dispute-avoidance and decision 
                resolution meetings and related efforts in accordance 
                with subsection (h);
                    ``(F) take such other actions as are necessary and 
                proper, within the authority of the lead agency, to 
                facilitate the expeditious resolution of the 
                environmental review process for the project; and
                    ``(G) prepare or ensure that any required 
                environmental impact statement or other document 
                required to be completed under the National 
                Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
                seq.) is completed in accordance with this section and 
                applicable Federal law.
    ``(d) Roles and Responsibilities of Cooperating Agencies.--
            ``(1) In general.--With respect to a project, each Federal 
        agency shall carry out any obligations of the Federal agency in 
        the environmental review process in accordance with this 
        section and applicable Federal law.
            ``(2) Invitation.--
                    ``(A) In general.--The lead agency shall--
                            ``(i) identify, as early as practicable in 
                        the environmental review process for a project, 
                        any other agencies that may have an interest in 
                        the project, including--
                                    ``(I) agencies with jurisdiction 
                                over environmentally-related matters 
                                that may affect the project or may be 
                                required by law to conduct an 
                                environmental-related independent 
                                review or analysis of the project or 
                                determine whether to issue an 
                                environmental-related permit, license, 
                                or approval for the project; and
                                    ``(II) agencies with special 
                                expertise relevant to the project;
                            ``(ii) invite the agencies identified in 
                        clause (i) to become participating agencies in 
                        the environmental review process for that 
                        project; and
                            ``(iii) grant requests to become 
                        cooperating agencies from agencies not 
                        originally invited.
                    ``(B) Responses.--The deadline for receipt of a 
                response from an agency that receives an invitation 
                under subparagraph (A)(ii)--
                            ``(i) shall be 30 days after the date of 
                        receipt by the agency of the invitation; but
                            ``(ii) may be extended by the lead agency 
                        for good cause.
            ``(3) Declining of invitations.--A Federal agency that is 
        invited by the lead agency to participate in the environmental 
        review process for a project shall be designated as a 
        cooperating agency by the lead agency, unless the invited 
        agency informs the lead agency in writing, by the deadline 
        specified in the invitation, that the invited agency--
                    ``(A) has no jurisdiction or authority with respect 
                to the project;
                    ``(B) has no expertise or information relevant to 
                the project; and
                    ``(C) does not intend to submit comments on the 
                project.
            ``(4) Effect of designation.--Designation as a cooperating 
        agency under this subsection shall not imply that the 
        cooperating agency--
                    ``(A) supports a proposed project; or
                    ``(B) has any jurisdiction over, or special 
                expertise with respect to evaluation of, the project.
            ``(5) Designations for categories of projects.--
                    ``(A) In general.--The Secretary may invite other 
                agencies to become cooperating agencies for a category 
                of projects.
                    ``(B) Designation.--An agency may be designated as 
                a cooperating agency for a category of projects only 
                with the consent of the agency.
            ``(6) Concurrent reviews.--Each Federal agency shall, to 
        the maximum extent practicable--
                    ``(A) carry out obligations of the Federal agency 
                under other applicable law concurrently, and in 
                conjunction, with the review required under the 
                National Environmental Policy Act of 1969 (42 U.S.C. 
                4321 et seq.), unless doing so would impair the ability 
                of the Federal agency to carry out those obligations; 
                and
                    ``(B) formulate and implement administrative, 
                policy, and procedural mechanisms to enable the agency 
                to ensure completion of the environmental review 
                process in a timely, coordinated, and environmentally 
                responsible manner.
    ``(e) Development of Flexible Process and Timeline.--
            ``(1) Coordination plan.--
                    ``(A) In general.--The lead agency shall establish 
                a coordination plan, which may be incorporated into a 
                memorandum of understanding, to coordinate agency and 
                public participation in and comment on the 
                environmental review process for a project or category 
                of projects.
                    ``(B) Workplan.--
                            ``(i) In general.--The lead agency shall 
                        develop, as part of the coordination plan, a 
                        workplan for completing the collection, 
                        analysis, and evaluation of baseline data and 
                        future impacts modeling necessary to complete 
                        the environmental review process, including any 
                        data, analyses, and modeling necessary for 
                        related permits, approvals, reviews, or studies 
                        required for the project under other laws.
                            ``(ii) Consultation.--In developing the 
                        workplan under clause (i), the lead agency 
                        shall consult with--
                                    ``(I) each cooperating agency for 
                                the project;
                                    ``(II) the State in which the 
                                project is located; and
                                    ``(III) if the State is not the 
                                project sponsor, the project sponsor.
                    ``(C) Schedule.--
                            ``(i) In general.--The lead agency shall 
                        establish as part of the coordination plan, 
                        after consultation with each cooperating agency 
                        for the project and with the State in which the 
                        project is located (and, if the State is not 
                        the project sponsor, with the project sponsor), 
                        a schedule for completion of the environmental 
                        review process for the project.
                            ``(ii) Factors for consideration.--In 
                        establishing the schedule, the lead agency 
                        shall consider factors such as--
                                    ``(I) the responsibilities of 
                                cooperating agencies under applicable 
                                laws;
                                    ``(II) resources available to the 
                                cooperating agencies;
                                    ``(III) overall size and complexity 
                                of a project;
                                    ``(IV) the overall schedule for and 
                                cost of a project; and
                                    ``(V) the sensitivity of the 
                                natural and historic resources that 
                                could be affected by the project.
                    ``(D) Consistency with other time periods.--A 
                schedule under subparagraph (C) shall be consistent 
                with any other relevant time periods established under 
                Federal law.
                    ``(E) Modification.--The lead agency may--
                            ``(i) lengthen a schedule established under 
                        subparagraph (C) for good cause; and
                            ``(ii) shorten a schedule only with the 
                        concurrence of the affected cooperating 
                        agencies.
                    ``(F) Dissemination.--A copy of a schedule under 
                subparagraph (C), and of any modifications to the 
                schedule, shall be--
                            ``(i) provided to all cooperating agencies 
                        and to the State transportation department of 
                        the State in which the project is located (and, 
                        if the State is not the project sponsor, to the 
                        project sponsor); and
                            ``(ii) made available to the public.
            ``(2) Comments and timelines.--
                    ``(A) In general.--A schedule established under 
                paragraph (1)(C) shall include--
                            ``(i) opportunities for comment, deadline 
                        for receipt of any comments submitted, deadline 
                        for lead agency response to comments; and
                            ``(ii) except as otherwise provided under 
                        paragraph (1)--
                                    ``(I) an opportunity to comment by 
                                agencies and the public on a draft or 
                                final environmental impact statement 
                                for a period of not more than 60 days 
                                longer than the minimum period required 
                                under the National Environmental Policy 
                                Act of 1969 (42 U.S.C. 4321 et seq.); 
                                and
                                    ``(II) for all other comment 
                                periods established by the lead agency 
                                for agency or public comments in the 
                                environmental review process, a period 
                                of not more than the longer of--
                                            ``(aa) 30 days after the 
                                        final day of the minimum period 
                                        required under Federal law 
                                        (including regulations), if 
                                        available; or
                                            ``(bb) if a minimum period 
                                        is not required under Federal 
                                        law (including regulations), 30 
                                        days.
                    ``(B) Extension of comment periods.--The lead 
                agency may extend a period of comment established under 
                this paragraph for good cause.
                    ``(C) Late comments.--A comment concerning a 
                project submitted under this paragraph after the date 
                of termination of the applicable comment period or 
                extension of a comment period shall not be eligible for 
                consideration by the lead agency unless the lead agency 
                or project sponsor determines there was good cause for 
                the delay or the lead agency is required to consider 
                significant new circumstances or information in 
                accordance with sections 1501.7 and 1502.9 of title 40, 
                Code of Federal Regulations.
                    ``(D) Deadlines for decisions under other laws.--In 
                any case in which a decision under any Federal law 
                relating to a project (including the issuance or denial 
                of a permit or license) is required to be made by the 
                later of the date that is 180 days after the date on 
                which the Secretary made all final decisions of the 
                lead agency with respect to the project, or 180 days 
                after the date on which an application was submitted 
                for the permit or license, the Secretary shall submit 
                to the Committee on Environment and Public Works of the 
                Senate and the Committee on Transportation and 
                Infrastructure of the House of Representatives--
                            ``(i) as soon as practicable after the 180-
                        day period, an initial notice of the failure of 
                        the Federal agency to make the decision; and
                            ``(ii) every 60 day thereafter until such 
                        date as all decisions of the Federal agency 
                        relating to the project have been made by the 
                        Federal agency, an additional notice that 
                        describes the number of decisions of the 
                        Federal agency that remain outstanding as of 
                        the date of the additional notice.
            ``(3) Involvement of the public.--Nothing in this 
        subsection shall reduce any time period provided for public 
        comment in the environmental review process under existing 
        Federal law (including a regulation).
    ``(f) Development of Project Purpose and Need Statement.--
            ``(1) In general.--With respect to the environmental review 
        process for a project, the purpose and need for the project 
        shall be defined in accordance with this subsection.
            ``(2) Authority.--The lead agency shall define the purpose 
        and need for a project, including the transportation objectives 
        and any other objectives intended to be achieved by the 
        project.
            ``(3) Involvement of cooperating agencies and the public.--
        Before determining the purpose and need for a project, the lead 
        agency shall solicit for 30 days, and consider, any relevant 
        comments on the draft statement of purpose and need for a 
        proposed project received from the public and cooperating 
        agencies.
            ``(4) Effect on other reviews.--For the purpose of 
        compliance with the National Environmental Policy Act of 1969 
        (42 U.S.C. 4321 et seq.) and any other law requiring an agency 
        that is not the lead agency to determine or consider a project 
        purpose or project need, such an agency acting, permitting, or 
        approving under, or otherwise applying, Federal law with 
        respect to a project shall adopt the determination of purpose 
        and need for the project made by the lead agency.
            ``(5) Savings.--Nothing in this subsection preempts or 
        interferes with any power, jurisdiction, responsibility, or 
        authority of an agency under applicable law (including 
        regulations) with respect to a project.
            ``(6) Contents.--
                    ``(A) In general.--The statement of purpose and 
                need shall include a clear statement of the objectives 
                that the proposed project is intended to achieve.
                    ``(B) Effect on existing standards.--Nothing in 
                this subsection shall alter existing standards for 
                defining the purpose and need of a project.
            ``(7) Factors to consider.--The lead agency may determine 
        that any of the following factors and documents are appropriate 
        for consideration in determining the purpose of and need for a 
        project:
                    ``(A) Transportation plans and related planning 
                documents developed through the statewide and 
                metropolitan transportation planning process under 
                sections 134 and 135.
                    ``(B) Land use plans adopted by units of State, 
                local, or tribal government (or, in the case of Federal 
                land, by the applicable Federal land management 
                agencies).
                    ``(C) Economic development plans adopted by--
                            ``(i) units of State, local, or tribal 
                        government; or
                            ``(ii) established economic development 
                        planning organizations or authorities.
                    ``(D) Environmental protection plans, including 
                plans for the protection or treatment of--
                            ``(i) air quality;
                            ``(ii) water quality and runoff;
                            ``(iii) habitat needs of plants and 
                        animals;
                            ``(iv) threatened and endangered species;
                            ``(v) invasive species;
                            ``(vi) historic properties; and
                            ``(vii) other environmental resources.
                    ``(E) Any publicly available plans or policies 
                relating to the national defense, national security, or 
                foreign policy of the United States.
    ``(g) Development of Project Alternatives.--
            ``(1) In general.--With respect to the environmental review 
        process for a project, the alternatives shall be determined in 
        accordance with this subsection.
            ``(2) Authority.--The lead agency shall determine the 
        alternatives to be considered for a project.
            ``(3) Involvement of cooperating agencies and the public.--
                    ``(A) In general.--Before determining the 
                alternatives for a project, the lead agency shall 
                solicit for 30 days and consider any relevant comments 
                on the proposed alternatives received from the public 
                and cooperating agencies.
                    ``(B) Alternatives.--The lead agency shall 
                consider--
                            ``(i) alternatives that meet the purpose 
                        and need of the project; and
                            ``(ii) the alternative of no action.
                    ``(C) Effect on existing standards.--Nothing in 
                this subsection shall alter the existing standards for 
                determining the range of alternatives.
            ``(4) Effect on other reviews.--Any other agency acting 
        under or applying Federal law with respect to a project shall 
        consider only the alternatives determined by the lead agency.
            ``(5) Savings.--Nothing in this subsection preempts or 
        interferes with any power, jurisdiction, responsibility, or 
        authority of an agency under applicable law (including 
        regulations) with respect to a project.
            ``(6) Factors to consider.--The lead agency may determine 
        that any of the following factors and documents are appropriate 
        for consideration in determining the alternatives for a 
        project:
                    ``(A) The overall size and complexity of the 
                proposed action.
                    ``(B) The sensitivity of the potentially affected 
                resources.
                    ``(C) The overall schedule and cost of the project.
                    ``(D) Transportation plans and related planning 
                documents developed through the statewide and 
                metropolitan transportation planning process under 
                sections 134 and 135 of title 23 of the United States 
                Code.
                    ``(E) Land use plans adopted by units of State, 
                local, or tribal government (or, in the case of Federal 
                land, by the applicable Federal land management 
                agencies).
                    ``(F) Economic development plans adopted by--
                            ``(i) units of State, local, or tribal 
                        government; or
                            ``(ii) established economic development 
                        planning organizations or authorities.
                    ``(G) environmental protection plans, including 
                plans for the protection or treatment of--
                            ``(i) air quality;
                            ``(ii) water quality and runoff;
                            ``(iii) habitat needs of plants and 
                        animals;
                            ``(iv) threatened and endangered species;
                            ``(v) invasive species;
                            ``(vi) historic properties; and
                            ``(vii) other environmental resources.
                    ``(H) Any publicly available plans or policies 
                relating to the national defense, national security, or 
                foreign policy of the United States.
    ``(h) Prompt Issue Identification and Resolution Process.--
            ``(1) In general.--The lead agency, the project sponsor, 
        and the cooperating agencies shall work cooperatively, in 
        accordance with this section, to identify and resolve issues 
        that could--
                    ``(A) delay completion of the environmental review 
                process; or
                    ``(B) result in denial of any approvals required 
                for the project under applicable laws.
            ``(2) Lead agency responsibilities.--
                    ``(A) In general.--The lead agency, with the 
                assistance of the project sponsor, shall make 
                information available to the cooperating agencies, as 
                early as practicable in the environmental review 
                process, regarding--
                            ``(i) the environmental and socioeconomic 
                        resources located within the project area; and
                            ``(ii) the general locations of the 
                        alternatives under consideration.
                    ``(B) Basis for information.--Information about 
                resources in the project area may be based on existing 
                data sources, including geographic information systems 
                mapping.
            ``(3) Cooperating agency responsibilities.--
                    ``(A) In general.--Based on information received 
                from the lead agency, cooperating agencies shall 
                promptly identify to the lead agency any major issues 
                of concern regarding the potential environmental or 
                socioeconomic impacts of a project.
                    ``(B) Major issues of concern.--A major issue of 
                concern referred to in subparagraph (A) may include any 
                issue that could substantially delay or prevent an 
                agency from granting a permit or other approval that is 
                needed for a project, as determined by a cooperating 
                agency.
            ``(4) Issue resolution.--On identification of a major issue 
        of concern under paragraph (3), or at any time upon the request 
        of a project sponsor or the Governor of a State, the lead 
        agency shall promptly convene a meeting with representatives of 
        each of the relevant cooperating agencies, the project sponsor, 
        and the Governor to address and resolve the issue.
            ``(5) Notification.--If a resolution of a major issue of 
        concern under paragraph (4) cannot be achieved by the date that 
        is 30 days after the date on which a meeting under that 
        paragraph is convened, the lead agency shall provide 
        notification of the failure to resolve the major issue of 
        concern to--
                    ``(A) the heads of all cooperating agencies;
                    ``(B) the project sponsor;
                    ``(C) the Governor involved;
                    ``(D) the Committee on Environment and Public Works 
                of the Senate; and
                    ``(E) the Committee on Transportation and 
                Infrastructure of the House of Representatives.
    ``(i) Performance Measurement.--
            ``(1) Progress reports.--The Secretary shall establish a 
        program to measure and report on progress toward improving and 
        expediting the planning and environmental review process.
            ``(2) Minimum requirements.--The program shall include, at 
        a minimum--
                    ``(A) the establishment of criteria for measuring 
                consideration of--
                            ``(i) State and metropolitan planning, 
                        project planning, and design criteria; and
                            ``(ii) environmental processing times and 
                        costs;
                    ``(B) the collection of data to assess performance 
                based on the established criteria; and
                    ``(C) the annual reporting of the results of the 
                performance measurement studies.
            ``(3) Involvement of the public and cooperating agencies.--
                    ``(A) In general.--The Secretary shall biennially 
                conduct a survey of agencies participating in the 
                environmental review process under this section to 
                assess the expectations and experiences of each 
                surveyed agency with regard to the planning and 
                environmental review process for projects reviewed 
                under this section.
                    ``(B) Public participation.--In conducting the 
                survey, the Secretary shall solicit comments from the 
                public.
    ``(j) Assistance to Affected Federal and State Agencies.--
            ``(1) In general.--The Secretary may approve a request by a 
        State or recipient to provide funds made available under this 
        title for a highway project, or made available under chapter 53 
        of title 49 for a mass transit project, to agencies 
        participating in the coordinated environmental review process 
        established under this section in order to provide the 
        resources necessary to meet any time limits established under 
        this section.
            ``(2) Amounts.--Such requests under paragraph (1) shall be 
        approved only--
                    ``(A) for such additional amounts as the Secretary 
                determines are necessary for the affected Federal and 
                State agencies to meet the time limits for 
                environmental review; and
                    ``(B) if those time limits are less than the 
                customary time necessary for that review.
    ``(k) Judicial Review and Savings Clause.--
            ``(1) Judicial review.--Nothing in this section shall 
        affect the reviewability of any final Federal agency action in 
        any United States district court or State court.
            ``(2) Savings clause.--Nothing in this section shall 
        affect--
                    ``(A) the applicability of the National 
                Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
                seq.) or any other Federal environmental statute; or
                    ``(B) the responsibility of any Federal officer to 
                comply with or enforce such a statute.''.
    (b) Conforming Amendments.--
            (1) The analysis for chapter 3 of title 23, United States 
        Code, is amended by inserting after the item relating to 
        section 325 (as added by section 1203(f)) the following:

``326. Transportation project development process.''.
            (2) Section 1309 of the Transportation Equity Act for the 
        21st Century (112 Stat. 232) is repealed.

SEC. 1512. ASSUMPTION OF RESPONSIBILITY FOR CATEGORICAL EXCLUSIONS.

    (a) In General.--Chapter 3 of title 23, United States Code (as 
amended by section 1511(a)), is amended by inserting after section 326 
the following:
``Sec. 327. Assumption of responsibility for categorical exclusions
    ``(a) Categorical Exclusion Determinations.--
            ``(1) In general.--The Secretary may assign, and a State 
        may assume, responsibility for determining whether certain 
        designated activities are included within classes of action 
        identified in regulation by the Secretary that are 
        categorically excluded from requirements for environmental 
        assessments or environmental impact statements pursuant to 
        regulations promulgated by the Council on Environmental Quality 
        under part 1500 of title 40, Code of Federal Regulations (as in 
        effect on October 1, 2003).
            ``(2) Scope of authority.--A determination described in 
        paragraph (1) shall be made by a State in accordance with 
        criteria established by the Secretary and only for types of 
        activities specifically designated by the Secretary.
            ``(3) Criteria.--The criteria under paragraph (2) shall 
        include provisions for public availability of information 
        consistent with section 552 of title 5 and the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).
    ``(b) Other Applicable Federal Laws.--
            ``(1) In general.--If a State assumes responsibility under 
        subsection (a), the Secretary may also assign and the State may 
        assume all or part of the responsibilities of the Secretary for 
        environmental review, consultation, or other related actions 
        required under any Federal law applicable to activities that 
        are classified by the Secretary as categorical exclusions, with 
        the exception of government-to-government consultation with 
        Indian tribes, subject to the same procedural and substantive 
        requirements as would be required if that responsibility were 
        carried out by the Secretary.
            ``(2) Sole responsibility.--A State that assumes 
        responsibility under paragraph (1) with respect to a Federal 
        law shall be solely responsible and solely liable for complying 
        with and carrying out that law, and the Secretary shall have no 
        such responsibility or liability.
    ``(c) Memoranda of Understanding.--
            ``(1) In general.--The Secretary and the State, after 
        providing public notice and opportunity for comment, shall 
        enter into a memorandum of understanding setting forth the 
        responsibilities to be assigned under this section and the 
        terms and conditions under which the assignments are made, 
        including establishment of the circumstances under which the 
        Secretary would reassume responsibility for categorical 
        exclusion determinations.
            ``(2) Term.--A memorandum of understanding--
                    ``(A) shall have term of not more than 3 years; and
                    ``(B) shall be renewable.
            ``(3) Acceptance of jurisdiction.--In a memorandum of 
        understanding, the State shall consent to accept the 
        jurisdiction of the Federal courts for the compliance, 
        discharge, and enforcement of any responsibility of the 
        Secretary that the State assumes.
            ``(4) Monitoring.--The Secretary shall--
                    ``(A) monitor compliance by the State with the 
                memorandum of understanding and the provision by the 
                State of financial resources to carry out the 
                memorandum of understanding; and
                    ``(B) take into account the performance by the 
                State when considering renewal of the memorandum of 
                understanding.
    ``(d) Termination.--The Secretary may terminate any assumption of 
responsibility under a memorandum of understanding on a determination 
that the State is not adequately carrying out the responsibilities 
assigned to the State.
    ``(e) State Agency Deemed To Be Federal Agency.--A State agency 
that is assigned a responsibility under a memorandum of understanding 
shall be deemed to be a Federal agency for the purposes of the Federal 
law under which the responsibility is exercised.''.
    (b) Conforming Amendment.--The analysis for chapter 3 of title 23, 
United States Code (as amended by section 1511(b)), is amended by 
inserting after the item relating to section 326 the following:

``327. Assumption of responsibility for categorical exclusions.''.

SEC. 1513. SURFACE TRANSPORTATION PROJECT DELIVERY PILOT PROGRAM.

    (a) In General.--Chapter 3 of title 23, United States Code (as 
amended by section 1512(a)), is amended by inserting after section 327 
the following:
``Sec. 328. Surface transportation project delivery pilot program
    ``(a) Establishment.--
            ``(1) In general.--The Secretary shall carry out a surface 
        transportation project delivery pilot program (referred to in 
        this section as the `program').
            ``(2) Assumption of responsibility.--
                    ``(A) In general.--Subject to the other provisions 
                of this section, with the written agreement of the 
                Secretary and a State, which may be in the form of a 
                memorandum of understanding, the Secretary may assign, 
                and the State may assume, the responsibilities of the 
                Secretary with respect to 1 or more highway projects 
                within the State under the National Environmental 
                Policy Act of 1969 (42 U.S.C. 4321 et seq.).
                    ``(B) Additional responsibility.--If a State 
                assumes responsibility under subparagraph (A)--
                            ``(i) the Secretary may assign to the 
                        State, and the State may assume, all or part of 
                        the responsibilities of the Secretary for 
                        environmental review, consultation, or other 
                        action required under any Federal environmental 
                        law pertaining to the review or approval of a 
                        specific project; but
                            ``(ii) the Secretary may not assign--
                                    ``(I) responsibility for any 
                                conformity determination required under 
                                section 176 of the Clean Air Act (42 
                                U.S.C. 7506); or
                                    ``(II) any responsibility imposed 
                                on the Secretary by section 134 or 135.
                    ``(C) Procedural and substantive requirements.--A 
                State shall assume responsibility under this section 
                subject to the same procedural and substantive 
                requirements as would apply if that responsibility were 
                carried out by the Secretary.
                    ``(D) Federal responsibility.--Any responsibility 
                of the Secretary not explicitly assumed by the State by 
                written agreement under this section shall remain the 
                responsibility of the Secretary.
                    ``(E) No effect on authority.--Nothing in this 
                section preempts or interferes with any power, 
                jurisdiction, responsibility, or authority of an 
                agency, other than the Department of Transportation, 
                under applicable law (including regulations) with 
                respect to a project.
    ``(b) State Participation.--
            ``(1) Number of participating states.--The Secretary may 
        permit not more than 5 States (including the State of Oklahoma) 
        to participate in the program.
            ``(2) Application.--Not later than 270 days after the date 
        of enactment of this section, the Secretary shall promulgate 
        regulations that establish requirements relating to information 
        required to be contained in any application of a State to 
        participate in the program, including, at a minimum--
                    ``(A) the projects or classes of projects for which 
                the State anticipates exercising the authority that may 
                be granted under the program;
                    ``(B) verification of the financial resources 
                necessary to carry out the authority that may be 
                granted under the program; and
                    ``(C) evidence of the notice and solicitation of 
                public comment by the State relating to participation 
                of the State in the program, including copies of 
                comments received from that solicitation.
            ``(3) Public notice.--
                    ``(A) In general.--Each State that submits an 
                application under this subsection shall give notice of 
                the intent of the State to participate in the program 
                not later than 30 days before the date of submission of 
                the application.
                    ``(B) Method of notice and solicitation.--The State 
                shall provide notice and solicit public comment under 
                this paragraph by publishing the complete application 
                of the State in accordance with the appropriate public 
                notice law of the State.
            ``(4) Selection criteria.--The Secretary may approve the 
        application of a State under this section only if--
                    ``(A) the regulatory requirements under paragraph 
                (2) have been met;
                    ``(B) the Secretary determines that the State has 
                the capability, including financial and personnel, to 
                assume the responsibility; and
                    ``(C) the head of the State agency having primary 
                jurisdiction over highway matters enters into a written 
                agreement with the Secretary described in subsection 
                (c).
            ``(5) Other federal agency views.--If a State applies to 
        assume a responsibility of the Secretary that would have 
        required the Secretary to consult with another Federal agency, 
        the Secretary shall solicit the views of the Federal agency 
        before approving the application.
    ``(c) Written Agreement.--A written agreement under this section 
shall--
            ``(1) be executed by the Governor or the top-ranking 
        transportation official in the State who is charged with 
        responsibility for highway construction;
            ``(2) be in such form as the Secretary may prescribe;
            ``(3) provide that the State--
                    ``(A) agrees to assume all or part of the 
                responsibilities of the Secretary described in 
                subsection (a);
                    ``(B) expressly consents, on behalf of the State, 
                to accept the jurisdiction of the Federal courts for 
                the compliance, discharge, and enforcement of any 
                responsibility of the Secretary assumed by the State;
                    ``(C) certifies that State laws (including 
                regulations) are in effect that--
                            ``(i) authorize the State to take the 
                        actions necessary to carry out the 
                        responsibilities being assumed; and
                            ``(ii) are comparable to section 552 of 
                        title 5, including providing that any decision 
                        regarding the public availability of a document 
                        under those State laws is reviewable by a court 
                        of competent jurisdiction; and
                    ``(D) agrees to maintain the financial resources 
                necessary to carry out the responsibilities being 
                assumed.
    ``(d) Jurisdiction.--
            ``(1) In general.--The United States district courts shall 
        have exclusive jurisdiction over any civil action against a 
        State for failure to carry out any responsibility of the State 
        under this section.
            ``(2) Legal standards and requirements.--A civil action 
        under paragraph (1) shall be governed by the legal standards 
        and requirements that would apply in such a civil action 
        against the Secretary had the Secretary taken the actions in 
        question.
            ``(3) Intervention.--The Secretary shall have the right to 
        intervene in any action described in paragraph (1).
    ``(e) Effect of Assumption of Responsibility.--A State that assumes 
responsibility under subsection (a)(2) shall be solely responsible and 
solely liable for carrying out, in lieu of the Secretary, the 
responsibilities assumed under subsection (a)(2), until the program is 
terminated as provided in subsection (i).
    ``(f) Limitations on Agreements.--Nothing in this section permits a 
State to assume any rulemaking authority of the Secretary under any 
Federal law.
    ``(g) Audits.--
            ``(1) In general.--To ensure compliance by a State with any 
        agreement of the State under subsection (c)(1) (including 
        compliance by the State with all Federal laws for which 
        responsibility is assumed under subsection (a)(2)), for each 
        State participating in the program under this section, the 
        Secretary shall conduct--
                    ``(A) semiannual audits during each of the first 2 
                years of State participation; and
                    ``(B) annual audits during each subsequent year of 
                State participation.
            ``(2) Public availability and comment.--
                    ``(A) In general.--An audit conducted under 
                paragraph (1) shall be provided to the public for 
                comment.
                    ``(B) Response.--Not later than 60 days after the 
                date on which the period for public comment ends, the 
                Secretary shall respond to public comments received 
                under subparagraph (A).
    ``(h) Report to Congress.--The Secretary shall submit to Congress 
an annual report that describes the administration of the program.
    ``(i) Termination.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        program shall terminate on the date that is 6 years after the 
        date of enactment of this section.
            ``(2) Termination by secretary.--The Secretary may 
        terminate the participation of any State in the program if--
                    ``(A) the Secretary determines that the State is 
                not adequately carrying out the responsibilities 
                assigned to the State;
                    ``(B) the Secretary provides to the State--
                            ``(i) notification of the determination of 
                        noncompliance; and
                            ``(ii) a period of at least 30 days during 
                        which to take such corrective action as the 
                        Secretary determines is necessary to comply 
                        with the applicable agreement; and
                    ``(C) the State, after the notification and period 
                provided under subparagraph (B), fails to take 
                satisfactory corrective action, as determined by 
                Secretary.''.
    (b) Conforming Amendment.--The analysis for chapter 3 of title 23, 
United States Code (as amended by section 1512(b)), is amended by 
inserting after the item relating to section 327 the following:

``328. Surface transportation project delivery pilot program.''.

SEC. 1514. PARKS, RECREATION AREAS, WILDLIFE AND WATERFOWL REFUGES, AND 
              HISTORIC SITES.

    (a) Programs and Projects With de Minimis Impacts.--
            (1) Title 23.--Section 138 of title 23, United States Code, 
        is amended--
                    (A) in the first sentence, by striking ``It is 
                hereby'' and inserting the following:
    ``(a) Declaration of Policy.--It is''; and
                    (B) by adding at the end the following:
    ``(b) De Minimis Impacts.--
            ``(1) Requirements.--
                    ``(A) In general.--The requirements of this section 
                shall be considered to be satisfied with respect to an 
                area described in paragraph (2) or (3) if the Secretary 
                determines, in accordance with this subsection, that a 
                transportation program or project will have a de 
                minimis impact on the area.
                    ``(B) Criteria.--In making any determination under 
                this subsection, the Secretary shall consider to be 
                part of a transportation program or project any 
                avoidance, minimization, mitigation, or enhancement 
                measures that are required to be implemented as a 
                condition of approval of the transportation program or 
                project.
            ``(2) Historic sites.--With respect to historic sites, the 
        Secretary may make a finding of de minimis impact only if--
                    ``(A) the Secretary has determined, in accordance 
                with the consultation process required under section 
                106 of the National Historic Preservation Act (16 
                U.S.C. 470f), that--
                            ``(i) the transportation program or project 
                        will have no adverse effect on the historic 
                        site; or
                            ``(ii) there will be no historic properties 
                        affected by the transportation program or 
                        project;
                    ``(B) the finding of the Secretary has received 
                written concurrence from the applicable State historic 
                preservation officer or tribal historic preservation 
                officer (and from the Advisory Council on Historic 
                Preservation, if participating in the consultation); 
                and
                    ``(C) the finding of the Secretary has been 
                developed in consultation with parties consulting as 
                part of the process referred to in subparagraph (A).
            ``(3) Parks, recreation areas, and wildlife and waterfowl 
        refuges.--With respect to parks, recreation areas, and wildlife 
        or waterfowl refuges, the Secretary may make a finding of de 
        minimis impact only if--
                    ``(A) the Secretary has determined, in accordance 
                with the National Environmental Policy Act of 1969 (42 
                U.S.C. 4321 et seq.) (including public notice and 
                opportunity for public review and comment), that the 
                transportation program or project will not adversely 
                affect the activities, features, and attributes of the 
                park, recreation area, or wildlife or waterfowl refuge 
                eligible for protection under this section; and
                    ``(B) the finding of the Secretary has received 
                concurrence from the officials with jurisdiction over 
                the park, recreation area, or wildlife or waterfowl 
                refuge.''.
            (2) Title 49.--Section 303 of title 49, United States Code, 
        is amended--
                    (A) by striking ``(c) The Secretary'' and inserting 
                the following:
    ``(c) Approval of Programs and Projects.--Subject to subsection 
(d), the Secretary''; and
                    (B) by adding at the end the following:
    ``(d) De Minimis Impacts.--
            ``(1) Requirements.--
                    ``(A) In general.--The requirements of this section 
                shall be considered to be satisfied with respect to an 
                area described in paragraph (2) or (3) if the Secretary 
                determines, in accordance with this subsection, that a 
                transportation program or project will have a de 
                minimis impact on the area.
                    ``(B) Criteria.--In making any determination under 
                this subsection, the Secretary shall consider to be 
                part of a transportation program or project any 
                avoidance, minimization, mitigation, or enhancement 
                measures that are required to be implemented as a 
                condition of approval of the transportation program or 
                project.
            ``(2) Historic sites.--With respect to historic sites, the 
        Secretary may make a finding of de minimis impact only if--
                    ``(A) the Secretary has determined, in accordance 
                with the consultation process required under section 
                106 of the National Historic Preservation Act (16 
                U.S.C. 470f), that--
                            ``(i) the transportation program or project 
                        will have no adverse effect on the historic 
                        site; or
                            ``(ii) there will be no historic properties 
                        affected by the transportation program or 
                        project;
                    ``(B) the finding of the Secretary has received 
                written concurrence from the applicable State historic 
                preservation officer or tribal historic preservation 
                officer (and from the Advisory Council on Historic 
                Preservation, if participating in the consultation); 
                and
                    ``(C) the finding of the Secretary has been 
                developed in consultation with parties consulting as 
                part of the process referred to in subparagraph (A).
            ``(3) Parks, recreation areas, and wildlife and waterfowl 
        refuges.--With respect to parks, recreation areas, and wildlife 
        or waterfowl refuges, the Secretary may make a finding of de 
        minimis impact only if--
                    ``(A) the Secretary has determined, in accordance 
                with the National Environmental Policy Act of 1969 (42 
                U.S.C. 4321 et seq.) (including public notice and 
                opportunity for public review and comment), that the 
                transportation program or project will not adversely 
                affect the activities, features, and attributes of the 
                park, recreation area, or wildlife or waterfowl refuge 
                eligible for protection under this section; and
                    ``(B) the finding of the Secretary has received 
                concurrence from the officials with jurisdiction over 
                the park, recreation area, or wildlife or waterfowl 
                refuge.''.
    (b) Clarification of Existing Standards.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary shall (in consultation 
        with affected agencies and interested parties) promulgate 
        regulations that clarify the factors to be considered and the 
        standards to be applied in determining the prudence and 
        feasibility of alternatives under section 138 of title 23 and 
        section 303 of title 49, United States Code.
            (2) Requirements.--The regulations--
                    (A) shall clarify the application of the legal 
                standards to a variety of different types of 
                transportation programs and projects depending on the 
                circumstances of each case; and
                    (B) may include, as appropriate, examples to 
                facilitate clear and consistent interpretation by 
                agency decisionmakers.
    (c) Implementation Study.--
            (1) In general.--The Secretary and the Transportation 
        Research Board of the National Academy of Sciences shall 
        jointly conduct a study on the implementation of this section 
        and the amendments made by this section.
            (2) Components.--In conducting the study, the Secretary and 
        the Transportation Research Board shall evaluate--
                    (A) the processes developed under this section and 
                the amendments made by this section and the 
                efficiencies that may result;
                    (B) the post-construction effectiveness of impact 
                mitigation and avoidance commitments adopted as part of 
                projects conducted under this section and the 
                amendments made by this section; and
                    (C) the quantity of projects with impacts that are 
                considered de minimis under this section and the 
                amendments made by this section, including information 
                on the location, size, and cost of the projects.
            (3) Report requirement.--The Secretary and the 
        Transportation Research Board shall prepare--
                    (A) not earlier than the date that is 4 years after 
                the date of enactment of this Act, a report on the 
                results of the study conducted under this subsection; 
                and
                    (B) not later than September 30, 2009, an update on 
                the report required under subparagraph (A).
            (4) Report recipients.--The Secretary and the 
        Transportation Research Board shall--
                    (A) submit the report and update required under 
                paragraph (3) to--
                            (i) the appropriate committees of Congress;
                            (ii) the Secretary of the Interior; and
                            (iii) the Advisory Council on Historic 
                        Preservation; and
                    (B) make the report and update available to the 
                public.

SEC. 1515. REGULATIONS.

    Except as provided in section 1513, not later than 1 year after the 
date of enactment of this Act, the Secretary shall promulgate 
regulations necessary to implement the amendments made by chapter 1 and 
this chapter.

                        CHAPTER 3--MISCELLANEOUS

SEC. 1521. CRITICAL REAL PROPERTY ACQUISITION.

    Section 108 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(d) Critical Real Property Acquisition.--
            ``(1) In general.--Subject to paragraph (2), funds 
        apportioned to a State under this title may be used to pay the 
        costs of acquiring any real property that is determined to be 
        critical under paragraph (2) for a project proposed for funding 
        under this title.
            ``(2) Reimbursement.--The Federal share of the costs 
        referred to in paragraph (1) shall be eligible for 
        reimbursement out of funds apportioned to a State under this 
        title if, before the date of acquisition, the Secretary 
        determines that--
                    ``(A) the property is offered for sale on the open 
                market;
                    ``(B) in acquiring the property, the State will 
                comply with the Uniform Relocation Assistance and Real 
                Property Acquisition Policies Act of 1970 (42 U.S.C. 
                4601 et seq.); and
                    ``(C) immediate acquisition of the property is 
                critical because--
                            ``(i) based on an appraisal of the 
                        property, the value of the property is 
                        increasing significantly;
                            ``(ii) there is an imminent threat of 
                        development or redevelopment of the property; 
                        and
                            ``(iii) the property is necessary for the 
                        implementation of the goals stated in the 
                        proposal for the project.
            ``(3) Applicable law.--An acquisition of real property 
        under this section shall be considered to be an exempt project 
        under section 176 of the Clean Air Act (42 U.S.C. 7506).
            ``(4) Environmental review.--
                    ``(A) In general.--A project proposed to be 
                conducted under this title shall not be conducted on 
                property acquired under paragraph (1) until all 
                required environmental reviews for the project have 
                been completed.
                    ``(B) Effect on consideration of project 
                alternatives.--The number of critical acquisitions of 
                real property associated with a project shall not 
                affect the consideration of project alternatives during 
                the environmental review process.
            ``(5) Proceeds from the sale or lease of real property.--
        Section 156(c) shall not apply to the sale, use, or lease of 
        any real property acquired under paragraph (1).''.

SEC. 1522. PLANNING CAPACITY BUILDING INITIATIVE.

    Section 104 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(m) Planning Capacity Building Initiative.--
            ``(1) In general.--The Secretary shall carry out a planning 
        capacity building initiative to support enhancements in 
        transportation planning to--
                    ``(A) strengthen the processes and products of 
                metropolitan and statewide transportation planning 
                under this title;
                    ``(B) enhance tribal capacity to conduct joint 
                transportation planning under chapter 2;
                    ``(C) participate in the metropolitan and statewide 
                transportation planning programs under this title; and
                    ``(D) increase the knowledge and skill level of 
                participants in metropolitan and statewide 
                transportation.
            ``(2) Priority.--The Secretary shall give priority to 
        planning practices and processes that support--
                    ``(A) the transportation elements of homeland 
                security planning, including--
                            ``(i) training and best practices relating 
                        to emergency evacuation;
                            ``(ii) developing materials to assist areas 
                        in coordinating emergency management and 
                        transportation officials; and
                            ``(iii) developing training on how planning 
                        organizations may examine security issues;
                    ``(B) performance-based planning, including--
                            ``(i) data and data analysis technologies 
                        to be shared with States, metropolitan planning 
                        organizations, local governments, and 
                        nongovernmental organizations that--
                                    ``(I) participate in transportation 
                                planning;
                                    ``(II) use the data and data 
                                analysis to engage in metropolitan, 
                                tribal, or statewide transportation 
                                planning;
                                    ``(III) involve the public in the 
                                development of transportation plans, 
                                projects, and alternative scenarios; 
                                and
                                    ``(IV) develop strategies to avoid, 
                                minimize, and mitigate the impacts of 
                                transportation facilities and projects; 
                                and
                            ``(ii) improvement of the quality of 
                        congestion management systems, including the 
                        development of--
                                    ``(I) a measure of congestion;
                                    ``(II) a measure of transportation 
                                system reliability; and
                                    ``(III) a measure of induced 
                                demand;
                    ``(C) safety planning, including--
                            ``(i) development of State strategic safety 
                        plans consistent with section 148;
                            ``(ii) incorporation of work zone safety 
                        into planning; and
                            ``(iii) training in the development of data 
                        systems relating to highway safety;
                    ``(D) operations planning, including--
                            ``(i) developing training of the 
                        integration of transportation system operations 
                        and management into the transportation planning 
                        process; and
                            ``(ii) training and best practices relating 
                        to regional concepts of operations;
                    ``(E) freight planning, including--
                            ``(i) modeling of freight at a regional and 
                        statewide level; and
                            ``(ii) techniques for engaging the freight 
                        community with the planning process;
                    ``(F) air quality planning, including--
                            ``(i) assisting new and existing 
                        nonattainment and maintenance areas in 
                        developing the technical capacity to perform 
                        air quality conformity analysis;
                            ``(ii) providing training on areas such as 
                        modeling and data collection to support air 
                        quality planning and analysis;
                            ``(iii) developing concepts and techniques 
                        to assist areas in meeting air quality 
                        performance timeframes; and
                            ``(iv) developing materials to explain air 
                        quality issues to decisionmakers and the 
                        public; and
                    ``(G) integration of environment and planning.
            ``(3) Use of funds.--The Secretary shall use amounts made 
        available under paragraph (4) to make grants to, or enter into 
        contracts, cooperative agreements, and other transactions with, 
        a Federal agency, State agency, local agency, federally 
        recognized Indian tribal government or tribal consortium, 
        authority, association, nonprofit or for-profit corporation, or 
        institution of higher education for research, program 
        development, information collection and dissemination, and 
        technical assistance.
            ``(4) Set-aside.--
                    ``(A) In general.--On October 1 of each fiscal 
                year, of the funds made available under subsection (a), 
                the Secretary shall set aside $4,000,000 to carry out 
                this subsection.
                    ``(B) Federal share.--The Federal share of the cost 
                of an activity carried out using funds made available 
                under subparagraph (A) shall be 100 percent.
                    ``(C) Availability.--Funds made available under 
                subparagraph (A) shall remain available until 
                expended.''.

                        Subtitle F--Environment

SEC. 1601. ENVIRONMENTAL RESTORATION AND POLLUTION ABATEMENT; CONTROL 
              OF INVASIVE PLANT SPECIES AND ESTABLISHMENT OF NATIVE 
              SPECIES.

    (a) Modification to NHS/STP for Environmental Restoration, 
Pollution Abatement, and Invasive Species.--
            (1) Modifications to national highway system.--Section 
        103(b)(6) of title 23, United States Code, is amended by adding 
        at the end the following:
                    ``(Q) Environmental restoration and pollution 
                abatement in accordance with section 165.
                    ``(R) Control of invasive plant species and 
                establishment of native species in accordance with 
                section 166.''.
            (2) Modifications to surface transportation program.--
        Section 133(b) of title 23, is amended by striking paragraph 
        (14) and inserting the following:
            ``(14) Environmental restoration and pollution abatement in 
        accordance with section 165.
            ``(15) Control of invasive plant species and establishment 
        of native species in accordance with section 166.''.
    (b) Eligible Activities.--Subchapter I of chapter 1 of title 23, 
United States Code, is amended by adding at the end the following:
``Sec. 165. Eligibility for environmental restoration and pollution 
              abatement
    ``(a) In General.--Subject to subsection (b), environmental 
restoration and pollution abatement to minimize or mitigate the impacts 
of any transportation project funded under this title (including 
retrofitting and construction of storm water treatment systems to meet 
Federal and State requirements under sections 401 and 402 of the 
Federal Water Pollution Control Act (33 U.S.C. 1341, 1342)) may be 
carried out to address water pollution or environmental degradation 
caused wholly or partially by a transportation facility.
    ``(b) Maximum Expenditure.--In a case in which a transportation 
facility is undergoing reconstruction, rehabilitation, resurfacing, or 
restoration, the expenditure of funds under this section for 
environmental restoration or pollution abatement described in 
subsection (a) shall not exceed 20 percent of the total cost of the 
reconstruction, rehabilitation, resurfacing, or restoration of the 
facility.
``Sec. 166. Control of invasive plant species and establishment of 
              native species
    ``(a) Definitions.--In this section:
            ``(1) Invasive plant species--The term `invasive plant 
        species' means a nonindigenous species the introduction of 
        which causes or is likely to cause economic or environmental 
        harm or harm to human health.
            ``(2) Native plant species.--The term `native plant 
        species' means, with respect to a particular ecosystem, a 
        species that, other than as result of an introduction, 
        historically occurred or currently occurs in that ecosystem.
    ``(b) Control of Species.--
            ``(1) In general.--In accordance with all applicable 
        Federal law (including regulations), funds made available to 
        carry out this section may be used for--
                    ``(A) participation in the control of invasive 
                plant species; and
                    ``(B) the establishment of native species.
            ``(2) Included activities.--The participation and 
        establishment under paragraph (1) may include--
                    ``(A) participation in statewide inventories of 
                invasive plant species and desirable plant species;
                    ``(B) regional native plant habitat conservation 
                and mitigation;
                    ``(C) native revegetation;
                    ``(D) elimination of invasive species to create 
                fuel breaks for the prevention and control of 
                wildfires; and
                    ``(E) training.
            ``(3) Contributions.--
                    ``(A) In general.--Subject to subparagraph (B), an 
                activity described in paragraph (1) may be carried out 
                concurrently with, in advance of, or following the 
                construction of a project funded under this title.
                    ``(B) Condition for activities conducted in advance 
                of project construction.--An activity described in 
                paragraph (1) may be carried out in advance of 
                construction of a project only if the activity is 
                carried out in accordance with all applicable 
                requirements of Federal law (including regulations) and 
                State transportation planning processes.''.
    (c) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1406(b)), is 
amended by adding at the end the following:

``165. Eligibility for environmental restoration and pollution 
                            abatement.
``166. Control of invasive plant species and establishment of native 
                            species.''.

SEC. 1602. NATIONAL SCENIC BYWAYS PROGRAM.

    (a) In General.--Section 162 of title 23, United States Code, is 
amended--
            (1) in subsection (a)(1), by striking ``the roads as'' and 
        all that follows and inserting ``the roads as--
                    ``(A) National Scenic Byways;
                    ``(B) All-American Roads; or
                    ``(C) America's Byways.'';
            (2) in subsection (b)--
                    (A) in paragraph (1)(A), by striking ``designated 
                as'' and all that follows and inserting ``designated 
                as--
                            ``(i) National Scenic Byways;
                            ``(ii) All-American Roads; or
                            ``(iii) America's Byways; and'';
                    (B) in paragraph (2)--
                            (i) in subparagraph (A), by striking 
                        ``Byway or All-American Road'' and inserting 
                        ``Byway, All-American Road, or 1 of America's 
                        Byways''; and
                            (ii) in subparagraph (B), by striking 
                        ``designation as a'' and all that follows and 
                        inserting ``designation as--
                            ``(i) a National Scenic Byway;
                            ``(ii) an All-American Road; or
                            ``(iii) 1 of America's Byways; and''; and
            (3) in subsection (c)(4), by striking ``passing lane,''.
    (b) Research, Technical Assistance, Marketing, and Promotion.--
Section 162 of title 23, United States Code, is amended--
            (1) by redesignating subsections (d), (e), and (f) as 
        subsections (e), (f), and (g), respectively;
            (2) by inserting after subsection (c) the following:
    ``(d) Research, Technical Assistance, Marketing, and Promotion.--
            ``(1) In general.--The Secretary may carry out technical 
        assistance, marketing, market research, and promotion with 
        respect to State Scenic Byways, National Scenic Byways, All-
        American Roads, and America's Byways.
            ``(2) Cooperation, grants, and contracts.--The Secretary 
        may make grants to, or enter into contracts, cooperative 
        agreements, and other transactions with, any Federal agency, 
        State agency, authority, association, institution, for-profit 
        or nonprofit corporation, organization, or person, to carry out 
        projects and activities under this subsection.
            ``(3) Funds.--The Secretary may use not more than 
        $2,000,000 for each fiscal year of funds made available for the 
        National Scenic Byways Program to carry out projects and 
        activities under this subsection.
            ``(4) Priority.--The Secretary shall give priority under 
        this subsection to partnerships that leverage Federal funds for 
        research, technical assistance, marketing and promotion.''; and
            (3) in subsection (g) (as redesignated by paragraph (1)), 
        by striking ``80 percent'' and inserting ``the share applicable 
        under section 120, as adjusted under subsection (d) of that 
        section''.

SEC. 1603. RECREATIONAL TRAILS PROGRAM.

    (a) Recreational Trails Program Formula.--Section 104(h)(1) of 
title 23, United States Code, is amended--
            (1) by striking ``Whenever'' and inserting the following:
                    ``(A) In general.--In any case in which'';
            (2) by striking ``research and technical assistance under 
        the recreational trails program and for the administration of 
        the National Recreational Trails Advisory Committee'' and 
        inserting ``research, technical assistance, and training under 
        the recreational trails program''; and
            (3) by striking ``The Secretary'' and inserting the 
        following:
                    ``(B) Contracts and agreements.--The Secretary''.
    (b) Recreational Trails Program Administration.--Section 206 of 
title 23, United States Code, is amended--
            (1) in subsection (d)--
                    (A) by striking paragraph (2) and inserting the 
                following:
            ``(2) Permissible uses.--Permissible uses of funds 
        apportioned to a State for a fiscal year to carry out this 
        section include--
                    ``(A) maintenance and restoration of recreational 
                trails;
                    ``(B) development and rehabilitation of trailside 
                and trailhead facilities and trail linkages for 
                recreational trails;
                    ``(C) purchase and lease of recreational trail 
                construction and maintenance equipment;
                    ``(D) construction of new recreational trails, 
                except that, in the case of new recreational trails 
                crossing Federal land, construction of the trails shall 
                be--
                            ``(i) permissible under other law;
                            ``(ii) necessary and recommended by a 
                        statewide comprehensive outdoor recreation plan 
                        that is--
                                    ``(I) required under the Land and 
                                Water Conservation Fund Act of 1965 (16 
                                U.S.C. 460l-4 et seq.); and
                                    ``(II) in effect;
                            ``(iii) approved by the administering 
                        agency of the State designated under subsection 
                        (c)(1)(A); and
                            ``(iv) approved by each Federal agency 
                        having jurisdiction over the affected land, 
                        under such terms and conditions as the head of 
                        the Federal agency determines to be 
                        appropriate, except that the approval shall be 
                        contingent on compliance by the Federal agency 
                        with all applicable laws, including--
                                    ``(I) the National Environmental 
                                Policy Act of 1969 (42 U.S.C. 4321 et 
                                seq.);
                                    ``(II) the Forest and Rangeland 
                                Renewable Resources Planning Act of 
                                1974 (16 U.S.C. 1600 et seq.); and
                                    ``(III) the Federal Land Policy and 
                                Management Act of 1976 (43 U.S.C. 1701 
                                et seq.);
                    ``(E) acquisition of easements and fee simple title 
                to property for recreational trails or recreational 
                trail corridors;
                    ``(F) assessment of trail conditions for 
                accessibility and maintenance;
                    ``(G) use of trail crews, youth conservation or 
                service corps, or other appropriate means to carry out 
                activities under this section;
                    ``(H) development and dissemination of publications 
                and operation of educational programs to promote safety 
                and environmental protection, as those objectives 
                relate to the use of recreational trails, supporting 
                non-law enforcement trail safety and trail use 
                monitoring patrol programs, and providing trail-related 
                training, but in an amount not to exceed 5 percent of 
                the apportionment made to the State for the fiscal 
                year; and
                    ``(I) payment of costs to the State incurred in 
                administering the program, but in an amount not to 
                exceed 7 percent of the apportionment made to the State 
                for the fiscal year to carry out this section.''; and
                    (B) in paragraph (3)--
                            (i) in subparagraph (D), by striking 
                        ``(2)(F)'' and inserting ``(2)(I)''; and
                            (ii) by adding at the end the following:
                    ``(E) Use of youth conservation or service corps.--
                A State shall make available not less than 10 percent 
                of the apportionments of the State to provide grants 
                to, or to enter into cooperative agreements or 
                contracts with, qualified youth conservation or service 
                corps to perform recreational trails program 
                activities.'';
            (2) in subsection (f)--
                    (A) in paragraph (1)--
                            (i) by inserting ``and the Federal share of 
                        the administrative costs of a State'' after 
                        ``project''; and
                            (ii) by striking ``not exceed 80 percent'' 
                        and inserting ``be determined in accordance 
                        with section 120'';
                    (B) in paragraph (2)--
                            (i) in subparagraph (A), by striking ``80 
                        percent of'' and inserting ``the amount 
                        determined in accordance with section 120 
                        for''; and
                            (ii) in subparagraph (B), by inserting 
                        ``sponsoring the project'' after ``Federal 
                        agency'';
                    (C) by striking paragraph (5);
                    (D) by redesignating paragraph (4) as paragraph 
                (5);
                    (E) by inserting after paragraph (3) the following:
            ``(4) Use of recreational trails program funds to match 
        other federal program funds.--Notwithstanding any other 
        provision of law, funds made available under this section may 
        be used to pay the non-Federal matching share for other Federal 
        program funds that are--
                    ``(A) expended in accordance with the requirements 
                of the Federal program relating to activities funded 
                and populations served; and
                    ``(B) expended on a project that is eligible for 
                assistance under this section.''; and
                    (F) in paragraph (5) (as redesignated by 
                subparagraph (D)), by striking ``80 percent'' and 
                inserting ``the Federal share as determined in 
                accordance with section 120''; and
            (3) in subsection (h)--
                    (A) in paragraph (1), by inserting after 
                subparagraph (B) the following:
                    ``(C) Planning and environmental assessment costs 
                incurred prior to project approval.--A project funded 
                under any of subparagraphs (A) through (H) of 
                subsection (d)(2) may permit preapproval planning and 
                environmental compliance costs incurred not more than 
                18 months before project approval to be credited toward 
                the non-Federal share in accordance with subsection 
                (f).''; and
                    (B) by striking paragraph (2) and inserting the 
                following:
            ``(2) Waiver of highway program requirements.--A project 
        funded under this section--
                    ``(A) is intended to enhance recreational 
                opportunity;
                    ``(B) is not considered to be a highway project; 
                and
                    ``(C) is not subject to--
                            ``(i) section 112, 114, 116, 134, 135, 138, 
                        217, or 301 of this title; or
                            ``(ii) section 303 of title 49.''.

SEC. 1604. EXEMPTION OF INTERSTATE SYSTEM.

    Subsection 103(c) of title 23, United States Code, is amended by 
adding at the end the following:
            ``(5) Exemption of interstate system.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the Interstate System shall not be 
                considered to be a historic site under section 303 of 
                title 49 or section 138 of this title, regardless of 
                whether the Interstate System or portions of the 
                Interstate System are listed on, or eligible for 
                listing on, the National Register of Historic Places.
                    ``(B) Individual elements.--A portion of the 
                Interstate System that possesses an independent feature 
                of historic significance, such as a historic bridge or 
                a highly significant engineering feature, that would 
                qualify independently for listing on the National 
                Register of Historic Places, shall be considered to be 
                a historic site under section 303 of title 49 or 
                section 138 of this title, as applicable.''.

SEC. 1605. STANDARDS.

    (a) In General.--Section 109(a) of title 23, United States Code, is 
amended--
            (1) in paragraph (1), by striking ``and'' at the end;
            (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(3) consider the preservation, historic, scenic, natural 
        environmental, and community values.''.
    (b) Context Sensitive Design.--Section 109 of title 23, United 
States Code, is amended by striking subsection (p) and inserting the 
following:
    ``(p) Context Sensitive Design.--
            ``(1) In general.--The Secretary shall encourage States to 
        design projects funded under this title that--
                    ``(A) allow for the preservation of environmental, 
                scenic, or historic values;
                    ``(B) ensure the safe use of the facility;
                    ``(C) provide for consideration of the context of 
                the locality;
                    ``(D) encourage access for other modes of 
                transportation; and
                    ``(E) comply with subsection (a).
            ``(2) Approval by secretary.--Notwithstanding subsections 
        (b) and (c), the Secretary may approve a project described in 
        paragraph (1) for the National Highway System if the project is 
        designed to achieve the criteria specified in that 
        paragraph.''.

SEC. 1606. USE OF HIGH OCCUPANCY VEHICLE LANES.

    Section 102 of title 23, United States Code, is amended by striking 
subsection (a) and inserting the following:
    ``(a) High Occupancy Vehicle Lane Passenger Requirements.--
            ``(1) Definitions.--In this subsection:
                    ``(A) Responsible agency.--The term `responsible 
                agency' means--
                            ``(i) a State transportation department; 
                        and
                            ``(ii) a local agency in a State that is 
                        responsible for transportation matters.
                    ``(B) Seriously degraded.--The term `seriously 
                degraded', with respect to a high occupancy vehicle 
                lane, means, in the case of a high occupancy vehicle 
                lane, the minimum average operating speed, performance 
                threshold, and associated time period of the high 
                occupancy vehicle lane, calculated and determined 
                jointly by all applicable responsible agencies and 
                based on conditions unique to the roadway, are 
                unsatisfactory.
            ``(2) Requirements.--
                    ``(A) In general.--Subject to subparagraph (B), for 
                each State, 1 or more responsible agencies shall 
                establish the occupancy requirements of vehicles 
                operating on high occupancy vehicle lanes.
                    ``(B) Minimum number of occupants.--Except as 
                provided in paragraph (3), an occupancy requirement 
                established under subparagraph (A) shall--
                            ``(i) require at least 2 occupants per 
                        vehicle for a vehicle operating on a high 
                        occupancy vehicle lane; and
                            ``(ii) in the case of a high occupancy 
                        vehicle lane that traverses an adjacent State, 
                        be established in consultation with the 
                        adjacent State.
            ``(3) Exceptions to hov occupancy requirements.--
                    ``(A) Motorcycles.--For the purpose of this 
                subsection, a motorcycle--
                            ``(i) shall not be considered to be a 
                        single occupant vehicle; and
                            ``(ii) shall be allowed to use a high 
                        occupancy vehicle lane unless a responsible 
                        agency--
                                    ``(I) certifies to the Secretary 
                                the use of a high occupancy vehicle 
                                lane by a motorcycle would create a 
                                safety hazard; and
                                    ``(II) restricts that the use of 
                                the high occupancy vehicle lane by 
                                motorcycles.
                    ``(B) Low emission and energy-efficient vehicles.--
                            ``(i) Definition of low emission and 
                        energy-efficient vehicle.--In this 
                        subparagraph, the term `low emission and 
                        energy-efficient vehicle' means a vehicle that 
                        has been certified by the Administrator of the 
                        Environmental Protection Agency--
                                    ``(I)(aa) to have a 45-mile per 
                                gallon or greater fuel economy highway 
                                rating; or
                                    ``(bb) to qualify as an alternative 
                                fueled vehicle under section 301 of the 
                                Energy Policy Act of 1992 (42 U.S.C. 
                                13211); and
                                    ``(II) as meeting Tier II emission 
                                level established in regulations 
                                promulgated by the Administrator of the 
                                Environmental Protection Agency under 
                                section 202(i) of the Clean Air Act (42 
                                U.S.C. 7521(i)) for that make and model 
                                year vehicle.
                            ``(ii) Exemption for low emission and 
                        energy-efficient vehicles.--A responsible 
                        agency may permit qualifying low emission and 
                        energy-efficient vehicles that do not meet 
                        applicable occupancy requirements (as 
                        determined by the responsible agency) to use 
                        high occupancy vehicle lanes if the responsible 
                        agency--
                                    ``(I) establishes a program that 
                                addresses how those qualifying low 
                                emission and energy-efficient vehicles 
                                are selected and certified;
                                    ``(II) establishes requirements for 
                                labeling qualifying low emission and 
                                energy-efficient vehicles (including 
                                procedures for enforcing those 
                                requirements);
                                    ``(III) continuously monitors, 
                                evaluates, and reports to the Secretary 
                                on performance; and
                                    ``(IV) imposes such restrictions on 
                                the use on high occupancy vehicle lanes 
                                by vehicles that do not satisfy 
                                established occupancy requirements as 
                                are necessary to ensure that the 
                                performance of individual high 
                                occupancy vehicle lanes, and the entire 
                                high occupancy vehicle lane system, 
                                will not become seriously degraded.
                    ``(C) Tolling of vehicles.--
                            ``(i) In general.--A responsible agency may 
                        permit vehicles, in addition to the vehicles 
                        described in paragraphs (A), (B), and (D) that 
                        do not satisfy established occupancy 
                        requirements, to use a high occupancy vehicle 
                        lane only if the responsible agency charges 
                        those vehicles a toll.
                            ``(ii) Applicable authority.--In imposing a 
                        toll under clause (i), a responsible agency 
                        shall--
                                    ``(I) be subject to section 129;
                                    ``(II) establish a toll program 
                                that addresses ways in which motorists 
                                may enroll and participate in the 
                                program;
                                    ``(III) develop, manage, and 
                                maintain a system that will 
                                automatically collect the tolls from 
                                covered vehicles;
                                    ``(IV) continuously monitor, 
                                evaluate, and report on performance of 
                                the system;
                                    ``(V) establish such policies and 
                                procedures as are necessary--
                                            ``(aa) to vary the toll 
                                        charged in order to manage the 
                                        demand for use of high 
                                        occupancy vehicle lanes; and
                                            ``(bb) to enforce 
                                        violations; and
                                    ``(VI) establish procedures to 
                                impose such restrictions on the use of 
                                high occupancy vehicle lanes by 
                                vehicles that do not satisfy 
                                established occupancy requirements as 
                                are necessary to ensure that the 
                                performance of individual high 
                                occupancy vehicle lanes, and the entire 
                                high occupancy vehicle lane system, 
                                will not become seriously degraded.
                    ``(D) Designated public transportation vehicles.--
                            ``(i) Definition of designated public 
                        transportation vehicle.--In this subparagraph, 
                        the term `designated public transportation 
                        vehicle' means a vehicle that--
                                    ``(I) provides designated public 
                                transportation (as defined in section 
                                221 of the Americans with Disabilities 
                                Act of 1990 (42 U.S.C. 12141)); and
                                    ``(II)(aa) is owned or operated by 
                                a public entity; or
                                    ``(bb) is operated under a contract 
                                with a public entity.
                            ``(ii) Use of high occupancy vehicle 
                        lanes.--A responsible agency may permit 
                        designated public transportation vehicles that 
                        do not satisfy established occupancy 
                        requirements to use high occupancy vehicle 
                        lanes if the responsible agency--
                                    ``(I) requires the clear and 
                                identifiable labeling of each 
                                designated public transportation 
                                vehicle operating under a contract with 
                                a public entity with the name of the 
                                public entity on all sides of the 
                                vehicle;
                                    ``(II) continuously monitors, 
                                evaluates, and reports on performance 
                                of those designated public 
                                transportation vehicles; and
                                    ``(III) imposes such restrictions 
                                on the use of high occupancy vehicle 
                                lanes by designated public 
                                transportation vehicles as are 
                                necessary to ensure that the 
                                performance of individual high 
                                occupancy vehicle lanes, and the entire 
                                high occupancy vehicle lane system, 
                                will not become seriously degraded.
                    ``(E) HOV lane management, operation, and 
                monitoring.--
                            ``(i) In general.--A responsible agency 
                        that permits any of the exceptions specified in 
                        this paragraph shall comply with clauses (ii) 
                        and (iii).
                            ``(ii) Performance monitoring, evaluation, 
                        and reporting.--A responsible agency described 
                        in clause (i) shall establish, manage, and 
                        support a performance monitoring, evaluation, 
                        and reporting program under which the 
                        responsible agency continuously monitors, 
                        assesses, and reports on the effects that any 
                        vehicle permitted to use a high occupancy 
                        vehicle lane under an exception under this 
                        paragraph may have on the operation of--
                                    ``(I) individual high occupancy 
                                vehicle lanes; and
                                    ``(II) the entire high occupancy 
                                vehicle lane system.
                            ``(iii) Operation of hov lane or system.--A 
                        responsible agency described in clause (i) 
                        shall limit use of, or cease to use, any of the 
                        exceptions specified in this paragraph if the 
                        presence of any vehicle permitted to use a high 
                        occupancy vehicle lane under an exception under 
                        this paragraph seriously degrades the operation 
                        of--
                                    ``(I) individual high occupancy 
                                vehicle lanes; and
                                    ``(II) the entire high occupancy 
                                vehicle lane system.''.

SEC. 1607. BICYCLE TRANSPORTATION AND PEDESTRIAN WALKWAYS.

    (a) In General.--Section 217 of title 23, United States Code, is 
amended--
            (1) in subsection (a), by inserting ``pedestrian and'' 
        after ``safe'';
            (2) in subsection (e), by striking ``bicycles'' each place 
        it appears and inserting ``pedestrians or bicyclists'';
            (3) by striking subsection (f) and inserting the following:
    ``(f) Federal Share.--The Federal share of the construction of 
bicycle transportation facilities and pedestrian walkways, and for 
carrying out nonconstruction projects relating to safe pedestrian and 
bicycle use, shall be determined in accordance with section 120(b).'';
            (4) by redesignating subsection (j) as subsection (k);
            (5) by inserting after subsection (i) the following:
    ``(j) Bicycle and Pedestrian Safety Grants.--
            ``(1) In general.--The Secretary shall select and make 
        grants to a national, nonprofit organization engaged in 
        promoting bicycle and pedestrian safety--
                    ``(A) to operate a national bicycle and pedestrian 
                clearinghouse;
                    ``(B) to develop information and educational 
                programs regarding walking and bicycling; and
                    ``(C) to disseminate techniques and strategies for 
                improving bicycle and pedestrian safety.
            ``(2) Funding.--The Secretary may use funds set aside under 
        section 104(n) to carry out this subsection.
            ``(3) Applicability of title 23.--Funds authorized to be 
        appropriated to carry out this subsection shall be available 
        for obligation in the same manner as if the funds were 
        apportioned under section 104, except that the funds shall 
        remain available until expended.''; and
            (6) in subsection (k) (as redesignated by paragraph (4))--
                    (A) by redesignating paragraph (4) as paragraph 
                (5); and
                    (B) by inserting after paragraph (3) the following:
            ``(4) Shared use path.--The term `shared use path' means a 
        multiuse trail or other path that is--
                    ``(A) physically separated from motorized vehicular 
                traffic by an open space or barrier, either within a 
                highway right-of-way or within an independent right-of-
                way; and
                    ``(B) usable for transportation purposes (including 
                by pedestrians, bicyclists, skaters, equestrians, and 
                other nonmotorized users).''.
    (b) Reservation of Funds.--Section 104 of title 23, United States 
Code (as amended by section 1522), is amended by adding at the end the 
following:
    ``(n) Bicycle and Pedestrian Safety Grants.--On October 1 of each 
of fiscal years 2004 through 2009, the Secretary, after making the 
deductions authorized by subsections (a) and (f), shall set aside 
$500,000 of the remaining funds apportioned under subsection (b)(3) for 
use in carrying out the bicycle and pedestrian safety grant program 
under section 217.''.

SEC. 1608. IDLING REDUCTION FACILITIES IN INTERSTATE RIGHTS-OF-WAY.

    Section 111 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(d) Idling Reduction Facilities in Interstate Rights-of-Way.--
            ``(1) In general.--Notwithstanding subsection (a), a State 
        may--
                    ``(A) permit electrification or other idling 
                reduction facilities and equipment, for use by motor 
                vehicles used for commercial purposes, to be placed in 
                rest and recreation areas, and in safety rest areas, 
                constructed or located on rights-of-way of the 
                Interstate System in the State, so long as those idling 
                reduction measures do not--
                            ``(i) reduce the existing number of 
                        designated truck parking spaces at any given 
                        rest or recreation area; or
                            ``(ii) preclude the use of those spaces by 
                        trucks employing alternative idle reduction 
                        technologies; and
                    ``(B) charge a fee, or permit the charging of a 
                fee, for the use of those parking spaces actively 
                providing power to a truck to reduce idling.
            ``(2) Purpose.--The exclusive purpose of the facilities 
        described in paragraph (1) (or similar technologies) shall be 
        to enable operators of motor vehicles used for commercial 
        purposes--
                    ``(A) to reduce idling of a truck while parked in 
                the rest or recreation area; and
                    ``(B) to use installed or other equipment 
                specifically designed to reduce idling of a truck, or 
                provide alternative power for supporting driver 
                comfort, while parked.''.

SEC. 1609. TOLL PROGRAMS.

    (a) Interstate System Reconstruction and Rehabilitation Pilot 
Program.--Section 1216(b) of the Transportation Equity Act for the 21st 
Century (23 U.S.C. 129 note; 112 Stat. 212)--
            (1) is amended--
                    (A) in paragraph (1)--
                            (i) by striking ``The Secretary'' and 
                        inserting ``Notwithstanding section 301, the 
                        Secretary''; and
                            (ii) by striking ``that could not otherwise 
                        be adequately maintained or functionally 
                        improved without the collection of tolls'';
                    (B) in paragraph (3), by striking subparagraph (C) 
                and inserting the following:
                    ``(C) An analysis demonstrating that financing the 
                reconstruction or rehabilitation of the facility with 
                the collection of tolls under this pilot program is the 
                most efficient, economical, or expeditious way to 
                advance the project.'';
                    (C) in paragraph (4)--
                            (i) by striking subparagraph (A) and 
                        inserting the following:
                    ``(A) the State's analysis showing that financing 
                the reconstruction or rehabilitation of a facility with 
                the collection of tolls under the pilot program is the 
                most efficient, economical, or expeditious way to 
                advance the project;'';
                            (ii) by striking subparagraph (B) and 
                        inserting the following:
                    ``(B) the facility needs reconstruction or 
                rehabilitation, including major work that may require 
                replacing sections of the existing facility on new 
                alignment;'';
                            (iii) by striking subparagraph (C); and
                            (iv) by redesignating subparagraphs (D) and 
                        (E) as subparagraphs (C) and (D), respectively;
            (2) is redesignated as subsection (d) of section 129 of 
        title 23, United States Code, and moved to appear at the end of 
        that section; and
            (3) by striking ``of title 23, United States Code'' each 
        place it appears.
    (b) Fast and Sensible Toll (FAST) Lanes Program.--Section 129 of 
title 23, United States Code (as amended by subsection (a)(2)), is 
amended by adding at the end the following:
    ``(e) Fast and Sensible Toll (FAST) Lanes Program.--
            ``(1) Definitions.--In this subsection:
                    ``(A) Eligible toll facility.--The term `eligible 
                toll facility' includes--
                            ``(i) a facility in existence on the date 
                        of enactment of this subsection that collects 
                        tolls;
                            ``(ii) a facility in existence on the date 
                        of enactment of this subsection, including a 
                        facility that serves high occupancy vehicles;
                            ``(iii) a facility modified or constructed 
                        after the date of enactment of this subsection 
                        to create additional tolled capacity (including 
                        a facility constructed by a private entity or 
                        using private funds); and
                            ``(iv) in the case of a new lane added to a 
                        previously non-tolled facility, only the new 
                        lane.
                    ``(B) Nonattainment area.--The term `nonattainment 
                area' has the meaning given the term in section 171 of 
                the Clean Air Act (42 U.S.C. 7501).
            ``(2) Establishment.--Notwithstanding sections 129 and 301, 
        the Secretary shall permit a State, public authority, or a 
        public or private entity designated by a State, to collect a 
        toll from motor vehicles at an eligible toll facility for any 
        highway, bridge, or tunnel, including facilities on the 
        Interstate System--
                    ``(A) to manage high levels of congestion;
                    ``(B) to reduce emissions in a nonattainment area 
                or maintenance area; or
                    ``(C) to finance the expansion of a highway, for 
                the purpose of reducing traffic congestion, by 
                constructing 1 or more additional lanes (including 
                bridge, tunnel, support, and other structures necessary 
                for that construction) on the Interstate System.
            ``(3) Limitation on use of revenues.--
                    ``(A) Use.--
                            ``(i) In general.--Toll revenues received 
                        under paragraph (2) shall be used by a State, 
                        public authority, or private entity designated 
                        by a State, for--
                                    ``(I) debt service for debt 
                                incurred on 1 or more highway or 
                                transit projects carried out under this 
                                title or title 49;
                                    ``(II) a reasonable return on 
                                investment of any private financing;
                                    ``(III) the costs necessary for 
                                proper operation and maintenance of any 
                                facilities under paragraph (2) 
                                (including reconstruction, resurfacing, 
                                restoration, and rehabilitation); or
                                    ``(IV) if the State, public 
                                authority, or private entity annually 
                                certifies that the tolled facility is 
                                being adequately operated and 
                                maintained, any other purpose relating 
                                to a highway or transit project carried 
                                out under this title or title 49.
                    ``(B) Requirements.--
                            ``(i) Variable price requirement.--A 
                        facility that charges tolls under this 
                        subsection may establish a toll that varies in 
                        price according to time of day or level of 
                        traffic, as appropriate to manage congestion or 
                        improve air quality.
                            ``(ii) HOV variable pricing requirement.--
                        The Secretary shall require, for each high 
                        occupancy vehicle facility that charges tolls 
                        under this subsection, that the tolls vary in 
                        price according to time of day or level of 
                        traffic, as appropriate to manage congestion or 
                        improve air quality.
                            ``(iii) HOV passenger requirements.--In 
                        addition to the exceptions to the high 
                        occupancy vehicle passenger requirements 
                        established under section 102(a)(2), a State 
                        may permit motor vehicles with fewer than 2 
                        occupants to operate in high occupancy vehicle 
                        lanes as part of a variable toll pricing 
                        program established under this subsection.
                    ``(C) Agreement.--
                            ``(i) In general.--Before the Secretary may 
                        permit a facility to charge tolls under this 
                        subsection, the Secretary and the applicable 
                        State, public authority, or private entity 
                        designated by a State shall enter into an 
                        agreement for each facility incorporating the 
                        conditions described in subparagraphs (A) and 
                        (B).
                            ``(ii) Termination.--An agreement under 
                        clause (i) shall terminate with respect to a 
                        facility upon the decision of the State, public 
                        authority, or private entity designated by a 
                        State to discontinue the variable tolling 
                        program under this subsection for the facility.
                            ``(iii) Debt.--
                                    ``(I) In general.--If there is any 
                                debt outstanding on a facility at the 
                                time at which the decision is made to 
                                discontinue the program under this 
                                subsection with respect to the 
                                facility, the facility may continue to 
                                charge tolls in accordance with the 
                                terms of the agreement until such time 
                                as the debt is retired.
                                    ``(II) Notice.--On retirement of 
                                the debt of a tolled facility, the 
                                applicable State, public authority, or 
                                private entity designated by a State 
                                shall provide notice to the public of 
                                that retirement.
                    ``(D) Limitation on federal share.--The Federal 
                share of the cost of a project on a facility tolled 
                under this subsection, including a project to install 
                the toll collection facility shall be a percentage, not 
                to exceed 80 percent, determined by the applicable 
                State.
            ``(4) Eligibility.--To be eligible to participate in the 
        program under this subsection, a State, public authority, or 
        private entity designated by a State shall provide to the 
        Secretary--
                    ``(A) a description of the congestion or air 
                quality problems sought to be addressed under the 
                program;
                    ``(B) a description of--
                            ``(i) the goals sought to be achieved under 
                        the program; and
                            ``(ii) the performance measures that would 
                        be used to gauge the success made toward 
                        reaching those goals; and
                    ``(C) such other information as the Secretary may 
                require.
            ``(5) Automation.--Fees collected from motorists using a 
        FAST lane shall be collected only through the use of noncash 
        electronic technology that optimizes the free flow of traffic 
        on the tolled facility.
            ``(6) Interoperability.--
                    ``(A) Rule.--
                            ``(i) In general.--Not later than 180 days 
                        after the date of enactment of this paragraph, 
                        the Secretary shall promulgate a final rule 
                        specifying requirements, standards, or 
                        performance specifications for automated toll 
                        collection systems implemented under this 
                        section.
                            ``(ii) Development.--In developing that 
                        rule, which shall be designed to maximize the 
                        interoperability of electronic collection 
                        systems, the Secretary shall, to the maximum 
                        extent practicable--
                                    ``(I) seek to accelerate progress 
                                toward the national goal of achieving a 
                                nationwide interoperable electronic 
                                toll collection system;
                                    ``(II) take into account the use of 
                                noncash electronic technology currently 
                                deployed within an appropriate 
                                geographical area of travel and the 
                                noncash electronic technology likely to 
                                be in use within the next 5 years; and
                                    ``(III) seek to minimize additional 
                                costs and maximize convenience to users 
                                of toll facility and to the toll 
                                facility owner or operator.
                    ``(B) Future modifications.--As the state of 
                technology progresses, the Secretary shall modify the 
                rule promulgated under subparagraph (A), as 
                appropriate.
            ``(7) Reporting.--
                    ``(A) In general.--The Secretary, in cooperation 
                with State and local agencies and other program 
                participants and with opportunity for public comment, 
                shall--
                            ``(i) develop and publish performance goals 
                        for each FAST lane project;
                            ``(ii) establish a program for regular 
                        monitoring and reporting on the achievement of 
                        performance goals, including--
                                    ``(I) effects on travel, traffic, 
                                and air quality;
                                    ``(II) distribution of benefits and 
                                burdens;
                                    ``(III) use of alternative 
                                transportation modes; and
                                    ``(IV) use of revenues to meet 
                                transportation or impact mitigation 
                                needs.
                    ``(B) Reports to congress.--The Secretary shall 
                submit to the Committee on Environment and Public Works 
                of the Senate and the Committee on Transportation and 
                Infrastructure of the House of Representatives--
                            ``(i) not later than 1 year after the date 
                        of enactment of this subsection, and annually 
                        thereafter, a report that describes in detail 
                        the uses of funds under this subsection in 
                        accordance with paragraph (8)(D); and
                            ``(ii) not later than 3 years after the 
                        date of enactment of this subsection, and every 
                        3 years thereafter, a report that describes any 
                        success of the program under this subsection in 
                        meeting congestion reduction and other 
                        performance goals established for FAST lane 
                        programs.
            ``(8) Funding.--
                    ``(A) Authorization of appropriations.--There is 
                authorized to be appropriated from the Highway Trust 
                Fund (other than the Mass Transit Account) to carry out 
                pre-implementation studies and post-implementation 
                evaluations of projects planned or implemented under 
                this subsection $11,000,000 for each of fiscal years 
                2004 through 2009.
                    ``(B) Availability.--Funds allocated by the 
                Secretary to a State under this subsection shall remain 
                available for obligation by the State for a period of 3 
                years after the last day of the fiscal year for which 
                the funds were authorized.
                    ``(C) Contract authority.--Funds authorized to be 
                appropriated under this paragraph shall be available 
                for obligation in the same manner as if the funds were 
                apportioned under this chapter, except that the Federal 
                share of the cost of any project carried out under this 
                subsection and the availability of funds authorized by 
                this paragraph shall be determined in accordance with 
                this subsection.
                    ``(D) Program promotion.--Notwithstanding any other 
                provision of this section, the Secretary shall use an 
                amount not to exceed 2 percent of the funds made 
                available under subparagraph (A)--
                            ``(i) to make grants to promote the 
                        purposes of the program under this subsection;
                            ``(ii) to provide technical support to 
                        State and local governments or other public or 
                        private entities involved in implementing or 
                        considering FAST lane programs; and
                            ``(iii) to conduct research on variable 
                        pricing that will support State or local 
                        efforts to initiate those pricing requirements.
                    ``(E) Effect on other apportionments and 
                allocations.--Revenues collected from tolls established 
                under this subsection shall not be taken into account 
                in determining the apportionments and allocations that 
                any State or transportation district within a State 
                shall be entitled to receive under or in accordance 
                with this chapter.
            ``(9) Compliance.--The Secretary shall ensure that any 
        project or activity carried out under this section complies 
        with requirements under section 106 of this title and section 
        307 of title 49.
            ``(10) Voluntary use.--Nothing in this subsection requires 
        any highway user to use a FAST lane.
            ``(11) Environmental requirements.--Nothing in this 
        subsection affects any environmental requirement applicable to 
        the construction or operation of an eligible toll facility 
        under this title or any other provision of law.''.
    (c) Conforming Amendments.--
            (1) In general.--Section 1012 of the Intermodal Surface 
        Transportation Efficiency Act (23 U.S.C. 149 note; 105 Stat. 
        1938; 112 Stat. 211) is amended by striking subsection (b).
            (2) Continuation of program.--Notwithstanding the amendment 
        made by paragraph (1), the Secretary shall monitor and allow 
        any value pricing program established under a cooperative 
        agreement in effect on the day before the date of enactment of 
        this Act to continue.

SEC. 1610. FEDERAL REFERENCE METHOD.

    (a) In General.--Section 6102 of the Transportation Equity Act for 
the 21st Century (42 U.S.C. 7407 note; 112 Stat. 464) is amended by 
striking subsection (e) and inserting the following:
    ``(e) Field Study.--Not later than 2 years after the date of 
enactment of the Safe, Accountable, Flexible, and Efficient 
Transportation Equity Act of 2004, the Administrator shall--
            ``(1) conduct a field study of the ability of the 
        PM<INF>2.5</INF> Federal Reference Method to differentiate 
        those particles that are larger than 2.5 micrometers in 
        diameter;
            ``(2) develop a Federal reference method to measure 
        directly particles that are larger than 2.5 micrometers in 
        diameter without reliance on subtracting from coarse particle 
        measurements those particles that are equal to or smaller than 
        2.5 micrometers in diameter;
            ``(3) develop a method of measuring the composition of 
        coarse particles; and
            ``(4) submit a report on the study and responsibilities of 
        the Administrator under paragraphs (1) through (3) to--
                    ``(A) the Committee on Commerce of the House of 
                Representatives; and
                    ``(B) the Committee on Environment and Public Works 
                of the Senate.''.

SEC. 1611. ADDITION OF PARTICULATE MATTER AREAS TO CMAQ.

    Section 104(b)(2) of title 23, United States Code, is amended--
            (1) in subparagraph (B)--
                    (A) in the matter preceding clause (i), by striking 
                ``ozone or carbon monoxide'' and inserting ``ozone, 
                carbon monoxide, or fine particulate matter 
                (PM<INF>2.5</INF>)'';
                    (B) by striking clause (i) and inserting the 
                following:
                            ``(i) 1.0, if at the time of apportionment, 
                        the area is a maintenance area;'';
                    (C) in clause (vi), by striking ``or'' after the 
                semicolon; and
                    (D) in clause (vii)--
                            (i) by striking ``area as described in 
                        section 149(b) for ozone,'' and inserting 
                        ``area for ozone (as described in section 
                        149(b) or for PM-2.5''; and
                            (ii) by striking the period at the end and 
                        inserting a semicolon;
            (2) by adding at the end the following:
                            ``(viii) 1.0 if, at the time of 
                        apportionment, any county that is not 
                        designated as a nonattainment or maintenance 
                        area under the 1-hour ozone standard is 
                        designated as nonattainment under the 8-hour 
                        ozone standard; or
                            ``(ix) 1.2 if, at the time of 
                        apportionment, the area is not a nonattainment 
                        or maintenance area as described in section 
                        149(b) for ozone or carbon monoxide, but is an 
                        area designated nonattainment under the PM-2.5 
                        standard.'';
            (3) by striking subparagraph (C) and inserting the 
        following:
                    ``(C) Additional adjustment for carbon monoxide 
                areas.--If, in addition to being designated as a 
                nonattainment or maintenance area for ozone as 
                described in section 149(b), any county within the area 
                was also classified under subpart 3 of part D of title 
                I of the Clean Air Act (42 U.S.C. 7512 et seq.) as a 
                nonattainment or maintenance area described in section 
                149(b) for carbon monoxide, the weighted nonattainment 
                or maintenance area population of the county, as 
                determined under clauses (i) through (vi) or clause 
                (viii) of subparagraph (B), shall be further multiplied 
                by a factor of 1.2.'';
            (4) by redesignating subparagraph (D) and (E) as 
        subparagraphs (E) and (F) respectively; and
            (5) by inserting after subparagraph (C) the following:
                    ``(D) Additional adjustment for pm 2.5 areas.--If, 
                in addition to being designated as a nonattainment or 
                maintenance area for ozone or carbon monoxide, or both 
                as described in section 149(b), any county within the 
                area was also designated under the PM-2.5 standard as a 
                nonattainment or maintenance area, the weighted 
                nonattainment or maintenance area population of those 
                counties shall be further multiplied by a factor of 
                1.2.''.

SEC. 1612. ADDITION TO CMAQ-ELIGIBLE PROJECTS.

    (a) Eligible Projects.--Section 149(b) of title 23, United States 
Code, is amended--
            (1) in paragraph (4), by striking ``or'' at the end;
            (2) in paragraph (5), by striking the period at the end and 
        inserting a semicolon; and
            (3) by adding at the end the following:
            ``(6) if the project or program is for the purchase of 
        alternative fuel (as defined in section 301 of the Energy 
        Policy Act of 1992 (42 U.S.C. 13211)) or biodiesel; or
            ``(7) if the project or program involves the purchase of 
        integrated, interoperable emergency communications 
        equipment.''.
    (b) States Receiving Minimum Apportionment.--Section 149(c) of 
title 23, United States Code, is amended--
            (1) in paragraph (1), by striking ``for any project 
        eligible under the surface transportation program under section 
        133.'' and inserting the following: ``for any project in the 
        State that--
                    ``(A) would otherwise be eligible under this 
                section as if the project were carried out in a 
                nonattainment or maintenance area; or
                    ``(B) is eligible under the surface transportation 
                program under section 133.''; and
            (2) in paragraph (2), by striking ``for any project in the 
        State eligible under section 133.'' and inserting the 
        following: ``for any project in the State that--
                    ``(A) would otherwise be eligible under this 
                section as if the project were carried out in a 
                nonattainment or maintenance area; or
                    ``(B) is eligible under the surface transportation 
                program under section 133.''.
    (c) Responsibility of States.--
            (1) In general.--Each State shall be responsible for 
        ensuring that subrecipients of Federal funds within the State 
        under section 149 of title 23, United States Code, have 
        emission reduction strategies for fleets that are--
                    (A) used in construction projects located in 
                nonattainment and maintenance areas; and
                    (B) funded under title 23, United States Code.
            (2) Emission reduction strategies.--The Administrator of 
        the Environmental Protection Agency, in consultation with the 
        Secretary, shall develop a nonbinding list of emission 
        reduction strategies and supporting technical information for 
        each strategy, including--
                    (A) contract preferences;
                    (B) requirements for the use of anti-idling 
                equipment;
                    (C) diesel retrofits; and
                    (D) such other matters as the Administrator of the 
                Environmental Protection Agency, in consultation with 
                the Secretary, determine to be appropriate.
            (3) Use of cmaq funds.--A State may use funds made 
        available under this title and title 23, United States Code, 
        for the congestion mitigation and air quality program under 
        section 149 of title 23, United States Code, to ensure the 
        deployment of the emission reduction strategies described in 
        paragraph (1).

SEC. 1613. IMPROVED INTERAGENCY CONSULTATION.

    Section 149 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(g) Interagency Consultation.--The Secretary shall encourage 
States and metropolitan planning organizations to consult with State 
and local air quality agencies in nonattainment and maintenance areas 
on the estimated emission reductions from proposed congestion 
mitigation and air quality improvement programs and projects.''.

SEC. 1614. EVALUATION AND ASSESSMENT OF CMAQ PROJECTS.

    Section 149 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(h) Evaluation and Assessment of Projects.--
            ``(1) In general.--The Secretary, in consultation with the 
        Administrator of the Environmental Protection Agency, shall 
        evaluate and assess a representative sample of projects funded 
        under the congestion mitigation and air quality program to--
                    ``(A) determine the direct and indirect impact of 
                the projects on air quality and congestion levels; and
                    ``(B) ensure the effective implementation of the 
                program.
            ``(2) Database.--Using appropriate assessments of projects 
        funded under the congestion mitigation and air quality program 
        and results from other research, the Secretary shall maintain 
        and disseminate a cumulative database describing the impacts of 
        the projects.
            ``(3) Consideration.--The Secretary, in consultation with 
        the Administrator of the Environmental Protection Agency, shall 
        consider the recommendations and findings of the report 
        submitted to Congress under section 1110(e) of the 
        Transportation Equity Act for the 21st Century (112 Stat. 144), 
        including recommendations and findings that would improve the 
        operation and evaluation of the congestion mitigation and air 
        quality improvement program under section 149.''.

SEC. 1615. SYNCHRONIZED PLANNING AND CONFORMITY TIMELINES, 
              REQUIREMENTS, AND HORIZON.

    (a) Metropolitan Planning.--
            (1) Development of long-range transportation plan.--Section 
        134(g)(1) of title 23, United States Code, is amended by 
        striking ``periodically, according to a schedule that the 
        Secretary determines to be appropriate,'' and inserting ``every 
        4 years (or more frequently, in a case in which the 
        metropolitan planning organization elects to update a 
        transportation plan more frequently) in areas designated as 
        nonattainment, as defined in section 107(d) of the Clean Air 
        Act (42 U.S.C. 7407(d)), and in areas that were nonattainment 
        that have been redesignated to attainment in accordance with 
        section 107(d)(3) of that Act (42 U.S.C. 7407(d)(3)), with a 
        maintenance plan under section 175A of that Act (42 U.S.C. 
        7505a), or every 5 years (or more frequently, in a case in 
        which the metropolitan planning organization elects to update a 
        transportation plan more frequently) in areas designated as 
        attainment (as defined in section 107(d) of that Act (42 U.S.C. 
        7407(d))),''.
            (2) Metropolitan transportation improvement program.--
        Section 134(h) of title 23, United States Code, is amended--
                    (A) in paragraph (1)(D), by striking ``2 years'' 
                and inserting ``4 years''; and
                    (B) in paragraph (2)(A), by striking ``3-year'' and 
                inserting ``4-year''.
            (3) Statewide transportation improvement program.--Section 
        135(f)(1)(A) of title 23, United States Code, is amended by 
        inserting after ``program'' the following: ``(which program 
        shall cover a period of 4 years and be updated every 4 
        years)''.
            (4) Final regulations.--Not later than 18 months after the 
        date of enactment of the Safe, Accountable, Flexible, and 
        Efficient Transportation Equity Act of 2004, the Secretary 
        shall promulgate regulations that are consistent with the 
        amendments made by this subsection.
    (b) Synchronized Conformity Determination.--Section 176(c) of the 
Clean Air Act (42 U.S.C. 7506(c)) is amended--
            (1) in paragraph (2)--
                    (A) by striking ``(2) Any transportation plan'' and 
                inserting the following:
            ``(2) Transportation plans and programs.--Any 
        transportation plan'';
                    (B) in subparagraph (C)(iii), by striking the 
                period at the end and inserting a semicolon;
                    (C) in subparagraph (D)--
                            (i) by striking ``Any project'' and 
                        inserting ``any transportation project''; and
                            (ii) by striking the period at the end and 
                        inserting ``; and''; and
                    (D) by adding at the end the following:
                    ``(E) the appropriate metropolitan planning 
                organization shall redetermine conformity of existing 
                transportation plans and programs not later than 2 
                years after the date on which the Administrator--
                            ``(i) finds a motor vehicle emissions 
                        budget to be adequate in accordance with 
                        section 93.118(e)(4) of title 40, Code of 
                        Federal Regulations (as in effect on October 1, 
                        2003);
                            ``(ii) approves an implementation plan that 
                        establishes a motor vehicle emissions budget, 
                        if that budget has not yet been used in a 
                        conformity determination prior to approval; or
                            ``(iii) promulgates an implementation plan 
                        that establishes or revises a motor vehicle 
                        emissions budget.'';
            (2) in paragraph (4)(B)(ii), by striking ``but in no case 
        shall such determinations for transportation plans and programs 
        be less frequent than every 3 years; and'' and inserting ``but 
        the frequency for making conformity determinations on updated 
        transportation plans and programs shall be every 4 years, 
        except in a case in which--
                                    ``(I) the metropolitan planning 
                                organization elects to update a 
                                transportation plan or program more 
                                frequently; or
                                    ``(II) the metropolitan planning 
                                organization is required to determine 
                                conformity in accordance with paragraph 
                                (2)(E); and'';
            (3) in paragraph (4)(B)--
                    (A) in clause (ii), by striking ``and'' at the end;
                    (B) in clause (iii), by striking the period at the 
                end and inserting ``; and''; and
                    (C) by adding at the end the following:
                            ``(iv) address the effects of the most 
                        recent population, economic, employment, 
                        travel, transit ridership, congestion, and 
                        induced travel demand information in the 
                        development and application of the latest 
                        travel and emissions models.'';
            (4) by adding at the end the following:
            ``(7) Conformity horizon for transportation plans.--
                    ``(A) In general.--For the purposes of this 
                section, a transportation plan in a nonattainment or 
                maintenance area shall be considered to be a 
                transportation plan or a portion of a transportation 
                plan that extends for the longest of the following 
                periods:
                            ``(i) The first 10-year period of any such 
                        transportation plan.
                            ``(ii) The latest year in the 
                        implementation plan applicable to the area that 
                        contains a motor vehicle emission budget.
                            ``(iii) The year after the completion date 
                        of a regionally significant project, if the 
                        project requires approval before the subsequent 
                        conformity determination.
                    ``(B) Exception.--In a case in which an area has a 
                revision to an implementation plan under section 
                175A(b) and the Administrator has found the motor 
                vehicle emissions budgets from that revision to be 
                adequate in accordance with section 93.118(e)(4) of 
                title 40, Code of Federal Regulations (as in effect on 
                October 1, 2003), or has approved the revision, the 
                transportation plan shall be considered to be a 
                transportation plan or portion of a transportation plan 
                that extends through the last year of the 
                implementation plan required under section 175A(b).
            ``(8) Definitions.--In this subsection:
                    ``(A) Regionally significant project.--
                            ``(i) In general.--The term `regionally 
                        significant project' means a transportation 
                        project that is on a facility that serves a 
                        regional transportation need, including--
                                    ``(I) access to and from the area 
                                outside of the region;
                                    ``(II) access to and from major 
                                planned developments, including new 
                                retail malls, sports complexes, or 
                                transportation terminals; and
                                    ``(III) most transportation 
                                terminals.
                            ``(ii) Principal arterials and fixed 
                        guideways.--The term `regionally significant 
                        project' includes, at a minimum--
                                    ``(I) all principal arterial 
                                highways; and
                                    ``(II) all fixed guideway transit 
                                facilities that offer an alternative to 
                                regional highway travel.
                            ``(iii) Additional projects.--The 
                        interagency consultation process and procedures 
                        described in section 93.105(c) of title 40, 
                        Code of Federal Regulations (as in effect on 
                        October 1, 2003), shall be used to make 
                        determinations as to whether minor arterial 
                        highways and other transportation projects 
                        should be considered `regionally significant 
                        projects'.
                            ``(iv) Exclusions.--The term `regionally 
                        significant project' does not include any 
                        project of a type listed in sections 93.126 or 
                        127 of title 40, Code of Federal Regulations 
                        (as in effect on October 1, 2003).
                    ``(B) Significant revision.--The term `significant 
                revision' means--
                            ``(i) with respect to a regionally 
                        significant project, a significant change in 
                        design concept or scope to the project; and
                            ``(ii) with respect to any other kind of 
                        project, a change that converts a project that 
                        is not a regionally significant project into a 
                        regionally significant project.
                    ``(C) Transportation project.--The term 
                `transportation project' includes only a project that 
                is--
                            ``(i) a regionally significant project; or
                            ``(ii) a project that makes a significant 
                        revision to an existing project.''; and
            (5) in the matter following paragraph (3)(B), by inserting 
        ``transportation'' before ``project'' each place it appears.

SEC. 1616. TRANSITION TO NEW AIR QUALITY STANDARDS.

    Section 176(c) of the Clean Air Act (42 U.S.C. 7506(c)) is amended 
by striking paragraph (3) and inserting the following:
            ``(3) Methods of conformity determination before budget is 
        available.--
                    ``(A) In general.--Until such time as a motor 
                vehicle emission budget from an implementation plan 
                submitted for a national ambient air quality standard 
                is determined to be adequate in accordance with section 
                93.118(e)(4) of title 40, Code of Federal Regulations 
                (as in effect on October 1, 2003), or the submitted 
                implementation plan is approved, conformity of such a 
                plan, program, or project shall be demonstrated, in 
                accordance with clauses (i) and (ii) and as selected 
                through the consultation process required under 
                paragraph (4)(D)(i), with--
                            ``(i) a motor vehicle emission budget that 
                        has been found adequate in accordance with 
                        section 93.118(e)(4) of title 40, Code of 
                        Federal Regulations (as in effect on October 1, 
                        2003), or that has been approved, from an 
                        implementation plan for the most recent prior 
                        applicable national ambient air quality 
                        standard addressing the same pollutant; or
                            ``(ii) other such tests as the 
                        Administrator shall determine to ensure that--
                                    ``(I) the transportation plan or 
                                program--
                                            ``(aa) is consistent with 
                                        the most recent estimates of 
                                        mobile source emissions;
                                            ``(bb) provides for the 
                                        expeditious implementation of 
                                        transportation control measures 
                                        in the applicable 
                                        implementation plan; and
                                            ``(cc) with respect to an 
                                        ozone or carbon monoxide 
                                        nonattainment area, contributes 
                                        to annual emissions reductions 
                                        consistent with sections 
                                        182(b)(1) and 187(a)(7); and
                                    ``(II) the transportation project--
                                            ``(aa) comes from a 
                                        conforming transportation plan 
                                        and program described in this 
                                        subparagraph; and
                                            ``(bb) in a carbon monoxide 
                                        nonattainment area, eliminates 
                                        or reduces the severity and 
                                        number of violations of the 
                                        carbon monoxide standards in 
                                        the area substantially affected 
                                        by the project.
                    ``(B) Determination for a transportation project in 
                a carbon monoxide nonattainment area.--A determination 
                under subparagraph (A)(ii)(II)(bb) may be made as part 
                of either the conformity determination for the 
                transportation program or for the individual project 
                taken as a whole during the environmental review phase 
                of project development.''.

SEC. 1617. REDUCED BARRIERS TO AIR QUALITY IMPROVEMENTS.

    Section 176(c) of the Clean Air Act (42 U.S.C. 7506(c)) (as amended 
by section 1615(b)(4)) is amended--
            (1) by redesignating paragraph (8) as paragraph (9); and
            (2) by inserting after paragraph (7) the following:
            ``(8) Substitution for transportation control measures.--
                    ``(A) In general.--Transportation control measures 
                that are specified in an implementation plan may be 
                replaced or added to the implementation plan with 
                alternate or additional transportation control measures 
                if--
                            ``(i) the substitute measures achieve 
                        equivalent or greater emissions reductions than 
                        the control measure to be replaced, as 
                        demonstrated with an analysis that is 
                        consistent with the current methodology used 
                        for evaluating the replaced control measure in 
                        the implementation plan;
                            ``(ii) the substitute control measures are 
                        implemented--
                                    ``(I) in accordance with a schedule 
                                that is consistent with the schedule 
                                provided for control measures in the 
                                implementation plan; or
                                    ``(II) if the implementation plan 
                                date for implementation of the control 
                                measure to be replaced has passed, as 
                                soon as practicable after the 
                                implementation plan date but not later 
                                than the date on which emission 
                                reductions are necessary to achieve the 
                                purpose of the implementation plan;
                            ``(iii) the substitute and additional 
                        control measures are accompanied with evidence 
                        of adequate personnel, funding, and authority 
                        under State or local law to implement, monitor, 
                        and enforce the control measures;
                            ``(iv) the substitute and additional 
                        control measures were developed through a 
                        collaborative process that included--
                                    ``(I) participation by 
                                representatives of all affected 
                                jurisdictions (including local air 
                                pollution control agencies, the State 
                                air pollution control agency, and State 
                                and local transportation agencies);
                                    ``(II) consultation with the 
                                Administrator; and
                                    ``(III) reasonable public notice 
                                and opportunity for comment; and
                            ``(v) the metropolitan planning 
                        organization, State air pollution control 
                        agency, and the Administrator concur with the 
                        equivalency of the substitute or additional 
                        control measures.
                    ``(B) Adoption.--After carrying out subparagraph 
                (A), a State shall adopt the substitute or additional 
                transportation control measure in the applicable 
                implementation plan.
                    ``(C) No requirement for express permission.--The 
                substitution or addition of a transportation control 
                measure in accordance with this paragraph shall not be 
                contingent on there being any provision in the 
                implementation plan that expressly permits such a 
                substitution or addition.
                    ``(D) No requirement for new conformity 
                determination.--The substitution or addition of a 
                transportation control measure in accordance with this 
                paragraph shall not require--
                            ``(i) a new conformity determination for 
                        the transportation plan; or
                            ``(ii) a revision of the implementation 
                        plan.
                    ``(E) Continuation of control measure being 
                replaced.--A control measure that is being replaced by 
                a substitute control measure under this paragraph shall 
                remain in effect until the substitute control measure 
                is adopted by the State pursuant to subparagraph (B).
                    ``(F) Effect of adoption.--Adoption of a substitute 
                control measure shall constitute rescission of the 
                previously applicable control measure.''.

SEC. 1618. AIR QUALITY MONITORING DATA INFLUENCED BY EXCEPTIONAL 
              EVENTS.

    (a) In General.--Section 319 of the Clean Air Act (42 U.S.C. 7619) 
is amended--
            (1) by striking the section heading and all that follows 
        through ``after notice and opportunity for public hearing'' and 
        inserting the following:

``SEC. 319. AIR QUALITY MONITORING.

    ``(a) In General.--After notice and opportunity for public 
hearing''; and
            (2) by adding at the end the following:
    ``(b) Air Quality Monitoring Data Influenced by Exceptional 
Events.--
            ``(1) Definition of exceptional event.--In this section:
                    ``(A) In general.--The term `exceptional event' 
                means an event that--
                            ``(i) affects air quality;
                            ``(ii) is not reasonably controllable or 
                        preventable;
                            ``(iii) is--
                                    ``(I) a natural event; or
                                    ``(II) an event caused by human 
                                activity that is unlikely to recur at a 
                                particular location; and
                            ``(iv) is determined by the Administrator 
                        through the process established in the 
                        regulations promulgated under paragraph (2) to 
                        be an exceptional event.
                    ``(B) Exclusions.--The term `exceptional event' 
                does not include--
                            ``(i) stagnation of air masses or 
                        meteorological inversions;
                            ``(ii) a meteorological event involving 
                        high temperatures or lack of precipitation; or
                            ``(iii) air pollution relating to source 
                        noncompliance.
            ``(2) Regulations.--
                    ``(A) Proposed regulations.--Not later than March 
                1, 2005, after consultation with Federal land managers 
                and State air pollution control agencies, the 
                Administrator shall publish in the Federal Register 
                proposed regulations governing the review and handling 
                of air quality monitoring data influenced by 
                exceptional events.
                    ``(B) Final regulations.--Not later than 1 year 
                after the date on which the Administrator publishes 
                proposed regulations under subparagraph (A), and after 
                providing an opportunity for interested persons to make 
                oral presentations of views, data, and arguments 
                regarding the proposed regulations, the Administrator 
                shall promulgate final regulations governing the review 
                and handling or air quality monitoring data influenced 
                by an exceptional event that are consistent with 
                paragraph (3).
            ``(3) Principles and requirements.--
                    ``(A) Principles.--In promulgating regulations 
                under this section, the Administrator shall follow--
                            ``(i) the principle that protection of 
                        public health is the highest priority;
                            ``(ii) the principle that timely 
                        information should be provided to the public in 
                        any case in which the air quality is unhealthy;
                            ``(iii) the principle that all ambient air 
                        quality data should be included in a timely 
                        manner, an appropriate Federal air quality 
                        database that is accessible to the public;
                            ``(iv) the principle that each State must 
                        take necessary measures to safeguard public 
                        health regardless of the source of the air 
                        pollution; and
                            ``(v) the principle that air quality data 
                        should be carefully screened to ensure that 
                        events not likely to recur are represented 
                        accurately in all monitoring data and analyses.
                    ``(B) Requirements.--Regulations promulgated under 
                this section shall, at a minimum, provide that--
                            ``(i) the occurrence of an exceptional 
                        event must be demonstrated by reliable, 
                        accurate data that is promptly produced and 
                        provided by Federal, State, or local government 
                        agencies;
                            ``(ii) a clear causal relationship must 
                        exist between the measured exceedances of a 
                        national ambient air quality standard and the 
                        exceptional event to demonstrate that the 
                        exceptional event caused a specific air 
                        pollution concentration at a particular air 
                        quality monitoring location;
                            ``(iii) there is a public process for 
                        determining whether an event is exceptional; 
                        and
                            ``(iv) there are criteria and procedures 
                        for the Governor of a State to petition the 
                        Administrator to exclude air quality monitoring 
                        data that is directly due to exceptional events 
                        from use in determinations by the Environmental 
                        Protection Agency with respect to exceedances 
                        or violations of the national ambient air 
                        quality standards.
            ``(4) Interim provision.--Until the effective date of a 
        regulation promulgated under paragraph (2), the following 
        guidance issued by the Administrator shall continue to apply:
                    ``(A) Guidance on the identification and use of air 
                quality data affected by exceptional events (July 
                1986).
                    ``(B) Areas affected by PM-10 natural events, May 
                30, 1996.
                    ``(C) Appendices I, K, and N to part 50 of title 
                40, Code of Federal Regulations.''.

SEC. 1619. CONFORMING AMENDMENTS.

    Section 176(c)(4) of the Clean Air Act (42 U.S.C. 7506(c)(4) is 
amended--
            (1) by redesignating subparagraphs (B) through (D) as 
        subparagraphs (D) through (F), respectively;
            (2) by striking ``(4)(A) No later than one year after the 
        date of enactment of the Clean Air Act Amendments of 1990, the 
        Administrator shall promulgate'' and inserting the following:
            ``(4) Criteria and procedures for determining conformity.--
                    ``(A) In general.--The Administrator shall 
                promulgate, and periodically update,'';
            (3) in subparagraph (A)--
                    (A) in the second sentence, by striking ``No later 
                than one year after such date of enactment, the 
                Administrator, with the concurrence of the Secretary of 
                Transportation, shall promulgate'' and inserting the 
                following:
                    ``(B) Transportation plans, programs, and 
                projects.--The Administrator, with the concurrence of 
                the Secretary of Transportation, shall promulgate, and 
                periodically update,''; and
                    (B) in the third sentence, by striking ``A suit'' 
                and inserting the following:
                    ``(C) Civil action to compel promulgation.--A civil 
                action''; and
            (4) by striking subparagraph (E) (as redesignated by 
        paragraph (1)) and inserting the following:
                    ``(E) Inclusion of criteria and procedures in 
                sip.--Not later than 2 years after the date of 
                enactment of the Safe, Accountable, Flexible, and 
                Efficient Transportation Equity Act of 2004, the 
                procedures under subparagraph (A) shall include a 
                requirement that each State include in the State 
                implementation plan criteria and procedures for 
                consultation in accordance with the Administrator's 
                criteria and procedures for consultation required by 
                subparagraph (D)(i).''.

SEC. 1620. HIGHWAY STORMWATER DISCHARGE MITIGATION PROGRAM.

    (a) Highway Stormwater Mitigation Projects.--Section 133(d) of 
title 23, United States Code (as amended by section 1401(a)(2)(B)), is 
amended by adding at the end the following:
            ``(5) Highway stormwater discharge mitigation projects.--Of 
        the amount apportioned to a State under section 104(b)(3) for a 
        fiscal year, 2 percent shall be available only for projects and 
        activities carried out under section 167.''.
    (b) Highway Stormwater Discharge Mitigation Program.--Subchapter I 
of chapter 1 of title 23, United States Code (as amended by section 
1601(a)), is amended by adding at the end the following:
``Sec. 167. Highway stormwater discharge mitigation program
    ``(a) Definitions.--In this section:
            ``(1) Administrator.--The term `Administrator' means the 
        Administrator of the Environmental Protection Agency.
            ``(2) Eligible mitigation project.--The term `eligible 
        mitigation project' means a practice or technique that--
                    ``(A) improves stormwater discharge water quality;
                    ``(B) attains preconstruction hydrology;
                    ``(C) promotes infiltration of stormwater into 
                groundwater;
                    ``(D) recharges groundwater;
                    ``(E) minimizes stream bank erosion;
                    ``(F) promotes natural filters;
                    ``(G) otherwise mitigates water quality impacts of 
                highway stormwater discharges, improves surface water 
                quality, or enhances groundwater recharge; or
                    ``(H) reduces flooding caused by highway stormwater 
                discharge.
            ``(3) Federal-aid highway and associated facility.--The 
        term `Federal-aid highway and associated facility' means--
                    ``(A) a Federal-aid highway; or
                    ``(B) a facility or land owned by a State (or 
                political subdivision of a State) that is directly 
                associated with the Federal-aid highway.
            ``(4) Highway stormwater discharge.--The term `highway 
        stormwater discharge' means stormwater discharge from a 
        Federal-aid highway, or a Federal-aid highway and associated 
        facility, that was constructed before the date of enactment of 
        this section.
            ``(5) Highway stormwater discharge mitigation.--The term 
        `highway stormwater discharge mitigation' means--
                    ``(A) the reduction of water quality impacts of 
                stormwater discharges from Federal-aid highways or 
                Federal-aid highways and associated facilities; or
                    ``(B) the enhancement of groundwater recharge from 
                stormwater discharges from Federal-aid highways or 
                Federal-aid highways and associated facilities.
            ``(6) Program.--The term `program' means the highway 
        stormwater discharge mitigation program established under 
        subsection (b).
    ``(b) Establishment.--The Secretary shall establish a highway 
stormwater discharge mitigation program--
            ``(1) to improve the quality of stormwater discharge from 
        Federal-aid highways or Federal-aid highways and associated 
        facilities; and
            ``(2) to enhance groundwater recharge.
    ``(c) Priority of Projects.--For projects funded from the 
allocation under section 133(d)(6), a State shall give priority to 
projects sponsored by a State or local government that assist the State 
or local government in complying with the Federal Water Pollution 
Control Act (33 U.S.C. 1251 et seq.).
    ``(d) Guidance.--
            ``(1) In general.--Not later than 180 days after the date 
        of enactment of this section, the Secretary, in consultation 
        with the Administrator, shall issue guidance to assist States 
        in carrying out this section.
            ``(2) Requirements for guidance.--The guidance issued under 
        paragraph (1) shall include information concerning innovative 
        technologies and nonstructural best management practices to 
        mitigate highway stormwater discharges.''.
    (c) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1601(b), is 
amended by inserting after the item relating to section 166 the 
following:

``167. Highway stormwater discharge mitigation program.''.

SEC. 1621. EXEMPTION FROM CERTAIN HAZARDOUS MATERIALS TRANSPORTATION 
              REQUIREMENTS.

    (a) Definition of Eligible Person.--In this section, the term 
``eligible person'' means an agricultural producer that has gross 
agricultural commodity sales that do not exceed $500,000.
    (b) Exemption.--Subject to subsection (c), part 172 of title 49, 
Code of Federal Regulations, shall not apply to an eligible person that 
transports a fertilizer, pesticide, propane, gasoline, or diesel fuel 
for agricultural purposes, to the extent determined by the Secretary.
    (c) Applicability.--Subsection (b) applies to security plan 
requirements under subpart I of part 172 of title 49, Code of Federal 
Regulations (or a successor regulation).

SEC. 1622. FUNDS FOR REBUILDING FISH STOCKS.

    Section 105 of the Miscellaneous Appropriations and Offsets Act, 
2004 (Division H of the Consolidated Appropriations Act, 2004 (Public 
Law 108-199)) is repealed.

                         Subtitle G--Operations

SEC. 1701. TRANSPORTATION SYSTEMS MANAGEMENT AND OPERATIONS.

    (a) Surface Transportation Program Eligibility.--Section 133(b) of 
title 23, United States Code (as amended by section 1601(a)(2)), is 
amended by adding at the end the following:
            ``(16) Regional transportation operations collaboration and 
        coordination activities that are associated with regional 
        improvements, such as traffic incident management, technology 
        deployment, emergency management and response, traveler 
        information, and regional congestion relief.
            ``(17) Rush hour congestion relief.--
                    ``(A) In general.--Subject to subparagraph (B), a 
                State may spend the funds apportioned under this 
                section to reduce traffic delays caused by motor 
                vehicle accidents and breakdowns on highways during 
                peak driving times.
                    ``(B) Use of funds.--A State, metropolitan planning 
                organization, or local government may use the funds 
                under subparagraph (A)--
                            ``(i) to develop a region-wide coordinated 
                        plan to mitigate traffic delays caused by motor 
                        vehicle accidents and breakdowns;
                            ``(ii) to purchase or lease 
                        telecommunications equipment for first 
                        responders;
                            ``(iii) to purchase or lease towing and 
                        recovery services;
                            ``(iv) to pay contractors for towing and 
                        recovery;
                            ``(v) to rent vehicle storage areas 
                        adjacent to roadways;
                            ``(vi) to fund service patrols, equipment, 
                        and operations;
                            ``(vii) to purchase incident detection 
                        equipment;
                            ``(viii) to carry out training.''.
    (b) Congestion Mitigation and Air Quality Improvement Program 
Eligibility.--Section 149(b)(5) of title 23, United States Code, is 
amended by inserting ``improve transportation systems management and 
operations,'' after ``intersections,''.
    (c) Transportation Systems Management and Operations.--
            (1) In general.--Subchapter I of chapter 1 of title 23, 
        United States Code (as amended by section 1620(b)), is amended 
        by adding at the end the following:
``Sec. 168. Transportation systems management and operations
    ``(a) In General.--The Secretary shall carry out a transportation 
systems management and operations program to--
            ``(1) ensure efficient and effective transportation systems 
        management and operations on Federal-aid highways through 
        collaboration, coordination, and real-time information sharing 
        at a regional and Statewide level among--
                    ``(A) managers and operators of major modes of 
                transportation;
                    ``(B) public safety officials; and
                    ``(C) the general public; and
            ``(2) manage and operate Federal-aid highways in a 
        coordinated manner to preserve the capacity and maximize the 
        performance of highway and transit facilities for travelers and 
        carriers.
    ``(b) Authorized Activities.--
            ``(1) In general.--In carrying out the program under 
        subsection (a), the Secretary may carry out activities to--
                    ``(A) encourage managers and operators of major 
                modes of transportation, public safety officials, and 
                transportation planners in urbanized areas that are 
                responsible for conducting the day-to-day management, 
                operations, public safety, and planning of 
                transportation facilities and services to collaborate 
                on and coordinate, on a regional level and in a 
                continuous and sustained manner, improved 
                transportation systems management and operations; and
                    ``(B) encourage States to--
                            ``(i) establish a system of basic real-time 
                        monitoring for the surface transportation 
                        system; and
                            ``(ii) provide the means to share the data 
                        gathered under clause (i) among--
                                    ``(I) highway, transit, and public 
                                safety agencies;
                                    ``(II) jurisdictions (including 
                                States, cities, counties, and 
                                metropolitan planning organizations);
                                    ``(III) private-sector entities; 
                                and
                                    ``(IV) the general public.
            ``(2) Activities.--Activities to be carried out under 
        paragraph (1) include--
                    ``(A) developing a regional concept of operations 
                that defines a regional strategy shared by all 
                transportation and public safety participants with 
                respect to the manner in which the transportation 
                systems of the region should be managed, operated, and 
                measured;
                    ``(B) the sharing of information among operators, 
                service providers, public safety officials, and the 
                general public; and
                    ``(C) guiding, in a regionally-coordinated manner 
                and in a manner consistent with and integrated into the 
                metropolitan and statewide transportation planning 
                processes and regional intelligent transportation 
                system architecture, the implementation of regional 
                transportation system management and operations 
                initiatives, including--
                            ``(i) emergency evacuation and response;
                            ``(ii) traffic incident management;
                            ``(iii) technology deployment; and
                            ``(iv) traveler information systems 
                        delivery.
    ``(c) Cooperation.--In carrying out the program under subsection 
(a), the Secretary may assist and cooperate with other Federal 
agencies, State and local governments, metropolitan planning 
organizations, private industry, and other interested parties to 
improve regional collaboration and real-time information sharing 
between managers and operators of major modes of transportation, public 
safety officials, emergency managers, and the general public to 
increase the security, safety, and reliability of Federal-aid highways.
    ``(d) Guidance; Regulations.--
            ``(1) In general.--In carrying out the program under 
        subsection (a), the Secretary may issue guidance or promulgate 
        regulations for the procurement of transportation system 
        management and operations facilities, equipment, and services, 
        including--
                    ``(A) equipment procured in preparation for natural 
                disasters, disasters caused by human activity, and 
                emergencies;
                    ``(B) system hardware;
                    ``(C) software; and
                    ``(D) software integration services.
            ``(2) Considerations.--In developing the guidance or 
        regulations under paragraph (1), the Secretary may consider 
        innovative procurement methods that support the timely and 
        streamlined execution of transportation system management and 
        operations programs and projects.
            ``(3) Financial assistance.--The Secretary may authorize 
        the use of funds made available under section 104(b)(3) to 
        provide assistance for regional operations collaboration and 
        coordination activities that are associated with regional 
        improvements, such as--
                    ``(A) traffic incident management;
                    ``(B) technology deployment;
                    ``(C) emergency management and response;
                    ``(D) traveler information; and
                    ``(E) congestion relief.''.
            (2) Conforming amendment.--The analysis for subchapter I of 
        chapter 1 of title 23, United States Code (as amended by 
        section 1620(c)), is amended by adding at the end:

``168. Transportation systems management and operations.''.

SEC. 1702. REAL-TIME SYSTEM MANAGEMENT INFORMATION PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1701(c)(1)), is amended by adding at 
the end the following:
``Sec. 169. Real-time system management information program
    ``(a) In General.--The Secretary shall carry out a real-time system 
management information program to--
            ``(1) provide a nationwide system of basic real-time 
        information for managing and operating the surface 
        transportation system;
            ``(2)(A) identify long-range real-time highway and transit 
        monitoring needs; and
            ``(B) develop plans and strategies for meeting those needs;
            ``(3) provide the capability and means to share the basic 
        real-time information with State and local governments and the 
        traveling public; and
            ``(4) provide the nationwide capability to monitor, in 
        real-time, the traffic and travel conditions of major highways 
        in the United States, and to share that information with State 
        and local governments and the traveling public, to--
                    ``(A) improve the security of the surface 
                transportation system;
                    ``(B) address congestion problems;
                    ``(C) support improved response to weather events; 
                and
                    ``(D) facilitate the distribution of national and 
                regional traveler information.
    ``(b) Data Exchange Formats.--Not later than 1 year after the date 
of enactment of this section, the Secretary shall establish data 
exchange formats to ensure that the data provided by highway and 
transit monitoring systems (including statewide incident reporting 
systems) can readily be exchanged between jurisdictions to facilitate 
the nationwide availability of information on traffic and travel 
conditions.
    ``(c) Statewide Incident Reporting System.--Not later than 2 years 
after the date of enactment of this section, or not later than 5 years 
after the date of enactment of this section if the Secretary determines 
that adequate real-time communications capability will not be available 
within 2 years after the date of enactment of this section, each State 
shall establish a statewide incident reporting system to facilitate the 
real-time electronic reporting of highway and transit incidents to a 
central location for use in--
            ``(1) monitoring an incident;
            ``(2) providing accurate traveler information on the 
        incident; and
            ``(3) responding to the incident as appropriate.
    ``(d) Regional ITS Architecture.--
            ``(1) In general.--In developing or updating regional 
        intelligent transportation system architectures under section 
        940.9 of title 23, Code of Federal Regulations (or any 
        successor regulation), States and local governments shall 
        address--
                    ``(A) the real-time highway and transit information 
                needs of the State or local government, including 
                coverage, monitoring systems, data fusion and 
                archiving, and methods of exchanging or sharing 
                information; and
                    ``(B) the systems needed to meet those needs.
            ``(2) Data exchange formats.--In developing or updating 
        regional intelligent transportation system architectures, 
        States and local governments are encouraged to incorporate the 
        data exchange formats developed by the Secretary under 
        subsection (b) to ensure that the data provided by highway and 
        transit monitoring systems can readily be--
                    ``(A) exchanged between jurisdictions; and
                    ``(B) shared with the traveling public.
    ``(e) Eligible Funding.--Subject to project approval by the 
Secretary, a State may--
            ``(1) use funds available to the State under section 505(a) 
        to carry out activities relating to the planning of real-time 
        monitoring elements; and
            ``(2) use funds apportioned to the State under paragraphs 
        (1) and (3) of section 104(b) to carry out activities relating 
        to the planning and deployment of real-time monitoring 
        elements.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1701(c)(2)), 
is amended adding at the end the following:

``169. Real-time system management information program.''.

SEC. 1703. CONTRACTING FOR ENGINEERING AND DESIGN SERVICES.

    Section 112(b)(2) of title 23, United States Code, is amended--
            (1) in subparagraph (A), by striking ``title 40'' and all 
        that follows through the period and inserting ``title 40.'';
            (2) by striking subparagraph (B);
            (3) by redesignating subparagraphs (C) through (F) as 
        subparagraphs (B) through (E), respectively; and
            (4) by striking subparagraph (G).

SEC. 1704. OFF-DUTY TIME FOR DRIVERS OF COMMERCIAL VEHICLES.

    Section 345(a)(2) of the National Highway System Designation Act of 
1995 (49 U.S.C. 31136 note; 109 Stat. 613) is amended by adding at the 
end the following: ``No additional off-duty time for a driver of such a 
vehicle shall be required in order for the driver to operate the 
vehicle.''.

SEC. 1705. DESIGNATION OF TRANSPORTATION MANAGEMENT AREAS.

    (a) Funding.--Section 134(d)(3)(C)(ii) of title 23, United States 
Code, is amended by striking subclause (II) and inserting the 
following:
                                    ``(II) Funding.--In addition to 
                                funds made available to the 
                                metropolitan planning organization for 
                                the Lake Tahoe Region under this title 
                                and chapter 53 of title 49, 1 percent 
                                of all funds distributed under section 
                                202 shall be used to carry out the 
                                transportation planning process for the 
                                Lake Tahoe region under this 
                                subparagraph.''.
    (b) Special Designation.--Section 134(i)(1) of title 23, United 
States Code, is amended by adding at the end the following:
                    ``(C) Special designation.--
                            ``(i) In general.--The urbanized areas of 
                        Oklahoma City, Oklahoma, and Norman, Oklahoma, 
                        shall be designated as a single transportation 
                        management area.
                            ``(ii) Allocation.--The allocation of funds 
                        to the Oklahoma City-Norman Transportation 
                        Management Area designated under clause (i) 
                        shall be based on the aggregate population of 
                        the 2 urbanized areas referred to in that 
                        clause, as determined by the Bureau of the 
                        Census.''.

                  Subtitle H--Federal-Aid Stewardship

SEC. 1801. FUTURE INTERSTATE SYSTEM ROUTES.

    Section 103(c)(4)(B) of title 23, United States Code, is amended--
            (1) in clause (ii), by striking ``12'' and inserting 
        ``25''; and
            (2) in clause (iii)--
                    (A) in subclause (I), by striking ``in the 
                agreement between the Secretary and the State or 
                States''; and
                    (B) by adding at the end the following:
                                    ``(III) Existing agreements.--An 
                                agreement described in clause (ii) that 
                                is entered into before the date of 
                                enactment of this subparagraph shall be 
                                deemed to include the 25-year time 
                                limitation described in that clause, 
                                regardless of any earlier construction 
                                completion date in the agreement.''.

SEC. 1802. STEWARDSHIP AND OVERSIGHT.

    (a) In General.--Section 106 of title 23, United States Code, is 
amended--
            (1) by striking subsection (e) and inserting the following:
    ``(e) Value Engineering Analysis.--
            ``(1) Definition of value engineering analysis.--
                    ``(A) In general.--In this subsection, the term 
                `value engineering analysis' means a systematic process 
                of review and analysis of a project, during the concept 
                and design phases, by a multidisciplined team of 
                persons not involved in the project, that is conducted 
                to provide recommendations such as those described in 
                subparagraph (B) for--
                            ``(i) providing the needed functions 
                        safely, reliably, and at the lowest overall 
                        cost; and
                            ``(ii) improving the value and quality of 
                        the project.
                    ``(B) Inclusions.--The recommendations referred to 
                in subparagraph (A) include, with respect to a 
                project--
                            ``(i) combining or eliminating otherwise 
                        inefficient use of costly parts of the original 
                        proposed design for the project; and
                            ``(ii) completely redesigning the project 
                        using different technologies, materials, or 
                        methods so as to accomplish the original 
                        purpose of the project.
            ``(2) Analysis.--The State shall provide a value 
        engineering analysis or other cost-reduction analysis for--
                    ``(A) each project on the Federal-Aid System with 
                an estimated total cost of $25,000,000 or more;
                    ``(B) a bridge project with an estimated total cost 
                of $20,000,000 or more; and
                    ``(C) any other project the Secretary determines to 
                be appropriate.
            ``(3) Major projects.--The Secretary may require more than 
        1 analysis described in paragraph (2) for a major project 
        described in subsection (h).
            ``(4) Requirements.--Analyses described in paragraph (1) 
        for a bridge project shall--
                    ``(A) include bridge substructure requirements 
                based on construction material; and
                    ``(B) be evaluated--
                            ``(i) on engineering and economic bases, 
                        taking into consideration acceptable designs 
                        for bridges; and
                            ``(ii) using an analysis of life-cycle 
                        costs and duration of project construction.''; 
                        and
            (2) by striking subsections (g) and (h) and inserting the 
        following:
    ``(g) Oversight Program.--
            ``(1) Program.--
                    ``(A) In general.--The Secretary shall establish an 
                oversight program to monitor the effective and 
                efficient use of funds made available under this title.
                    ``(B) Minimum requirements.--At a minimum, the 
                program shall monitor and respond to all areas relating 
                to financial integrity and project delivery.
            ``(2) Financial integrity.--
                    ``(A) Financial management systems.--
                            ``(i) In general.--The Secretary shall 
                        perform annual reviews of the financial 
                        management systems of State transportation 
                        departments that affect projects approved under 
                        subsection (a).
                            ``(ii) Review areas.--In carrying out 
                        clause (i), the Secretary shall use risk 
                        assessment procedures to identify areas to be 
                        reviewed.
                    ``(B) Project costs.--The Secretary shall--
                            ``(i) develop minimum standards for 
                        estimating project costs; and
                            ``(ii) periodically evaluate practices of 
                        the States for--
                                    ``(I) estimating project costs;
                                    ``(II) awarding contracts; and
                                    ``(III) reducing project costs.
                    ``(C) Responsibility of the states.--
                            ``(i) In general.--Each State shall be 
                        responsible for ensuring that subrecipients of 
                        Federal funds within the State under this 
                        section have--
                                    ``(I) sufficient accounting 
                                controls to properly manage the Federal 
                                funds; and
                                    ``(II) adequate project delivery 
                                systems for projects approved under 
                                this section.
                            ``(ii) Review by secretary.--The Secretary 
                        shall periodically review monitoring by the 
                        States of those subrecipients.
            ``(3) Project delivery.--The Secretary shall--
                    ``(A) perform annual reviews of the project 
                delivery system of each State, including analysis of 1 
                or more activities that are involved in the life cycle 
                of a project; and
                    ``(B) employ risk assessment procedures to identify 
                areas to be reviewed.
            ``(4) Specific oversight responsibilities.--Nothing in this 
        section discharges or otherwise affects any oversight 
        responsibility of the Secretary--
                    ``(A) specifically provided for under this title or 
                other Federal law; or
                    ``(B) for the design and construction of all 
                Appalachian development highways under section 14501 of 
                title 40 or section 170 of this title.
    ``(h) Major Projects.--
            ``(1) In general.--Notwithstanding any other provision of 
        this section, a recipient of Federal financial assistance for a 
        project under this title with an estimated total cost of 
        $1,000,000,000 or more, and recipients for such other projects 
        as may be identified by the Secretary, shall submit to the 
        Secretary for each project--
                    ``(A) a project management plan; and
                    ``(B) an annual financial plan.
            ``(2) Project management plan.--A project management plan 
        shall document--
                    ``(A) the procedures and processes that are in 
                effect to provide timely information to the project 
                decisionmakers to effectively manage the scope, costs, 
                schedules, and quality of, and the Federal requirements 
                applicable to, the project; and
                    ``(B) the role of the agency leadership and 
                management team in the delivery of the project.
            ``(3) Financial plan.--A financial plan shall--
                    ``(A) be based on detailed estimates of the cost to 
                complete the project; and
                    ``(B) provide for the annual submission of updates 
                to the Secretary that are based on reasonable 
                assumptions, as determined by the Secretary, of future 
                increases in the cost to complete the project.
    ``(i) Other Projects.--A recipient of Federal financial assistance 
for a project under this title that receives $100,000,000 or more in 
Federal assistance for the project, and that is not covered by 
subsection (h), shall prepare, and make available to the Secretary at 
the request of the Secretary, an annual financial plan for the 
project.''.
    (b) Conforming Amendments.--
            (1) Section 114(a) of title 23, United States Code, is 
        amended--
                    (A) in the first sentence by striking ``highways or 
                portions of highways located on a Federal-aid system'' 
                and inserting ``Federal-aid highway or a portion of a 
                Federal-aid highway''; and
                    (B) by striking the second sentence and inserting 
                ``The Secretary shall have the right to conduct such 
                inspections and take such corrective action as the 
                Secretary determines to be appropriate.''.
            (2) Section 117 of title 23, United States Code, is 
        amended--
                    (A) by striking subsection (d); and
                    (B) by redesignating subsections (e) through (h) as 
                subsections (d) through (g), respectively.
    (c) Contractor Suspension and Debarment Policy; Sharing Fraud 
Monetary Recoveries.--
            (1) In general.--Section 307 of title 49, United States 
        Code, is amended to read as follows:
``Sec. 307. Contractor suspension and debarment policy; sharing fraud 
              monetary recoveries
    ``(a) Mandatory Enforcement Policy.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, the Secretary--
                    ``(A) shall debar any contractor or subcontractor 
                convicted of a criminal or civil offense involving 
                fraud relating to a project receiving Federal highway 
                or transit funds for such period as the Secretary 
                determines to be appropriate; and
                    ``(B) subject to approval by the Attorney General--
                            ``(i) except as provided in paragraph (2), 
                        shall suspend any contractor or subcontractor 
                        upon indictment for criminal or civil offenses 
                        involving fraud; and
                            ``(ii) may exclude nonaffiliated 
                        subsidiaries of a debarred business entity.
            ``(2) National security exception.--If the Secretary finds 
        that mandatory debarment or suspension of a contractor or 
        subcontractor under paragraph (1) would be contrary to the 
        national security of the United States, the Secretary--
                    ``(A) may waive the debarment or suspension; and
                    ``(B) in the instance of each waiver, shall provide 
                notification to Congress of the waiver with appropriate 
                details.
    ``(b) Sharing of Monetary Recoveries.--
            ``(1) In general.--Notwithstanding any other provision of 
        law--
                    ``(A) monetary judgments accruing to the Federal 
                Government from judgments in Federal criminal 
                prosecutions and civil judgments pertaining to fraud in 
                highway and transit programs shall be shared with the 
                State or local transit agency involved; and
                    ``(B) the State or local transit agency shall use 
                the funds for transportation infrastructure and 
                oversight activities relating to programs authorized 
                under title 23 and this title.
            ``(2) Amount.--The amount of recovered funds to be shared 
        with an affected State or local transit agency shall be--
                    ``(A) determined by the Attorney General, in 
                consultation with the Secretary; and
                    ``(B) considered to be Federal funds to be used in 
                compliance with other relevant Federal transportation 
                laws (including regulations).
            ``(3) Fraudulent activity.--Paragraph (1) shall not apply 
        in any case in which a State or local transit agency is found 
        by the Attorney General, in consultation with the Secretary, to 
        have been involved or negligent with respect to the fraudulent 
        activities.''.
            (2) Conforming amendment.--The analysis for chapter 3 of 
        title 49, United States Code, is amended by striking the item 
        relating to section 307 and inserting the following:

``307. Contractor suspension and debarment policy; sharing fraud 
                            monetary recoveries.''.

SEC. 1803. DESIGN-BUILD CONTRACTING.

    Section 112(b)(3) of title 23, United States Code, is amended by 
striking subparagraph (C) and inserting the following:
                    ``(C) Qualified projects.--A qualified project 
                referred to in subparagraph (A) is a project under this 
                chapter (including intermodal projects) for which the 
                Secretary has approved the use of design-build 
                contracting under criteria specified in regulations 
                promulgated by the Secretary.''.

SEC. 1804. PROGRAM EFFICIENCIES--FINANCE.

    (a) Advance Construction.--Section 115 of title 23, United States 
Code, is amended--
            (1) by redesignating subsection (c) as subsection (d);
            (2) by redesignating subsections (a)(2), (a)(2)(A), and 
        (a)(2)(B) as subsections (c), (c)(1), and (c)(2), respectively, 
        and indenting appropriately;
            (3) by striking ``(a) Congestion'' and all that follows 
        through subsection (a)(1)(B);
            (4) by striking subsection (b); and
            (5) by inserting after the section heading the following:
    ``(a) In General.--The Secretary may authorize a State to proceed 
with a project authorized under this title--
            ``(1) without the use of Federal funds; and
            ``(2) in accordance with all procedures and requirements 
        applicable to the project other than those procedures and 
        requirements that limit the State to implementation of a 
        project--
                    ``(A) with the aid of Federal funds previously 
                apportioned or allocated to the State; or
                    ``(B) with obligation authority previously 
                allocated to the State.
    ``(b) Obligation of Federal Share.--The Secretary, on the request 
of a State and execution of a project agreement, may obligate all or a 
portion of the Federal share of the project authorized under this 
section from any category of funds for which the project is 
eligible.''.
    (b) Obligation and Release of Funds.--Section 118 of title 23, 
United States Code, is amended by striking subsection (d) and inserting 
the following:
    ``(d) Obligation and Release of Funds.--
            ``(1) In general.--Funds apportioned or allocated to a 
        State for a particular purpose for any fiscal year shall be 
        considered to be obligated if a sum equal to the total of the 
        funds apportioned or allocated to the State for that purpose 
        for that fiscal year and previous fiscal years is obligated.
            ``(2) Released funds.--Any funds released by the final 
        payment for a project, or by modifying the project agreement 
        for a project, shall be--
                    ``(A) credited to the same class of funds 
                previously apportioned or allocated to the State; and
                    ``(B) immediately available for obligation.
            ``(3) Net obligations.--Notwithstanding any other provision 
        of law (including a regulation), obligations recorded against 
        funds made available under this section shall be recorded and 
        reported as net obligations.''.

SEC. 1805. SET-ASIDES FOR INTERSTATE DISCRETIONARY PROJECTS.

    Section 118(c)(1) of title 23, United States Code, is amended--
                    (1) by striking ``$50,000,000'' and all that 
                follows through ``2003'' and inserting ``$100,000,000 
                for each of fiscal years 2004 through 2009''; and
                    (2) by striking ``Transportation Equity Act for the 
                21st Century'' and inserting ``Safe, Accountable, 
                Flexible, and Efficient Transportation Equity Act of 
                2004''.

SEC. 1806. FEDERAL LANDS HIGHWAYS PROGRAM.

    (a) Federal Share Payable.--
            (1) In general.--Section 120(k) of title 23, United States 
        Code, is amended--
                    (A) by striking ``Federal-aid highway''; and
                    (B) by striking ``section 104'' and inserting 
                ``this title or chapter 53 of title 49''.
            (2) Technical references.--Section 120(l) of title 23, 
        United States Code, is amended by striking ``section 104'' and 
        inserting ``this title or chapter 53 of title 49''.
    (b) Payments to Federal Agencies for Federal-Aid Projects.--Section 
132 of title 23, United States Code, is amended--
            (1) by striking the first 2 sentences and inserting the 
        following:
    ``(a) In General.--In a case in which a proposed Federal-aid 
project is to be undertaken by a Federal agency in accordance with an 
agreement between a State and the Federal agency, the State may--
            ``(1) direct the Secretary to transfer the funds for the 
        Federal share of the project directly to the Federal agency; or
            ``(2) make such deposit with, or payment to, the Federal 
        agency as is required to meet the obligation of the State under 
        the agreement for the work undertaken or to be undertaken by 
        the Federal agency.
    ``(b) Reimbursement.--On execution of a project agreement with a 
State described in subsection (a), the Secretary may reimburse the 
State, using any available funds, for the estimated Federal share under 
this title of the obligation of the State deposited or paid under 
subsection (a)(2).''; and
            (2) in the last sentence, by striking ``Any sums'' and 
        inserting the following:
    ``(c) Recovery and Crediting of Funds.--Any sums''.
    (c) Allocations.--Section 202 of title 23, United States Code, is 
amended--
            (1) in subsection (a), by striking ``(a) On October 1'' and 
        all that follows through ``Such allocation'' and inserting the 
        following:
    ``(a) Allocation Based on Need.--
            ``(1) In general.--On October 1 of each fiscal year, the 
        Secretary shall allocate sums authorized to be appropriated for 
        the fiscal year for forest development roads and trails 
        according to the relative needs of the various national forests 
        and grasslands.
            ``(2) Planning.--The allocation under paragraph (1)'';
            (2) by striking subsection (b) and inserting the following:
    ``(b) Allocation for Public Lands Highways.--
            ``(1) Public lands highways.--
                    ``(A) In general.--On October 1 of each fiscal 
                year, the Secretary shall allocate 33\1/3\ percent of 
                the sums authorized to be appropriated for that fiscal 
                year for public lands highways among those States 
                having unappropriated or unreserved public lands, or 
                nontaxable Indian lands or other Federal reservations, 
                on the basis of need in the States, respectively, as 
                determined by the Secretary, on application of the 
                State transportation departments of the respective 
                States.
                    ``(B) Preference.--In making the allocation under 
                subparagraph (A), the Secretary shall give preference 
                to those projects that are significantly impacted by 
                Federal land and resource management activities that 
                are proposed by a State that contains at least 3 
                percent of the total public land in the United States.
            ``(2) Forest highways.--
                    ``(A) In general.--On October 1 of each fiscal 
                year, the Secretary shall allocate 66\2/3\ percent of 
                the funds authorized to be appropriated for public 
                lands highways for forest highways in accordance with 
                section 134 of the Federal-Aid Highway Act of 1987 (23 
                U.S.C. 202 note; 101 Stat. 173).
                    ``(B) Public access to and within national forest 
                system.--In making the allocation under subparagraph 
                (A), the Secretary shall give equal consideration to 
                projects that provide access to and within the National 
                Forest System, as identified by the Secretary of 
                Agriculture through--
                            ``(i) renewable resource and land use 
                        planning; and
                            ``(ii) assessments of the impact of that 
                        planning on transportation facilities.'';
            (3) in subsection (c)--
                    (A) by striking ``(c) On'' and inserting the 
                following:
    ``(c) Park Roads and Parkways.--
            ``(1) In general.--On''; and
                    (B) by adding at the end the following:
            ``(2) Priority.--
                    ``(A) Definition of qualifying national park.--In 
                this paragraph, the term ``qualifying national park'' 
                means a National Park that is used more than 1,000,000 
                recreational visitor days per year, based on an average 
                of the 3 most recent years of available data from the 
                National Park Service.
                    ``(B) Priority.--Notwithstanding any other 
                provision of law, with respect to funds authorized for 
                park roads and parkways, the Secretary shall give 
                priority in the allocation of funds to projects for 
                highways that--
                            ``(i) are located in, or provide access to, 
                        a qualifying National Park; and
                            ``(ii) were initially constructed before 
                        1940.
                    ``(C) Priority conflicts.--If there is a conflict 
                between projects described in subparagraph (B), the 
                Secretary shall give highest priority to projects 
                that--
                            ``(i) are in, or that provide access to, 
                        parks that are adjacent to a National Park of a 
                        foreign country; or
                            ``(ii) are located in more than 1 State;'';
            (4) in subsection (d)--
                    (A) in paragraph (1)--
                            (i) in the paragraph heading, by striking 
                        ``1999'' and inserting ``2005''; and
                            (ii) by striking ``1999'' and inserting 
                        ``2005'';
                    (B) in paragraph (2)--
                            (i) in the paragraph heading, by striking 
                        ``2000'' and inserting ``2005'';
                            (ii) in subparagraphs (A), (B), and (D), by 
                        striking ``2000'' each place it appears and 
                        inserting ``2005'';
                            (iii) in subparagraph (B), by striking 
                        ``1999'' each place it appears and inserting 
                        ``2004''; and
                            (iv) by adding at the end the following:
                    ``(E) Transferred funds.--
                            ``(i) In general.--Not later than 30 days 
                        after the date on which funds are made 
                        available to the Secretary of the Interior 
                        under this paragraph, the funds shall be 
                        distributed to, and available for immediate use 
                        by, the eligible Indian tribes, in accordance 
                        with the formula applicable for each fiscal 
                        year.
                            ``(ii) Formula.--If the Secretary of the 
                        Interior has not promulgated final regulations 
                        for the distribution of funds under clause (i) 
                        for a fiscal year by the date on which the 
                        funds for the fiscal year are required to be 
                        distributed under that clause, the Secretary of 
                        the Interior shall distribute the funds under 
                        clause (i) in accordance with the applicable 
                        funding formula for the preceding year.
                            ``(iii) Use of funds.--Notwithstanding any 
                        other provision of this section, funds 
                        available to Indian tribes for Indian 
                        reservation roads shall be expended on projects 
                        identified in a transportation improvement 
                        program approved by the Secretary.'';
                    (C) in paragraph (3)--
                            (i) in subparagraph (A), by striking 
                        ``under this title'' and inserting ``under this 
                        chapter and section 125(e)''; and
                            (ii) by adding at the end the following:
                    ``(C) Federal lands highway program demonstration 
                project.--
                            ``(i) In general.--The Secretary shall 
                        establish a demonstration project under which 
                        all funds made available under this chapter for 
                        Indian reservation roads and for highway 
                        bridges located on Indian reservation roads as 
                        provided for in subparagraph (A) shall be made 
                        available, on the request of an affected Indian 
                        tribal government, to the Indian tribal 
                        government for use in carrying out, in 
                        accordance with the Indian Self-Determination 
                        and Education Assistance Act (25 U.S.C. 450b et 
                        seq.), contracts and agreements for the 
                        planning, research, engineering, and 
                        construction described in that subparagraph.
                            ``(ii) Exclusion of agency participation.--
                        In accordance with subparagraph (B), all funds 
                        for Indian reservation roads and for highway 
                        bridges located on Indian reservation roads to 
                        which clause (i) applies shall be paid without 
                        regard to the organizational level at which the 
                        Federal lands highway program has previously 
                        carried out the programs, functions, services, 
                        or activities involved.
                            ``(iii) Selection of participating 
                        tribes.--
                                    ``(I) Participants.--
                                            ``(aa) In general.--In 
                                        addition to Indian tribes or 
                                        tribal organizations that, as 
                                        of the date of enactment of 
                                        this subparagraph, are 
                                        contracting or compacting for 
                                        any Indian reservation road 
                                        function or program, for each 
                                        fiscal year, the Secretary may 
                                        select up to 15 Indian tribes 
                                        from the applicant pool 
                                        described in subclause (II) to 
                                        participate in the 
                                        demonstration project carried 
                                        out under clause (i).
                                            ``(bb) Consortia.--Two or 
                                        more Indian tribes that are 
                                        otherwise eligible to 
                                        participate in a program or 
                                        activity to which this title 
                                        applies may form a consortium 
                                        to be considered as a single 
                                        Indian tribe for the purpose of 
                                        becoming part of the applicant 
                                        pool under subclause (II).
                                            ``(cc) Funding.--An Indian 
                                        tribe participating in the 
                                        pilot program under this 
                                        subparagraph shall receive 
                                        funding in an amount equal to 
                                        the sum of the funding that the 
                                        Indian tribe would otherwise 
                                        receive in accordance with the 
                                        funding formula established 
                                        under the other provisions of 
                                        this subsection, and an 
                                        additional percentage of that 
                                        amount equal to the percentage 
                                        of funds withheld during the 
                                        applicable fiscal year for the 
                                        road program management costs 
                                        of the Bureau of Indian Affairs 
                                        under subsection (f)(1).
                                    ``(II) Applicant pool.--The 
                                applicant pool described in this 
                                subclause shall consist of each Indian 
                                tribe (or consortium) that--
                                            ``(aa) has successfully 
                                        completed the planning phase 
                                        described in subclause (IV);
                                            ``(bb) has requested 
                                        participation in the 
                                        demonstration project under 
                                        this subparagraph through the 
                                        adoption of a resolution or 
                                        other official action by the 
                                        tribal governing body; and
                                            ``(cc) has demonstrated 
                                        financial stability and 
                                        financial management capability 
                                        in accordance with subclause 
                                        (III) during the 3-fiscal-year 
                                        period immediately preceding 
                                        the fiscal year for which 
                                        participation under this 
                                        subparagraph is being 
                                        requested.
                                    ``(III) Criteria for determining 
                                financial stability and financial 
                                management capacity.--For the purpose 
                                of subclause (II), evidence that, 
                                during the 3-year period referred to in 
                                subclause (II)(cc), an Indian tribe had 
                                no uncorrected significant and material 
                                audit exceptions in the required annual 
                                audit of the Indian tribe's self-
                                determination contracts or self-
                                governance funding agreements with any 
                                Federal agency shall be conclusive 
                                evidence of the required stability and 
                                capability.
                                    ``(IV) Planning phase.--
                                            ``(aa) In general.--An 
                                        Indian tribe (or consortium) 
                                        requesting participation in the 
                                        demonstration project under 
                                        this subparagraph shall 
                                        complete a planning phase that 
                                        shall include legal and 
                                        budgetary research and internal 
                                        tribal government and 
                                        organization preparation.
                                            ``(bb) Eligibility.--An 
                                        Indian tribe (or consortium) 
                                        described in item (aa) shall be 
                                        eligible to receive a grant 
                                        under this subclause to plan 
                                        and negotiate participation in 
                                        a project described in that 
                                        item.
                                    ``(V) Report to congress.--Not 
                                later than September 30, 2006, the 
                                Secretary shall submit to Congress a 
                                report describing the implementation of 
                                the demonstration project and any 
                                recommendations for improving the 
                                project.''; and
                    (D) in paragraph (4)--
                            (i) in subparagraph (B)--
                                    (I) by striking ``(B) 
                                Reservation.--Of the amounts'' and all 
                                that follows through ``to replace,'' 
                                and inserting the following:
                    ``(B) Funding.--
                            ``(i) Authorization of appropriations.--In 
                        addition to any other funds made available for 
                        Indian reservation roads for each fiscal year, 
                        there is authorized to be appropriated from the 
                        Highway Trust Fund (other than the Mass Transit 
                        Account) $15,000,000 for each of fiscal years 
                        2004 through 2009 to carry out planning, 
                        design, engineering, preconstruction, 
                        construction, and inspection of projects to 
                        replace,''; and
                                    (II) by adding at the end the 
                                following:
                            ``(ii) Availability.--Funds made available 
                        to carry out this subparagraph shall be 
                        available for obligation in the same manner as 
                        if the funds were apportioned under chapter 
                        1.''; and
                            (ii) by striking subparagraph (D) and 
                        inserting the following:
                    ``(D) Approval requirement.--
                            ``(i) In general.--Subject to clause (ii), 
                        on request by an Indian tribe or the Secretary 
                        of the Interior, the Secretary may make funds 
                        available under this subsection for preliminary 
                        engineering for Indian reservation road bridge 
                        projects.
                            ``(ii) Construction and construction 
                        engineering.--The Secretary may make funds 
                        available under clause (i) for construction and 
                        construction engineering only after approval by 
                        the Secretary of applicable plans, 
                        specifications, and estimates.''; and
            (5) by adding at the end the following:
    ``(f) Administration of Indian Reservation Roads.--
            ``(1) Contract authority.--Notwithstanding any other 
        provision of law, for any fiscal year, not more than 6 percent 
        of the contract authority amounts made available from the 
        Highway Trust Fund to the Bureau of Indian Affairs under this 
        title shall be used to pay the expenses incurred by the Bureau 
        in administering the Indian reservation roads program 
        (including the administrative expenses relating to individual 
        projects associated with the Indian reservation roads program).
            ``(2) Health and safety assurances.--Notwithstanding any 
        other provision of law, an Indian tribe or tribal organization 
        may commence road and bridge construction under the 
        Transportation Equity Act for the 21st Century (Public Law 105-
        178) or the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004 that is funded through a 
        contract or agreement under the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450b et seq.) if the Indian 
        tribe or tribal organization--
                    ``(A) provides assurances in the contract or 
                agreement that the construction will meet or exceed 
                applicable health and safety standards;
                    ``(B) obtains the advance review of the plans and 
                specifications from a licensed professional that has 
                certified that the plans and specifications meet or 
                exceed the applicable health and safety standards; and
                    ``(C) provides a copy of the certification under 
                subparagraph (B) to the Assistant Secretary for Indian 
                Affairs.''.
    (d) Planning and Agency Coordination.--Section 204 of title 23, 
United States Code, is amended--
            (1) in subsection (a)(1), by inserting ``refuge roads, 
        recreation roads,'' after ``parkways,'';
            (2) by striking subsection (b) and inserting the following:
    ``(b) Use of Funds.--
            ``(1) In general.--Funds available for public lands 
        highways, recreation roads, park roads and parkways, forest 
        highways, and Indian reservation roads shall be used by the 
        Secretary and the Secretary of the appropriate Federal land 
        management agency to pay the cost of transportation planning, 
        research, engineering, operation and maintenance of transit 
        facilities, and construction of the highways, roads, parkways, 
        forest highways, and transit facilities located on public land, 
        national parks, and Indian reservations.
            ``(2) Contract.--In connection with an activity described 
        in paragraph (1), the Secretary and the Secretary of the 
        appropriate Federal land management agency may enter into a 
        construction contract or other appropriate agreement with--
                    ``(A) a State (including a political subdivision of 
                a State); or
                    ``(B) an Indian tribe.
            ``(3) Indian reservation roads.--In the case of an Indian 
        reservation road--
                    ``(A) Indian labor may be used, in accordance with 
                such rules and regulations as may be promulgated by the 
                Secretary of the Interior, to carry out any 
                construction or other activity described in paragraph 
                (1); and
                    ``(B) funds made available to carry out this 
                section may be used to pay bridge preconstruction costs 
                (including planning, design, and engineering).
            ``(4) Federal employment.--No maximum on Federal employment 
        shall be applicable to construction or improvement of Indian 
        reservation roads.
            ``(5) Availability of funds.--Funds available under this 
        section for each class of Federal lands highway shall be 
        available for any kind of transportation project eligible for 
        assistance under this title that is within or adjacent to, or 
        that provides access to, the areas served by the particular 
        class of Federal lands highway.
            ``(6) Reservation of funds.--The Secretary of the Interior 
        may reserve funds from administrative funds of the Bureau of 
        Indian Affairs that are associated with the Indian reservation 
        road program to finance the Indian technical centers authorized 
        under section 504(b).''; and
            (3) in subsection (k)(1)--
                    (A) in subparagraph (B)--
                            (i) by striking ``(2), (5),'' and inserting 
                        ``(2), (3), (5),''; and
                            (ii) by striking ``and'' after the 
                        semicolon;
                    (B) in subparagraph (C), by striking the period at 
                the end and inserting a semicolon; and
                    (C) by adding at the end the following:
                    ``(D) maintenance of public roads in national fish 
                hatcheries under the jurisdiction of the United States 
                Fish and Wildlife Service;
                    ``(E) the non-Federal share of the cost of any 
                project funded under this title or chapter 53 of title 
                49 that provides access to or within a wildlife refuge; 
                and
                    ``(F) maintenance and improvement of recreational 
                trails (except that expenditures on trails under this 
                subparagraph shall not exceed 5 percent of available 
                funds for each fiscal year).''.
    (e) Maintenance of Indian Reservation Roads.--Section 204(c) of 
title 23, United States Code, is amended by striking the second and 
third sentences and inserting the following: ``Notwithstanding any 
other provision of this title, of the amount of funds apportioned for 
Indian reservation roads from the Highway Trust Fund, an Indian tribe 
may expend for the purpose of maintenance not more than the greater of 
$250,000 or 25 percent of the apportioned amount. The Bureau of Indian 
Affairs shall continue to retain primary responsibility, including 
annual funding request responsibility, for road maintenance programs on 
Indian reservations. The Secretary shall ensure that funding made 
available under this subsection for maintenance of Indian reservation 
roads for each fiscal year is supplementary to and not in lieu of any 
obligation of funds by the Bureau of Indian Affairs for road 
maintenance programs on Indian reservations.''.
    (e) Safety.--
            (1) Allocations.--Section 202 of title 23, United States 
        Code (as amended by subsection (c)(5)), is amended by adding at 
        the end the following:
    ``(g) Safety.--Subject to paragraph (2), on October 1 of each 
fiscal year, the Secretary shall allocate the sums authorized to be 
appropriated for the fiscal year for safety as follows:
            ``(1) 12 percent to the Bureau of Reclamation.
            ``(2) 18 percent to the Bureau of Indian Affairs.
            ``(3) 17 percent to the Bureau of Land Management.
            ``(4) 17 percent to the Forest Service.
            ``(5) 7 percent to the United States Fish and Wildlife 
        Service.
            ``(6) 17 percent to the National Park Service.
            ``(7) 12 percent to the Corps of Engineers.''.
            (2) Availability of funds.--Section 203 of title 23, United 
        States Code, is amended by inserting ``safety projects or 
        activities,'' after ``refuge roads,'' each place it appears.
            (3) Use of funding.--Section 204 of title 23, United States 
        Code, is amended by adding at the end the following:
    ``(l) Safety Activities.--
            ``(1) In general.--Notwithstanding any other provision of 
        this title, funds made available for safety under this title 
        shall be used by the Secretary and the head of the appropriate 
        Federal land management agency only to pay the costs of 
        carrying out--
                    ``(A) transportation safety improvement activities;
                    ``(B) activities to eliminate high-accident 
                locations;
                    ``(C) projects to implement protective measures at, 
                or eliminate, at-grade railway-highway crossings;
                    ``(D) collection of safety information;
                    ``(E) transportation planning projects or 
                activities;
                    ``(F) bridge inspection;
                    ``(G) development and operation of safety 
                management systems;
                    ``(H) highway safety education programs; and
                    ``(I) other eligible safety projects and activities 
                authorized under chapter 4.
            ``(2) Contracts.--In carrying out paragraph (1), the 
        Secretary and the Secretary of the appropriate Federal land 
        management agency may enter into contracts or agreements with--
                    ``(A) a State;
                    ``(B) a political subdivision of a State; or
                    ``(C) an Indian tribe.
            ``(3) Exception.--The cost sharing requirements under the 
        Federal Water Project Recreation Act (16 U.S.C. 460l-12 et 
        seq.) shall not apply to funds made available to the Bureau of 
        Reclamation under this subsection.''.
    (f) Recreation Roads.--
            (1) Authorizations.--Section 201 of title 23, United States 
        Code, is amended in the first sentence by inserting 
        ``recreation roads,'' after ``public lands highways,''.
            (2) Allocations.--Section 202 of title 23, United States 
        Code (as amended by subsection (e)(1)), is amended by adding at 
        the end the following:
    ``(h) Recreation Roads.--
            ``(1) In general.--Subject to paragraphs (2) and (3), on 
        October 1 of each fiscal year, the Secretary, after completing 
        the transfer under subsection 204(i), shall allocate the sums 
        authorized to be appropriated for the fiscal year for 
        recreation roads as follows:
                    ``(A) 8 percent to the Bureau of Reclamation.
                    ``(B) 9 percent to the Corps of Engineers.
                    ``(C) 13 percent to the Bureau of Land Management.
                    ``(D) 70 percent to the Forest Service.
            ``(2) Allocation within agencies.--Recreation road funds 
        allocated to a Federal agency under paragraph (1) shall be 
        allocated for projects and activities of the Federal agency 
        according to the relative needs of each area served by 
        recreation roads under the jurisdiction of the Federal agency, 
        as indicated in the approved transportation improvement program 
        for each Federal agency.''.
            (3) Availability of funds.--Section 203 of title 23, United 
        States Code, is amended--
                    (A) in the first sentence, by inserting 
                ``recreation roads,'' after ``Indian reservation 
                roads,''; and
                    (B) in the fourth sentence, by inserting ``, 
                recreation roads,'' after ``Indian roads''.
            (4) Use of funding.--Section 204 of title 23, United States 
        Code (as amended by subsection (e)(3)), is amended by adding at 
        the end the following:
    ``(m) Recreation Roads.--
            ``(1) In general.--Notwithstanding any other provision of 
        this title, funds made available for recreation roads under 
        this title shall be used by the Secretary and the Secretary of 
        the appropriate Federal land management agency only to pay the 
        cost of--
                    ``(A) maintenance or improvements of existing 
                recreation roads;
                    ``(B) maintenance and improvements of eligible 
                projects described in paragraph (1), (2), (3), (5), or 
                (6) of subsection (h) that are located in or adjacent 
                to Federal land under the jurisdiction of--
                            ``(i) the Department of Agriculture; or
                            ``(ii) the Department of the Interior;
                    ``(C) transportation planning and administrative 
                activities associated with those maintenance and 
                improvements; and
                    ``(D) the non-Federal share of the cost of any 
                project funded under this title or chapter 53 of title 
                49 that provides access to or within Federal land 
                described in subparagraph (B).
            ``(2) Contracts.--In carrying out paragraph (1), the 
        Secretary and the Secretary of the appropriate Federal land 
        management agency may enter into contracts or agreements with--
                    ``(A) a State;
                    ``(B) a political subdivision of a State; or
                    ``(C) an Indian tribe.
            ``(3) New roads.--No funds made available under this 
        section shall be used to pay the cost of the design or 
        construction of new recreation roads.
            ``(4) Compliance with other environmental laws.--A 
        maintenance or improvement project that is funded under this 
        subsection, and that is consistent with or has been identified 
        in a land use plan for an area under the jurisdiction of a 
        Federal agency, shall not require any additional environmental 
        reviews or assessments under the National Environmental Policy 
        Act of 1969 (42 U.S.C. 4321 et seq.) if--
                    ``(A) the Federal agency that promulgated the land 
                use plan analyzed the specific proposal for the 
                maintenance or improvement project under that Act; and
                    ``(B) as of the date on which the funds are to be 
                expended, there are--
                            ``(i) no significant changes to the 
                        proposal bearing on environmental concerns; and
                            ``(ii) no significant new information.
            ``(5) Exception.--The cost sharing requirements under the 
        Federal Water Project Recreation Act (16 U.S.C. 460l-12 et 
        seq.) shall not apply to funds made available to the Bureau of 
        Reclamation under this subsection.''.
    (g) Conforming Amendments.--
            (1) Sections 120(e) and 125(e) of title 23, United States 
        Code, are amended by striking ``public lands highways,'' each 
        place it appears and inserting ``public lands highways, 
        recreation roads,''.
            (2) Sections 120(e), 125(e), 201, 202(a), and 203 of title 
        23, United States Code, are amended by striking ``forest 
        development roads'' each place it appears and inserting 
        ``National Forest System roads''.
            (3) Section 202(e) of title 23, United States Code, is 
        amended by striking ``Refuge System,'' and inserting ``Refuge 
        System and the various national fish hatcheries,''.
            (4) Section 204 of title 23, United States Code, is 
        amended--
                    (A) in subsection (a)(1), by striking ``public 
                lands highways,'' and inserting ``public lands 
                highways, recreation roads, forest highways,''; and
                    (B) in subsection (i), by striking ``public lands 
                highways'' each place it appears and inserting ``public 
                lands highways, recreation roads, and forest 
                highways''.
            (5) Section 205 of title 23, United States Code, is 
        amended--
                    (A) by striking the section heading and inserting 
                the following:
``Sec. 205. National Forest System roads and trails'';
                and
                    (B) in subsections (a) and (d), by striking 
                ``forest development roads'' each place it appears and 
                inserting ``National Forest System roads''.
            (6) The analysis for chapter 2 of title 23, United States 
        Code, is amended by striking the item relating to section 205 
        and inserting the following:

``205. National Forest System roads and trails.''.
            (7) Section 217(c) of title 23, United States Code, is 
        amended by inserting ``refuge roads,'' after ``Indian 
        reservation roads,''.

SEC. 1807. HIGHWAY BRIDGE PROGRAM.

    (a) In General.--Section 144 of title 23, United States Code, is 
amended--
            (1) by striking the section heading and all that follows 
        through subsection (a) and inserting the following:
``Sec. 144. Highway bridge program
    ``(a) Congressional Statement.--Congress finds and declares that it 
is in the vital interest of the United States that a highway bridge 
program be established to enable States to improve the condition of 
their bridges through replacement, rehabilitation, and systematic 
preventative maintenance on highway bridges over waterways, other 
topographical barriers, other highways, or railroads at any time at 
which the States and the Secretary determine that a bridge is unsafe 
because of structural deficiencies, physical deterioration, or 
functional obsolescence.'';
            (2) by striking subsection (d) and inserting the following:
    ``(d) Participation in Program.--
            ``(1) In general.--On application by a State to the 
        Secretary for assistance in replacing or rehabilitating a 
        highway bridge that has been determined to be eligible for 
        replacement or rehabilitation under subsection (b) or (c), the 
        Secretary may approve Federal participation in--
                    ``(A) replacing the bridge with a comparable 
                bridge; or
                    ``(B) rehabilitating the bridge.
            ``(2) Specific kinds of rehabilitation.--On application by 
        a State to the Secretary for assistance in painting, seismic 
        retrofit, or preventative maintenance of, or installation of 
        scour countermeasures or applying calcium magnesium acetate, 
        sodium acetate/formate, or other environmentally acceptable, 
        minimally corrosive anti-icing and de-icing compositions to, 
        the structure of a highway bridge, the Secretary may approve 
        Federal participation in the painting, seismic retrofit, or 
        preventative maintenance of, or installation of scour 
        countermeasures or application of acetate or sodium acetate/
        formate or such anti-icing or de-icing composition to, the 
        structure.
            ``(3) Eligibility.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the Secretary shall determine the 
                eligibility of highway bridges for replacement or 
                rehabilitation for each State based on the number of 
                unsafe highway bridges in the State.
                    ``(B) Preventative maintenance.--A State may carry 
                out a project for preventative maintenance on a bridge, 
                seismic retrofit of a bridge, or installation of scour 
                countermeasures to a bridge under this section without 
                regard to whether the bridge is eligible for 
                replacement or rehabilitation under this section.'';
            (3) in subsection (e)--
                    (A) in the third sentence, by striking ``square 
                footage'' and inserting ``area'';
                    (B) in the fourth sentence--
                            (i) by striking ``by the total cost of any 
                        highway bridges constructed under subsection 
                        (m) in such State, relating to replacement of 
                        destroyed bridges and ferryboat services, 
                        and,''; and
                            (ii) by striking ``1997'' and inserting 
                        ``2003''; and
                    (C) in the seventh sentence, by striking ``the 
                Federal-aid primary system'' and inserting ``Federal-
                aid highways'';
            (4) by striking subsections (f) and (g) and inserting the 
        following:
    ``(f) Set Asides.--
            ``(1) Discretionary bridge program.--
                    ``(A) In general.--Of the amounts authorized to be 
                appropriated to carry out the bridge program under this 
                section for each of fiscal years 2004 through 2009, all 
                but $150,000,000 shall be apportioned as provided in 
                subsection (e).
                    ``(B) Availability.--The $150,000,000 referred to 
                in subparagraph (A) shall be available at the 
                discretion of the Secretary, except that not to exceed 
                $25,000,000 of that amount shall be available only for 
                projects for the seismic retrofit of bridges.
                    ``(C) Set asides.--For fiscal year 2004, the 
                Secretary shall provide--
                            ``(i) $50,000,000 to the State of Nevada 
                        for construction of a replacement of the 
                        federally-owned bridge over the Hoover Dam in 
                        the Lake Mead National Recreation Area; and
                            ``(ii) $50,000,000 to the State of Missouri 
                        for construction of a structure over the 
                        Mississippi River to connect the city of St. 
                        Louis, Missouri, to the State of Illinois.
            ``(2) Off-system bridges.--
                    ``(A) In general.--Not less than 15 percent of the 
                amount apportioned to each State in each of fiscal 
                years 2004 through 2009 shall be expended for projects 
                to replace, rehabilitate, perform systematic 
                preventative maintenance or seismic retrofit, or apply 
                calcium magnesium acetate, sodium acetate/formate, or 
                other environmentally acceptable, minimally corrosive 
                anti-icing and de-icing compositions or install scour 
                countermeasures to highway bridges located on public 
                roads, other than those on a Federal-aid highway, or to 
                complete the Warwick Intermodal Station (including the 
                construction of a people mover between the Station and 
                the T.F. Green Airport).
                    ``(B) Reduction of expenditures.--The Secretary, 
                after consultation with State and local officials, may, 
                with respect to the State, reduce the requirement for 
                expenditure for bridges not on a Federal-aid highway if 
                the Secretary determines that the State has inadequate 
                needs to justify the expenditure.'';
            (5) in subsection (i)--
                    (A) in paragraph (3), by striking ``and'';
                    (B) in paragraph (4), by striking the period at the 
                end and inserting ``; and'';
                    (C) by striking ``Such reports'' and all that 
                follows through ``to Congress.''; and
                    (D) by adding at the end the following:
            ``(5) biennially submit such reports as are required under 
        this subsection to the appropriate committees of Congress 
        simultaneously with the report required by section 502(g).'';
            (6) in the first sentence of subsection (n), by striking 
        ``all standards'' and inserting ``all general engineering 
        standards'';
            (7) in subsection (o)--
                    (A) in paragraph (3)--
                            (i) by striking ``title (including this 
                        section)'' and inserting ``section''; and
                            (ii) by inserting ``200 percent of'' after 
                        ``shall not exceed''; and
                    (B) in paragraph (4)(B)--
                            (i) in the second sentence, by inserting 
                        ``200 percent of'' after ``not to exceed''; and
                            (ii) in the last sentence, by striking 
                        ``title'' and inserting ``section'';
            (8) by redesignating subsections (h) through (q) as 
        subsections (g) through (p), respectively; and
            (9) by adding at the end the following:
    ``(q) Continuation of Annual Materials Report on New Bridge 
Construction and Bridge Rehabilitation.--Not later than 1 year after 
the date of enactment of this subsection, and annually thereafter, the 
Secretary shall publish in the Federal Register a report describing 
construction materials used in new Federal-aid bridge construction and 
bridge rehabilitation projects.
    ``(r) Federal Share.--The Federal share of the cost of a project 
payable from funds made available to carry out this section shall be 
the share applicable under section 120(b), as adjusted under subsection 
(d) of that section.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code, is amended by striking the item 
relating to section 144 and inserting the following:

``144. Highway bridge program.''.

SEC. 1808. APPALACHIAN DEVELOPMENT HIGHWAY SYSTEM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1702(a)), is amended by adding at 
the end the following:
``Sec. 170. Appalachian development highway system
    ``(a) Apportionment.--
            ``(1) In general.--The Secretary shall apportion funds made 
        available under section 1101(7) of the Safe, Accountable, 
        Flexible, and Efficient Transportation Equity Act of 2004 for 
        fiscal years 2004 through 2009 among States based on the latest 
        available estimate of the cost to construct highways and access 
        roads for the Appalachian development highway system program 
        prepared by the Appalachian Regional Commission under section 
        14501 of title 40.
            ``(2) Availability.--Funds described in paragraph (1) shall 
        be available to construct highways and access roads under 
        chapter 145 of title 40.
    ``(b) Applicability of Title.--Funds made available under section 
1101(7) of the Safe, Accountable, Flexible, and Efficient 
Transportation Equity Act of 2004 for the Appalachian development 
highway system shall be available for obligation in the same manner as 
if the funds were apportioned under this chapter, except that--
            ``(1) the Federal share of the cost of any project under 
        this section shall be determined in accordance with subtitle IV 
        of title 40; and
            ``(2) the funds shall remain available until expended.''.
    (b) Conforming Amendments.--
            (1) Use of toll credits.--Section 120(j)(1) of title 23, 
        United States Code is amended by inserting ``and the 
        Appalachian development highway system program under subtitle 
        IV of title 40'' after ``(other than the emergency relief 
        program authorized by section 125''.
            (2) Analysis.--The analysis of chapter 1 of title 23, 
        United States Code (as amended by section 1702(b)), is amended 
        by adding at the end the following:

``170. Appalachian development highway system.''.

SEC. 1809. MULTISTATE CORRIDOR PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by 1808(a)), is amended by adding at the end 
the following:
``Sec. 171. Multistate corridor program
    ``(a) Establishment and Purpose.--The Secretary shall carry out a 
program to--
            ``(1) support and encourage multistate transportation 
        planning and development; and
            ``(2) facilitate transportation decisionmaking and 
        coordinate project delivery involving multistate corridors.
    ``(b) Eligible Recipients.--A State transportation department and a 
metropolitan planning organization may receive and administer funds 
provided under this section.
    ``(c) Eligible Activities.--The Secretary shall make allocations 
under this program for multistate highway and multimodal planning 
studies and construction.
    ``(d) Other Provisions Regarding Eligibility.--
            ``(1) Studies.--All studies funded under this program shall 
        be consistent with the continuing, cooperative, and 
        comprehensive planning processes required by sections 134 and 
        135.
            ``(2) Construction.--All construction funded under this 
        program shall be consistent with section 133(b)(1).
    ``(e) Selection Criteria.--The Secretary shall select studies and 
projects to be carried out under the program based on--
            ``(1) the existence and significance of signed and binding 
        multijurisdictional agreements;
            ``(2) endorsement of the study or project by applicable 
        elected State and local representatives;
            ``(3) prospects for early completion of the study or 
        project; or
            ``(4) whether the projects to be studied or constructed are 
        located on corridors identified by section 1105(c) of the 
        Intermodal Surface Transportation Efficiency Act of 1991 
        (Public Law 102-240; 105 Stat. 2032).
    ``(f) Program Priorities.--In administering the program, the 
Secretary shall--
            ``(1) encourage and enable States and other jurisdictions 
        to work together to develop plans for multimodal and 
        multijurisdictional transportation decisionmaking; and
            ``(2) give priority to studies or projects that emphasize 
        multimodal planning, including planning for operational 
        improvements that--
                    ``(A) increase--
                            ``(i) mobility;
                            ``(ii) freight productivity;
                            ``(iii) access to marine or inland ports;
                            ``(iv) safety and security; and
                            ``(v) reliability; and
                    ``(B) enhance the environment.
    ``(g) Federal Share.--Except as provided in section 120, the 
Federal share of the cost of a study or project carried out under the 
program, using funds from all Federal sources, shall be 80 percent.
    ``(h) Applicability.--Funds authorized to be appropriated under 
section 1101(10) of the Safe, Accountable, Flexible, and Efficient 
Transportation Equity Act of 2004 to carry out this section shall be 
available for obligation in the same manner as if the funds were 
apportioned under this chapter.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1809(b)) is 
amended by adding at the end the following:

``171. Multistate corridor program.''.

SEC. 1810. BORDER PLANNING, OPERATIONS, TECHNOLOGY, AND CAPACITY 
              PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1809(a)), is amended by adding at 
the end the following:
``Sec. 172. Border planning, operations, technology, and capacity 
              program
    ``(a) Definitions.--In this section:
            ``(1) Border state.--The term `border State' means any of 
        the States of Alaska, Arizona, California, Idaho, Maine, 
        Michigan, Minnesota, Montana, New Hampshire, New Mexico, New 
        York, North Dakota, Texas, Vermont, and Washington.
            ``(2) Program.--The term `program' means the border 
        planning, operations, technology, and capacity program 
        established under subsection (b).
    ``(b) Establishment and Purpose.--The Secretary shall establish and 
carry out a border planning, operations, technology, and capacity 
improvement program to support coordination and improvement in bi-
national transportation planning, operations, efficiency, information 
exchange, safety, and security at the international borders of the 
United States with Canada and Mexico.
    ``(c) Eligible Activities.--
            ``(1) In general.--The Secretary shall make allocations 
        under the program for projects to carry out eligible activities 
        described in paragraph (2) at or near international land 
        borders in border States.
            ``(2) Eligible activities.--A border State may obligate 
        funds apportioned to the border State under this section for--
                    ``(A) highway and multimodal planning or 
                environmental studies;
                    ``(B) cross-border port of entry and safety 
                inspection improvements, including operational 
                enhancements and technology applications;
                    ``(C) technology and information exchange 
                activities; and
                    ``(D) right-of-way acquisition, design, and 
                construction, as needed--
                            ``(i) to implement the enhancements or 
                        applications described in subparagraphs (B) and 
                        (C);
                            ``(ii) to decrease air pollution emissions 
                        from vehicles or inspection facilities at 
                        border crossings; or
                            ``(iii) to increase highway capacity at or 
                        near international borders.
    ``(d) Other Provisions Regarding Eligibility.--
            ``(1) In general.--Each project funded under the program 
        shall be carried out in accordance with the continuing, 
        cooperative, and comprehensive planning processes required by 
        sections 134 and 135.
            ``(2) Regionally significant projects.--To be funded under 
        the program, a regionally significant project shall be included 
        on the applicable transportation plan and program required by 
        sections 134 and 135.
    ``(e) Program Priorities.--Border States shall give priority to 
projects that emphasize--
            ``(1) multimodal planning;
            ``(2) improvements in infrastructure; and
            ``(3) operational improvements that--
                    ``(A) increase safety, security, freight capacity, 
                or highway access to rail, marine, and air services; 
                and
                    ``(B) enhance the environment.
    ``(f) Mandatory Program.--
            ``(1) In general.--For each fiscal year, the Secretary 
        shall allocate among border States, in accordance with the 
        formula described in paragraph (2), funds to be used in 
        accordance with subsection (d).
            ``(2) Formula.--Subject to paragraph (3), the amount 
        allocated to a border State under this paragraph shall be 
        determined by the Secretary, as follows:
                    ``(A) 25 percent in the ratio that--
                            ``(i) the average annual weight of all 
                        cargo entering the border State by commercial 
                        vehicle across the international border with 
                        Canada or Mexico, as the case may be; bears to
                            ``(ii) the average annual weight of all 
                        cargo entering all border States by commercial 
                        vehicle across the international borders with 
                        Canada and Mexico.
                    ``(B) 25 percent in the ratio that--
                            ``(i) the average trade value of all cargo 
                        imported into the border State and all cargo 
                        exported from the border State by commercial 
                        vehicle across the international border with 
                        Canada or Mexico, as the case may be; bears to
                            ``(ii) the average trade value of all cargo 
                        imported into all border States and all cargo 
                        exported from all border States by commercial 
                        vehicle across the international borders with 
                        Canada and Mexico.
                    ``(C) 25 percent in the ratio that--
                            ``(i) the number of commercial vehicles 
                        annually entering the border State across the 
                        international border with Canada or Mexico, as 
                        the case may be; bears to
                            ``(ii) the number of all commercial 
                        vehicles annually entering all border States 
                        across the international borders with Canada 
                        and Mexico.
                    ``(D) 25 percent in the ratio that--
                            ``(i) the number of passenger vehicles 
                        annually entering the border State across the 
                        international border with Canada or Mexico, as 
                        the case may be; bears to
                            ``(ii) the number of all passenger vehicles 
                        annually entering all border States across the 
                        international borders with Canada and Mexico.
            ``(3) Data source.--
                    ``(A) In general.--The data used by the Secretary 
                in making allocations under this subsection shall be 
                based on the Bureau of Transportation Statistics 
                Transborder Surface Freight Dataset (or other similar 
                database).
                    ``(B) Basis of calculation.--All formula 
                calculations shall be made using the average values for 
                the most recent 5-year period for which data are 
                available.
            ``(4) Minimum allocation.--Notwithstanding paragraph (2), 
        for each fiscal year, each border State shall receive at least 
        \1/2\ of 1 percent of the funds made available for allocation 
        under this paragraph for the fiscal year.
    ``(g) Federal Share.--Except as provided in section 120, the 
Federal share of the cost of a project carried out under the program 
shall be 80 percent.
    ``(h) Obligation.--Funds made available under section 1101(11) of 
the Safe, Accountable, Flexible, and Efficient Transportation Equity 
Act of 2004 to carry out the program shall be available for obligation 
in the same manner as if the funds were apportioned under this chapter.
    ``(i) Information Exchange.--No individual project the scope of 
work of which is limited to information exchange shall receive an 
allocation under the program in an amount that exceeds $500,000 for any 
fiscal year.
    ``(j) Projects in Canada or Mexico.--A project in Canada or Mexico, 
proposed by a border State to directly and predominantly facilitate 
cross-border vehicle and commercial cargo movements at an international 
gateway or port of entry into the border region of the State, may be 
constructed using funds made available under the program if, before 
obligation of those funds, Canada or Mexico, or the political 
subdivision of Canada or Mexico that is responsible for the operation 
of the facility to be constructed, provides assurances satisfactory to 
the Secretary that any facility constructed under this subsection will 
be--
            ``(1) constructed in accordance with standards equivalent 
        to applicable standards in the United States; and
            ``(2) properly maintained and used over the useful life of 
        the facility for the purpose for which the Secretary allocated 
        funds to the project.
    ``(k) Transfer of Funds to the General Services Administration.--
            ``(1) State funds.--At the request of a border State, funds 
        made available under the program may be transferred to the 
        General Services Administration for the purpose of funding 1 or 
        more specific projects if--
                    ``(A) the Secretary determines, after consultation 
                with the State transportation department of the border 
                State, that the General Services Administration should 
                carry out the project; and
                    ``(B) the General Services Administration agrees to 
                accept the transfer of, and to administer, those funds.
            ``(2) Non-federal share.--
                    ``(A) In general.--A border State that makes a 
                request under paragraph (1) shall provide directly to 
                the General Services Administration, for each project 
                covered by the request, the non-Federal share of the 
                cost of each project described in subsection (f).
                    ``(B) No augmentation of appropriations.--Funds 
                provided by a border State under subparagraph (A)--
                            ``(i) shall not be considered to be an 
                        augmentation of the appropriations made 
                        available to the General Services 
                        Administration; and
                            ``(ii) shall be--
                                    ``(I) administered in accordance 
                                with the procedures of the General 
                                Services Administration; but
                                    ``(II) available for obligation in 
                                the same manner as if the funds were 
                                apportioned under this chapter.
                    ``(C) Obligation authority.--Obligation authority 
                shall be transferred to the General Services 
                Administration in the same manner and amount as the 
                funds provided for projects under subparagraph (A).
            ``(3) Direct transfer of authorized funds.--
                    ``(A) In general.--In addition to allocations to 
                States and metropolitan planning organizations under 
                subsection (c), the Secretary may transfer funds made 
                available to carry out this section to the General 
                Services Administration for construction of 
                transportation infrastructure projects at or near the 
                border in border States, if--
                            ``(i) the Secretary determines that the 
                        transfer is necessary to effectively carry out 
                        the purposes of this program; and
                            ``(ii) the General Services Administration 
                        agrees to accept the transfer of, and to 
                        administer, those funds.
                    ``(B) No augmentation of appropriations.--Funds 
                transferred by the Secretary under subparagraph (A)--
                            ``(i) shall not be considered to be an 
                        augmentation of the appropriations made 
                        available to the General Services 
                        Administration; and
                            ``(ii) shall be--
                                    ``(I) administered in accordance 
                                with the procedures of the General 
                                Services Administration; but
                                    ``(II) available for obligation in 
                                the same manner as if the funds were 
                                apportioned under this chapter.
                    ``(C) Obligation authority.--Obligation authority 
                shall be transferred to the General Services 
                Administration in the same manner and amount as the 
                funds transferred under subparagraph (A).''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1809(b)), is 
amended by adding at the end the following:

``172. Border planning, operations, and technology program.''.

SEC. 1811. PUERTO RICO HIGHWAY PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1810(a)), is amended by adding at 
the end the following:
``Sec. 173. Puerto Rico highway program
    ``(a) In General.--The Secretary shall allocate funds authorized by 
section 1101(15) of the Safe, Accountable, Flexible, and Efficient 
Transportation Equity Act of 2004 for each of fiscal years 2004 through 
2009 to the Commonwealth of Puerto Rico to carry out a highway program 
in the Commonwealth.
    ``(b) Applicability of Title.--
            ``(1) In general.--Amounts made available by section 
        1101(15) of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004 shall be available for 
        obligation in the same manner as if such funds were apportioned 
        under this chapter.
            ``(2) Limitation on obligations.--The amounts shall be 
        subject to any limitation on obligations for Federal-aid 
        highway and highway safety construction programs.
    ``(c) Treatment of Funds.--Amounts made available to carry out this 
section for a fiscal year shall be administered as follows:
            ``(1) Apportionment.--For the purpose of imposing any 
        penalty under this title or title 49, the amounts shall be 
        treated as being apportioned to Puerto Rico under sections 
        104(b) and 144, for each program funded under those sections in 
        an amount determined by multiplying--
                    ``(A) the aggregate of the amounts for the fiscal 
                year; by
                    ``(B) the ratio that--
                            ``(i) the amount of funds apportioned to 
                        Puerto Rico for each such program for fiscal 
                        year 1997; bears to
                            ``(ii) the total amount of funds 
                        apportioned to Puerto Rico for all such 
                        programs for fiscal year 1997.
            ``(2) Penalty.--The amounts treated as being apportioned to 
        Puerto Rico under each section referred to in paragraph (1) 
        shall be deemed to be required to be apportioned to Puerto Rico 
        under that section for purposes of the imposition of any 
        penalty under this title and title 49.
            ``(3) Effect on allocations and apportionments.--Subject to 
        paragraph (2), nothing in this section affects any allocation 
        under section 105 and any apportionment under sections 104 and 
        144.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1810(b)), is 
amended by adding at the end the following:

``173. Puerto Rico highway program.''.

SEC. 1812. NATIONAL HISTORIC COVERED BRIDGE PRESERVATION.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1811(a)), is amended by adding at 
the end the following:
``Sec. 174. National historic covered bridge preservation
    ``(a) Definition of Historic Covered Bridge.--In this section, the 
term `historic covered bridge' means a covered bridge that is listed or 
eligible for listing on the National Register of Historic Places.
    ``(b) Historic Covered Bridge Preservation.--Subject to the 
availability of appropriations, the Secretary shall--
            ``(1) collect and disseminate information on historic 
        covered bridges;
            ``(2) conduct educational programs relating to the history 
        and construction techniques of historic covered bridges;
            ``(3) conduct research on the history of historic covered 
        bridges; and
            ``(4) conduct research on, and study techniques for, 
        protecting historic covered bridges from rot, fire, natural 
        disasters, or weight-related damage.
    ``(c) Grants.--
            ``(1) In general.--Subject to the availability of 
        appropriations, the Secretary shall make a grant to a State 
        that submits an application to the Secretary that demonstrates 
        a need for assistance in carrying out 1 or more historic 
        covered bridge projects described in paragraph (2).
            ``(2) Eligible projects.--A grant under paragraph (1) may 
        be made for a project--
                    ``(A) to rehabilitate or repair a historic covered 
                bridge; or
                    ``(B) to preserve a historic covered bridge, 
                including through--
                            ``(i) installation of a fire protection 
                        system, including a fireproofing or fire 
                        detection system and sprinklers;
                            ``(ii) installation of a system to prevent 
                        vandalism and arson; or
                            ``(iii) relocation of a bridge to a 
                        preservation site.
            ``(3) Authenticity requirements.--A grant under paragraph 
        (1) may be made for a project only if--
                    ``(A) to the maximum extent practicable, the 
                project--
                            ``(i) is carried out in the most 
                        historically appropriate manner; and
                            ``(ii) preserves the existing structure of 
                        the historic covered bridge; and
                    ``(B) the project provides for the replacement of 
                wooden components with wooden components, unless the 
                use of wood is impracticable for safety reasons.
            ``(4) Federal share.--Except as provided in section 120, 
        the Federal share of the cost of a project carried out with a 
        grant under this subsection shall be 80 percent.
    ``(d) Funding.--There is authorized to be appropriated to carry out 
this section $14,000,000 for each of fiscal years 2004 through 2009, to 
remain available until expended.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1811(b)), is 
amended by adding at the end the following:

``174. National historic covered bridge preservation.''.

SEC. 1813. TRANSPORTATION AND COMMUNITY AND SYSTEM PRESERVATION 
              PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1812(a)), is amended by adding at 
the end the following:
``Sec. 175. Transportation and community and system preservation 
              program
    ``(a) Establishment.--The Secretary shall establish a comprehensive 
program to facilitate the planning, development, and implementation of 
strategies by States, metropolitan planning organizations, federally-
recognized Indian tribes, and local governments to integrate 
transportation, community, and system preservation plans and practices 
that address the goals described in subsection (b).
    ``(b) Goals.--The goals of the program are to--
            ``(1) improve the efficiency of the transportation system 
        in the United States;
            ``(2) reduce the impacts of transportation on the 
        environment;
            ``(3) reduce the need for costly future investments in 
        public infrastructure;
            ``(4) provide efficient access to jobs, services, and 
        centers of trade; and
            ``(5) examine development patterns, and to identify 
        strategies, to encourage private sector development patterns 
        that achieve the goals identified in paragraphs (1) through 
        (4).
    ``(c) Allocation of Funds for Implementation.--
            ``(1) In general.--The Secretary shall allocate funds made 
        available to carry out this subsection to States, metropolitan 
        planning organizations, and local governments to carry out 
        projects to address transportation efficiency and community and 
        system preservation.
            ``(2) Criteria.--In allocating funds made available to 
        carry out this subsection, the Secretary shall give priority to 
        applicants that--
                    ``(A) have instituted preservation or development 
                plans and programs that--
                            ``(i) meet the requirements of this title 
                        and chapter 53 of title 49, United States Code; 
                        and
                            ``(ii)(I) are coordinated with State and 
                        local adopted preservation or development 
                        plans;
                            ``(II) are intended to promote cost-
                        effective and strategic investments in 
                        transportation infrastructure that minimize 
                        adverse impacts on the environment; or
                            ``(III) are intended to promote innovative 
                        private sector strategies.
                    ``(B) have instituted other policies to integrate 
                transportation and community and system preservation 
                practices, such as--
                            ``(i) spending policies that direct funds 
                        to high-growth areas;
                            ``(ii) urban growth boundaries to guide 
                        metropolitan expansion;
                            ``(iii) `green corridors' programs that 
                        provide access to major highway corridors for 
                        areas targeted for efficient and compact 
                        development; or
                            ``(iv) other similar programs or policies 
                        as determined by the Secretary;
                    ``(C) have preservation or development policies 
                that include a mechanism for reducing potential impacts 
                of transportation activities on the environment;
                    ``(D) examine ways to encourage private sector 
                investments that address the purposes of this section; 
                and
                    ``(E) propose projects for funding that address the 
                purposes described in subsection (b)(2).
            ``(3) Equitable distribution.--In allocating funds to carry 
        out this subsection, the Secretary shall ensure the equitable 
        distribution of funds to a diversity of populations and 
        geographic regions.
            ``(4) Use of allocated funds.--
                    ``(A) In general.--An allocation of funds made 
                available to carry out this subsection shall be used by 
                the recipient to implement the projects proposed in the 
                application to the Secretary.
                    ``(B) Types of projects.--The allocation of funds 
                shall be available for obligation for--
                            ``(i) any project eligible for funding 
                        under this title or chapter 53 of title 49, 
                        United States Code; or
                            ``(ii) any other activity relating to 
                        transportation and community and system 
                        preservation that the Secretary determines to 
                        be appropriate, including corridor preservation 
                        activities that are necessary to implement--
                                    ``(I) transit-oriented development 
                                plans;
                                    ``(II) traffic calming measures; or
                                    ``(III) other coordinated 
                                transportation and community and system 
                                preservation practices.
    ``(d) Funding.--
            ``(1) In general.--There is authorized to be appropriated 
        from the Highway Trust Fund (other than the Mass Transit 
        Account) to carry out this section $50,000,000 for each of 
        fiscal years 2004 through 2009.
            ``(2) Contract authority.--Funds authorized under this 
        subsection shall be available for obligation in the same manner 
        as if the funds were apportioned under this chapter.''.
    (b) Eligible Projects.--Section 133(b) of title 23, United States 
Code (as amended by section 1701(a)), is amended by adding at the end 
the following:
            ``(18) Transportation and community system preservation to 
        facilitate the planning, development, and implementation of 
        strategies of metropolitan planning organizations and local 
        governments to integrate transportation, community, and system 
        preservation plans and practices that address the following:
                    ``(A) Improvement of the efficiency of the 
                transportation system in the United States.
                    ``(B) Reduction of the impacts of transportation on 
                the environment.
                    ``(C) Reduction of the need for costly future 
                investments in public infrastructure.
                    ``(D) Provision of efficient access to jobs, 
                services, and centers of trade.
                    ``(E) Examination of development patterns, and 
                identification of strategies to encourage private 
                sector development patterns, that achieve the goals 
                identified in subparagraphs (A) through (D).
            ``(19) Projects relating to intersections, including 
        intersections--
                    ``(A) that--
                            ``(i) have disproportionately high accident 
                        rates;
                            ``(ii) have high levels of congestion, as 
                        evidenced by--
                                    ``(I) interrupted traffic flow at 
                                the intersection; and
                                    ``(II) a level of service rating, 
                                issued by the Transportation Research 
                                Board of the National Academy of 
                                Sciences in accordance with the Highway 
                                Capacity Manual, that is not better 
                                than `F' during peak travel hours; and
                            ``(iii) are directly connected to or 
                        located on a Federal-aid highway; and
                    ``(B) improvements that are approved in the 
                regional plan of the appropriate local metropolitan 
                planning organization.''.
    (c) Conforming Amendment.--The analysis for subchapter I of chapter 
1 of title 23, United States Code (as amended by section 1812(b)), is 
amended by adding at the end the following:

``175. Transportation and community and system preservation pilot 
                            program.''.

SEC. 1814. PARKING PILOT PROGRAMS.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1813(a)), is amended by adding at 
the end the following:
``Sec. 176. Parking pilot programs
    ``(a) Commercial Truck Parking Pilot Program.--
            ``(1) Establishment.--In cooperation with appropriate 
        State, regional, and local governments, the Secretary shall 
        establish a pilot program to address the shortage of long-term 
        parking for drivers of commercial motor vehicles on the 
        National Highway System.
            ``(2) Allocation of funds.--
                    ``(A) In general.--The Secretary shall allocate 
                funds made available under this subsection to States, 
                metropolitan planning organizations, and local 
                governments.
                    ``(B) Criteria.--In allocating funds under this 
                subsection, the Secretary shall give priority to an 
                applicant that--
                            ``(i) demonstrates a severe shortage of 
                        commercial vehicle parking capacity on the 
                        corridor to be addressed;
                            ``(ii) consults with affected State and 
                        local governments, community groups, private 
                        providers of commercial vehicle parking, and 
                        motorist and trucking organizations; and
                            ``(iii) demonstrates that the project 
                        proposed by the applicant is likely to have a 
                        positive effect on highway safety, traffic 
                        congestion, or air quality.
            ``(3) Use of allocated funds.--
                    ``(A) In general.--A recipient of funds allocated 
                under this subsection shall use the funds to carry out 
                the project proposed in the application submitted by 
                the recipient to the Secretary.
                    ``(B) Types of projects.--Funds under this 
                subsection shall be available for obligation for 
                projects that serve the National Highway System, 
                including--
                            ``(i) construction of safety rest areas 
                        that include parking for commercial motor 
                        vehicles;
                            ``(ii) construction of commercial motor 
                        vehicle parking facilities that are adjacent to 
                        commercial truck stops and travel plazas;
                            ``(iii) costs associated with the opening 
                        of facilities (including inspection and weigh 
                        stations and park-and-ride facilities) to 
                        provide commercial motor vehicle parking;
                            ``(iv) projects that promote awareness of 
                        the availability of public or private 
                        commercial motor vehicle parking on the 
                        National Highway System, including parking in 
                        connection with intelligent transportation 
                        systems and other systems;
                            ``(v) construction of turnouts along the 
                        National Highway System for commercial motor 
                        vehicles;
                            ``(vi) capital improvements to public 
                        commercial motor vehicle truck parking 
                        facilities closed on a seasonal basis in order 
                        to allow the facilities to remain open year-
                        around; and
                            ``(vii) improvements to the geometric 
                        design at interchanges on the National Highway 
                        System to improve access to commercial motor 
                        vehicle parking facilities.
            ``(4) Report.--Not later than 5 years after the date of 
        enactment of this section, the Secretary shall submit to 
        Congress a report on the results of the pilot program carried 
        out under this subsection.
            ``(5) Federal share.--The Federal share of the cost of a 
        project carried out under this subsection shall be consistent 
        with section 120.
            ``(6) Funding.--
                    ``(A) In general.--There is authorized to be 
                appropriated from the Highway Trust Fund (other than 
                the Mass Transit Account) to carry out this subsection 
                $10,000,000 for each of fiscal years 2005 through 2009.
                    ``(B) Contract authority.--Funds authorized under 
                this paragraph shall be available for obligation in the 
                same manner as if the funds were apportioned under this 
                chapter.
    ``(b) Corridor and Fringe Parking Pilot Program.--
            ``(1) Establishment.--
                    ``(A) In general.--In cooperation with appropriate 
                State, regional, and local governments, the Secretary 
                shall carry out a pilot program to provide corridor and 
                fringe parking facilities.
                    ``(B) Primary function.--The primary function of a 
                corridor and fringe parking facility funded under this 
                subsection shall be to provide parking capacity to 
                support car pooling, van pooling, ride sharing, 
                commuting, and high occupancy vehicle travel.
                    ``(C) Overnight parking.--A State may permit a 
                facility described in subparagraph (B) to be used for 
                the overnight parking of commercial vehicles if the use 
                does not foreclose or unduly limit the primary function 
                of the facility described in subparagraph (B).
            ``(2) Allocation of funds.--
                    ``(A) In general.--The Secretary shall allocate 
                funds made available to carry out this subsection to 
                States.
                    ``(B) Criteria.--In allocating funds under this 
                subsection, the Secretary shall give priority to a 
                State that--
                            ``(i) demonstrates demand for corridor and 
                        fringe parking on the corridor to be addressed;
                            ``(ii) consults with affected metropolitan 
                        planning organizations, local governments, 
                        community groups, and providers of corridor and 
                        fringe parking; and
                            ``(iii) demonstrates that the project 
                        proposed by the State is likely to have a 
                        positive effect on ride sharing, traffic 
                        congestion, or air quality.
            ``(3) Use of allocated funds.--
                    ``(A) In general.--A recipient of funds allocated 
                under this subsection shall use the funds to carry out 
                the project proposed in the application submitted by 
                the recipient to the Secretary.
                    ``(B) Types of projects.--Funds under this 
                subsection shall be available for obligation for 
                projects that serve the Federal-aid system, including--
                            ``(i) construction of corridor and fringe 
                        parking facilities;
                            ``(ii) costs associated with the opening of 
                        facilities;
                            ``(iii) projects that promote awareness of 
                        the availability of corridor and fringe parking 
                        through the use of signage and other means;
                            ``(iv) capital improvements to corridor and 
                        fringe parking facilities closed on a seasonal 
                        basis in order to allow the facilities to 
                        remain open year-around; and
                            ``(v) improvements to the geometric design 
                        on adjoining roadways to facilitate access to, 
                        and egress from, corridor and fringe parking 
                        facilities.
            ``(4) Report.--Not later than 5 years after the date of 
        enactment of this section, the Secretary shall submit to 
        Congress a report on the results of the pilot program carried 
        out under this subsection.
            ``(5) Federal share.--The Federal share of the cost of a 
        project carried out under this subsection shall be consistent 
        with section 120.
            ``(6) Funding.--
                    ``(A) In general.--There is authorized to be 
                appropriated from the Highway Trust Fund (other than 
                the Mass Transit Account) to carry out this subsection 
                $10,000,000 for each of fiscal years 2005 through 2009.
                    ``(B) Contract authority.--Funds authorized under 
                this paragraph shall be available for obligation in the 
                same manner as if the funds were apportioned under this 
                chapter.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
I of title 23, United States Code (as amended by section 1813(c)), is 
amended by adding at the end the following:

``176. Parking pilot programs.''.

SEC. 1815. INTERSTATE OASIS PROGRAM.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1814(a)), is amended by adding at 
the end the following:
``Sec. 177. Interstate oasis program
    ``(a) In General.--Not later than 180 days after the date of 
enactment of this section, in consultation with the States and other 
interested parties, the Secretary shall--
            ``(1) establish an Interstate oasis program; and
            ``(2) develop standards for designating, as an Interstate 
        oasis, a facility that--
                    ``(A) offers--
                            ``(i) products and services to the public;
                            ``(ii) 24-hour access to restrooms; and
                            ``(iii) parking for automobiles and heavy 
                        trucks; and
                    ``(B) meets other standards established by the 
                Secretary.
    ``(b) Standards for Designation.--The standards for designation 
under subsection (a) shall include standards relating to--
            ``(1) the appearance of a facility; and
            ``(2) the proximity of the facility to the Interstate 
        System.
    ``(c) Eligibility for Designation.--If a State elects to 
participate in the interstate oasis program, any facility meeting the 
standards established by the Secretary shall be eligible for 
designation under this section.
    ``(d) Logo.--The Secretary shall design a logo to be displayed by a 
facility designated under this section.''.
    (b) Conforming Amendment.--The analysis for subchapter I of chapter 
I of title 23, United States Code (as amended by section 1814(b)), is 
amended by adding at the end the following:

``177. Interstate oasis program.''.

SEC. 1816. TRIBAL-STATE ROAD MAINTENANCE AGREEMENTS.

    Section 204 of title 23, United States Code (as amended by section 
1806(f)(4)), is amended by adding at the end the following:
    ``(n) Tribal-State Road Maintenance Agreements.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, regulation, policy, or guideline, an Indian tribe and a 
        State may enter into a road maintenance agreement under which 
        an Indian tribe assumes the responsibilities of the State for--
                    ``(A) Indian reservation roads; and
                    ``(B) roads providing access to Indian reservation 
                roads.
            ``(2) Tribal-state agreements.--Agreements entered into 
        under paragraph (1)--
                    ``(A) shall be negotiated between the State and the 
                Indian tribe; and
                    ``(B) shall not require the approval of the 
                Secretary.
            ``(3) Annual report.--Effective beginning with fiscal year 
        2004, the Secretary shall prepare and submit to Congress an 
        annual report that identifies--
                    ``(A) the Indian tribes and States that have 
                entered into agreements under paragraph (1);
                    ``(B) the number of miles of roads for which Indian 
                tribes have assumed maintenance responsibilities; and
                    ``(C) the amount of funding transferred to Indian 
                tribes for the fiscal year under agreements entered 
                into under paragraph (1).''.

SEC. 1817. NATIONAL FOREST SYSTEM ROADS.

    Section 205 of title 23, United States Code, is amended by adding 
at the end the following:
    ``(e) Of the amounts made available for National Forest System 
roads, $15,000,000 for each fiscal year shall be used by the Secretary 
of Agriculture to pay the costs of facilitating the passage of aquatic 
species beneath roads in the National Forest System, including the 
costs of constructing, maintaining, replacing, or removing culverts and 
bridges, as appropriate.''.

SEC. 1818. TERRITORIAL HIGHWAY PROGRAM.

    (a) In General.--Chapter 2 of title 23, United States Code, is 
amended by striking section 215 and inserting the following:
``Sec. 215. Territorial highway program
    ``(a) Definitions.--In this section:
            ``(1) Program.--The term `program' means the territorial 
        highway program established under subsection (b).
            ``(2) Territory.--The term `territory' means the any of the 
        following territories of the United States:
                    ``(A) American Samoa.
                    ``(B) The Commonwealth of the Northern Mariana 
                Islands.
                    ``(C) Guam.
                    ``(D) The United States Virgin Islands.
    ``(b) Program.--
            ``(1) In general.--Recognizing the mutual benefits that 
        will accrue to the territories and the United States from the 
        improvement of highways in the territories, the Secretary may 
        carry out a program to assist each territorial government in 
        the construction and improvement of a system of arterial and 
        collector highways, and necessary inter-island connectors, that 
        is--
                    ``(A) designated by the Governor or chief executive 
                officer of each territory; and
                    ``(B) approved by the Secretary.
            ``(2) Federal share.--The Secretary shall provide Federal 
        financial assistance to territories under this section in 
        accordance with section 120(h).
    ``(c) Technical Assistance.--
            ``(1) In general.--To continue a long-range highway 
        development program, the Secretary may provide technical 
        assistance to the governments of the territories to enable the 
        territories to, on a continuing basis--
                    ``(A) engage in highway planning;
                    ``(B) conduct environmental evaluations;
                    ``(C) administer right-of-way acquisition and 
                relocation assistance programs; and
                    ``(D) design, construct, operate, and maintain a 
                system of arterial and collector highways, including 
                necessary inter-island connectors.
            ``(2) Form and terms of assistance.--Technical assistance 
        provided under paragraph (1), and the terms for the sharing of 
        information among territories receiving the technical 
        assistance, shall be included in the agreement required by 
        subsection (e).
    ``(d) Nonapplicability of Certain Provisions.--
            ``(1) In general.--Except to the extent that provisions of 
        chapter 1 are determined by the Secretary to be inconsistent 
        with the needs of the territories and the intent of the 
        program, chapter 1 (other than provisions of chapter 1 relating 
        to the apportionment and allocation of funds) shall apply to 
        funds authorized to be appropriated for the program.
            ``(2) Applicable provisions.--The specific sections of 
        chapter 1 that are applicable to each territory, and the extent 
        of the applicability of those section, shall be identified in 
        the agreement required by subsection (e).
    ``(e) Agreement.--
            ``(1) In general.--Except as provided in paragraph (3), 
        none of the funds made available for the program shall be 
        available for obligation or expenditure with respect to any 
        territory until the Governor or chief executive officer of the 
        territory enters into a new agreement with the Secretary (which 
        new agreement shall be entered into not later than 1 year after 
        the date of enactment of the Safe, Accountable, Flexible, and 
        Efficient Transportation Equity Act of 2004), providing that 
        the government of the territory shall--
                    ``(A) implement the program in accordance with 
                applicable provisions of chapter 1 and subsection (d);
                    ``(B) design and construct a system of arterial and 
                collector highways, including necessary inter-island 
                connectors, in accordance with standards that are--
                            ``(i) appropriate for each territory; and
                            ``(ii) approved by the Secretary;
                    ``(C) provide for the maintenance of facilities 
                constructed or operated under this section in a 
                condition to adequately serve the needs of present and 
                future traffic; and
                    ``(D) implement standards for traffic operations 
                and uniform traffic control devices that are approved 
                by the Secretary.
            ``(2) Technical assistance.--The new agreement required by 
        paragraph (1) shall--
                    ``(A) specify the kind of technical assistance to 
                be provided under the program;
                    ``(B) include appropriate provisions regarding 
                information sharing among the territories; and
                    ``(C) delineate the oversight role and 
                responsibilities of the territories and the Secretary.
            ``(3) Review and revision of agreement.--The new agreement 
        entered into under paragraph (1) shall be reevaluated and, as 
        necessary, revised, at least every 2 years.
            ``(4) Existing agreements.--With respect to an agreement 
        between the Secretary and the Governor or chief executive 
        officer of a territory that is in effect as of the date of 
        enactment of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004--
                    ``(A) the agreement shall continue in force until 
                replaced by a new agreement in accordance with 
                paragraph (1); and
                    ``(B) amounts made available for the program under 
                the agreement shall be available for obligation or 
                expenditure so long as the agreement, or a new 
                agreement under paragraph (1), is in effect.
    ``(f) Permissible Uses of Funds.--
            ``(1) In general.--Funds made available for the program may 
        be used only for the following projects and activities carried 
        out in a territory:
                    ``(A) Eligible surface transportation program 
                projects described in section 133(b).
                    ``(B) Cost-effective, preventive maintenance 
                consistent with section 116.
                    ``(C) Ferry boats, terminal facilities, and 
                approaches, in accordance with subsections (b) and (c) 
                of section 129.
                    ``(D) Engineering and economic surveys and 
                investigations for the planning, and the financing, of 
                future highway programs.
                    ``(E) Studies of the economy, safety, and 
                convenience of highway use.
                    ``(F) The regulation and equitable taxation of 
                highway use.
                    ``(G) Such research and development as are 
                necessary in connection with the planning, design, and 
                maintenance of the highway system.
            ``(2) Prohibition on use of funds for routine 
        maintenance.--None of the funds made available for the program 
        shall be obligated or expended for routine maintenance.
    ``(g) Location of Projects.--Territorial highway projects (other 
than those described in paragraphs (1), (3), and (4) of section 133(b)) 
may not be undertaken on roads functionally classified as local.''.
    (b) Conforming Amendments.--
            (1) Eligible projects.--Section 103(b)(6) of title 23, 
        United States Code, is amended by striking subparagraph (P) and 
        inserting the following:
            ``(P) Projects eligible for assistance under the 
        territorial highway program under section 215.''.
            (2) Funding.--Section 104(b)(1)(A) of title 23, United 
        States Code, is amended by striking ``to the Virgin Islands, 
        Guam, American Samoa, and the Commonwealth of Northern Mariana 
        Islands'' and inserting ``for the territorial highway program 
        authorized under section 215''.
            (3) Analysis.--The analysis for chapter 2 of title 23, 
        United States Code, is amended by striking the item relating to 
        section 215 and inserting the following:

``215. Territorial highway program.''.

SEC. 1819. MAGNETIC LEVITATION TRANSPORTATION TECHNOLOGY DEPLOYMENT 
              PROGRAM.

    Section 322 of title 23, United States Code, is amended--
            (1) in subsection (c)--
                    (A) by striking ``Not later than'' and inserting 
                the following:
            ``(1) Initial solicitation.--Not later than''; and
                    (B) by adding at the end the following:
            ``(2) Additional solicitation.--Not later than 1 year after 
        the date of enactment of this paragraph, the Secretary may 
        solicit additional applications from States, or authorities 
        designated by 1 or more States, for financial assistance 
        authorized by subsection (b) for planning, design, and 
        construction of eligible MAGLEV projects.'';
            (2) in subsection (e), by striking ``Prior to soliciting 
        applications, the Secretary'' and inserting ``The Secretary'';
            (3) in subsection (h)--
                    (A) in subparagraph (A), by striking clause (i) and 
                inserting the following:
                            ``(i) In general.--There is authorized to 
                        be appropriated from the Highway Trust Fund 
                        (other than the Mass Transit Account) to carry 
                        out this section $15,000,000 for each of fiscal 
                        years 2004 through 2009.''; and
                    (B) in subparagraph (B), by striking clause (i) and 
                inserting the following:
                            ``(i) In general.--There are authorized to 
                        be appropriated from the Highway Trust Fund 
                        (other than the Mass Transit Account) to carry 
                        out this section--
                                    ``(I) $375,000,000 for fiscal year 
                                2004;
                                    ``(II) $400,000,000 for fiscal year 
                                2005;
                                    ``(III) $415,000,000 for fiscal 
                                year 2006;
                                    ``(IV) $425,000,000 for fiscal year 
                                2007;
                                    ``(V) $435,000,000 for fiscal year 
                                2008; and
                                    ``(VI) $450,000,000 for fiscal year 
                                2009.''; and
            (4) by striking subsection (i).

SEC. 1820. DONATIONS AND CREDITS.

    Section 323 of title 23, United States Code, is amended--
            (1) in the first sentence of subsection (c), by inserting 
        ``, or a local government from offering to donate funds, 
        materials, or services performed by local government 
        employees,'' after ``services''; and
            (2) striking subsection (e).

SEC. 1821. DISADVANTAGED BUSINESS ENTERPRISES.

    (a) General Rule.--Except to the extent that the Secretary 
determines otherwise, not less than 10 percent of the amounts made 
available for any program under titles I, II, and III of this Act shall 
be expended with small business concerns owned and controlled by 
socially and economically disadvantaged individuals.
    (b) Definitions.--In this section:
            (1) Small business concern.--
                    (A) In general.--The term ``small business 
                concern'' has the meaning given the term under section 
                3 of the Small Business Act (15 U.S.C. 632).
                    (B) Exclusion.--The term ``small business concern'' 
                does not include any concern or group of concerns 
                controlled by the same socially and economically 
                disadvantaged individual or individuals that has 
                average annual gross receipts over the preceding 3 
                fiscal years in excess of $17,420,000, as adjusted by 
                the Secretary for inflation.
            (2) Socially and economically disadvantaged individuals.--
        The term ``socially and economically disadvantaged 
        individuals'' has the meaning given the term under section 8(d) 
        of the Small Business Act (15 U.S.C. 637(d)) and relevant 
        subcontracting regulations promulgated under that section, 
        except that women shall be presumed to be socially and 
        economically disadvantaged individuals for the purposes of this 
        section.
    (c) Annual Listing of Disadvantaged Business Enterprises.--Each 
State shall annually survey and compile a list of the small business 
concerns referred to in subsection (a) and the location of such 
concerns in the State and notify the Secretary, in writing, of the 
percentage of such concerns which are controlled by women, by socially 
and economically disadvantaged individuals (other than women), and by 
individuals who are women and are otherwise socially and economically 
disadvantaged individuals.
    (d) Uniform Certification.--The Secretary shall establish minimum 
uniform criteria for State governments to use in certifying whether a 
concern qualifies for purposes of this section. Such minimum uniform 
criteria shall include on-site visits, personal interviews, licenses, 
analysis of stock ownership, listing of equipment, analysis of bonding 
capacity, listing of work completed, resume of principal owners, 
financial capacity, and type of work preferred.
    (e) Compliance With Court Orders.--Nothing in this section limits 
the eligibility of an entity or person to receive funds made available 
under titles I, III, and V of this Act, if the entity or person is 
prevented, in whole or in part, from complying with subsection (a) 
because a Federal court issues a final order in which the court finds 
that the requirement of subsection (a), or the program established 
under subsection (a), is unconstitutional.

SEC. 1822. EMERGENCY RELIEF.

    Section 125(c)(1) of title 23, United States Code, is amended by 
striking $100,000,000'' and inserting ``$300,000,000''.

SEC. 1823. PRIORITY FOR PEDESTRIAN AND BICYCLE FACILITY ENHANCEMENT 
              PROJECTS.

    Section 133(e)(5) of title 23, United States Code, is amended by 
adding at the end the following:
                    ``(D) Priority for pedestrian and bicycle facility 
                enhancement projects.--The Secretary shall encourage 
                States to give priority to pedestrian and bicycle 
                facility enhancement projects that include a 
                coordinated physical activity or healthy lifestyles 
                program.''.

SEC. 1824. THE DELTA REGIONAL AUTHORITY.

    (a) In General.--Subchapter I of chapter 1 of title 23, United 
States Code (as amended by section 1814(a)), is amended by adding at 
the end the following:
``Sec. 178. Delta Region transportation development program
    ``(a) In General.--The Secretary shall carry out a program to--
            ``(1) support and encourage multistate transportation 
        planning and corridor development;
            ``(2) provide for transportation project development;
            ``(3) facilitate transportation decisionmaking; and
            ``(4) support transportation construction.
    ``(b) Eligible Recipients.--A State transportation department or 
metropolitan planning organization may receive and administer funds 
provided under the program.
    ``(c) Eligible Activities.--The Secretary shall make allocations 
under the program for multistate highway and transit planning, 
development, and construction projects.
    ``(d) Other Provisions Regarding Eligibility.--All activities 
funded under this program shall be consistent with the continuing, 
cooperative, and comprehensive planning processes required by section 
134 and 135.
    ``(e) Selection Criteria.--The Secretary shall select projects to 
be carried out under the program based on--
            ``(1) whether the project is located--
                    ``(A) in an area that is part of the Delta Regional 
                Authority; and
                    ``(B) on the Federal-aid system;
            ``(2) endorsement of the project by the State department of 
        transportation; and
            ``(3) evidence of the ability to complete the project.
    ``(f) Program Priorities.--In administering the program, the 
Secretary shall--
            ``(1) encourage State and local officials to work together 
        to develop plans for multimodal and multijurisdictional 
        transportation decisionmaking; and
            ``(2) give priority to projects that emphasize multimodal 
        planning, including planning for operational improvements 
        that--
                    ``(A) increase the mobility of people and goods;
                    ``(B) improve the safety of the transportation 
                system with respect to catastrophic--
                            ``(i) natural disasters; or
                            ``(ii) disasters caused by human activity; 
                        and
                    ``(C) contribute to the economic vitality of the 
                area in which the project is being carried out.
    ``(g) Federal Share.--Amounts provided by the Delta Regional 
Authority to carry out a project under this section shall be applied to 
the non-Federal share required by section 120.
    ``(h) Availability of Funds.--Amounts made available to carry out 
this section shall remain available until expended.''.
    (b) Conforming Amendment.--The analysis for chapter 1 of title 23, 
United States Code (as amended by section 1814(b)), is amended by 
adding at the end the following:

``178. Delta Region transportation development program.''.

SEC. 1825. MULTISTATE INTERNATIONAL CORRIDOR DEVELOPMENT PROGRAM.

    (a) Establishment.--The Secretary shall establish a program to 
develop international trade corridors to facilitate the movement of 
freight from international ports of entry and inland ports through and 
to the interior of the United States.
    (b) Eligible Recipients.--State transportation departments and 
metropolitan planning organizations shall be eligible to receive and 
administer funds provided under the program.
    (c) Eligible Activities.--The Secretary shall make allocations 
under this program for any activity eligible for funding under title 
23, United States Code, including multistate highway and multistate 
multimodal planning and project construction.
    (d) Other Provisions Regarding Eligibility.--All activities funded 
under this program shall be consistent with the continuing, 
cooperative, and comprehensive planning processes required by sections 
134 and 135 of title 23, United States Code.
    (e) Selection Criteria.--The Secretary shall only select projects 
for corridors--
            (1) that have significant levels or increases in truck and 
        traffic volume relating to international freight movement;
            (2) connect to at least 1 international terminus or inland 
        port;
            (3) traverse at least 3 States; and
            (4) are identified by section 115(c) of the Intermodal 
        Transportation Efficiency Act of 1991 (Public Law 102-240; 105 
        Stat. 2032).
    (f) Program Priorities.--In administering the program, the 
Secretary shall--
            (1) encourage and enable States and other jurisdictions to 
        work together to develop plans for multimodal and 
        multijurisdictional transportation decisionmaking; and
            (2) give priority to studies that emphasize multimodal 
        planning, including planning for operational improvements that 
        increase mobility, freight productivity, access to marine 
        ports, safety, and security while enhancing the environment.
    (g) Federal Share.--The Federal share required for any study 
carried out under this section shall be available for obligation in the 
same manner as if the funds were apportioned under chapter I of title 
23, United States Code.

SEC. 1826. AUTHORIZATION OF CONTRACT AUTHORITY FOR STATES WITH INDIAN 
              RESERVATIONS.

    Section 1214(d) of the Transportation Equity Act for the 21st 
Century (23 U.S.C. 202 note; 112 Stat. 206) is amended--
            (1) in paragraph (1), by inserting ``(except Arizona)'' 
        after ``each State''; and
            (2) in paragraph (5)(A), by striking ``$1,500,000 for each 
        of fiscal years 1998 through 2003'' and inserting ``$1,800,000 
        for each of fiscal years 2004 through 2009''.

                   Subtitle I--Technical Corrections

SEC. 1901. REPEAL OR UPDATE OF OBSOLETE TEXT.

    (a) Letting of Contracts.--Section 112 of title 23, United States 
Code, is amended--
            (1) by striking subsection (f); and
            (2) by redesignating subsection (g) as subsection (f).
    (b) Fringe and Corridor Parking Facilities.--Section 137(a) of 
title 23, United States Code, is amended in the first sentence by 
striking ``on the Federal-aid urban system'' and inserting ``on a 
Federal-aid highway''.

SEC. 1902. CLARIFICATION OF DATE.

    Section 109(g) of title 23, United States Code, is amended in the 
first sentence by striking ``The Secretary'' and all that follows 
through ``of 1970'' and inserting ``Not later than January 30, 1971, 
the Secretary shall issue''.

SEC. 1903. INCLUSION OF REQUIREMENTS FOR SIGNS IDENTIFYING FUNDING 
              SOURCES IN TITLE 23.

    (a) In General.--Section 154 of the Federal-Aid Highway Act of 1987 
(23 U.S.C. 101 note; 101 Stat. 209) is--
            (1) transferred to title 23, United States Code;
            (2) redesignated as section 321;
            (3) moved to appear after section 320 of that title; and
            (4) amended by striking the section heading and inserting 
        the following:
``Sec. 321. Signs identifying funding sources''.
    (b) Conforming Amendment.--The analysis for chapter 3 of title 23, 
United States Code, is amended by inserting after the item relating to 
section 320 the following:

``321. Signs identifying funding sources.''.

SEC. 1904. INCLUSION OF BUY AMERICA REQUIREMENTS IN TITLE 23.

    (a) In General.--Section 165 of the Highway Improvement Act of 1982 
(23 U.S.C. 101 note; 96 Stat. 2136) is--
            (1) transferred to title 23, United States Code;
            (2) redesignated as section 313;
            (3) moved to appear after section 312 of that title; and
            (4) amended by striking the section heading and inserting 
        the following:
``Sec. 313. Buy America''.
    (b) Conforming Amendments.--
            (1) The analysis for chapter 3 of title 23, United States 
        Code, is amended by inserting after the item relating to 
        section 312 the following:

``313. Buy America.''.
            (2) Section 313 of title 23, United States Code (as added 
        by subsection (a)), is amended--
                    (A) in subsection (a), by striking ``by this Act'' 
                the first place it appears and all that follows through 
                ``of 1978'' and inserting ``to carry out the Surface 
                Transportation Assistance Act of 1982 (96 Stat. 2097) 
                or this title'';
                    (B) in subsection (b), by redesignating paragraph 
                (4) as paragraph (3);
                    (C) in subsection (d), by striking ``this Act,'' 
                and all that follows through ``Code, which'' and 
                inserting ``the Surface Transportation Assistance Act 
                of 1982 (96 Stat. 2097) or this title that'';
                    (D) by striking subsection (e); and
                    (E) by redesignating subsections (f) and (g) as 
                subsections (e) and (f), respectively.

SEC. 1905. TECHNICAL AMENDMENTS TO NONDISCRIMINATION SECTION.

    Section 140 of title 23, United States Code, is amended--
            (1) in subsection (a)--
                    (A) in the first sentence, by striking ``subsection 
                (a) of section 105 of this title'' and inserting 
                ``section 135'';
                    (B) in the second sentence, by striking ``He'' and 
                inserting ``The Secretary'';
                    (C) in the third sentence, by striking ``where he 
                considers it necessary to assure'' and inserting ``if 
                necessary to ensure''; and
                    (D) in the last sentence--
                            (i) by striking ``him'' and inserting ``the 
                        Secretary'' and
                            (ii) by striking ``he'' and inserting ``the 
                        Secretary'';
            (2) in subsection (b)--
                    (A) in the first sentence, by striking ``highway 
                construction'' and inserting ``surface 
                transportation''; and
                    (B) in the second sentence--
                            (i) by striking ``as he may deem 
                        necessary'' and inserting ``as necessary''; and
                            (ii) by striking ``not to exceed $2,500,000 
                        for the transition quarter ending September 30, 
                        1976, and'';
            (3) in the second sentence of subsection (c)--
                    (A) by striking ``subsection 104(b)(3) of this 
                title'' and inserting ``section 104(b)(3)''; and
                    (B) by striking ``he may deem''; and
            (4) in the heading of subsection (d), by striking ``and 
        contracting''.

                   TITLE II--TRANSPORTATION RESEARCH

                          Subtitle A--Funding

SEC. 2001. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--The following sums are authorized to be 
appropriated out of the Highway Trust Fund (other than the Mass Transit 
Account):
            (1) Surface transportation research.--
                    (A) In general.--For carrying out sections 502, 
                503, 506, 507, 508, and 511 of title 23, United States 
                Code--
                            (i) $211,000,000 for each of fiscal years 
                        2004 and 2005;
                            (ii) $215,000,000 for fiscal year 2006;
                            (iii) $218,000,000 for fiscal year 2007;
                            (iv) $220,000,000 for fiscal year 2008; and
                            (v) $223,000,000 for fiscal year 2009.
                    (B) Surface transportation-environmental 
                cooperative research program.--For each of fiscal years 
                2004 through 2009, the Secretary shall set aside 
                $20,000,000 of the funds authorized under subparagraph 
                (A) to carry out the surface transportation-
                environmental cooperative research program under 
                section 507 of title 23, United States Code.
            (2) Training and education.--For carrying out section 504 
        of title 23, United States Code--
                    (A) $27,000,000 for fiscal year 2004;
                    (B) $28,000,000 for fiscal year 2005;
                    (C) $29,000,000 for fiscal year 2006;
                    (D) $30,000,000 for fiscal year 2007;
                    (E) $31,000,000 for fiscal year 2008; and
                    (F) $32,000,000 for fiscal year 2009.
            (3) Bureau of transportation statistics.--For the Bureau of 
        Transportation Statistics to carry out section 111 of title 49, 
        United States Code, $28,000,000 for each of fiscal years 2004 
        through 2009.
            (4) ITS standards, research, operational tests, and 
        development.--For carrying out sections 524, 525, 526, 527, 
        528, and 529 of title 23, United States Code--
                    (A) $120,000,000 for fiscal year 2004;
                    (B) $123,000,000 for fiscal year 2005;
                    (C) $126,000,000 for fiscal year 2006;
                    (D) $129,000,000 for fiscal year 2007;
                    (E) $132,000,000 for fiscal year 2008; and
                    (F) $135,000,000 for fiscal year 2009.
            (5) University transportation centers.--For carrying out 
        section 510 of title 23, United States Code--
                    (A) $40,000,000 for fiscal year 2004; and
                    (B) $45,000,000 for each of fiscal years 2005 
                through 2009.
    (b) Applicability of Title 23, United States Code.--Funds 
authorized to be appropriated by subsection (a)--
            (1) shall be available for obligation in the same manner as 
        if the funds were apportioned under chapter 1 of title 23, 
        United States Code, except that the Federal share of the cost 
        of a project or activity carried out using the funds shall be 
        the share applicable under section 120(b) of title 23, United 
        States Code, as adjusted under subsection (d) of that section 
        (unless otherwise specified or otherwise determined by the 
        Secretary); and
            (2) shall remain available until expended.
    (c) Allocations.--
            (1) Surface transportation research.--Of the amounts made 
        available under subsection (a)(1)--
                    (A) $27,000,000 for each of fiscal years 2004 
                through 2009 shall be available to carry out advanced, 
                high-risk, long-term research under section 502(d) of 
                title 23, United States Code;
                    (B) $18,000,000 for fiscal years 2004 and 2005, 
                $17,000,000 for fiscal year 2006, $15,000,000 for 
                fiscal year 2007, $12,000,000 for fiscal year 2008, and 
                $10,00,000 for fiscal year 2009 shall be available to 
                carry out the long-term pavement performance program 
                under section 502(e) of that title;
                    (C) $6,000,000 for each of fiscal years 2004 
                through 2009 shall be available to carry out the high-
                performance concrete bridge research and technology 
                transfer program under section 502(i) of that title;
                    (D) $6,000,000 for each of fiscal years 2004 
                through 2009 shall be made available to carry out 
                research on asphalt used in highway pavements;
                    (E) $6,000,000 for each of fiscal years 2004 
                through 2009 shall be made available to carry out 
                research on concrete pavements;
                    (F) $3,000,000 for each of fiscal years 2004 
                through 2009 shall be made available to carry out 
                research on aggregates used in highway pavements;
                    (G) $4,750,000 for each of fiscal years 2004 
                through 2009 shall be made available for further 
                development and deployment of techniques to prevent and 
                mitigate alkali silica reactivity;
                    (H) $2,000,000 for fiscal year 2005 shall be remain 
                available until expended for asphalt and asphalt-
                related reclamation research at the South Dakota School 
                of Mines; and
                    (I) $3,000,000 for each of fiscal years 2004 
                through 2009 shall be made available to carry out 
                section 502(f)(3) of title 23, United States Code.
            (2) Technology application program.--Of the amounts made 
        available under subsection (a)(1), $60,000,000 for each of 
        fiscal years 2004 through 2009 shall be available to carry out 
        section 503 of title 23, United States Code.
            (3) Training and education.--Of the amounts made available 
        under subsection (a)(2)--
                    (A) $12,000,000 for fiscal year 2004, $12,500,000 
                for fiscal year 2005, $13,000,000 for fiscal year 2006, 
                $13,500,000 for fiscal year 2007, $14,000,000 for 
                fiscal year 2008, and $14,500,000 for fiscal year 2009 
                shall be available to carry out section 504(a) of title 
                23, United States Code (relating to the National 
                Highway Institute);
                    (B) $15,000,000 for each of fiscal years 2004 
                through 2009 shall be available to carry out section 
                504(b) of that title (relating to local technical 
                assistance); and
                    (C) $3,000,000 for each of fiscal years 2004 
                through 2009 shall be available to carry out section 
                504(c)(2) of that title (relating to the Eisenhower 
                Transportation Fellowship Program).
            (4) International highway transportation outreach 
        program.--Of the amounts made available under subsection 
        (a)(1), $500,000 for each of fiscal years 2004 through 2009 
        shall be available to carry out section 506 of title 23, United 
        States Code.
            (5) New strategic highway research program.--For each of 
        fiscal years 2004 through 2009, to carry out section 509 of 
        title 23, United States Code, the Secretary shall set aside--
                    (A) $15,000,000 of the amounts made available to 
                carry out the interstate maintenance program under 
                section 119 of title 23, United States Code, for the 
                fiscal year;
                    (B) $19,000,000 of the amounts made available for 
                the National Highway System under section 101 of title 
                23, United States Code, for the fiscal year;
                    (C) $13,000,000 of the amounts made available to 
                carry out the bridge program under section 144 of title 
                23, United States Code, for the fiscal year;
                    (D) $20,000,000 of the amounts made available to 
                carry out the surface transportation program under 
                section 133 of title 23, United States Code, for the 
                fiscal year;
                    (E) $5,000,000 of the amounts made available to 
                carry out the congestion mitigation and air quality 
                improvement program under section 149 of title 23, 
                United States Code, for the fiscal year; and
                    (F) $3,000,000 of the amounts made available to 
                carry out the highway safety improvement program under 
                section 148 of title 23, United States Code, for the 
                fiscal year.
            (6) Commercial vehicle intelligent transportation system 
        infrastructure program.--Of the amounts made available under 
        subsection (a)(4), not less than $30,000,000 for each of fiscal 
        years 2004 through 2009 shall be available to carry out section 
        527 of title 23, United States Code.
    (d) Transfers of Funds.--The Secretary may transfer--
            (1) to an amount made available under paragraphs (1), (2), 
        or (4) of subsection (c), not to exceed 10 percent of the 
        amount allocated for a fiscal year under any other of those 
        paragraphs; and
            (2) to an amount made available under subparagraphs (A), 
        (B), or (C) of subsection (c)(3), not to exceed 10 percent of 
        the amount allocated for a fiscal year under any other of those 
        subparagraphs.

SEC. 2002. OBLIGATION CEILING.

    Notwithstanding any other provision of law, the total of all 
obligations from amounts made available from the Highway Trust Fund 
(other than the Mass Transit Account) by section 2001(a) shall not 
exceed--
            (1) $426,200,000 for fiscal year 2004;
            (2) $435,200,000 for fiscal year 2005;
            (3) $443,200,000 for fiscal year 2006;
            (4) $450,200,000 for fiscal year 2007;
            (5) $456,200,000 for fiscal year 2008; and
            (6) $463,200,000 for fiscal year 2009.

SEC. 2003. NOTICE.

    (a) Notice of Reprogramming.--If any funds authorized for carrying 
out this title or the amendments made by this title are subject to a 
reprogramming action that requires notice to be provided to the 
Committee on Appropriations of the House of Representatives and the 
Committee on Appropriations of the Senate, notice of that action shall 
be concurrently provided to the Committee on Transportation and 
Infrastructure and the Committee on Science of the House of 
Representatives and the Committee on Environment and Public Works of 
the Senate.
    (b) Notice of Reorganization.--On or before the 15th day preceding 
the date of any major reorganization of a program, project, or activity 
of the Department of Transportation for which funds are authorized by 
this title or the amendments made by this title, the Secretary shall 
provide notice of the reorganization to the Committee on Transportation 
and Infrastructure and the Committee on Science of the House of 
Representatives and the Committee on Environment and Public Works of 
the Senate.

                  Subtitle B--Research and Technology

SEC. 2101. RESEARCH AND TECHNOLOGY PROGRAM.

    (a) In General.--Chapter 5 of title 23, United States Code, is 
amended to read as follows:

                  ``CHAPTER 5--RESEARCH AND TECHNOLOGY

                 ``SUBCHAPTER I--SURFACE TRANSPORTATION

``Sec.
``501. Definitions.
``502. Surface transportation research.
``503. Technology application program.
``504. Training and education.
``505. State planning and research.
``506. International highway transportation outreach program.
``507. Surface transportation-environmental cooperative research 
                            program.
``508. Surface transportation research technology deployment and 
                            strategic planning.
``509. New strategic highway research program.
``510. University transportation centers.
``511. Multistate corridor operations and management.
``512. Transportation analysis simulation system.
    ``SUBCHAPTER II--INTELLIGENT TRANSPORTATION SYSTEM RESEARCH AND 
                      TECHNICAL ASSISTANCE PROGRAM

``521. Finding.
``522. Goals and purposes.
``523. Definitions.
``524. General authorities and requirements.
``525. National ITS Program Plan.
``526. National ITS architecture and standards.
``527. Commercial vehicle intelligent transportation system 
                            infrastructure program.
``528. Research and development.
``529. Use of funds.

                 ``SUBCHAPTER I--SURFACE TRANSPORTATION

``Sec. 501. Definitions
    ``In this subchapter:
            ``(1) Federal laboratory.--The term `Federal laboratory' 
        includes--
                    ``(A) a Government-owned, Government-operated 
                laboratory; and
                    ``(B) a Government-owned, contractor-operated 
                laboratory.
            ``(2) Safety.--The term `safety' includes highway and 
        traffic safety systems, research, and development relating to--
                    ``(A) vehicle, highway, driver, passenger, 
                bicyclist, and pedestrian characteristics;
                    ``(B) accident investigations;
                    ``(C) integrated, interoperable emergency 
                communications;
                    ``(D) emergency medical care; and
                    ``(E) transportation of the injured.
``Sec. 502. Surface transportation research
    ``(a) In General.--
            ``(1) Research, development, and technology transfer 
        activities.--The Secretary may carry out research, development, 
        and technology transfer activities with respect to--
                    ``(A) all phases of transportation planning and 
                development (including new technologies, construction, 
                transportation systems management and operations 
                development, design, maintenance, safety, security, 
                financing, data collection and analysis, demand 
                forecasting, multimodal assessment, and traffic 
                conditions); and
                    ``(B) the effect of State laws on the activities 
                described in subparagraph (A).
            ``(2) Tests and development.--The Secretary may test, 
        develop, or assist in testing and developing, any material, 
        invention, patented article, or process.
            ``(3) Cooperation, grants, and contracts.--
                    ``(A) In general.--The Secretary may carry out this 
                section--
                            ``(i) independently;
                            ``(ii) in cooperation with--
                                    ``(I) any other Federal agency or 
                                instrumentality; and
                                    ``(II) any Federal laboratory; or
                            ``(iii) by making grants to, or entering 
                        into contracts, cooperative agreements, and 
                        other transactions with--
                                    ``(I) the National Academy of 
                                Sciences;
                                    ``(II) the American Association of 
                                State Highway and Transportation 
                                Officials;
                                    ``(III) planning organizations;
                                    ``(IV) a Federal laboratory;
                                    ``(V) a State agency;
                                    ``(VI) an authority, association, 
                                institution, or organization;
                                    ``(VII) a for-profit or nonprofit 
                                corporation;
                                    ``(VIII) a foreign country; or
                                    ``(IX) any other person.
                    ``(B) Competition; review.--All parties entering 
                into contracts, cooperative agreements or other 
                transactions with the Secretary, or receiving grants, 
                to perform research or provide technical assistance 
                under this section shall be selected, to the maximum 
                extent practicable and appropriate--
                            ``(i) on a competitive basis; and
                            ``(ii) on the basis of the results of peer 
                        review of proposals submitted to the Secretary.
            ``(4) Technological innovation.--The programs and 
        activities carried out under this section shall be consistent 
        with the surface transportation research and technology 
        development strategic plan developed under section 508(c).
            ``(5) Funds.--
                    ``(A) Special account.--In addition to other funds 
                made available to carry out this section, the Secretary 
                shall use such funds as may be deposited by any 
                cooperating organization or person in a special account 
                of the Treasury established for this purpose.
                    ``(B) Use of funds.--The Secretary shall use funds 
                made available to carry out this section to develop, 
                administer, communicate, and promote the use of 
                products of research, development, and technology 
                transfer programs under this section.
    ``(b) Collaborative Research and Development.--
            ``(1) In general.--To encourage innovative solutions to 
        surface transportation problems and stimulate the deployment of 
        new technology, the Secretary may carry out, on a cost-shared 
        basis, collaborative research and development with--
                    ``(A) non-Federal entities (including State and 
                local governments, foreign governments, colleges and 
                universities, corporations, institutions, partnerships, 
                sole proprietorships, and trade associations that are 
                incorporated or established under the laws of any 
                State); and
                    ``(B) Federal laboratories.
            ``(2) Agreements.--In carrying out this subsection, the 
        Secretary may enter into cooperative research and development 
        agreements (as defined in section 12 of the Stevenson-Wydler 
        Technology Innovation Act of 1980 (15 U.S.C. 3710a)).
            ``(3) Federal share.--
                    ``(A) In general.--The Federal share of the cost of 
                activities carried out under a cooperative research and 
                development agreement entered into under this 
                subsection shall not exceed 50 percent, except that if 
                there is substantial public interest or benefit, the 
                Secretary may approve a greater Federal share.
                    ``(B) Non-federal share.--All costs directly 
                incurred by the non-Federal partners, including 
                personnel, travel, and hardware development costs, 
                shall be credited toward the non-Federal share of the 
                cost of the activities described in subparagraph (A).
            ``(4) Use of technology.--The research, development, or use 
        of a technology under a cooperative research and development 
        agreement entered into under this subsection, including the 
        terms under which the technology may be licensed and the 
        resulting royalties may be distributed, shall be subject to the 
        Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 
        3701 et seq.).
            ``(5) Waiver of advertising requirements.--Section 3709 of 
        the Revised Statutes (41 U.S.C. 5) shall not apply to a 
        contract or agreement entered into under this chapter.
    ``(c) Contents of Research Program.--The Secretary shall include as 
priority areas of effort within the surface transportation research 
program--
            ``(1) the development of new technologies and methods in 
        materials, pavements, structures, design, and construction, 
        with the objectives of--
                    ``(A)(i) increasing to 50 years the expected life 
                of pavements;
                    ``(ii) increasing to 100 years the expected life of 
                bridges; and
                    ``(iii) significantly increasing the durability of 
                other infrastructure;
                    ``(B) lowering the life-cycle costs, including--
                            ``(i) construction costs;
                            ``(ii) maintenance costs;
                            ``(iii) operations costs; and
                            ``(vi) user costs.
            ``(2) the development, and testing for effectiveness, of 
        nondestructive evaluation technologies for civil infrastructure 
        using existing and new technologies;
            ``(3) the investigation of--
                    ``(A) the application of current natural hazard 
                mitigation techniques to manmade hazards; and
                    ``(B) the continuation of hazard mitigation 
                research combining manmade and natural hazards;
            ``(4) the improvement of safety--
                    ``(A) at intersections;
                    ``(B) with respect to accidents involving vehicles 
                run off the road; and
                    ``(C) on rural roads;
            ``(5) the reduction of work zone incursions and improvement 
        of work zone safety;
            ``(6) the improvement of geometric design of roads for the 
        purpose of safety;
            ``(7) the examination of data collected through the 
        national bridge inventory conducted under section 144 using the 
        national bridge inspection standards established under section 
        151, with the objectives of determining whether--
                    ``(A) the most useful types of data are being 
                collected; and
                    ``(B) any improvement could be made in the types of 
                data collected and the manner in which the data is 
                collected, with respect to bridges in the United 
                States;
            ``(8) the improvement of the infrastructure investment 
        needs report described in subsection (g) through--
                    ``(A) the study and implementation of new methods 
                of collecting better quality data, particularly with 
                respect to performance, congestion, and infrastructure 
                conditions;
                    ``(B) monitoring of the surface transportation 
                system in a system-wide manner, through the use of--
                            ``(i) intelligent transportation system 
                        technologies of traffic operations centers; and
                            ``(ii) other new data collection 
                        technologies as sources of better quality 
                        performance data;
                    ``(C) the determination of the critical metrics 
                that should be used to determine the condition and 
                performance of the surface transportation system; and
                    ``(D) the study and implementation of new methods 
                of statistical analysis and computer models to improve 
                the prediction of future infrastructure investment 
                requirements;
            ``(9) the development of methods to improve the 
        determination of benefits from infrastructure improvements, 
        including--
                    ``(A) more accurate calculations of benefit-to-cost 
                ratios, considering benefits and impacts throughout 
                local and regional transportation systems;
                    ``(B) improvements in calculating life-cycle costs; 
                and
                    ``(C) valuation of assets;
            ``(10) the improvement of planning processes to better 
        predict outcomes of transportation projects, including the 
        application of computer simulations in the planning process to 
        predict outcomes of planning decisions;
            ``(11) the multimodal applications of Geographic 
        Information Systems and remote sensing, including such areas of 
        application as--
                    ``(A) planning;
                    ``(B) environmental decisionmaking and project 
                delivery; and
                    ``(C) freight movement;
            ``(12) the development and application of methods of 
        providing revenues to the Highway Trust Fund with the objective 
        of offsetting potential reductions in fuel tax receipts;
            ``(13) the development of tests and methods to determine 
        the benefits and costs to communities of major transportation 
        investments and projects;
            ``(14) the conduct of extreme weather research, including 
        research to--
                    ``(A) reduce contraction and expansion damage;
                    ``(B) reduce or repair road damage caused by 
                freezing and thawing;
                    ``(C) improve deicing or snow removal techniques;
                    ``(D) develop better methods to reduce the risk of 
                thermal collapse, including collapse from changes in 
                underlying permafrost;
                    ``(E) improve concrete and asphalt installation in 
                extreme weather conditions; and
                    ``(F) make other improvements to protect highway 
                infrastructure or enhance highway safety or 
                performance;
            ``(15) the improvement of surface transportation planning;
            ``(16) environmental research;
            ``(17) transportation system management and operations; and
            ``(18) any other surface transportation research topics 
        that the Secretary determines, in accordance with the strategic 
        planning process under section 508, to be critical.
    ``(d) Advanced, High-Risk Research.--
            ``(1) In general.--The Secretary shall establish and carry 
        out, in accordance with the surface transportation research and 
        technology development strategic plan developed under section 
        508(c) and research priority areas described in subsection (c), 
        an advanced research program that addresses longer-term, 
        higher-risk research with potentially dramatic breakthroughs 
        for improving the durability, efficiency, environmental impact, 
        productivity, and safety (including bicycle and pedestrian 
        safety) aspects of highway and intermodal transportation 
        systems.
            ``(2) Partnerships.--In carrying out the program, the 
        Secretary shall seek to develop partnerships with the public 
        and private sectors.
            ``(3) Report.--The Secretary shall include in the strategic 
        plan required under section 508(c) a description of each of the 
        projects, and the amount of funds expended for each project, 
        carried out under this subsection during the fiscal year.
    ``(e) Long-Term Pavement Performance Program.--
            ``(1) Authority.--The Secretary shall continue, through 
        September 30, 2009, the long-term pavement performance program 
        tests, monitoring, and data analysis.
            ``(2) Grants, cooperative agreements, and contracts.--Under 
        the program, the Secretary shall make grants and enter into 
        cooperative agreements and contracts to--
                    ``(A) monitor, material-test, and evaluate highway 
                test sections in existence as of the date of the grant, 
                agreement, or contract;
                    ``(B) analyze the data obtained in carrying out 
                subparagraph (A); and
                    ``(C) prepare products to fulfill program 
                objectives and meet future pavement technology needs.
            ``(3) Conclusion of program.--
                    ``(A) Summary report.--The Secretary shall include 
                in the strategic plan required under section 508(c) a 
                report on the initial conclusions of the long-term 
                pavement performance program that includes--
                            ``(i) an analysis of any research 
                        objectives that remain to be achieved under the 
                        program;
                            ``(ii) an analysis of other associated 
                        longer-term expenditures under the program that 
                        are in the public interest;
                            ``(iii) a detailed plan regarding the 
                        storage, maintenance, and user support of the 
                        database, information management system, and 
                        materials reference library of the program;
                            ``(iv) a schedule for continued 
                        implementation of the necessary data collection 
                        and analysis and project plan under the 
                        program; and
                            ``(v) an estimate of the costs of carrying 
                        out each of the activities described in clauses 
                        (i) through (iv) for each fiscal year during 
                        which the program is carried out.
                    ``(B) Deadline; usefulness of advances.--The 
                Secretary shall, to the maximum extent practicable--
                            ``(i) ensure that the long-term pavement 
                        performance program is concluded not later than 
                        September 30, 2009; and
                            ``(ii) make such allowances as are 
                        necessary to ensure the usefulness of the 
                        technological advances resulting from the 
                        program.
    ``(f) Seismic Research.--The Secretary shall--
            ``(1) in consultation and cooperation with Federal agencies 
        participating in the National Earthquake Hazards Reduction 
        Program established by section 5 of the Earthquake Hazards 
        Reduction Act of 1977 (42 U.S.C. 7704), coordinate the conduct 
        of seismic research;
            ``(2) take such actions as are necessary to ensure that the 
        coordination of the research is consistent with--
                    ``(A) planning and coordination activities of the 
                Director of the Federal Emergency Management Agency 
                under section 5(b)(1) of that Act (42 U.S.C. 
                7704(b)(1)); and
                    ``(B) the plan developed by the Director of the 
                Federal Emergency Management Agency under section 8(b) 
                of that Act (42 U.S.C. 7705b(b)); and
            ``(3) in cooperation with the Center for Civil Engineering 
        Research at the University of Nevada, Reno, carry out a seismic 
        research program--
                    ``(A) to study the vulnerability of the Federal-aid 
                highway system and other surface transportation systems 
                to seismic activity;
                    ``(B) to develop and implement cost-effective 
                methods to reduce the vulnerability; and
                    ``(C) to conduct seismic research and upgrade 
                earthquake simulation facilities as necessary to carry 
                out the program.
    ``(g) Infrastructure Investment Needs Report.--
            ``(1) In general.--Not later than July 31, 2004, and July 
        31 of every second year thereafter, the Secretary shall submit 
        to the Committee on Environment and Public Works of the Senate 
        and the Committee on Transportation and Infrastructure of the 
        House of Representatives a report that describes--
                    ``(A) estimates of the future highway and bridge 
                needs of the United States; and
                    ``(B) the backlog of current highway and bridge 
                needs.
            ``(2) Comparison with prior reports.--Each report under 
        paragraph (1) shall provide the means, including all necessary 
        information, to relate and compare the conditions and service 
        measures used in the previous biennial reports.
    ``(h) Security Related Research and Technology Transfer 
Activities.--
            ``(1) In general.--Not later than 180 days after the date 
        of enactment of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004, the Secretary, in 
        consultation with the Secretary of Homeland Security, with key 
        stakeholder input (including State transportation departments) 
        shall develop a 5-year strategic plan for research and 
        technology transfer and deployment activities pertaining to the 
        security aspects of highway infrastructure and operations.
            ``(2) Components of plan.--The plan shall include--
                    ``(A) an identification of which agencies are 
                responsible for the conduct of various research and 
                technology transfer activities;
                    ``(B) a description of the manner in which those 
                activities will be coordinated; and
                    ``(C) a description of the process to be used to 
                ensure that the advances derived from relevant 
                activities supported by the Federal Highway 
                Administration are consistent with the operational 
                guidelines, policies, recommendations, and regulations 
                of the Department of Homeland Security; and
                    ``(D) a systematic evaluation of the research that 
                should be conducted to address, at a minimum--
                            ``(i) vulnerabilities of, and measures that 
                        may be taken to improve, emergency response 
                        capabilities and evacuations;
                            ``(ii) recommended upgrades of traffic 
                        management during crises;
                            ``(iii) integrated, interoperable emergency 
                        communications among the public, the military, 
                        law enforcement, fire and emergency medical 
                        services, and transportation agencies;
                            ``(iv) protection of critical, security-
                        related infrastructure; and
                            ``(v) structural reinforcement of key 
                        facilities.
            ``(3) Submission.--On completion of the plan under this 
        subsection, the Secretary shall submit to the Committee on 
        Environment and Public Works of the Senate and the Committee on 
        Transportation and Infrastructure of the House of 
        Representatives--
                    ``(A) a copy of the plan developed under paragraph 
                (1); and
                    ``(B) a copy of a memorandum of understanding 
                specifying coordination strategies and assignment of 
                responsibilities covered by the plan that is signed by 
                the Secretary and the Secretary of Homeland Security.
    ``(i) High-Performance Concrete Bridge Research and Technology 
Transfer Program.--In accordance with the objectives described in 
subsection (c)(1) and the requirements under sections 503(b)(4) and 
504(b), the Secretary shall carry out a program to demonstrate the 
application of high-performance concrete in the construction and 
rehabilitation of bridges.
    ``(j) Biobased Transportation Research.--There shall be available 
from the Highway Trust Fund (other than the Mass Transit Account) 
$18,000,000 for each of fiscal years 2004 through 2009 equally divided 
and available to carry out biobased research of national importance at 
the National Biodiesel Board and at research centers identified in 
section 9011 of Public Law 107-171.
``Sec. 503. Technology application program
    ``(a) Technology Application Initiatives and Partnerships 
Program.--
            ``(1) Establishment.--The Secretary, in consultation with 
        interested stakeholders, shall develop and administer a 
        national technology and innovation application initiatives and 
        partnerships program.
            ``(2) Purpose.--The purpose of the program shall be to 
        significantly accelerate the adoption of technology and 
        innovation by the surface transportation community.
            ``(3) Application goals.--
                    ``(A) Establishment.--Not later than 180 days after 
                the date of enactment of the Safe, Accountable, 
                Flexible, and Efficient Transportation Equity Act of 
                2004, the Secretary, in consultation with the Surface 
                Transportation Research Technology Advisory Committee, 
                State transportation departments, and other interested 
                stakeholders, shall establish, as part of the surface 
                transportation research and technology development 
                strategic plan under section 508(c), goals to carry out 
                paragraph (1).
                    ``(B) Design.--Each of the goals and the program 
                developed to achieve the goals shall be designed to 
                provide tangible benefits, with respect to 
                transportation systems, in the areas of efficiency, 
                safety, reliability, service life, environmental 
                protection, and sustainability.
                    ``(C) Strategies for achievement.--For each goal, 
                the Secretary, in cooperation with representatives of 
                the transportation community, such as States, local 
                governments, the private sector, and academia, shall 
                use domestic and international technology to develop 
                strategies and initiatives to achieve the goal, 
                including technical assistance in deploying technology 
                and mechanisms for sharing information among program 
                participants.
            ``(4) Integration with other programs.--The Secretary shall 
        integrate activities carried out under this subsection with the 
        efforts of the Secretary to--
                    ``(A) disseminate the results of research sponsored 
                by the Secretary; and
                    ``(B) facilitate technology transfer.
            ``(5) Leveraging of federal resources.--In selecting 
        projects to be carried out under this subsection, the Secretary 
        shall give preference to projects that leverage Federal funds 
        with other significant public or private resources.
            ``(6) Grants, cooperative agreements, and contracts.--Under 
        the program, the Secretary may make grants and enter into 
        cooperative agreements and contracts to foster alliances and 
        support efforts to stimulate advances in transportation 
        technology.
            ``(7) Reports.--The results and progress of activities 
        carried out under this section shall be published as part of 
        the annual transportation research report prepared by the 
        Secretary under section 508(c)(5).
            ``(8) Allocation.--To the extent appropriate to achieve the 
        goals established under paragraph (3), the Secretary may 
        further allocate funds made available to carry out this section 
        to States for use by those States.
    ``(b) Innovative Surface Transportation Infrastructure Research and 
Construction Program.--
            ``(1) In general.--The Secretary shall establish and carry 
        out a program for the application of innovative material, 
        design, and construction technologies in the construction, 
        preservation, and rehabilitation of elements of surface 
        transportation infrastructure.
            ``(2) Goals.--The goals of the program shall include--
                    ``(A) the development of new, cost-effective, and 
                innovative materials;
                    ``(B) the reduction of maintenance costs and life-
                cycle costs of elements of infrastructure, including 
                the costs of new construction, replacement, and 
                rehabilitation;
                    ``(C) the development of construction techniques to 
                increase safety and reduce construction time and 
                traffic congestion;
                    ``(D) the development of engineering design 
                criteria for innovative products and materials for use 
                in surface transportation infrastructure;
                    ``(E) the development of highway bridges and 
                structures that will withstand natural disasters and 
                disasters caused by human activity; and
                    ``(F) the development of new, nondestructive 
                technologies and techniques for the evaluation of 
                elements of transportation infrastructure.
            ``(3) Grants, cooperative agreements, and contracts.--
                    ``(A) In general.--Under the program, the Secretary 
                shall make grants to, and enter into cooperative 
                agreements and contracts with--
                            ``(i) States, other Federal agencies, 
                        universities and colleges, private sector 
                        entities, and nonprofit organizations, to pay 
                        the Federal share of the cost of research, 
                        development, and technology transfer concerning 
                        innovative materials and methods; and
                            ``(ii) States, to pay the Federal share of 
                        the cost of repair, rehabilitation, 
                        replacement, and new construction of elements 
                        of surface transportation infrastructure that 
                        demonstrate the application of innovative 
                        materials and methods.
                    ``(B) Applications.--
                            ``(i) In general.--To receive a grant under 
                        this subsection, an entity described in 
                        subparagraph (A) shall submit to the Secretary 
                        an application in such form and containing such 
                        information as the Secretary may require.
                            ``(ii) Approval.--The Secretary shall 
                        select and approve an application based on 
                        whether the proposed project that is the 
                        subject of the application would meet the goals 
                        described in paragraph (2).
            ``(4) Technology and information transfer.--The Secretary 
        shall take such action as is necessary to--
                    ``(A) ensure that the information and technology 
                resulting from research conducted under paragraph (3) 
                is made available to State and local transportation 
                departments and other interested parties, as specified 
                by the Secretary; and
                    ``(B) encourage the use of the information and 
                technology.
            ``(5) Federal share.--The Federal share of the cost of a 
        project under this section shall be determined by the 
        Secretary.
``Sec. 504. Training and education
    ``(a) National Highway Institute.--
            ``(1) In general.--The Secretary shall--
                    ``(A) operate, in the Federal Highway 
                Administration, a National Highway Institute (referred 
                to in this subsection as the `Institute'); and
                    ``(B) administer, through the Institute, the 
                authority vested in the Secretary by this title or by 
                any other law for the development and conduct of 
                education and training programs relating to highways.
            ``(2) Duties of the institute.--In cooperation with State 
        transportation departments, industries in the United States, 
        and national or international entities, the Institute shall 
        develop and administer education and training programs of 
        instruction for--
                    ``(A) Federal Highway Administration, State, and 
                local transportation agency employees;
                    ``(B) regional, State, and metropolitan planning 
                organizations;
                    ``(C) State and local police, public safety, and 
                motor vehicle employees; and
                    ``(D) United States citizens and foreign nationals 
                engaged or to be engaged in surface transportation work 
                of interest to the United States.
            ``(3) Courses.--
                    ``(A) In general.--The Institute shall--
                            ``(i) develop or update existing courses in 
                        asset management, including courses that 
                        include such components as--
                                    ``(I) the determination of life-
                                cycle costs;
                                    ``(II) the valuation of assets;
                                    ``(III) benefit-to-cost ratio 
                                calculations; and
                                    ``(IV) objective decisionmaking 
                                processes for project selection; and
                            ``(ii) continually develop courses relating 
                        to the application of emerging technologies 
                        for--
                                    ``(I) transportation infrastructure 
                                applications and asset management;
                                    ``(II) intelligent transportation 
                                systems;
                                    ``(III) operations (including 
                                security operations);
                                    ``(IV) the collection and archiving 
                                of data;
                                    ``(V) expediting the planning and 
                                development of transportation projects; 
                                and
                                    ``(VI) the intermodal movement of 
                                individuals and freight.
                    ``(B) Additional courses.--In addition to the 
                courses developed under subparagraph (A), the 
                Institute, in consultation with State transportation 
                departments, metropolitan planning organizations, and 
                the American Association of State Highway and 
                Transportation Officials, may develop courses relating 
                to technology, methods, techniques, engineering, 
                construction, safety, maintenance, environmental 
                mitigation and compliance, regulations, management, 
                inspection, and finance.
                    ``(C) Revision of courses offered.--The Institute 
                shall periodically--
                            ``(i) review the course inventory of the 
                        Institute; and
                            ``(ii) revise or cease to offer courses 
                        based on course content, applicability, and 
                        need.
            ``(4) Eligibility; federal share.--The funds apportioned to 
        a State under section 104(b)(3) for the surface transportation 
        program shall be available for expenditure by the State 
        transportation department for the payment of not to exceed 80 
        percent of the cost of tuition and direct educational expenses 
        (excluding salaries) in connection with the education and 
        training of employees of State and local transportation 
        agencies in accordance with this subsection.
            ``(5) Federal responsibility.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), education and training of employees 
                of Federal, State, and local transportation (including 
                highway) agencies authorized under this subsection may 
                be provided--
                            ``(i) by the Secretary, at no cost to the 
                        States and local governments, if the Secretary 
                        determines that provision at no cost is in the 
                        public interest; or
                            ``(ii) by the State, through grants, 
                        cooperative agreements, and contracts with 
                        public and private agencies, institutions, 
                        individuals, and the Institute.
                    ``(B) Payment of full cost by private persons.--
                Private agencies, international or foreign entities, 
                and individuals shall pay the full cost of any 
                education and training (including the cost of course 
                development) received by the agencies, entities, and 
                individuals, unless the Secretary determines that 
                payment of a lesser amount of the cost is of critical 
                importance to the public interest.
            ``(6) Training fellowships; cooperation.--The Institute 
        may--
                    ``(A) engage in training activities authorized 
                under this subsection, including the granting of 
                training fellowships; and
                    ``(B) exercise the authority of the Institute 
                independently or in cooperation with any--
                            ``(i) other Federal or State agency;
                            ``(ii) association, authority, institution, 
                        or organization;
                            ``(iii) for-profit or nonprofit 
                        corporation;
                            ``(iv) national or international entity;
                            ``(v) foreign country; or
                            ``(vi) person.
            ``(7) Collection of fees.--
                    ``(A) In general.--In accordance with this 
                subsection, the Institute may assess and collect fees 
                to defray the costs of the Institute in developing or 
                administering education and training programs under 
                this subsection.
                    ``(B) Persons subject to fees.--Fees may be 
                assessed and collected under this subsection only with 
                respect to--
                            ``(i) persons and entities for whom 
                        education or training programs are developed or 
                        administered under this subsection; and
                            ``(ii) persons and entities to whom 
                        education or training is provided under this 
                        subsection.
                    ``(C) Amount of fees.--The fees assessed and 
                collected under this subsection shall be established in 
                a manner that ensures that the liability of any person 
                or entity for a fee is reasonably based on the 
                proportion of the costs referred to in subparagraph (A) 
                that relate to the person or entity.
                    ``(D) Use.--All fees collected under this 
                subsection shall be used, without further 
                appropriation, to defray costs associated with the 
                development or administration of education and training 
                programs authorized under this subsection.
            ``(8) Relation to fees.--The funds made available to carry 
        out this subsection may be combined with or held separate from 
        the fees collected under--
                    ``(A) paragraph (7);
                    ``(B) memoranda of understanding;
                    ``(C) regional compacts; and
                    ``(D) other similar agreements.
    ``(b) Local Technical Assistance Program.--
            ``(1) Authority.--The Secretary shall carry out a local 
        technical assistance program that will provide access to 
        surface transportation technology to--
                    ``(A) highway and transportation agencies in 
                urbanized areas;
                    ``(B) highway and transportation agencies in rural 
                areas;
                    ``(C) contractors that perform work for the 
                agencies; and
                    ``(D) infrastructure security.
            ``(2) Grants, cooperative agreements, and contracts.--The 
        Secretary may make grants and enter into cooperative agreements 
        and contracts to provide education and training, technical 
        assistance, and related support services to--
                    ``(A) assist rural, local transportation agencies 
                and tribal governments, and the consultants and 
                construction personnel working for the agencies and 
                governments, to--
                            ``(i) develop and expand expertise in road 
                        and transportation areas (including pavement, 
                        bridge, concrete structures, intermodal 
                        connections, safety management systems, 
                        intelligent transportation systems, incident 
                        response, operations, and traffic safety 
                        countermeasures);
                            ``(ii) improve roads and bridges;
                            ``(iii) enhance--
                                    ``(I) programs for the movement of 
                                passengers and freight; and
                                    ``(II) intergovernmental 
                                transportation planning and project 
                                selection; and
                            ``(iv) deal effectively with special 
                        transportation-related problems by preparing 
                        and providing training packages, manuals, 
                        guidelines, and technical resource materials;
                    ``(B) develop technical assistance for tourism and 
                recreational travel;
                    ``(C) identify, package, and deliver transportation 
                technology and traffic safety information to local 
                jurisdictions to assist urban transportation agencies 
                in developing and expanding their ability to deal 
                effectively with transportation-related problems 
                (particularly the promotion of regional cooperation);
                    ``(D) operate, in cooperation with State 
                transportation departments and universities--
                            ``(i) local technical assistance program 
                        centers designated to provide transportation 
                        technology transfer services to rural areas and 
                        to urbanized areas; and
                            ``(ii) local technical assistance program 
                        centers designated to provide transportation 
                        technical assistance to tribal governments; and
                    ``(E) allow local transportation agencies and 
                tribal governments, in cooperation with the private 
                sector, to enhance new technology implementation.
    ``(c) Research Fellowships.--
            ``(1) General authority.--The Secretary, acting 
        independently or in cooperation with other Federal agencies and 
        instrumentalities, may make grants for research fellowships for 
        any purpose for which research is authorized by this chapter.
            ``(2) Dwight david eisenhower transportation fellowship 
        program.--The Secretary shall establish and implement a 
        transportation research fellowship program, to be known as the 
        `Dwight David Eisenhower Transportation Fellowship Program', 
        for the purpose of attracting qualified students to the field 
        of transportation.
``Sec. 505. State planning and research
    ``(a) In General.--Two percent of the sums apportioned to a State 
for fiscal year 2004 and each fiscal year thereafter under sections 104 
(other than subsections (f) and (h)) and 144 shall be available for 
expenditure by the State, in consultation with the Secretary, only 
for--
            ``(1) the conduct of engineering and economic surveys and 
        investigations;
            ``(2) the planning of--
                    ``(A) future highway programs and local public 
                transportation systems; and
                    ``(B) the financing of those programs and systems, 
                including metropolitan and statewide planning under 
                sections 134 and 135;
            ``(3) the development and implementation of management 
        systems under section 303;
            ``(4) the conduct of studies on--
                    ``(A) the economy, safety, and convenience of 
                surface transportation systems; and
                    ``(B) the desirable regulation and equitable 
                taxation of those systems;
            ``(5) research, development, and technology transfer 
        activities necessary in connection with the planning, design, 
        construction, management, and maintenance of highway, public 
        transportation, and intermodal transportation systems;
            ``(6) the conduct of studies, research, and training 
        relating to the engineering standards and construction 
        materials for surface transportation systems described in 
        paragraph (5) (including the evaluation and accreditation of 
        inspection and testing and the regulation of and charging for 
        the use of the standards and materials); and
            ``(7) the conduct of activities relating to the planning of 
        real-time monitoring elements.
    ``(b) Minimum Expenditures on Research, Development, and Technology 
Transfer Activities.--
            ``(1) In general.--Subject to paragraph (2), not less than 
        25 percent of the funds subject to subsection (a) that are 
        apportioned to a State for a fiscal year shall be expended by 
        the State for research, development, and technology transfer 
        activities that--
                    ``(A) are described in subsection (a); and
                    ``(B) relate to highway, public transportation, and 
                intermodal transportation systems.
            ``(2) Waivers.--The Secretary may waive the application of 
        paragraph (1) with respect to a State for a fiscal year if--
                    ``(A) the State certifies to the Secretary for the 
                fiscal year that total expenditures by the State for 
                transportation planning under sections 134 and 135 will 
                exceed 75 percent of the funds described in paragraph 
                (1); and
                    ``(B) the Secretary accepts the certification of 
                the State.
            ``(3) Nonapplicability of assessment.--Funds expended under 
        paragraph (1) shall not be considered to be part of the 
        extramural budget of the agency for the purpose of section 9 of 
        the Small Business Act (15 U.S.C. 638).
    ``(c) Federal Share.--The Federal share of the cost of a project 
carried out using funds subject to subsection (a) shall be the share 
applicable under section 120(b), as adjusted under subsection (d) of 
that section.
    ``(d) Administration of Sums.--Funds subject to subsection (a) 
shall be--
            ``(1) combined and administered by the Secretary as a 
        single fund; and
            ``(2) available for obligation for the period described in 
        section 118(b)(2).
    ``(e) Eligible Use of State Planning and Research Funds.--A State, 
in coordination with the Secretary, may obligate funds made available 
to carry out this section for any purpose authorized under section 
506(a).
``Sec. 506. International highway transportation outreach program
    ``(a) Establishment.--The Secretary may establish an international 
highway transportation outreach program--
            ``(1) to inform the United States highway community of 
        technological innovations in foreign countries that could 
        significantly improve highway transportation in the United 
        States;
            ``(2) to promote United States highway transportation 
        expertise, goods, and services in foreign countries; and
            ``(3) to increase transfers of United States highway 
        transportation technology to foreign countries.
    ``(b) Activities.--Activities carried out under the program may 
include--
            ``(1) the development, monitoring, assessment, and 
        dissemination in the United States of information about highway 
        transportation innovations in foreign countries that could 
        significantly improve highway transportation in the United 
        States;
            ``(2) research, development, demonstration, training, and 
        other forms of technology transfer and exchange;
            ``(3) the provision to foreign countries, through 
        participation in trade shows, seminars, expositions, and other 
        similar activities, of information relating to the technical 
        quality of United States highway transportation goods and 
        services;
            ``(4) the offering of technical services of the Federal 
        Highway Administration that cannot be readily obtained from 
        private sector firms in the United States for incorporation 
        into the proposals of those firms undertaking highway 
        transportation projects outside the United States, if the costs 
        of the technical services will be recovered under the terms of 
        the project;
            ``(5) the conduct of studies to assess the need for, or 
        feasibility of, highway transportation improvements in foreign 
        countries; and
            ``(6) the gathering and dissemination of information on 
        foreign transportation markets and industries.
    ``(c) Cooperation.--The Secretary may carry out this section in 
cooperation with any appropriate--
            ``(1) Federal, State, or local agency;
            ``(2) authority, association, institution, or organization;
            ``(3) for-profit or nonprofit corporation;
            ``(4) national or international entity;
            ``(5) foreign country; or
            ``(6) person.
    ``(d) Funds.--
            ``(1) Contributions.--Funds available to carry out this 
        section shall include funds deposited by any cooperating 
        organization or person into a special account of the Treasury 
        established for this purpose.
            ``(2) Eligible uses of funds.--The funds deposited into the 
        account, and other funds available to carry out this section, 
        shall be available to cover the cost of any activity eligible 
        under this section, including the cost of--
                    ``(A) promotional materials;
                    ``(B) travel;
                    ``(C) reception and representation expenses; and
                    ``(D) salaries and benefits.
            ``(3) Reimbursements for salaries and benefits.--
        Reimbursements for salaries and benefits of Department of 
        Transportation employees providing services under this section 
        shall be credited to the account.
    ``(e) Report--For each fiscal year, the Secretary shall submit to 
the Committee on Environment and Public Works of the Senate and the 
Committee on Transportation and Infrastructure of the House of 
Representatives a report that describes the destinations and individual 
trip costs of international travel conducted in carrying out activities 
described in this section.
``Sec. 507. Surface transportation-environmental cooperative research 
              program
    ``(a) In General.--The Secretary shall establish and carry out a 
surface transportation-environmental cooperative research program.
    ``(b) Contents.--The program carried out under this section may 
include research--
            ``(1) to develop more accurate models for evaluating 
        transportation control measures and transportation system 
        designs that are appropriate for use by State and local 
        governments (including metropolitan planning organizations) in 
        designing implementation plans to meet Federal, State, and 
        local environmental requirements;
            ``(2) to improve understanding of the factors that 
        contribute to the demand for transportation;
            ``(3) to develop indicators of economic, social, and 
        environmental performance of transportation systems to 
        facilitate analysis of potential alternatives;
            ``(4) to meet additional priorities as determined by the 
        Secretary in the strategic planning process under section 508; 
        and
            ``(5) to refine, through the conduct of workshops, 
        symposia, and panels, and in consultation with stakeholders 
        (including the Department of Energy, the Environmental 
        Protection Agency, and other appropriate Federal and State 
        agencies and associations) the scope and research emphases of 
        the program.
    ``(c) Program Administration.--The Secretary shall--
            ``(1) administer the program established under this 
        section; and
            ``(2) ensure, to the maximum extent practicable, that--
                    ``(A) the best projects and researchers are 
                selected to conduct research in the priority areas 
                described in subsection (b)--
                            ``(i) on the basis of merit of each 
                        submitted proposal; and
                            ``(ii) through the use of open 
                        solicitations and selection by a panel of 
                        appropriate experts;
                    ``(B) a qualified, permanent core staff with the 
                ability and expertise to manage a large multiyear 
                budget is used;
                    ``(C) the stakeholders are involved in the 
                governance of the program, at the executive, overall 
                program, and technical levels, through the use of 
                expert panels and committees; and
                    ``(D) there is no duplication of research effort 
                between the program established under this section and 
                the new strategic highway research program established 
                under section 509.
    ``(d) National Academy of Sciences.--The Secretary may make grants 
to, and enter into cooperative agreements with, the National Academy of 
Sciences to carry out such activities relating to the research, 
technology, and technology transfer activities described in subsections 
(b) and (c) as the Secretary determines to be appropriate.
``Sec. 508. Surface transportation research technology deployment and 
              strategic planning
    ``(a) Planning.--
            ``(1) Establishment.--The Secretary shall--
                    ``(A) establish, in accordance with section 306 of 
                title 5, a strategic planning process that--
                            ``(i) enhances effective implementation of 
                        this section through the establishment in 
                        accordance with paragraph (2) of the Surface 
                        Transportation Research Technology Advisory 
                        Committee; and
                            ``(ii) focuses on surface transportation 
                        research funded through paragraphs (1), (2), 
                        (4), and (5) of section 2001(a) of the Safe, 
                        Accountable, Flexible, and Efficient 
                        Transportation Equity Act of 2004, taking into 
                        consideration national surface transportation 
                        system needs and intermodality requirements;
                    ``(B) coordinate Federal surface transportation 
                research, technology development, and deployment 
                activities;
                    ``(C) at such intervals as are appropriate and 
                practicable, measure the results of those activities 
                and the ways in which the activities affect the 
                performance of the surface transportation systems of 
                the United States; and
                    ``(D) ensure, to the maximum extent practicable, 
                that planning and reporting activities carried out 
                under this section are coordinated with all other 
                surface transportation planning and reporting 
                requirements.
            ``(2) Surface transportation research technology advisory 
        committee.--
                    ``(A) Establishment.--Not later than 90 days after 
                the date of enactment of the Safe, Accountable, 
                Flexible, and Efficient Transportation Equity Act of 
                2004, the Secretary shall establish a committee to be 
                known as the `Surface Transportation Research 
                Technology Advisory Committee' (referred to in this 
                section as the `Committee').
                    ``(B) Membership.--The Committee shall be composed 
                of 12 members appointed by the Secretary--
                            ``(i) each of which shall have expertise in 
                        a particular area relating to Federal surface 
                        transportation programs, including--
                                    ``(I) safety;
                                    ``(II) operations;
                                    ``(III) infrastructure (including 
                                pavements and structures);
                                    ``(IV) planning and environment;
                                    ``(V) policy; and
                                    ``(VI) asset management; and
                            ``(ii) of which--
                                    ``(I) 3 members shall be 
                                individuals representing the Federal 
                                Government;
                                    ``(II) 3 members--
                                            ``(aa) shall be 
                                        exceptionally qualified to 
                                        serve on the Committee, as 
                                        determined by the Secretary, 
                                        based on education, training, 
                                        and experience; and
                                            ``(bb) shall not be 
                                        officers or employees of the 
                                        United States;
                                    ``(III) 3 members--
                                            ``(aa) shall represent the 
                                        transportation industry 
                                        (including the pavement 
                                        industry); and
                                            ``(bb) shall not be 
                                        officers or employees of the 
                                        United States; and
                                    ``(IV) 3 members shall represent 
                                State transportation departments from 3 
                                different geographical regions of the 
                                United States.
                    ``(C) Meetings.--The advisory subcommittees shall 
                meet on a regular basis, but not less than twice each 
                year.
                    ``(D) Duties.--The Committee shall provide to the 
                Secretary, on a continuous basis, advice and guidance 
                relating to--
                            ``(i) the determination of surface 
                        transportation research priorities;
                            ``(ii) the improvement of the research 
                        planning and implementation process;
                            ``(iii) the design and selection of 
                        research projects;
                            ``(iv) the review of research results;
                            ``(v) the planning and implementation of 
                        technology transfer activities and
                            ``(vi) the formulation of the surface 
                        transportation research and technology 
                        deployment and deployment strategic plan 
                        required under subsection (c).
                    ``(E) Authorization of appropriations.--There is 
                authorized to be appropriated from the Highway Trust 
                Fund (other than the Mass Transit Account) to carry out 
                this paragraph $200,000 for each fiscal year.
    ``(b) Implementation.--The Secretary shall--
            ``(1) provide for the integrated planning, coordination, 
        and consultation among the operating administrations of the 
        Department of Transportation, all other Federal agencies with 
        responsibility for surface transportation research and 
        technology development, State and local governments, 
        institutions of higher education, industry, and other private 
        and public sector organizations engaged in surface 
        transportation-related research and development activities; and
            ``(2) ensure that the surface transportation research and 
        technology development programs of the Department do not 
        duplicate other Federal, State, or private sector research and 
        development programs.
    ``(c) Surface Transportation Research and Technology Deployment 
Strategic Plan.--
            ``(1) In general.--After receiving, and based on, extensive 
        consultation and input from stakeholders representing the 
        transportation community and the Surface Transportation 
        Research Advisory Committee, the Secretary shall, not later 
        than 1 year after the date of enactment of the Safe, 
        Accountable, Flexible, and Efficient Transportation Equity Act 
        of 2004, complete, and shall periodically update thereafter, a 
        strategic plan for each of the core surface transportation 
        research areas, including--
                    ``(A) safety;
                    ``(B) operations;
                    ``(C) infrastructure (including pavements and 
                structures);
                    ``(D) planning and environment;
                    ``(E) policy; and
                    ``(F) asset management.
            ``(2) Components.--The strategic plan shall specify--
                    ``(A) surface transportation research objectives 
                and priorities;
                    ``(B) specific surface transportation research 
                projects to be conducted;
                    ``(C) recommended technology transfer activities to 
                promote the deployment of advances resulting from the 
                surface transportation research conducted; and
                    ``(D) short- and long-term technology development 
                and deployment activities.
            ``(3) Review and submission of findings.--The Secretary 
        shall enter into a contract with the Transportation Research 
        Board of the National Academy of Sciences, on behalf of the 
        Research and Technology Coordinating Committee of the National 
        Research Council, under which--
                    ``(A) the Transportation Research Board shall--
                            ``(i) review the research and technology 
                        planning and implementation process used by 
                        Federal Highway Administration; and
                            ``(ii) evaluate each of the strategic plans 
                        prepared under this subsection--
                                    ``(I) to ensure that sufficient 
                                stakeholder input is being solicited 
                                and considered throughout the 
                                preparation process; and
                                    ``(II) to offer recommendations 
                                relevant to research priorities, 
                                project selection, and deployment 
                                strategies; and
                    ``(B) the Secretary shall ensure that the Research 
                and Technology Coordinating Committee, in a timely 
                manner, informs the Committee on Environment and Public 
                Works of the Senate and the Committee on Transportation 
                and Infrastructure of the House of Representatives of 
                the findings of the review and evaluation under 
                subparagraph (A).
            ``(4) Responses of secretary.--Not later than 60 days after 
        the date of completion of the strategic plan under this 
        subsection, the Secretary shall submit to the Committee on 
        Environment and Public Works of the Senate and the Committee on 
        Transportation and Infrastructure of the House of 
        Representatives written responses to each of the 
        recommendations of the Research and Technology Coordinating 
        Committee under paragraph (3)(A)(ii)(II).
    ``(d) Consistency With Government Performance and Results Act of 
1993.--The plans and reports developed under this section shall be 
consistent with and incorporated as part of the plans developed under 
section 306 of title 5 and sections 1115 and 1116 of title 31.
``Sec. 509. New strategic highway research program
    ``(a) In General.--The National Research Council shall establish 
and carry out, through fiscal year 2009, a new strategic highway 
research program.
    ``(b) Basis; Priorities.--With respect to the program established 
under subsection (a)--
            ``(1) the program shall be based on--
                    ``(A) National Research Council Special Report No. 
                260, entitled `Strategic Highway Research'; and
                    ``(B) the results of the detailed planning work 
                subsequently carried out to scope the research areas 
                through National Cooperative Research Program Project 
                20-58.
            ``(2) the scope and research priorities of the program 
        shall--
                    ``(A) be refined through stakeholder input in the 
                form of workshops, symposia, and panels; and
                    ``(B) include an examination of--
                            ``(i) the roles of highway infrastructure, 
                        drivers, and vehicles in fatalities on public 
                        roads;
                            ``(ii) high-risk areas and activities 
                        associated with the greatest numbers of highway 
                        fatalities;
                            ``(iii) the roles of various levels of 
                        government agencies and non-governmental 
                        organizations in reducing highway fatalities 
                        (including recommendations for methods of 
                        strengthening highway safety partnerships);
                            ``(iv) measures that may save the greatest 
                        number of lives in the short- and long-term;
                            ``(v) renewal of aging infrastructure with 
                        minimum impact on users of facilities;
                            ``(vi) driving behavior and likely crash 
                        causal factors to support improved 
                        countermeasures;
                            ``(vii) reduction in congestion due to 
                        nonrecurring congestion;
                            ``(viii) planning and designing of new road 
                        capacity to meet mobility, economic, 
                        environmental, and community needs;
            ``(3) the program shall consider, at a minimum, the results 
        of studies relating to the implementation of the Strategic 
        Highway Safety Plan prepared by the American Association of 
        State Highway and Transportation Officials; and
            ``(4) the research results of the program, expressed in 
        terms of technologies, methodologies, and other appropriate 
        categorizations, shall be disseminated to practicing engineers 
        as soon as practicable for their use.
    ``(c) Program Administration.--In carrying out the program under 
this section, the National Research Council shall ensure, to the 
maximum extent practicable, that--
            ``(1) the best projects and researchers are selected to 
        conduct research for the program and priorities described in 
        subsection (b)--
                    ``(A) on the basis of the merit of each submitted 
                proposal; and
                    ``(B) through the use of open solicitations and 
                selection by a panel of appropriate experts;
            ``(2) the National Research Council acquires a qualified, 
        permanent core staff with the ability and expertise to manage a 
        large research program and multiyear budget;
            ``(3) the stakeholders are involved in the governance of 
        the program, at the executive, overall program, and technical 
        levels, through the use of expert panels and committees; and
            ``(4) there is no duplication of research effort between 
        the program established under this section and the surface 
        transportation-environment cooperative research program 
        established under section 507 or any other research effort of 
        the Department.
    ``(d) National Academy of Sciences.--The Secretary may make grants 
to, and enter into cooperative agreements with, the National Academy of 
Sciences to carry out such activities relating to research, technology, 
and technology transfer described in subsections (b) and (c) as the 
Secretary determines to be appropriate.
    ``(e) Report on Implementation of Results.--
            ``(1) In general.--Not later than October 1, 2007, the 
        Secretary shall enter into a contract with the Transportation 
        Research Board of the National Academy of Sciences under which 
        the Transportation Research Board shall complete a report on 
        the strategies and administrative structure to be used for 
        implementation of the results of new strategic highway research 
        program.
            ``(2) Components.--The report under paragraph (1) shall 
        include, with respect to the new strategic highway research 
        program--
                    ``(A) an identification of the most promising 
                results of research under the program (including the 
                persons most likely to use the results);
                    ``(B) a discussion of potential incentives for, 
                impediments to, and methods of, implementing those 
                results;
                    ``(C) an estimate of costs that would be incurred 
                in expediting implementation of those results; and
                    ``(D) recommendations for the way in which 
                implementation of the results of the program under this 
                section should be conducted, coordinated, and supported 
                in future years, including a discussion of the 
                administrative structure and organization best suited 
                to carry out those responsibilities.
            ``(3) Consultation.--In developing the report, the 
        Transportation Research Board shall consult with a wide variety 
        of stakeholders, including--
                    ``(A) the American Association of State highway 
                Officials;
                    ``(B) the Federal Highway Administration; and
                    ``(C) the Surface Transportation Research 
                Technology Advisory Committee.
            ``(4) Submission.--Not later than February 1, 2009, the 
        Secretary shall submit to the Committee on Environment and 
        Public Works of the Senate and the Committee on Transportation 
        and Infrastructure of the House of Representatives the report 
        under this subsection.
``Sec. 510. University transportation centers
    ``(a) Centers.--
            ``(1) In general.--During fiscal year 2004, the Secretary 
        shall provide grants to 40 nonprofit institutions of higher 
        learning (or consortia of institutions of higher learning) to 
        establish centers to address transportation design, management, 
        research, development, and technology matters, especially the 
        education and training of greater numbers of individuals to 
        enter into the professional field of transportation.
            ``(2) Distribution of centers.--Not more than 1 university 
        transportation center (or lead university in a consortia of 
        institutions of higher learning), other than a center or 
        university selected through a competitive process, may be 
        located in any State.
            ``(3) Identification of centers.--The university 
        transportation centers established under this section shall--
                    ``(A) comply with applicable requirements under 
                subsection (c); and
                    ``(B) be located at the institutions of higher 
                learning specified in paragraph (4).
            ``(4) Identification of groups.--For the purpose of making 
        grants under this subsection, the following grants are 
        identified:
                    ``(A) Group a.--Group A shall consist of the 10 
                regional centers selected under subsection (b).
                    ``(B) Group b.--Group B shall consist of the 
                following:
                            ``(i) [_________].
                            ``(ii) [_________].
                            ``(iii) [_________].
                            ``(iv) [_________].
                            ``(v) [_________].
                            ``(vi) [_________].
                            ``(vii) [_________].
                            ``(viii) [_________]
                            ``(ix) [_________].
                            ``(x) [_________].
                            ``(xi) [_________].
                    ``(C) Group c.--Group C shall consist of the 
                following:
                            ``(i) [_________].
                            ``(ii) [_________].
                            ``(iii) [_________].
                            ``(iv) [_________].
                            ``(v) [_________].
                            ``(vi) [_________].
                            ``(vii) [_________].
                            ``(viii) [_________].
                            ``(ix) [_________].
                            ``(x) [_________].
                            ``(xi) [_________].
                    ``(D) Group d.--Group D shall consist of the 
                following:
                            ``(i) [_________].
                            ``(ii) [_________].
                            ``(iii) [_________].
                            ``(iv) [_________].
                            ``(v) [_________].
                            ``(vi) [_________].
                            ``(vii) [_________].
                            ``(viii) [_________].
    ``(b) Regional Centers.--
            ``(1) In general.--Not later than September 30, 2004, the 
        Secretary shall provide to nonprofit institutions of higher 
        learning (or consortia of institutions of higher learning) 
        grants to be used during the period of fiscal years 2005 
        through 2009 to establish and operate 1 university 
        transportation center in each of the 10 Federal regions that 
        comprise the Standard Federal Regional Boundary System.
            ``(2) Selection of regional centers.--
                    ``(A) Proposals.--In order to be eligible to 
                receive a grant under this subsection, an institution 
                described in paragraph (1) shall submit to the 
                Secretary a proposal, in response to any request for 
                proposals that shall be made by the Secretary, that is 
                in such form and contains such information as the 
                Secretary shall prescribe.
                    ``(B) Request schedule.--The Secretary shall 
                request proposals once for the period of fiscal years 
                2004 through 2006 and once for the period of fiscal 
                years 2007 through 2009.
                    ``(C) Eligibility.--Any institution of higher 
                learning (or consortium of institutions of higher 
                learning) that meets the criteria described in 
                subsection (c) (including any institution identified in 
                subsection (a)(4)) may apply for a grant under this 
                subsection.
                    ``(D) Selection criteria.--The Secretary shall 
                select each recipient of a grant under this subsection 
                through a competitive process on the basis of--
                            ``(i) the location of the center within the 
                        Federal region to be served;
                            ``(ii) the demonstrated research 
                        capabilities and extension resources available 
                        to the recipient to carry out this section;
                            ``(iii) the capability of the recipient to 
                        provide leadership in making national and 
                        regional contributions to the solution of 
                        immediate and long-range transportation 
                        problems;
                            ``(iv) the demonstrated ability of the 
                        recipient to disseminate results of 
                        transportation research and education programs 
                        through a statewide or regionwide continuing 
                        education program; and
                            ``(v) the strategic plan that the recipient 
                        proposes to carry out using funds from the 
                        grant.
                    ``(E) Selection process.--In selecting the 
                recipients of grants under this subsection, the 
                Secretary shall consult with, and consider the advice 
                of--
                            ``(i) the Research and Special Programs 
                        Administration;
                            ``(ii) the Federal Highway Administration; 
                        and
                            ``(iii) the Federal Transit Administration.
    ``(c) Center Requirements.--
            ``(1) In general.--With respect to a university 
        transportation center established under subsection (a) or (b), 
        the institution or consortium that receives a grant to 
        establish the center--
                    ``(A) shall annually contribute at least $250,000 
                to the operation and maintenance of the center, except 
                that payment by the institution or consortium of the 
                salary required for transportation-related faculty and 
                staff for a period greater than 90 days may not be 
                counted against that contribution;
                    ``(B) shall have established, as of the date of 
                receipt of the grant, undergraduate or graduate 
                programs in--
                            ``(i) civil engineering;
                            ``(ii) transportation engineering;
                            ``(iii) transportation systems management 
                        and operations; or
                            ``(iv) any other field significantly 
                        related to surface transportation systems, as 
                        determined by the Secretary; and
                    ``(C) not later than 120 days after the date on 
                which the institution or consortium receives notice of 
                selection as a site for the establishment of a 
                university transportation center under this section, 
                shall submit to the Secretary a 6-year program plan for 
                the university transportation center that includes, 
                with respect to the center--
                            ``(i) a description of the purposes of 
                        programs to be conducted by the center;
                            ``(ii) a description of the undergraduate 
                        and graduate transportation education efforts 
                        to be carried out by the center;
                            ``(iii) a description of the nature and 
                        scope of research to be conducted by the 
                        center;
                            ``(iv) a list of personnel, including the 
                        roles and responsibilities of those personnel 
                        within the center; and
                            ``(v) a detailed budget, including the 
                        amount of contributions by the institution or 
                        consortium to the center; and
                    ``(D) shall establish an advisory committee that--
                            ``(i) is composed of a representative from 
                        each of the State transportation department of 
                        the State in which the institution or 
                        consortium is located, the Department of 
                        Transportation, and the institution or 
                        consortia, as appointed by those respective 
                        entities;
                            ``(ii) in accordance with paragraph (2), 
                        shall review and approve or disapprove the plan 
                        of the institution or consortium under 
                        subparagraph (C); and
                            ``(iii) shall, to the maximum extent 
                        practicable, ensure that the proposed research 
                        to be carried out by the university 
                        transportation center will contribute to the 
                        national highway research and technology 
                        agenda, as periodically updated by the 
                        Secretary, in consultation with stakeholders 
                        representing the highway community.
            ``(2) Peer review.--
                    ``(A) In general.--The Secretary shall require peer 
                review for each report on research carried out using 
                funds made available for this section.
                    ``(B) Purposes of peer review.--Peer review of a 
                report under this section shall be carried out to 
                evaluate--
                            ``(i) the relevance of the research 
                        described in the report with respect to the 
                        strategic plan under, and the goals of, this 
                        section;
                            ``(ii) the research covered by the report, 
                        and to recommend modifications to individual 
                        project plans;
                            ``(iii) the results of the research before 
                        publication of those results; and
                            ``(iv) the overall outcomes of the 
                        research.
                    ``(C) Internet availability.--Each report under 
                this section that is received by the Secretary shall be 
                published--
                            ``(i) by the Secretary, on the Internet 
                        website of the Department of Transportation; 
                        and
                            ``(ii) by the University Transportation 
                        Center.
            ``(3) Approval of plans--A plan of an institution or 
        consortium described in paragraph (1)(C) shall not be submitted 
        to the Secretary until such time as the advisory committee 
        established under paragraph (1)(D) reviews and approves the 
        plan.
            ``(4) Failure to comply.--If a recipient of a grant under 
        this subsection fails to submit a program plan acceptable to 
        the Secretary and in accordance with paragraph (1)(C)--
                    ``(A) the recipient shall forfeit the grant and the 
                selection of the recipient as a site for the 
                establishment of a university transportation center; 
                and
                    ``(B) the Secretary shall select a replacement 
                recipient for the forfeited grant.
            ``(5) Applicability.--This subsection does not apply to any 
        research funds received in accordance with a competitive 
        contract offered and entered into by the Federal Highway 
        Administration.
    ``(d) Objectives.--Each university transportation center 
established under subsection (a) or (b) shall carry out--
            ``(1) undergraduate or graduate education programs that 
        include--
                    ``(A) multidisciplinary coursework; and
                    ``(B) opportunities for students to participate in 
                research;
            ``(2) basic and applied research, the results and products 
        of which shall be judged by peers or other experts in the field 
        so as to advance the body of knowledge in transportation; and
            ``(3) an ongoing program of technology transfer that makes 
        research results available to potential users in such form as 
        will enable the results to be implemented, used, or otherwise 
        applied.
    ``(e) Maintenance of Effort.--To be eligible to receive a grant 
under this section, an applicant shall--
            ``(1) enter into an agreement with the Secretary to ensure 
        that the applicant will maintain total expenditures from all 
        other sources to establish and operate a university 
        transportation center and related educational and research 
        activities at a level that is at least equal to the average 
        level of those expenditures during the 2 fiscal years before 
        the date on which the grant is provided;
            ``(2) provide the annual institutional contribution 
        required under subsection (c)(1); and
            ``(3) submit to the Secretary, in a timely manner, for use 
        by the Secretary in the preparation of the annual research 
        report under section 508(c)(5) of title 23, an annual report on 
        the projects and activities of the university transportation 
        center for which funds are made available under section 2001 of 
        the Safe, Accountable, Flexible, and Efficient Transportation 
        Equity Act of 2004 that contains, at a minimum, for the fiscal 
        year covered by the report, a description of--
                    ``(A) the goals of the center;
                    ``(B) the educational activities carried out by the 
                center (including a detailed summary of the budget for 
                those educational activities);
                    ``(C) teaching activities of faculty at the center;
                    ``(D) each research project carried out by the 
                center, including--
                            ``(i) the identity and location of each 
                        investigator working on a research project;
                            ``(ii) the overall funding amount for each 
                        research project (including the amounts 
                        expended for the project as of the date of the 
                        report);
                            ``(iii) the current schedule for each 
                        research project; and
                            ``(iv) the results of each research project 
                        through the date of submission of the report, 
                        with particular emphasis on results for the 
                        fiscal year covered by the report; and
                    ``(E) overall technology transfer and 
                implementation efforts of the center.
    ``(f) Program Coordination.--The Secretary shall--
            ``(1) coordinate the research, education, training, and 
        technology transfer activities carried out by recipients of 
        grants under this section; and
            ``(2) establish and operate a clearinghouse for, and 
        disseminate, the results of those activities.
    ``(g) Funding.--
            ``(1) Number and amount of grants.--The Secretary shall 
        make the following grants under this subsection:
                    ``(A) Group a.--For each of fiscal years 2004 
                through 2009, the Secretary shall make a grant in the 
                amount of $20,000,000 to each of the institutions in 
                group A (as described in subsection (a)(4)(A)).
                    ``(B) Group b.--The Secretary shall make a grant to 
                each of the institutions in group B (as described in 
                subsection (a)(4)(B)) in the amount of--
                            ``(i) $4,000,000 for each of fiscal years 
                        2004 and 2005; and
                            ``(ii) $6,000,000 for each of fiscal years 
                        2006 and 2007.
                    ``(C) Group c.--For each of fiscal years 2004 
                through 2007, the Secretary shall make a grant in the 
                amount of $10,000,000 to each of the institutions in 
                group C (as described in subsection (a)(4)(C)).
                    ``(D) Group d.--For each of fiscal years 2004 
                through 2009, the Secretary shall make a grant in the 
                amount of $25,000,000 to each of the institutions in 
                group D (as described in subsection (a)(4)(D)).
                    ``(E) Limited grants for groups b and c.--For each 
                of fiscal years 2008 and 2009, of the institutions 
                classified in groups B and C (as described in 
                subsection (a)(4)(B)), the Secretary shall select and 
                make a grant in the amount of $10,000,000 to each of 
                not more than 15 institutions.
            ``(2) Use of funds--
                    ``(A) In general.--Of the funds made available for 
                a fiscal year to a university transportation center 
                established under subsection (a) or (b)--
                            ``(i) not less than $250,000 shall be used 
                        to establish and maintain new faculty positions 
                        for the teaching of undergraduate, 
                        transportation-related courses;
                            ``(ii) not more than $500,000 for the 
                        fiscal year, or $1,000,000 in the aggregate, 
                        may be used to construct or improve 
                        transportation-related laboratory facilities; 
                        and
                            ``(iii) not more than $300,000 for the 
                        fiscal year may be used for student internships 
                        of not more than 180 days in duration to enable 
                        students to gain experience by working on 
                        transportation projects as interns with design 
                        or construction firms.
                    ``(B) Facilities and administration fee.--Not more 
                than 10 percent of any grant made available to a 
                university transportation center (or any institution or 
                consortium that establishes such a center) for a fiscal 
                year may be used to pay to the appropriate nonprofit 
                institution of higher learning any administration and 
                facilities fee (or any similar overhead fee) for the 
                fiscal year.
            ``(3) Limitation on availability of funds.--Funds made 
        available under this subsection shall remain available for 
        obligation for a period of 2 years after September 30 of the 
        fiscal year for which the funds are authorized.
``Sec. 511. Multistate corridor operations and management
    ``(a) In General.--The Secretary shall encourage multistate 
cooperative agreements, coalitions, or other arrangements to promote 
regional cooperation, planning, and shared project implementation for 
programs and projects to improve transportation system management and 
operations.
    ``(b) Interstate Route I-95 Corridor Coalition Transportation 
Systems Management and Operations.--
            ``(1) In general.--The Secretary shall make grants under 
        this subsection to States to continue intelligent 
        transportation system management and operations in the 
        Interstate Route I-95 corridor coalition region initiated under 
        the Intermodal Surface Transportation Efficiency Act of 1991 
        (Public Law 102-240).
            ``(2) Funding.--Of the amounts made available under section 
        2001(a)(4) of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004, the Secretary shall use to 
        carry out this subsection--
                    ``(A) $8,000,000 for fiscal year 2004;
                    ``(B) $10,000,000 for fiscal year 2005;
                    ``(C) $12,000,000 for fiscal year 2006;
                    ``(D) $12,000,000 for fiscal year 2007;
                    ``(E) $12,000,000 for fiscal year 2008; and
                    ``(F) $12,000,000 for fiscal year 2009.
``Sec. 512. Transportation analysis simulation system
    ``(a) Continuation of Transims Development.--
            ``(1) In general.--The Secretary shall continue the 
        deployment of the advanced transportation model known as the 
        `Transportation Analysis Simulation System' (referred to in 
        this section as `TRANSIMS') developed by the Los Alamos 
        National Laboratory.
            ``(2) Requirements and considerations.--In carrying out 
        paragraph (1), the Secretary shall--
                    ``(A) further improve TRANSIMS to reduce the cost 
                and complexity of using the TRANSIMS;
                    ``(B) continue development of TRANSIMS for 
                applications to facilitate transportation planning, 
                regulatory compliance, and response to natural 
                disasters and other transportation disruptions; and
                    ``(C) assist State transportation departments and 
                metropolitan planning organizations, especially smaller 
                metropolitan planning organizations, in the 
                implementation of TRANSIMS by providing training and 
                technical assistance.
    ``(b) Eligible Activities.--The Secretary shall use funds made 
available to carry out this section--
            ``(1) to further develop TRANSIMS for additional 
        applications, including--
                    ``(A) congestion analyses;
                    ``(B) major investment studies;
                    ``(C) economic impact analyses;
                    ``(D) alternative analyses;
                    ``(E) freight movement studies;
                    ``(F) emergency evacuation studies;
                    ``(G) port studies; and
                    ``(H) airport access studies;
            ``(2) provide training and technical assistance with 
        respect to the implementation and application of TRANSIMS to 
        States, local governments, and metropolitan planning 
        organizations with responsibility for travel modeling;
            ``(3) develop methods to simulate the national 
        transportation infrastructure as a single, integrated system 
        for the movement of individuals and goods;
            ``(4) provide funding to State transportation departments 
        and metropolitan planning organizations for implementation of 
        TRANSIMS.
    ``(c) Allocation of Funds.--Of the funds made available to carry 
out this section for each fiscal year, not less than 15 percent shall 
be allocated for activities described in subsection (b)(3).
    ``(d) Funding.--Of the amounts made available under section 2001(a) 
of the Safe, Accountable, Flexible, and Efficient Transportation Equity 
Act of 2004 for each of fiscal years 2004 through 2009, the Secretary 
shall use $1,000,000 to carry out this section.
    ``(e) Availability of Funds.--Funds made available under this 
section shall be available to the Secretary through the Transportation 
Planning, Research, and Development Account of the Office of the 
Secretary.''.
    (b) Other University Funding.--No university (other than university 
transportation centers specified in section 510 of title 23, United 
States Code (as added by subsection (a)) shall receive funds made 
available under section 2001 to carry out research unless the 
university is selected to receive the funds--
            (1) through a competitive process that incorporates merit-
        based peer review; and
            (2) based on a proposal submitted to the Secretary by the 
        university in response to a request for proposals issued by the 
        Secretary.
    (c) Conforming Amendment.--Section 5505 of title 49, United States 
Code, is repealed.

SEC. 2102. STUDY OF DATA COLLECTION AND STATISTICAL ANALYSIS EFFORTS.

    (a) Definitions.--In this section:
            (1) Administration.--The term ``Administration'' means the 
        Federal Highway Administration.
            (2) Board.--The term ``Board'' means the Transportation 
        Research Board of the National Academy of Sciences.
            (3) Bureau.--The term ``Bureau'' means the Bureau of 
        Transportation Statistics.
            (4) Department.--The term ``Department'' means the 
        Department of Transportation.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of Transportation.
    (b) Priority Areas of Effort.--
            (1) Statistical standards.--The Secretary shall direct the 
        Bureau to assume the role of the lead agency in working with 
        other agencies of the Department to establish, by not later the 
        date that is 1 year after the date of enactment of this Act, 
        statistical standards for the Department.
            (2) Statistical analysis effort.--
                    (A) In general.--The Bureau shall provide to the 
                Secretary, on an annual basis, an overview of the level 
                of effort expended on statistical analyses by each 
                agency within the Department.
                    (B) Duty of agencies.--Each agency of the 
                Department shall provide to the Bureau such information 
                as the Bureau may require in carrying out subparagraph 
                (A).
            (3) National security.--The Bureau shall--
                    (A) conduct a study of the ways in which 
                transportation statistics are and may be used for the 
                purpose of national security; and
                    (B) submit to the Transportation Security 
                Administration recommendations for means by which the 
                use of transportation statistics for the purpose of 
                national security may be improved.
            (4) Modernization.--The Bureau shall develop new protocols 
        for adapting data collection and delivery efforts in existence 
        as of the date of enactment of this Act to deliver information 
        in a more timely and frequent fashion.
    (c) Study.--
            (1) In general.--Not later than 90 days after the date of 
        enactment of this Act, the Secretary shall provide a grant to, 
        or enter into a cooperative agreement or contract with, the 
        Board for the conduct of a study of the data collection and 
        statistical analysis efforts of the Department with respect to 
        the modes of surface transportation for which funds are made 
        available under this Act.
            (2) Purpose.--The purpose of the study shall be to provide 
        to the Department information for use by agencies of the 
        Department in providing to surface transportation agencies and 
        individuals engaged in the surface transportation field higher 
        quality, and more relevant and timely, data, statistical 
        analyses, and products.
            (3) Content.--The study shall include--
                    (A) an examination and analysis of the efforts, 
                analyses, and products (with respect to usefulness and 
                policy relevance) of the Bureau as of the date of the 
                study, as compared with the duties of the Bureau 
                specified in subsections (c) through (f) of section 111 
                of title 49, United States Code;
                    (B) an examination and analysis of data collected 
                by, methods of data collection of, and analyses 
                performed by, agencies within the Department; and
                    (C) recommendations relating to--
                            (i) the future efforts of the Department in 
                        the area of surface transportation with respect 
                        to--
                                    (I) types of data collected;
                                    (II) methods of data collection;
                                    (III) types of analyses performed; 
                                and
                                    (IV) products made available by the 
                                Secretary to the transportation 
                                community and Congress;
                            (ii) the means by which the Department may 
                        cooperate with State transportation departments 
                        to provide technical assistance in the use of 
                        data collected by traffic operations centers; 
                        and
                            (iii) duplication of efforts within the 
                        Department, including ways in which--
                                    (I) the duplication may be reduced 
                                or eliminated; and
                                    (II) each agency of the Department 
                                may cooperate with, and complement the 
                                efforts of, the others.
            (4) Consultation.--In conducting the study, the Board shall 
        consult with such stakeholders, agencies, and other entities as 
        the Board considers to be appropriate.
            (5) Report.--Not later than 1 year after the date on which 
        a grant is provided, or a cooperative agreement or contract is 
        entered into, for a study under paragraph (1)--
                    (A) the Board shall submit to the Secretary, the 
                Committee on Environment and Public Works of the 
                Senate, and the Committee on Transportation and 
                Infrastructure of the House of Representatives a final 
                report on the results of the study; and
                    (B) the results of the study shall be published--
                            (i) by the Secretary, on the Internet 
                        website of the Department; and
                            (ii) by the Board, on the Internet website 
                        of the Board.
            (6) Implementation of results.--The Bureau shall, to the 
        maximum extent practicable, implement any recommendations made 
        with respect to the results of the study under this subsection.
            (7) Compliance.--
                    (A) In general.--The Comptroller General of the 
                United States shall conduct a review of the study under 
                this subsection.
                    (B) Noncompliance.--If the Comptroller General of 
                the United States determines that the Bureau failed to 
                conduct the study under this subsection, the Bureau 
                shall be ineligible to receive funds from the Highway 
                Trust Fund until such time as the Bureau conducts the 
                study under this subsection.
    (d) Conforming Amendments.--
            (1) Section 111 of title 49, United States Code, is 
        amended--
                    (A) by redesignating subsection (k) as subsection 
                (m);
                    (B) by inserting after subsection (j) the 
                following:
    ``(k) Annual Report.--
            ``(1) In general.--For fiscal year 2005 and each fiscal 
        year thereafter, the Bureau shall prepare and submit to the 
        Secretary an annual report that--
                    ``(A) describes progress made in responding to 
                study recommendations for the fiscal year; and
                    ``(B) summarizes the activities and expenditure of 
                funds by the Bureau for the fiscal year.
            ``(2) Availability.--The Bureau shall--
                    ``(A) make the report described in paragraph (1) 
                available to the public; and
                    ``(B) publish the report on the Internet website of 
                the Bureau.
            ``(3) Combination of reports.--The report required under 
        paragraph (1) may be included in or combined with the 
        Transportation Statistics Annual Report required by subsection 
        (j).
    ``(l) Expenditure of Funds.--Funds from the Highway Trust Fund 
(other than the Mass Transit Account) that are authorized to be 
appropriated, and made available, in accordance with section 2001(a)(3) 
of the Safe, Accountable, Flexible, and Efficient Transportation Equity 
Act of 2004 shall be used only for the collection and statistical 
analysis of information relating to surface transportation systems.''; 
and
                    (C) in subsection (m) (as redesignated by 
                subparagraph (A)), by inserting ``surface 
                transportation'' after ``sale of''.
            (2) The analysis for chapter 55 of title 49, United States 
        Code, is amended by striking the item relating to section 5505 
        and inserting the following:

``5505. University transportation centers.''.

SEC. 2103. CENTERS FOR SURFACE TRANSPORTATION EXCELLENCE.

    (a) Establishment.--The Secretary shall establish the centers for 
surface transportation excellence described in subsection (b) to 
promote high-quality outcomes in support of strategic national programs 
and activities, including--
            (1) the environment;
            (2) operations;
            (3) surface transportation safety;
            (4) project finance; and
            (5) asset management.
    (b) Centers.--The centers for surface transportation excellence 
referred to in subsection (a) are--
            (1) a Center for Environmental Excellence to provide 
        technical assistance, information sharing of best practices, 
        and training in the use of tools and decision-making processes 
        to assist States in planning and delivering environmentally-
        sound surface transportation projects;
            (2) a Center for Operations Excellence to provide support 
        for an integrated and coordinated national program for 
        implementing operations in planning and management (including 
        standards development) for the transportation system in the 
        United States;
            (3) a Center for Excellence in Surface Transportation 
        Safety to implement a program of support for State 
        transportation departments, including--
                    (A) the maintenance of an Internet site to provide 
                critical information on safety programs;
                    (B) the provision of technical assistance to 
                support a lead State transportation department for each 
                of the safety emphasis areas (as identified by the 
                Secretary); and
                    (C) the provision of training and education to 
                enhance knowledge of personnel of State transportation 
                departments in support of safety highway goals;
            (4) a Center for Excellence in Project Finance--
                    (A) to provide support to State transportation 
                departments in the development of finance plans and 
                project oversight tools; and
                    (B) to develop and offer training in state-of-the-
                art financing methods to advance projects and leverage 
                funds; and
            (5) a Center for Excellence in Asset Management to develop 
        and conduct research, provide training and education, and 
        disseminate information on the benefits and tools for asset 
        management.
    (c) Program Administration.--
            (1) In general.--Before funds authorized under this section 
        for fiscal years 2005 through 2009 are obligated, the Secretary 
        shall review and approve a multiyear strategic plan to be 
        submitted by each of the centers.
            (2) Timing.--The plan shall be submitted before the 
        beginning of fiscal year 2005 and, subsequently, shall be 
        annually updated.
            (3) Content.--The plan shall include--
                    (A) a list of research and technical assistance 
                projects and objectives; and
                    (B) a description of any other technology transfer 
                activities, including a summary of training efforts.
            (4) Cooperation and competition.--
                    (A) In general.--The Secretary shall carry out this 
                section by making grants to, or entering into 
                contracts, cooperative agreements, and other 
                transactions with--
                            (i) the National Academy of Sciences;
                            (ii) the American Association of State 
                        Highway and Transportation Officials;
                            (iii) planning organizations;
                            (iv) a Federal laboratory;
                            (v) a State agency;
                            (vi) an authority, association, 
                        institution, or organization; or
                            (vii) a for-profit or nonprofit 
                        corporation.
                    (B) Competition; review.--All parties entering into 
                contracts, cooperative agreements, or other 
                transactions with the Secretary, or receiving grants, 
                to perform research or provide technical assistance 
                under this section shall be selected, to the maximum 
                extent practicable--
                            (i) on a competitive basis; and
                            (ii) on the basis of the results of peer 
                        review of proposals submitted to the Secretary.
            (5) Nonduplication.--The Secretary shall ensure that 
        activities conducted by each of the centers do not duplicate, 
        and to the maximum extent practicable, are integrated and 
        coordinated with similar activities conducted by the Federal 
        Highway Administration, the local technical assistance program, 
        university transportation centers, and other research efforts 
        supported with funds authorized by this title.
    (d) Allocations.--
            (1) In general.--For each of fiscal years 2004 through 
        2009, of the funds made available under section 2001(a)(1)(A), 
        the Secretary shall set aside $10,000,000 to carry out this 
        section.
            (2) Allocation of funds.--Of the funds made available under 
        paragraph (1)--
                    (A) 20 percent shall be allocated to the Center for 
                Environmental Excellence established under subsection 
                (b)(1);
                    (B) 30 percent shall be allocated to the Center for 
                Operations Excellence established under subsection 
                (b)(2);
                    (C) 20 percent shall be allocated to the Center for 
                Excellence in Surface Transportation Safety established 
                under subsection (b)(3);
                    (D) 10 percent shall be allocated to the Center for 
                Excellence in Project Finance established under 
                subsection (b)(4); and
                    (E) 20 percent shall be allocated to the Center for 
                Excellence in Asset Management established under 
                subsection (b)(5).
            (3) Applicability of title 23.--Funds made available under 
        this section shall be available for obligation in the same 
        manner as if the funds were apportioned under chapter 1 of 
        title 23, United States Code, except that the Federal share 
        shall be 100 percent.

SEC. 2104. MOTORCYCLE CRASH CAUSATION STUDY GRANTS.

    (a) Grants.--The Secretary shall provide grants for the purpose of 
conducting a comprehensive, in-depth motorcycle crash causation study 
that employs the common international methodology for in-depth 
motorcycle accident investigation of the Organization for Economic 
Cooperation and Development.
    (b) Funding.--Of the amounts made available under section 
2001(a)(3), $1,500,000 for each of fiscal years 2004 and 2005 shall be 
available to carry out this section.

SEC. 2105. TRANSPORTATION TECHNOLOGY INNOVATION AND DEMONSTRATION 
              PROGRAM.

    (a) In General.--Section 5117(b)(3) of the Transportation Equity 
Act for the 21st Century (112 Stat. 449; 112 Stat. 864; 115 Stat. 2330) 
is amended--
            (1) in subparagraph (B)--
                    (A) in clause (i)--
                            (i) in the first sentence--
                                    (I) by striking ``Build an'' and 
                                inserting ``Build or integrate an''; 
                                and
                                    (II) by striking ``$2,000,000'' and 
                                inserting ``$2,500,000''; and
                            (ii) in the second sentence--
                                    (I) by striking ``300,000 and 
                                that'' and inserting ``300,000,''; and
                                    (II) by inserting before the period 
                                at the end the following: ``, and 
                                includes major transportation corridors 
                                serving that metropolitan area'';
                    (B) in clause (ii), by striking all that follows 
                ``will be'' and inserting ``reinvested in the 
                intelligent transportation infrastructure system.'';
                    (C) by striking clause (iii); and
                    (D) by redesignating clauses (iv) and (v) as 
                clauses (iii) and (iv), respectively;
            (2) in subparagraph (C)(ii), by striking ``July 1, 2002'' 
        and inserting ``the date that is 180 days after the date of 
        enactment of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2003'';
            (3) in subparagraph (E), by striking clause (ii) and 
        inserting the following:
                            ``(ii) The term ``follow-on deployment 
                        areas'' means the metropolitan areas of Albany, 
                        Atlanta, Austin, Baltimore, Birmingham, Boston, 
                        Burlington Vermont, Charlotte, Chicago, 
                        Cleveland, Columbus, Dallas/Ft. Worth, Denver, 
                        Detroit, Greensboro, Hartford, Houston, 
                        Indianapolis, Jacksonville, Kansas City, Las 
                        Vegas, Los Angeles, Louisville, Miami, 
                        Milwaukee, Minneapolis-St. Paul, Nashville, New 
                        Orleans, New York/Northern New Jersey, Norfolk, 
                        Northern Kentucky/Cincinnati, Oklahoma City, 
                        Orlando, Philadelphia, Phoenix, Pittsburgh, 
                        Portland, Providence, Raleigh, Richmond, 
                        Sacramento, Salt Lake, San Diego, San 
                        Francisco, San Jose, St. Louis, Seattle, Tampa, 
                        Tucson, Tulsa, and Washington, District of 
                        Columbia.'';
            (4) in subparagraph (F)--
                    (A) by striking ``Of the amounts'' and inserting 
                the following:
                            ``(i) This act.--Of the amounts''; and
                    (B) by adding at the end the following:
                            ``(ii) SAFETEA.--There are authorized to be 
                        appropriated out of the Highway Trust Fund 
                        (other than the Mass Transit Account) 
                        $5,000,000 for each fiscal year to carry out 
                        this paragraph.
                            ``(iii) Availability; no reduction or 
                        setaside.--Amounts made available by this 
                        subparagraph--
                                    ``(I) shall remain available until 
                                expended; and
                                    ``(II) shall not be subject to any 
                                reduction or setaside.''; and
            (5) by adding at the end the following:
                    ``(H) Use of rights-of-way.--
                            ``(i) In general.--An intelligent 
                        transportation system project described in 
                        paragraph (3) or (6) that involves privately 
                        owned intelligent transportation system 
                        components and is carried out using funds made 
                        available from the Highway Trust Fund shall not 
                        be subject to any law (including a regulation) 
                        of a State or political subdivision of a State 
                        prohibiting or regulating commercial activities 
                        in the rights-of-way of a highway for which 
                        Federal-aid highway funds have been used for 
                        planning, design, construction, or maintenance, 
                        if the Secretary determines that such use is in 
                        the public interest.
                            ``(ii) Effect of subparagraph.--Nothing in 
                        this subparagraph affects the authority of a 
                        State or political subdivision of a State to 
                        regulate highway safety.''.
    (b) Conforming Amendment.--Section 5204 of the Transportation 
Equity Act for the 21st Century (112 Stat. 453) is amended by striking 
subsection (k) (112 Stat. 2681-478).

         Subtitle C--Intelligent Transportation System Research

SEC. 2201. INTELLIGENT TRANSPORTATION SYSTEM RESEARCH AND TECHNICAL 
              ASSISTANCE PROGRAM.

    (a) In General.--Chapter 5 of title 23, United States Code (as 
amended by section 2101), is amended by adding at the end the 
following:

    ``SUBCHAPTER II--INTELLIGENT TRANSPORTATION SYSTEM RESEARCH AND 
                      TECHNICAL ASSISTANCE PROGRAM

``Sec. 521. Finding
    ``Congress finds that continued investment in architecture and 
standards development, research, technical assistance for State and 
local governments, and systems integration is needed to accelerate the 
rate at which intelligent transportation systems--
            ``(1) are incorporated into the national surface 
        transportation network; and
            ``(2) as a result of that incorporation, improve 
        transportation safety and efficiency and reduce costs and 
        negative impacts on communities and the environment.
``Sec. 522. Goals and purposes
    ``(a) Goals.--The goals of the intelligent transportation system 
research and technical assistance program include--
            ``(1) enhancement of surface transportation efficiency and 
        facilitation of intermodalism and international trade--
                    ``(A) to meet a significant portion of future 
                transportation needs, including public access to 
                employment, goods, and services; and
                    ``(B) to reduce regulatory, financial, and other 
                transaction costs to public agencies and system users;
            ``(2) the acceleration of the use of intelligent 
        transportation systems to assist in the achievement of national 
        transportation safety goals, including the enhancement of safe 
        operation of motor vehicles and nonmotorized vehicles, with 
        particular emphasis on decreasing the number and severity of 
        collisions;
            ``(3) protection and enhancement of the natural environment 
        and communities affected by surface transportation, with 
        particular emphasis on assisting State and local governments in 
        achieving national environmental goals;
            ``(4) accommodation of the needs of all users of surface 
        transportation systems, including--
                    ``(A) operators of commercial vehicles, passenger 
                vehicles, and motorcycles;
                    ``(B) users of public transportation users (with 
                respect to intelligent transportation system user 
                services); and
                    ``(C) individuals with disabilities; and
            ``(5)(A) improvement of the ability of the United States to 
        respond to emergencies and natural disasters; and
            ``(B) enhancement of national security and defense 
        mobility.
    ``(b) Purposes.--The Secretary shall carry out activities under the 
intelligent transportation system research and technical assistance 
program to, at a minimum--
            ``(1) assist in the development of intelligent 
        transportation system technologies;
            ``(2) ensure that Federal, State, and local transportation 
        officials have adequate knowledge of intelligent transportation 
        systems for full consideration in the transportation planning 
        process;
            ``(3) improve regional cooperation, interoperability, and 
        operations for effective intelligent transportation system 
        performance;
            ``(4) promote the innovative use of private resources;
            ``(5) assist State transportation departments in developing 
        a workforce capable of developing, operating, and maintaining 
        intelligent transportation systems;
            ``(6) maintain an updated national ITS architecture and 
        consensus-based standards while ensuring an effective Federal 
        presence in the formulation of domestic and international ITS 
        standards;
            ``(7) advance commercial vehicle operations components of 
        intelligent transportation systems--
                    ``(A) to improve the safety and productivity of 
                commercial vehicles and drivers; and
                    ``(B) to reduce costs associated with commercial 
                vehicle operations and Federal and State commercial 
                vehicle regulatory requirements;
            ``(8) evaluate costs and benefits of intelligent 
        transportation systems projects;
            ``(9) improve, as part of the Archived Data User Service 
        and in cooperation with the Bureau of Transportation 
        Statistics, the collection of surface transportation system 
        condition and performance data through the use of intelligent 
        transportation system technologies; and
            ``(10) ensure access to transportation information and 
        services by travelers of all ages.
``Sec. 523. Definitions
    ``In this subchapter:
            ``(1) Commercial vehicle information systems and 
        networks.--The term `commercial vehicle information systems and 
        networks' means the information systems and communications 
        networks that support commercial vehicle operations.
            ``(2) Commercial vehicle operations.--
                    ``(A) In general.--The term `commercial vehicle 
                operations' means motor carrier operations and motor 
                vehicle regulatory activities associated with the 
                commercial movement of goods (including hazardous 
                materials) and passengers.
                    ``(B) Inclusions.--The term `commercial vehicle 
                operations', with respect to the public sector, 
                includes--
                            ``(i) the issuance of operating 
                        credentials;
                            ``(ii) the administration of motor vehicle 
                        and fuel taxes; and
                            ``(iii) roadside safety and border crossing 
                        inspection and regulatory compliance 
                        operations.
            ``(3) Intelligent transportation infrastructure.--The term 
        `intelligent transportation infrastructure' means fully 
        integrated public sector intelligent transportation system 
        components, as defined by the Secretary.
            ``(4) Intelligent transportation system.--The term 
        `intelligent transportation system' means electronics, 
        communications, or information processing used singly or in 
        combination to improve the efficiency or safety of a surface 
        transportation system.
            ``(5) National its architecture.--The term `national ITS 
        architecture' means the common framework for interoperability 
        adopted by the Secretary that defines--
                    ``(A) the functions associated with intelligent 
                transportation system user services;
                    ``(B) the physical entities or subsystems within 
                which the functions reside;
                    ``(C) the data interfaces and information flows 
                between physical subsystems; and
                    ``(D) the communications requirements associated 
                with the information flows.
            ``(6) Standard.--The term `standard' means a document 
        that--
                    ``(A) contains technical specifications or other 
                precise criteria for intelligent transportation systems 
                that are to be used consistently as rules, guidelines, 
                or definitions of characteristics so as to ensure that 
                materials, products, processes, and services are fit 
                for their purposes; and
                    ``(B) may--
                            ``(i) support the national ITS 
                        architecture; and
                            ``(ii) promote--
                                    ``(I) the widespread use and 
                                adoption of intelligent transportation 
                                system technology as a component of the 
                                surface transportation systems of the 
                                United States; and
                                    ``(II) interoperability among 
                                intelligent transportation system 
                                technologies implemented throughout the 
                                States.
``Sec. 524. General authorities and requirements
    ``(a) Scope.--Subject to this subchapter, the Secretary shall carry 
out an ongoing intelligent transportation system research program--
            ``(1) to research, develop, and operationally test 
        intelligent transportation systems; and
            ``(2) to provide technical assistance in the nationwide 
        application of those systems as a component of the surface 
        transportation systems of the United States.
    ``(b) Policy.--Intelligent transportation system operational tests 
and projects funded under this subchapter shall encourage, but not 
displace, public-private partnerships or private sector investment in 
those tests and projects.
    ``(c) Cooperation With Governmental, Private, and Educational 
Entities.--The Secretary shall carry out the intelligent transportation 
system research and technical assistance program in cooperation with--
            ``(1) State and local governments and other public 
        entities;
            ``(2) the private sector;
            ``(3) Federal laboratories (as defined in section 501); and
            ``(4) colleges and universities, including historically 
        black colleges and universities and other minority institutions 
        of higher education.
    ``(d) Consultation With Federal Officials.--In carrying out the 
intelligent transportation system research program, the Secretary, as 
appropriate, shall consult with--
            ``(1) the Secretary of Commerce;
            ``(2) the Secretary of the Treasury;
            ``(3) the Administrator of the Environmental Protection 
        Agency;
            ``(4) the Director of the National Science Foundation; and
            ``(5) the Secretary of Homeland Security.
    ``(e) Technical Assistance, Training, and Information.--The 
Secretary may provide technical assistance, training, and information 
to State and local governments seeking to implement, operate, maintain, 
or evaluate intelligent transportation system technologies and 
services.
    ``(f) Transportation Planning.--The Secretary may provide funding 
to support adequate consideration of transportation system management 
and operations (including intelligent transportation systems) within 
metropolitan and statewide transportation planning processes.
    ``(g) Information Clearinghouse.--The Secretary shall--
            ``(1) maintain a repository for technical and safety data 
        collected as a result of federally sponsored projects carried 
        out under this subchapter; and
            ``(2) on request, make that information (except for 
        proprietary information and data) readily available to all 
        users of the repository at an appropriate cost.
    ``(h) Advisory Committees.--
            ``(1) In general.--In carrying out this subchapter, the 
        Secretary--
                    ``(A) may use 1 or more advisory committees; and
                    ``(B) shall designate a public-private 
                organization, the members of which participate in on-
                going research, planning, standards development, 
                deployment, and marketing of ITS programs, products, 
                and services, and coordinate the development and 
                deployment of intelligent transportation systems in the 
                United States, as the Federal advisory committee 
                authorized by section 5204(h) of the Transportation 
                Equity Act for the 21st Century (112 Stat. 454).
            ``(2) Funding.--Of the amount made available to carry out 
        this subchapter, the Secretary may use $1,500,000 for each 
        fiscal year for advisory committees described in paragraph (1).
            ``(3) Applicability of federal advisory committee act.--Any 
        advisory committee described in paragraph (1) shall be subject 
        to the Federal Advisory Committee Act (5 U.S.C. App.).
    ``(i) Procurement Methods.--The Secretary shall develop and provide 
appropriate technical assistance and guidance to assist State and local 
agencies in evaluating and selecting appropriate methods of deployment 
and procurement for intelligent transportation system projects carried 
out using funds made available from the Highway Trust Fund, including 
innovative and nontraditional methods such as Information Technology 
Omnibus Procurement (as developed by the Secretary).
    ``(j) Evaluations.--
            ``(1) Guidelines and requirements.--
                    ``(A) In general.--The Secretary shall issue 
                revised guidelines and requirements for the evaluation 
                of operational tests and other intelligent 
                transportation system projects carried out under this 
                subchapter.
                    ``(B) Objectivity and independence.--The guidelines 
                and requirements issued under subparagraph (A) shall 
                include provisions to ensure the objectivity and 
                independence of the evaluator so as to avoid any real 
                or apparent conflict of interest or potential influence 
                on the outcome by--
                            ``(i) parties to any such test; or
                            ``(ii) any other formal evaluation carried 
                        out under this subchapter.
                    ``(C) Funding.--The guidelines and requirements 
                issued under subparagraph (A) shall establish 
                evaluation funding levels based on the size and scope 
                of each test that ensure adequate evaluation of the 
                results of the test or project.
            ``(2) Special rule.--Any survey, questionnaire, or 
        interview that the Secretary considers necessary to carry out 
        the evaluation of any test or program assessment activity under 
        this subchapter shall not be subject to chapter 35 of title 44.
``Sec. 525. National ITS Program Plan
    ``(a) In General.--
            ``(1) Updates.--Not later than 1 year after the date of 
        enactment of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004, the Secretary, in 
        consultation with interested stakeholders (including State 
        transportation departments) shall develop a 5-year National ITS 
        Program Plan.
            ``(2) Scope.--The National ITS Program Plan shall--
                    ``(A) specify the goals, objectives, and milestones 
                for the research and deployment of intelligent 
                transportation systems in the contexts of--
                            ``(i) major metropolitan areas;
                            ``(ii) smaller metropolitan and rural 
                        areas; and
                            ``(iii) commercial vehicle operations;
                    ``(B) specify the manner in which specific programs 
                and projects will achieve the goals, objectives, and 
                milestones referred to in subparagraph (A), including 
                consideration of a 5-year timeframe for the goals and 
                objectives;
                    ``(C) identify activities that provide for the 
                dynamic development, testing, and necessary revision of 
                standards and protocols to promote and ensure 
                interoperability in the implementation of intelligent 
                transportation system technologies, including actions 
                taken to establish standards; and
                    ``(D) establish a cooperative process with State 
                and local governments for--
                            ``(i) determining desired surface 
                        transportation system performance levels; and
                            ``(ii) developing plans for accelerating 
                        the incorporation of specific intelligent 
                        transportation system capabilities into surface 
                        transportation systems.
    ``(b) Reporting.--The National ITS Program Plan shall be 
transmitted and biennially updated as part of the surface 
transportation research and technology development strategic plan 
developed under section 508(c).
``Sec. 526. National ITS architecture and standards
    ``(a) In General.--
            ``(1) Development, implementation, and maintenance.--In 
        accordance with section 12(d) of the National Technology 
        Transfer and Advancement Act of 1995 (15 U.S.C. 272 note; 110 
        Stat. 783), the Secretary shall develop, implement, and 
        maintain a national ITS architecture and supporting standards 
        and protocols to promote the widespread use and evaluation of 
        intelligent transportation system technology as a component of 
        the surface transportation systems of the United States.
            ``(2) Interoperability and efficiency.--To the maximum 
        extent practicable, the national ITS architecture shall promote 
        interoperability among, and efficiency of, intelligent 
        transportation system technologies implemented throughout the 
        United States.
            ``(3) Use of standards development organizations.--In 
        carrying out this section, the Secretary shall use the services 
        of such standards development organizations as the Secretary 
        determines to be appropriate.
    ``(b) Provisional Standards.--
            ``(1) In general.--If the Secretary finds that the 
        development or selection of an intelligent transportation 
        system standard jeopardizes the timely achievement of the 
        objectives identified in subsection (a), the Secretary may 
        establish a provisional standard--
                    ``(A) after consultation with affected parties; and
                    ``(B) by using, to the maximum extent practicable, 
                the work product of appropriate standards development 
                organizations.
            ``(2) Critical standards.--If a standard identified by the 
        Secretary as critical has not been adopted and published by the 
        appropriate standards development organization by the date of 
        enactment of this subchapter, the Secretary shall establish a 
        provisional standard--
                    ``(A) after consultation with affected parties; and
                    ``(B) by using, to the maximum extent practicable, 
                the work product of appropriate standards development 
                organizations.
            ``(3) Period of effectiveness.--A provisional standard 
        established under paragraph (1) or (2) shall--
                    ``(A) be published in the Federal Register; and
                    ``(B) remain in effect until such time as the 
                appropriate standards development organization adopts 
                and publishes a standard.
    ``(c) Waiver of Requirement To Establish Provisional Critical 
Standard.--
            ``(1) In general.--The Secretary may waive the requirement 
        under subsection (b)(2) to establish a provisional standard if 
        the Secretary determines that additional time would be 
        productive in, or that establishment of a provisional standard 
        would be counterproductive to, the timely achievement of the 
        objectives identified in subsection (a).
            ``(2) Notice.--The Secretary shall publish in the Federal 
        Register a notice that describes--
                    ``(A) each standard for which a waiver of the 
                provisional standard requirement is granted under 
                paragraph (1);
                    ``(B) the reasons for and effects of granting the 
                waiver; and
                    ``(C) an estimate as to the date on which the 
                standard is expected to be adopted through a process 
                consistent with section 12(d) of the National 
                Technology Transfer and Advancement Act of 1995 (15 
                U.S.C. 272 note; 110 Stat. 783).
            ``(3) Withdrawal of waiver.--
                    ``(A) In general.--The Secretary may withdraw a 
                waiver granted under paragraph (1) at any time.
                    ``(B) Notice.--On withdrawal of a waiver, the 
                Secretary shall publish in the Federal Register a 
                notice that describes--
                            ``(i) each standard for which the waiver 
                        has been withdrawn; and
                            ``(ii) the reasons for withdrawing the 
                        waiver.
    ``(d) Conformity With National ITS Architecture.--
            ``(1) In general.--Except as provided in paragraphs (2) and 
        (3), the Secretary shall ensure that intelligent transportation 
        system projects carried out using funds made available from the 
        Highway Trust Fund conform to the national ITS architecture, 
        applicable standards or provisional standards, and protocols 
        developed under subsection (a).
            ``(2) Discretion of secretary.--The Secretary may authorize 
        exceptions to paragraph (1) for projects designed to achieve 
        specific research objectives outlined in--
                    ``(A) the National ITS Program Plan under section 
                525; or
                    ``(B) the surface transportation research and 
                technology development strategic plan developed under 
                section 508(c).
            ``(3) Exceptions.--Paragraph (1) shall not apply to funds 
        used for operation or maintenance of an intelligent 
        transportation system in existence on the date of enactment of 
        this subchapter.
``Sec. 527. Commercial vehicle information systems and networks 
              deployment
    ``(a) Definitions.--In this section:
            ``(1) Commercial vehicle information systems and 
        networks.--The term `commercial vehicle information systems and 
        networks' means the information systems and communications 
        networks that provide the capability to--
                    ``(A) improve the safety of commercial vehicle 
                operations;
                    ``(B) increase the efficiency of regulatory 
                inspection processes to reduce administrative burdens 
                by advancing technology to facilitate inspections and 
                increase the effectiveness of enforcement efforts;
                    ``(C) advance electronic processing of registration 
                information, driver licensing information, fuel tax 
                information, inspection and crash data, and other 
                safety information;
                    ``(D) enhance the safe passage of commercial 
                vehicles across the United States and across 
                international borders; and
                    ``(E) promote the communication of information 
                among the States and encourage multistate cooperation 
                and corridor development.
            ``(2) Commercial vehicle operations.--
                    ``(A) In general.--The term `commercial vehicle 
                operations' means motor carrier operations and motor 
                vehicle regulatory activities associated with the 
                commercial movement of goods (including hazardous 
                materials) and passengers.
                    ``(B) Inclusions.--The term `commercial vehicle 
                operations', with respect to the public sector, 
                includes--
                            ``(i) the issuance of operating 
                        credentials;
                            ``(ii) the administration of motor vehicle 
                        and fuel taxes; and
                            ``(iii) the administration of roadside 
                        safety and border crossing inspection and 
                        regulatory compliance operations.
            ``(3) Core deployment.--The term `core deployment' means 
        the deployment of systems in a State necessary to provide the 
        State with--
                    ``(A) safety information exchange to--
                            ``(i) electronically collect and transmit 
                        commercial vehicle and driver inspection data 
                        at a majority of inspection sites;
                            ``(ii) connect to the Safety and Fitness 
                        Electronic Records system for access to--
                                    ``(I) interstate carrier and 
                                commercial vehicle data;
                                    ``(II) summaries of past safety 
                                performance; and
                                    ``(III) commercial vehicle 
                                credentials information; and
                            ``(iii) exchange carrier data and 
                        commercial vehicle safety and credentials 
                        information within the State and connect to 
                        Safety and Fitness Electronic Records system 
                        for access to interstate carrier and commercial 
                        vehicle data;
                    ``(B) interstate credentials administration to--
                            ``(i)(I) perform end-to-end (including 
                        carrier application) jurisdiction application 
                        processing, and credential issuance, of at 
                        least the International Registration Plan and 
                        International Fuel Tax Agreement credentials; 
                        and
                            ``(II) extend the processing to other 
                        credentials, including intrastate, titling, 
                        oversize or overweight requirements, carrier 
                        registration, and hazardous materials;
                            ``(ii) connect to the International 
                        Registration Plan and International Fuel Tax 
                        Agreement clearinghouses; and
                            ``(iii)(I) have at least 10 percent of the 
                        transaction volume handled electronically; and
                            ``(II) have the capability to add more 
                        carriers and to extend to branch offices where 
                        applicable; and
                    ``(C) roadside electronic screening to 
                electronically screen transponder-equipped commercial 
                vehicles at a minimum of 1 fixed or mobile inspection 
                site and to replicate the screening at other sites.
            ``(4) Expanded deployment.--The term `expanded deployment' 
        means the deployment of systems in a State that--
                    ``(A) exceed the requirements of a core deployment 
                of commercial vehicle information systems and networks;
                    ``(B) improve safety and the productivity of 
                commercial vehicle operations; and
                    ``(C) enhance transportation security.
    ``(b) Program.--The Secretary shall carry out a commercial vehicle 
information systems and networks program to--
            ``(1) improve the safety and productivity of commercial 
        vehicles and drivers; and
            ``(2) reduce costs associated with commercial vehicle 
        operations and Federal and State commercial vehicle regulatory 
        requirements.
    ``(c) Purpose.--It is the purpose of the program to advance the 
technological capability and promote the deployment of intelligent 
transportation system applications for commercial vehicle operations, 
including commercial vehicle, commercial driver, and carrier-specific 
information systems and networks.
    ``(d) Core Deployment Grants.--
            ``(1) In general.--The Secretary shall make grants to 
        eligible States for the core deployment of commercial vehicle 
        information systems and networks.
            ``(2) Eligibility.--To be eligible for a core deployment 
        grant under this subsection, a State shall--
                    ``(A) have a commercial vehicle information systems 
                and networks program plan and a top level system design 
                approved by the Secretary;
                    ``(B) certify to the Secretary that the commercial 
                vehicle information systems and networks deployment 
                activities of the State (including hardware 
                procurement, software and system development, and 
                infrastructure modifications)--
                            ``(i) are consistent with the national 
                        intelligent transportation systems and 
                        commercial vehicle information systems and 
                        networks architectures and available standards; 
                        and
                            ``(ii) promote interoperability and 
                        efficiency, to the maximum extent practicable; 
                        and
                    ``(C) agree to execute interoperability tests 
                developed by the Federal Motor Carrier Safety 
                Administration to verify that the systems of the State 
                conform with the national intelligent transportation 
                systems architecture, applicable standards, and 
                protocols for commercial vehicle information systems 
                and networks.
            ``(3) Amount of grants.--The maximum aggregate amount a 
        State may receive under this subsection for the core deployment 
        of commercial vehicle information systems and networks may not 
        exceed $2,500,000, including funds received under section 
        2001(a) of the Safe, Accountable, Flexible, and Efficient 
        Transportation Equity Act of 2004 for the core deployment of 
        commercial vehicle information systems and networks.
            ``(4) Use of funds.--
                    ``(A) In general.--Subject to subparagraph (B), 
                funds from a grant under this subsection may only be 
                used for the core deployment of commercial vehicle 
                information systems and networks.
                    ``(B) Remaining funds.--An eligible State that has 
                completed the core deployment of commercial vehicle 
                information systems and networks, or completed the 
                deployment before core deployment grant funds are 
                expended, may use the remaining core deployment grant 
                funds for the expanded deployment of commercial vehicle 
                information systems and networks in the State.
    ``(e) Expanded Deployment Grants.--
            ``(1) In general.--For each fiscal year, from the funds 
        remaining after the Secretary has made core deployment grants 
        under subsection (d), the Secretary may make grants to each 
        eligible State, on request, for the expanded deployment of 
        commercial vehicle information systems and networks.
            ``(2) Eligibility.--Each State that has completed the core 
        deployment of commercial vehicle information systems and 
        networks shall be eligible for an expanded deployment grant.
            ``(3) Amount of grants.--Each fiscal year, the Secretary 
        may distribute funds available for expanded deployment grants 
        equally among the eligible States in an amount that does not 
        exceed $1,000,000 for each State.
            ``(4) Use of funds.--A State may use funds from a grant 
        under this subsection only for the expanded deployment of 
        commercial vehicle information systems and networks.
    ``(f) Federal Share.--The Federal share of the cost of a project 
payable from funds made available to carry out this section shall be 
the share applicable under section 120(b), as adjusted under subsection 
(d) of that section.
    ``(g) Funding.--Funds authorized to be appropriated to carry out 
this section shall be available for obligation in the same manner and 
to the same extent as if the funds were apportioned under chapter 1, 
except that the funds shall remain available until expended.
``Sec. 528. Research and development
    ``(a) In General.--The Secretary shall carry out a comprehensive 
program of intelligent transportation system research, development, and 
operational tests of intelligent vehicles and intelligent 
infrastructure systems, and other similar activities that are necessary 
to carry out this subchapter.
    ``(b) Priority Areas.--Under the program, the Secretary shall give 
priority to funding projects that--
            ``(1) assist in the development of an interconnected 
        national intelligent transportation system network that--
                    ``(A) improves the reliability of the surface 
                transportation system;
                    ``(B) supports national security;
                    ``(C) reduces, by at least 20 percent, the cost of 
                manufacturing, deploying, and operating intelligent 
                transportation systems network components;
                    ``(D) could assist in deployment of the Armed 
                Forces in response to a crisis; and
                    ``(E) improves response to, and evacuation of the 
                public during, an emergency situation;
            ``(2) address traffic management, incident management, 
        transit management, toll collection traveler information, or 
        highway operations systems with goals of--
                    ``(A) reducing metropolitan congestion by 5 percent 
                by 2010;
                    ``(B) ensuring that a national, interoperable 511 
                system, along with a national traffic information 
                system that includes a user-friendly, comprehensive 
                website, is fully implemented for use by travelers 
                throughout the United States by September 30, 2010; and
                    ``(C)(i) improving incident management response, 
                particularly in rural areas, so that rural emergency 
                response times are reduced by an average of 10 minutes; 
                and
                    ``(ii) subject to subsection (d), improving 
                communication between emergency care providers and 
                trauma centers;
            ``(3) address traffic management, incident management, 
        transit management, toll collection, traveler information, or 
        highway operations systems;
            ``(4) conduct operational tests of the integration of at 
        least 3 crash-avoidance technologies in passenger vehicles;
            ``(5) incorporate human factors research, including the 
        science of the driving process;
            ``(6) facilitate the integration of intelligent 
        infrastructure, vehicle, and control technologies;
            ``(7) incorporate research on the impact of environmental, 
        weather, and natural conditions on intelligent transportation 
        systems, including the effects of cold climates;
            ``(8) as determined by the Secretary, will improve the 
        overall safety performance of vehicles and roadways, including 
        the use of real-time setting of speed limits through the use of 
        speed management technology;
            ``(9) examine--
                    ``(A) the application to intelligent transportation 
                systems of appropriately modified existing technologies 
                from other industries; and
                    ``(B) the development of new, more robust 
                intelligent transportation systems technologies and 
                instrumentation;
            ``(10) develop and test communication technologies that--
                    ``(A) are based on an assessment of the needs of 
                officers participating in a motor carrier safety 
                program funded under section 31104 of title 49;
                    ``(B) take into account the effectiveness and 
                adequacy of available technology;
                    ``(C) address systems integration, connectivity, 
                and interoperability challenges; and
                    ``(D) provide the means for officers participating 
                in a motor carrier safety program funded under section 
                31104 of title 49 to directly assess, without an 
                intermediary, current and accurate safety and 
                regulatory information on motor carriers, commercial 
                motor vehicles and drivers at roadside or mobile 
                inspection facilities;
            ``(11) enhance intermodal use of intelligent transportation 
        systems for diverse groups, including for emergency and health-
        related services;
            ``(12) improve sensing and wireless communications that 
        provide real-time information regarding congestion and 
        incidents;
            ``(13) develop and test high-accuracy, lane-level, real-
        time accessible digital map architectures that can be used by 
        intelligent vehicles and intelligent infrastructure elements to 
        facilitate safety and crash avoidance (including establishment 
        of national standards for an open-architecture digital map of 
        all public roads that is compatible with electronic 9-1-1 
        services);
            ``(14) encourage the dual-use of intelligent transportation 
        system technologies (such as wireless communications) for--
                    ``(A) emergency services;
                    ``(B) road pricing; and
                    ``(C) local economic development; and
            ``(15) advance the use of intelligent transportation 
        systems to facilitate high-performance transportation systems, 
        such as through--
                    ``(A) congestion-pricing;
                    ``(B) real-time facility management;
                    ``(C) rapid-emergency response; and
                    ``(D) just-in-time transit.
    ``(c) Operational Tests.--Operational tests conducted under this 
section shall be designed for--
            ``(1) the collection of data to permit objective evaluation 
        of the results of the tests;
            ``(2) the derivation of cost-benefit information that is 
        useful to others contemplating deployment of similar systems; 
        and
            ``(3) the development and implementation of standards.
    ``(d) Federal Share.--The Federal share of the costs of operational 
tests under subsection (a) shall not exceed 80 percent.
``Sec. 529. Use of funds
    ``(a) In General.--For each fiscal year, not more than $5,000,000 
of the funds made available to carry out this subchapter shall be used 
for intelligent transportation system outreach, public relations, 
displays, tours, and brochures.
    ``(b) Applicability.--Subsection (a) shall not apply to intelligent 
transportation system training, scholarships, or the publication or 
distribution of research findings, technical guidance, or similar 
documents.''.
    (b) Conforming Amendment.--Title V of the Transportation Equity Act 
for the 21st Century is amended by striking subtitle C (23 U.S.C. 502 
note; 112 Stat. 452).

                    TITLE III--PUBLIC TRANSPORTATION

SEC. 3001. SHORT TITLE.

    This title may be cited as the ``Federal Public Transportation Act 
of 2004''.

SEC. 3002. AMENDMENTS TO TITLE 49, UNITED STATES CODE; UPDATED 
              TERMINOLOGY.

    (a) Amendments to Title 49.--Except as otherwise specifically 
provided, whenever in this title an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision of 
law, the reference shall be considered to be made to a section or other 
provision of title 49, United States Code.
    (b) Updated Terminology.--Except for sections 5301(f), 5302(a)(7), 
and 5315, chapter 53, including the chapter analysis, is amended by 
striking ``mass transportation'' each place it appears and inserting 
``public transportation''.

SEC. 3003. POLICIES, FINDINGS, AND PURPOSES.

    (a) Development and Revitalization of Public Transportation 
Systems.--Section 5301(a) is amended to read as follows:
    ``(a) Development and Revitalization of Public Transportation 
Systems.--It is in the economic interest of the United States to foster 
the development and revitalization of public transportation systems, 
which are coordinated with other modes of transportation, that maximize 
the efficient, secure, and safe mobility of individuals and minimize 
environmental impacts.''.
    (b) General Findings.--Section 5301(b)(1) is amended--
            (1) by striking ``70 percent'' and inserting ``two-
        thirds''; and
            (2) by striking ``urban areas'' and inserting ``urbanized 
        areas''.
    (c) Preserving the Environment.--Section 5301(e) is amended--
            (1) by striking ``an urban'' and inserting ``a''; and
            (2) by striking ``under sections 5309 and 5310 of this 
        title''.
    (d) General Purposes.--Section 5301(f) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``improved mass'' and inserting 
                ``improved public''; and
                    (B) by striking ``public and private mass 
                transportation companies'' and inserting ``public 
                transportation companies and private companies engaged 
                in public transportation'';
            (2) in paragraph (2)--
                    (A) by striking ``urban mass'' and inserting 
                ``public''; and
                    (B) by striking ``public and private mass 
                transportation companies'' and inserting ``public 
                transportation companies and private companies engaged 
                in public transportation'';
            (3) in paragraph (3)--
                    (A) by striking ``urban mass'' and inserting 
                ``public''; and
                    (B) by striking ``public or private mass 
                transportation companies'' and inserting ``public 
                transportation companies or private companies engaged 
                in public transportation''; and
            (4) in paragraph (5), by striking ``urban mass'' and 
        inserting ``public''.

SEC. 3004. DEFINITIONS.

    Section 5302(a) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (G)(i), by inserting 
                ``including the intercity bus and intercity rail 
                portions of such facility or mall,'' after 
                ``transportation mall,'';
                    (B) in subparagraph (G)(ii), by inserting ``, 
                except for the intercity bus portion of intermodal 
                facilities or malls,'' after ``commercial revenue-
                producing facility'';
                    (C) in subparagraph (H)--
                            (i) by striking ``and'' after 
                        ``innovative'' and inserting ``or''; and
                            (ii) by striking ``or'' after the semicolon 
                        at the end;
                    (D) in subparagraph (I), by striking the period at 
                the end and inserting a semicolon; and
                    (E) by adding at the end the following:
                    ``(J) crime prevention and security, including--
                            ``(i) projects to refine and develop 
                        security and emergency response plans; or
                            ``(ii) projects to detect chemical or 
                        biological agents in public transportation;
                            ``(K) conducting emergency response drills 
                        with public transportation agencies and local 
                        first response agencies or security training 
                        for public transportation employees, except for 
                        expenses relating to operations; or
                            ``(L) establishing a debt service reserve, 
                        made up of deposits with a bondholder's 
                        trustee, to ensure the timely payment of 
                        principal and interest on bonds issued by a 
                        grant recipient to finance an eligible project 
                        under this chapter.'';
            (2) by striking paragraph (16);
            (3) by redesignating paragraphs (8) through (15) as 
        paragraphs (9) through (16), respectively;
            (4) by striking paragraph (7) and inserting the following:
            ``(7) Mass transportation.--The term `mass transportation' 
        means public transportation.
            ``(8) Mobility management.--The term `mobility management' 
        means a short-range planning or management activity or project 
        that does not include operating public transportation services 
        and--
                    ``(A) improves coordination among public 
                transportation providers, including private companies 
                engaged in public transportation;
                    ``(B) addresses customer needs by tailoring public 
                transportation services to specific market niches; or
                    ``(C) manages public transportation demand.'';
            (5) by amending paragraph (11), as redesignated, to read as 
        follows:
            ``(11) Public transportation.--The term `public 
        transportation' means transportation by a conveyance that 
        provides local regular and continuing general or special 
        transportation to the public, but does not include school bus, 
        charter bus, intercity bus or passenger rail, or sightseeing 
        transportation.'';
            (6) in subparagraphs (A) and (E) of paragraph (16), as 
        redesignated, by striking ``and'' each place it appears and 
        inserting ``or''; and
            (7) by amending paragraph (17) to read as follows:
            ``(17) Urbanized area.--The term `urbanized area' means an 
        area encompassing a population of not less than 50,000 people 
        that has been defined and designated in the most recent 
        decennial census as an `urbanized area' by the Secretary of 
        Commerce.''.

SEC. 3005. METROPOLITAN TRANSPORTATION PLANNING.

    Section 5303 is amended to read as follows:
``Sec. 5303. Metropolitan transportation planning
    ``(a) Definitions.--As used in this section and in section 5304, 
the following definitions shall apply:
            ``(1) Consultation.--A `consultation' occurs when 1 party--
                    ``(A) confers with another identified party in 
                accordance with an established process;
                    ``(B) prior to taking action, considers the views 
                of the other identified party; and
                    ``(C) periodically informs that party about action 
                taken.
            ``(2) Metropolitan planning area.--The term `metropolitan 
        planning area' means the geographic area determined by 
        agreement between the metropolitan planning organization and 
        the Governor under subsection (d).
            ``(3) Metropolitan planning organization.--The term 
        `metropolitan planning organization' means the Policy Board of 
        the organization designated under subsection (c).
            ``(4) Nonmetropolitan area.--The term `nonmetropolitan 
        area' means any geographic area outside all designated 
        metropolitan planning areas.
            ``(5) Nonmetropolitan local official.--The term 
        `nonmetropolitan local official' means any elected or appointed 
        official of general purpose local government located in a 
        nonmetropolitan area who is responsible for transportation 
        services for such local government.
    ``(b) General Requirements.--
            ``(1) Development of plans and programs.--To accomplish the 
        objectives described in section 5301(a), each metropolitan 
        planning organization, in cooperation with the State and public 
        transportation operators, shall develop transportation plans 
        and programs for metropolitan planning areas of the State in 
        which it is located.
            ``(2) Contents.--The plans and programs developed under 
        paragraph (1) for each metropolitan planning area shall provide 
        for the development and integrated management and operation of 
        transportation systems and facilities (including pedestrian 
        walkways and bicycle transportation facilities) that will 
        function as an intermodal transportation system for the 
        metropolitan planning area and as an integral part of an 
        intermodal transportation system for the State and the United 
        States.
            ``(3) Process of development.--The process for developing 
        the plans and programs shall provide for consideration of all 
        modes of transportation and shall be continuing, cooperative, 
        and comprehensive to the degree appropriate, based on the 
        complexity of the transportation problems to be addressed.
            ``(4) Planning and project development.--The metropolitan 
        planning organization, the State Department of Transportation, 
        and the appropriate public transportation provider shall agree 
        upon the approaches that will be used to evaluate alternatives 
        and identify transportation improvements that address the most 
        complex problems and pressing transportation needs in the 
        metropolitan area.
    ``(c) Designation of Metropolitan Planning Organizations.--
            ``(1) In general.--To carry out the transportation planning 
        process under this section, a metropolitan planning 
        organization shall be designated for each urbanized area--
                    ``(A) by agreement between the Governor and units 
                of general purpose local government that combined 
                represent not less than 75 percent of the affected 
                population (including the incorporated city or cities 
                named by the Bureau of the Census in designating the 
                urbanized area); or
                    ``(B) in accordance with procedures established by 
                applicable State or local law.
            ``(2) Structure.--Each metropolitan planning organization 
        designated under paragraph (1) that serves an area identified 
        as a transportation management area shall consist of--
                    ``(A) local elected officials;
                    ``(B) officials of public agencies that administer 
                or operate major modes of transportation in the 
                metropolitan area; and
                    ``(C) appropriate State officials.
            ``(3) Limitation on statutory construction.--Nothing in 
        this subsection shall be construed to interfere with the 
        authority, under any State law in effect on December 18, 1991, 
        of a public agency with multimodal transportation 
        responsibilities--
                    ``(A) to develop plans and programs for adoption by 
                a metropolitan planning organization; and
                    ``(B) to develop long-range capital plans, 
                coordinate transit services and projects, and carry out 
                other activities pursuant to State law.
            ``(4) Continuing designation.--The designation of a 
        metropolitan planning organization under this subsection or any 
        other provision of law shall remain in effect until the 
        metropolitan planning organization is redesignated under 
        paragraph (5).
            ``(5) Redesignation procedures.--A metropolitan planning 
        organization may be redesignated by agreement between the 
        Governor and units of general purpose local government that 
        combined represent not less than 75 percent of the existing 
        planning area population (including the incorporated city or 
        cities named by the Bureau of the Census in designating the 
        urbanized area) as appropriate to carry out this section.
            ``(6) Designation of more than 1 metropolitan planning 
        organization.--More than 1 metropolitan planning organization 
        may be designated within an existing metropolitan planning area 
        only if the Governor and the existing metropolitan planning 
        organization determine that the size and complexity of the 
        existing metropolitan planning area make designation of more 
        than 1 metropolitan planning organization for the area 
        appropriate.
    ``(d) Metropolitan Planning Area Boundaries.--
            ``(1) In general.--For the purposes of this section, the 
        boundaries of a metropolitan planning area shall be determined 
        by agreement between the metropolitan planning organization and 
        the Governor.
            ``(2) Included area.--Each metropolitan planning area--
                    ``(A) shall encompass at least the existing 
                urbanized area and the contiguous area expected to 
                become urbanized within a 20-year forecast period for 
                the transportation plan; and
                    ``(B) may encompass the entire metropolitan 
                statistical area or consolidated metropolitan 
                statistical area, as defined by the Office of 
                Management and Budget.
            ``(3) Identification of new urbanized areas within existing 
        planning area boundaries.--The designation by the Bureau of the 
        Census of new urbanized areas within an existing metropolitan 
        planning area shall not require the redesignation of the 
        existing metropolitan planning organization.
            ``(4) Existing metropolitan planning areas in 
        nonattainment.--Notwithstanding paragraph (2), in the case of 
        an urbanized area designated as a nonattainment area for ozone 
        or carbon monoxide under the Clean Air Act (42 U.S.C. 7401 et 
        seq.), the boundaries of the metropolitan planning area in 
        existence as of the date of enactment of the Federal Public 
        Transportation Act of 2004 shall be retained, except that the 
        boundaries may be adjusted by agreement of the Governor and 
        affected metropolitan planning organizations in accordance with 
        paragraph (5).
            ``(5) New metropolitan planning areas in nonattainment.--If 
        an urbanized area is designated after the date of enactment of 
        this paragraph in a nonattainment area for ozone or carbon 
        monoxide, the boundaries of the metropolitan planning area--
                    ``(A) shall be established in accordance with 
                subsection (c)(1);
                    ``(B) shall encompass the areas described in 
                paragraph (2)(A);
                    ``(C) may encompass the areas described in 
                paragraph (2)(B); and
                    ``(D) may address any nonattainment identified 
                under the Clean Air Act (42 U.S.C. 7401 et seq.) for 
                ozone or carbon monoxide.
    ``(e) Coordination in Multistate Areas.--
            ``(1) In general.--The Secretary shall encourage each 
        Governor with responsibility for a portion of a multistate 
        metropolitan area and the appropriate metropolitan planning 
        organizations to provide coordinated transportation planning 
        for the entire metropolitan area.
            ``(2) Interstate compacts.--States are authorized--
                    ``(A) to enter into agreements or compacts with 
                other States, which agreements or compacts are not in 
                conflict with any law of the United States, for 
                cooperative efforts and mutual assistance in support of 
                activities authorized under this section as the 
                activities pertain to interstate areas and localities 
                within the States; and
                    ``(B) to establish such agencies, joint or 
                otherwise, as the States may determine desirable for 
                making the agreements and compacts effective.
            ``(3) Lake tahoe region.--
                    ``(A) Definition.--In this paragraph, the term 
                `Lake Tahoe region' has the meaning given the term 
                `region' in subdivision (a) of article II of the Tahoe 
                Regional Planning Compact, as set forth in the first 
                section of Public Law 96-551 (94 Stat. 3234).
                    ``(B) Transportation planning process.--The 
                Secretary shall--
                            ``(i) establish with the Federal land 
                        management agencies that have jurisdiction over 
                        land in the Lake Tahoe region a transportation 
                        planning process for the region; and
                            ``(ii) coordinate the transportation 
                        planning process with the planning process 
                        required of State and local governments under 
                        this section and section 5304.
                    ``(C) Interstate compact.--
                            ``(i) In general.--Subject to clause (ii) 
                        and notwithstanding subsection (c), to carry 
                        out the transportation planning process 
                        required by this section, California and Nevada 
                        may designate a metropolitan planning 
                        organization for the Lake Tahoe region, by 
                        agreement between the Governor of the State of 
                        California, the Governor of the State of 
                        Nevada, and units of general purpose local 
                        government that combined represent not less 
                        than 75 percent of the affected population 
                        (including the incorporated city or cities 
                        named by the Bureau of the Census in 
                        designating the urbanized area), or in 
                        accordance with procedures established by 
                        applicable State or local law.
                            ``(ii) Involvement of federal land 
                        management agencies.--
                                    ``(I) Representation.--The policy 
                                board of a metropolitan planning 
                                organization designated under clause 
                                (i) shall include a representative of 
                                each Federal land management agency 
                                that has jurisdiction over land in the 
                                Lake Tahoe region.
                                    ``(II) Funding.--In addition to 
                                funds made available to the 
                                metropolitan planning organization 
                                under other provisions of title 23 and 
                                this chapter, not more than 1 percent 
                                of the funds allocated under section 
                                202 of title 23 may be used to carry 
                                out the transportation planning process 
                                for the Lake Tahoe region under this 
                                subparagraph.
                    ``(D) Activities.--Highway projects included in 
                transportation plans developed under this paragraph--
                            ``(i) shall be selected for funding in a 
                        manner that facilitates the participation of 
                        the Federal land management agencies that have 
                        jurisdiction over land in the Lake Tahoe 
                        region; and
                            ``(ii) may, in accordance with chapter 2 of 
                        title 23, be funded using funds allocated under 
                        section 202 of title 23.
    ``(f) Coordination of Metropolitan Planning Organizations.--
            ``(1) Nonattainment areas.--If more than 1 metropolitan 
        planning organization has authority within a metropolitan area 
        or an area which is designated as a nonattainment area for 
        ozone or carbon monoxide under the Clean Air Act (42 U.S.C. 
        7401 et seq.), each metropolitan planning organization shall 
        consult with the other metropolitan planning organizations 
        designated for such area and the State in the coordination of 
        plans required by this section.
            ``(2) Transportation improvements located in multiple 
        metropolitan planning areas.--If a transportation improvement 
        funded from the highway trust fund is located within the 
        boundaries of more than 1 metropolitan planning area, the 
        metropolitan planning organizations shall coordinate plans 
        regarding the transportation improvement.
            ``(3) Interregional and interstate project impacts.--
        Planning for National Highway System, commuter rail projects, 
        or other projects with substantial impacts outside a single 
        metropolitan planning area or State shall be coordinated 
        directly with the affected, contiguous, metropolitan planning 
        organizations and States.
            ``(4) Coordination with other planning processes.--
                    ``(A) In general.--The Secretary shall encourage 
                each metropolitan planning organization to coordinate 
                its planning process, to the maximum extent 
                practicable, with those officials responsible for other 
                types of planning activities that are affected by 
                transportation, including State and local land use 
                planning, economic development, environmental 
                protection, airport operations, housing, and freight.
                    ``(B) Other considerations.--The metropolitan 
                planning process shall develop transportation plans 
                with due consideration of, and in coordination with, 
                other related planning activities within the 
                metropolitan area. This should include the design and 
                delivery of transportation services within the 
                metropolitan area that are provided by--
                            ``(i) recipients of assistance under this 
                        chapter;
                            ``(ii) governmental agencies and nonprofit 
                        organizations (including representatives of the 
                        agencies and organizations) that receive 
                        Federal assistance from a source other than the 
                        Department of Transportation to provide 
                        nonemergency transportation services; and
                            ``(iii) recipients of assistance under 
                        section 204 of title 23.
    ``(g) Scope of Planning Process.--
            ``(1) In general.--The goals and objectives developed 
        through the metropolitan planning process for a metropolitan 
        planning area under this section shall address, in relation to 
        the performance of the metropolitan area transportation 
        systems--
                    ``(A) supporting the economic vitality of the 
                metropolitan area, especially by enabling global 
                competitiveness, productivity, and efficiency, 
                including through services provided by public and 
                private operators;
                    ``(B) increasing the safety of the transportation 
                system for motorized and nonmotorized users;
                    ``(C) increasing the security of the transportation 
                system for motorized and nonmotorized users;
                    ``(D) increasing the accessibility and mobility of 
                people and for freight, including through services 
                provided by public and private operators;
                    ``(E) protecting and enhancing the environment 
                (including the protection of habitat, water quality, 
                and agricultural and forest land, while minimizing 
                invasive species), promoting energy conservation, and 
                promoting consistency between transportation 
                improvements and State and local land use planning and 
                economic development patterns (including minimizing 
                adverse health effects from mobile source air pollution 
                and promoting the linkage of the transportation and 
                development goals of the metropolitan area);
                    ``(F) enhancing the integration and connectivity of 
                the transportation system, across and between modes, 
                for people and freight, including through services 
                provided by public and private operators;
                    ``(G) promoting efficient system management and 
                operation; and
                    ``(H) emphasizing the preservation and efficient 
                use of the existing transportation system, including 
                services provided by public and private operators.
            ``(2) Selection of factors.--After soliciting and 
        considering any relevant public comments, the metropolitan 
        planning organization shall determine which of the factors 
        described in paragraph (1) are most appropriate to consider.
            ``(3) Failure to consider factors.--The failure to consider 
        any factor specified in paragraph (1) shall not be reviewable 
        by any court under title 23, this title, subchapter II of 
        chapter 5 of title 5, or chapter 7 of title 5 in any matter 
        affecting a transportation plan, a transportation improvement 
        plan, a project or strategy, or the certification of a planning 
        process.
    ``(h) Development of Transportation Plan.--
            ``(1) In general.--
                    ``(A) Requirement.--Each metropolitan planning 
                organization shall develop a transportation plan for 
                its metropolitan planning area in accordance with this 
                subsection, and update such plan--
                            ``(i) not less frequently than once every 4 
                        years in areas designated as nonattainment, as 
                        defined in section 107(d) of the Clean Air Act 
                        (42 U.S.C. 7407(d)), and in areas that were 
                        nonattainment that have been redesignated as 
                        attainment, in accordance with paragraph (3) of 
                        such section, with a maintenance plan under 
                        section 175A of the Clean Air Act (42 U.S.C. 
                        7505a); or
                            ``(ii) not less frequently than once every 
                        5 years in areas designated as attainment, as 
                        defined in section 107(d) of the Clean Air Act.
                    ``(B) Coordination factors.--In developing the 
                transportation plan under this section, each 
                metropolitan planning organization shall consider the 
                factors described in subsection (f) over a 20-year 
                forecast period.
                    ``(C) Financial estimates.--For the purpose of 
                developing the transportation plan, the metropolitan 
                planning organization, transit operator, and State 
                shall cooperatively develop estimates of funds that 
                will be available to support plan implementation.
            ``(2) Mitigation activities.--
                    ``(A) In general.--A transportation plan under this 
                subsection shall include a discussion of--
                            ``(i) types of potential habitat, 
                        hydrological, and environmental mitigation 
                        activities that may assist in compensating for 
                        loss of habitat, wetland, and other 
                        environmental functions; and
                            ``(ii) potential areas to carry out these 
                        activities, including a discussion of areas 
                        that may have the greatest potential to restore 
                        and maintain the habitat types and hydrological 
                        or environmental functions affected by the 
                        plan.
                    ``(B) Consultation.--The discussion described in 
                subparagraph (A) shall be developed in consultation 
                with Federal and State tribal wildlife, land 
                management, and regulatory agencies.
            ``(3) Contents.-- A transportation plan under this 
        subsection shall be in a form that the Secretary determines to 
        be appropriate and shall contain--
                    ``(A) an identification of transportation 
                facilities, including major roadways, transit, 
                multimodal and intermodal facilities, intermodal 
                connectors, and other relevant facilities identified by 
                the metropolitan planning organization, which should 
                function as an integrated metropolitan transportation 
                system, emphasizing those facilities that serve 
                important national and regional transportation 
                functions;
                    ``(B) a financial plan that--
                            ``(i) demonstrates how the adopted 
                        transportation plan can be implemented;
                            ``(ii) indicates resources from public and 
                        private sources that are reasonably expected to 
                        be made available to carry out the plan;
                            ``(iii) recommends any additional financing 
                        strategies for needed projects and programs; 
                        and
                            ``(iv) may include, for illustrative 
                        purposes, additional projects that would be 
                        included in the adopted transportation plan if 
                        approved by the Secretary and reasonable 
                        additional resources beyond those identified in 
                        the financial plan were available;
                    ``(C) operational and management strategies to 
                improve the performance of existing transportation 
                facilities to relieve vehicular congestion and maximize 
                the safety and mobility of people and goods;
                    ``(D) capital investment and other strategies to 
                preserve the existing metropolitan transportation 
                infrastructure and provide for multimodal capacity 
                increases based on regional priorities and needs; and
                    ``(E) proposed transportation and transit 
                enhancement activities.
            ``(4) Consultation.--
                    ``(A) In general.--In each metropolitan area, the 
                metropolitan planning organization shall consult, as 
                appropriate, with State and local agencies responsible 
                for land use management, natural resources, 
                environmental protection, conservation, and historic 
                preservation concerning the development of a long-range 
                transportation plan.
                    ``(B) Issues.--The consultation shall involve--
                            ``(i) comparison of transportation plans 
                        with State conservation plans or with maps, if 
                        available;
                            ``(ii) comparison of transportation plans 
                        to inventories of natural or historic 
                        resources, if available; or
                            ``(iii) consideration of areas where 
                        wildlife crossing structures may be needed to 
                        ensure connectivity between wildlife habitat 
                        linkage areas.
            ``(5) Coordination with clean air act agencies.--In 
        metropolitan areas in nonattainment for ozone or carbon 
        monoxide under the Clean Air Act (42 U.S.C. 7401 et seq.), the 
        metropolitan planning organization shall coordinate the 
        development of a transportation plan with the process for 
        development of the transportation control measures of the State 
        implementation plan required by the Clean Air Act.
            ``(6) Approval of the transportation plan.--Each 
        transportation plan prepared by a metropolitan planning 
        organization shall be--
                    ``(A) approved by the metropolitan planning 
                organization; and
                    ``(B) submitted to the Governor for information 
                purposes at such time and in such manner as the 
                Secretary may reasonably require.
    ``(i) Participation by Interested Parties.--
            ``(1) Development of participation plan.--Not less 
        frequently than every 4 years, each metropolitan planning 
        organization shall develop and adopt a plan for participation 
        in the process for developing the metropolitan transportation 
        plan and programs by--
                    ``(A) citizens;
                    ``(B) affected public agencies;
                    ``(C) representatives of public transportation 
                employees;
                    ``(D) freight shippers;
                    ``(E) providers of freight transportation services;
                    ``(F) private providers of transportation;
                    ``(G) representatives of users of public transit;
                    ``(H) representatives of users of pedestrian 
                walkways and bicycle transportation facilities; and
                    ``(I) other interested parties.
            ``(2) Contents of participation plan.--The participation 
        plan--
                    ``(A) shall be developed in a manner the Secretary 
                determines to be appropriate;
                    ``(B) shall be developed in consultation with all 
                interested parties; and
                    ``(C) shall provide that all interested parties 
                have reasonable opportunities to comment on--
                            ``(i) the process for developing the 
                        transportation plan; and
                            ``(ii) the contents of the transportation 
                        plan.
            ``(3) Methods.--The participation plan shall provide that 
        the metropolitan planning organization shall, to the maximum 
        extent practicable--
                    ``(A) hold any public meetings at convenient and 
                accessible locations and times;
                    ``(B) employ visualization techniques to describe 
                plans; and
                    ``(C) make public information available in 
                electronically accessible format and means, such as the 
                World Wide Web.
            ``(4) Certification.--Before the metropolitan planning 
        organizations approve a transportation plan or program, each 
        metropolitan planning organization shall certify that it has 
        complied with the requirements of the participation plan it has 
        adopted.
    ``(j) Transportation Improvement Program.--
            ``(1) Development and update.--
                    ``(A) In general.--In cooperation with the State 
                and affected operators of public transportation, a 
                metropolitan planning organization designated for a 
                metropolitan planning area shall develop a 
                transportation improvement program for the area.
                    ``(B) Participation.--In developing the 
                transportation improvement program, the metropolitan 
                planning organization, in cooperation with the Governor 
                and any affected operator of public transportation, 
                shall provide an opportunity for participation by 
                interested parties in the development of the program, 
                in accordance with subsection (i).
                    ``(C) Updates.--The transportation improvement 
                program shall be updated not less than once every 4 
                years and shall be approved by the metropolitan 
                planning organization and the Governor.
                    ``(D) Funding estimate.--In developing the 
                transportation improvement program, the metropolitan 
                planning organization, operators of public 
                transportation, and the State shall cooperatively 
                develop estimates of funds that are reasonably expected 
                to be available to support program implementation.
                    ``(E) Project advancement.--Projects listed in the 
                transportation improvement program may be selected for 
                advancement consistent with the project selection 
                requirements.
                    ``(F) Major amendments.--Major amendments to the 
                list described in subparagraph (E), including the 
                addition, deletion, or concept and scope change of a 
                regionally significant project, may not be advanced 
                without--
                            ``(i) appropriate public involvement;
                            ``(ii) financial planning;
                            ``(iii) transportation conformity analyses; 
                        and
                            ``(iv) a finding by the Federal Highway 
                        Administration and Federal Transit 
                        Administration that the amended plan was 
                        produced in a manner consistent with this 
                        section.
            ``(2) Included projects.--
                    ``(A) Projects under chapter 1 of title 23 and this 
                chapter.--A transportation improvement program 
                developed under this section for a metropolitan area 
                shall include the projects and strategies within the 
                metropolitan area that are proposed for funding under 
                chapter 1 of title 23 and this chapter.
                    ``(B) Projects under chapter 2 of title 23.--
                            ``(i) Regionally significant projects.--
                        Regionally significant projects proposed for 
                        funding under chapter 2 of title 23 shall be 
                        identified individually in the metropolitan 
                        transportation improvement program.
                            ``(ii) Other projects.--Projects proposed 
                        for funding under chapter 2 of title 23 that 
                        are not regionally significant shall be grouped 
                        in 1 line item or identified individually in 
                        the metropolitan transportation improvement 
                        program.
            ``(3) Selection of projects.--
                    ``(A) In general.--Except as otherwise provided 
                under subsection (k)(4), the selection of federally 
                funded projects in metropolitan planning areas shall be 
                carried out, from the approved transportation plan--
                            ``(i) by the State, in the case of projects 
                        under chapter 1 of title 23 or section 5308, 
                        5310, 5311, or 5317 of this title;
                            ``(ii) by the designated recipient, in the 
                        case of projects under section 5307; and
                            ``(iii) in cooperation with the 
                        metropolitan planning organization.
                    ``(B) Modifications to project priority.--
                Notwithstanding any other provision of law, a project 
                may be advanced from the transportation improvement 
                program in place of another project in the same 
                transportation improvement program without the approval 
                of the Secretary.
            ``(4) Publication requirements.--
                    ``(A) Publication of transportation improvement 
                program.--A transportation improvement program 
                involving Federal participation shall be published or 
                otherwise made readily available by the metropolitan 
                planning organization for public review, including, to 
                the maximum extent practicable, in electronically 
                accessible formats and means, such as the World Wide 
                Web.
                    ``(B) Publication of annual listings of projects.--
                An annual listing of projects, including investments in 
                pedestrian walkways and bicycle transportation 
                facilities, for which Federal funds have been obligated 
                in the preceding 4 years shall be published or 
                otherwise made available for public review by the 
                cooperative effort of the State, transit operator, and 
                the metropolitan planning organization. This listing 
                shall be consistent with the funding categories 
                identified in the transportation improvement program.
                    ``(C) Rulemaking.--Not later than 120 days after 
                the date of enactment of the Federal Public 
                Transportation Act of 2004, the Secretary shall issue 
                regulations specifying--
                            ``(i) the types of data to be included in 
                        the list described in subparagraph (B), 
                        including--
                                    ``(I) the name, type, purpose, and 
                                geocoded location of each project;
                                    ``(II) the Federal, State, and 
                                local identification numbers assigned 
                                to each project;
                                    ``(III) amounts obligated and 
                                expended on each project, sorted by 
                                funding source and transportation mode, 
                                and the date on which each obligation 
                                was made; and
                                    ``(IV) the status of each project; 
                                and
                            ``(ii) the media through which the list 
                        described in subparagraph (B) will be made 
                        available to the public, including written and 
                        visual components for each of the projects 
                        listed.
    ``(k) Transportation Management Areas.--
            ``(1) Required identification.--The Secretary shall 
        identify each urbanized area with a population of more than 
        200,000 individuals as a transportation management area.
            ``(2) Transportation plans and programs.--Transportation 
        plans and programs for a metropolitan planning area serving a 
        transportation management area shall be based on a continuing 
        and comprehensive transportation planning process carried out 
        by the metropolitan planning organization in cooperation with 
        the State and transit operators.
            ``(3) Congestion management system.--
                    ``(A) In general.--The transportation planning 
                process under this section shall address congestion 
                management through a process that provides for 
                effective management and operation, based on a 
                cooperatively developed and implemented metropolitan-
                wide strategy, of new and existing transportation 
                facilities eligible for funding under title 23 and this 
                chapter through the use of travel demand reduction and 
                operational management strategies.
                    ``(B) Phase-in schedule.--The Secretary shall 
                establish a phase-in schedule that provides for full 
                compliance with the requirements of this section not 
                later than 1 year after the identification of 
                transportation management areas under paragraph (1).
            ``(4) Selection of projects.--
                    ``(A) In general.--All federally funded projects 
                carried out within the boundaries of a metropolitan 
                planning area serving a transportation management area 
                under title 23 (except for projects carried out on the 
                National Highway System and projects carried out under 
                the bridge program or the interstate maintenance 
                program) or under this chapter shall be selected for 
                implementation from the approved transportation 
                improvement program by the metropolitan planning 
                organization designated for the area in consultation 
                with the State and any affected public transit 
                operator.
                    ``(B) National highway system projects.--Projects 
                on the National Highway System carried out within the 
                boundaries of a metropolitan planning area serving a 
                transportation management area and projects carried out 
                within such boundaries under the bridge program or the 
                interstate maintenance program under title 23 shall be 
                selected for implementation from the approved 
                transportation improvement program by the State in 
                cooperation with the metropolitan planning organization 
                designated for the area.
            ``(5) Certification.--
                    ``(A) In general.--The Secretary shall--
                            ``(i) ensure that the metropolitan planning 
                        process of a metropolitan planning organization 
                        serving a transportation management area is 
                        being carried out in accordance with Federal 
                        law; and
                            ``(ii) subject to subparagraph (B), 
                        certify, not less frequently than once every 4 
                        years in nonattainment and maintenance areas 
                        (as defined under the Clean Air Act) and not 
                        less frequently than once every 5 years in 
                        attainment areas (as defined under such Act), 
                        that the requirements of this paragraph are met 
                        with respect to the metropolitan planning 
                        process.
                    ``(B) Requirements for certification.--The 
                Secretary may make the certification under subparagraph 
                (A) if--
                            ``(i) the transportation planning process 
                        complies with the requirements of this section 
                        and all other applicable Federal law; and
                            ``(ii) a transportation plan and a 
                        transportation improvement program for the 
                        metropolitan planning area have been approved 
                        by the metropolitan planning organization and 
                        the Governor.
                    ``(C) Penalty for failing to certify.--
                            ``(i) Withholding project funds.--If the 
                        metropolitan planning process of a metropolitan 
                        planning organization serving a transportation 
                        management area is not certified, the Secretary 
                        may withhold any funds otherwise available to 
                        the metropolitan planning area for projects 
                        funded under title 23 and this chapter.
                            ``(ii) Restoration of withheld funds.--Any 
                        funds withheld under clause (i) shall be 
                        restored to the metropolitan planning area when 
                        the metropolitan planning process is certified 
                        by the Secretary.
                    ``(D) Review of certification.--In making a 
                certification under this paragraph, the Secretary shall 
                provide for public involvement appropriate to the 
                metropolitan area under review.
    ``(l) Abbreviated Plans for Certain Areas.--
            ``(1) In general.--Subject to paragraph (2), in the case of 
        a metropolitan area not designated as a transportation 
        management area under this section, the Secretary may provide 
        for the development of an abbreviated transportation plan and 
        transportation improvement program for the metropolitan 
        planning area that the Secretary determines is appropriate to 
        achieve the purposes of this section, after considering the 
        complexity of transportation problems in the area.
            ``(2) Nonattainment areas.--The Secretary may not permit 
        abbreviated plans for a metropolitan area that is in 
        nonattainment for ozone or carbon monoxide under the Clean Air 
        Act (42 U.S.C. 7401 et seq.).
    ``(m) Additional Requirements for Certain Nonattainment Areas.--
            ``(1) In general.--Notwithstanding any other provisions of 
        title 23 or this chapter, Federal funds may not be advanced for 
        transportation management areas classified as nonattainment for 
        ozone or carbon monoxide pursuant to the Clean Air Act (42 
        U.S.C. 7401 et seq.) for any highway project that will result 
        in a significant increase in carrying capacity for single-
        occupant vehicles unless the project is addressed through a 
        congestion management process.
            ``(2) Applicability.--This subsection applies to any 
        nonattainment area within the metropolitan planning area 
        boundaries determined under subsection (d).
    ``(n) Limitation on Statutory Construction.--Nothing in this 
section shall be construed to confer on a metropolitan planning 
organization the authority to impose legal requirements on any 
transportation facility, provider, or project that is not eligible 
under title 23 or this chapter.
    ``(o) Availability of Funds.--Funds set aside under section 104(f) 
of title 23 or section 5308 of this title shall be available to carry 
out this section.
    ``(p) Continuation of Current Review Practice.--Any decision by the 
Secretary concerning a plan or program described in this section shall 
not be considered to be a Federal action subject to review under the 
National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).''.

SEC. 3006. STATEWIDE TRANSPORTATION PLANNING.

    Section 5304 is amended to read as follows:
``Sec. 5304. Statewide transportation planning
    ``(a) General Requirements.--
            ``(1) Development of plans and programs.--To support the 
        policies described in section 5301(a), each State shall develop 
        a statewide transportation plan (referred to in this section as 
        a ``Plan'') and a statewide transportation improvement program 
        (referred to in this section as a ``Program'') for all areas of 
        the State subject to section 5303.
            ``(2) Contents.--The Plan and the Program developed for 
        each State shall provide for the development and integrated 
        management and operation of transportation systems and 
        facilities (including pedestrian walkways and bicycle 
        transportation facilities) that will function as an intermodal 
        transportation system for the State and an integral part of an 
        intermodal transportation system for the United States.
            ``(3) Process of development.--The process for developing 
        the Plan and the Program shall--
                    ``(A) provide for the consideration of all modes of 
                transportation and the policies described in section 
                5301(a); and
                    ``(B) be continuing, cooperative, and comprehensive 
                to the degree appropriate, based on the complexity of 
                the transportation problems to be addressed.
    ``(b) Coordination With Metropolitan Planning; State Implementation 
Plan.--Each State shall--
            ``(1) coordinate planning under this section with--
                    ``(A) the transportation planning activities under 
                section 5303 for metropolitan areas of the State; and
                    ``(B) other related statewide planning activities, 
                including trade and economic development and related 
                multistate planning efforts; and
            ``(2) develop the transportation portion of the State 
        implementation plan, as required by the Clean Air Act (42 
        U.S.C. 7401 et seq.).
    ``(c) Interstate Agreements.--States may enter into agreements or 
compacts with other States for cooperative efforts and mutual 
assistance in support of activities authorized under this section 
related to interstate areas and localities in the States and 
establishing authorities the States consider desirable for making the 
agreements and compacts effective.
    ``(d) Scope of Planning Process.--
            ``(1) In general.--Each State shall carry out a statewide 
        transportation planning process that provides for the 
        consideration of projects, strategies, and implementing 
        projects and services that will--
                    ``(A) support the economic vitality of the United 
                States, the States, nonmetropolitan areas, and 
                metropolitan areas, especially by enabling global 
                competitiveness, productivity, and efficiency;
                    ``(B) increase the safety of the transportation 
                system for motorized and nonmotorized users;
                    ``(C) increase the security of the transportation 
                system for motorized and nonmotorized users;
                    ``(D) increase the accessibility and mobility of 
                people and freight;
                    ``(E) protect and enhance the environment 
                (including the protection of habitat, water quality, 
                and agricultural and forest land, while minimizing 
                invasive species), promote energy conservation, promote 
                consistency between transportation improvements and 
                State and local land use planning and economic 
                development patterns, and improve the quality of life 
                (including minimizing adverse health effects from 
                mobile source air pollution and promoting the linkage 
                of the transportation and development goals of the 
                State);
                    ``(F) enhance the integration and connectivity of 
                the transportation system, across and between modes 
                throughout the State, for people and freight;
                    ``(G) promote efficient system management and 
                operation; and
                    ``(H) emphasize the preservation and efficient use 
                of the existing transportation system.
            ``(2) Selection of projects and strategies.--After 
        soliciting and considering any relevant public comments, the 
        State shall determine which of the projects and strategies 
        described in paragraph (1) are most appropriate.
            ``(3) Mitigation activities.--
                    ``(A) In general.--A transportation plan under this 
                subsection shall include a discussion of--
                            ``(i) types of potential habitat, 
                        hydrological, and environmental mitigation 
                        activities that may assist in compensating for 
                        loss of habitat, wetland, and other 
                        environmental functions; and
                            ``(ii) potential areas to carry out these 
                        activities, including a discussion of areas 
                        that may have the greatest potential to restore 
                        and maintain the habitat types and hydrological 
                        or environmental functions affected by the 
                        plan.
                    ``(B) Consultation.--The discussion described in 
                subparagraph (A) shall be developed in consultation 
                with Federal and State tribal wildlife, land 
                management, and regulatory agencies.
            ``(4) Failure to consider factors.--The failure to consider 
        any factor described in paragraph (1) shall not be reviewable 
        by any court under title 23, this title, subchapter II of 
        chapter 5 of title 5, or chapter 7 of title 5 in any matter 
        affecting a Plan, a Program, a project or strategy, or the 
        certification of a planning process.
    ``(e) Additional Requirements.--In carrying out planning under this 
section, each State shall consider--
            ``(1) with respect to nonmetropolitan areas, the concerns 
        of affected local officials with responsibility for 
        transportation;
            ``(2) the concerns of Indian tribal governments and Federal 
        land management agencies that have jurisdiction over land 
        within the boundaries of the State; and
            ``(3) coordination of Plans, Programs, and planning 
        activities with related planning activities being carried out 
        outside of metropolitan planning areas and between States.
    ``(f) Statewide Transportation Plan.--
            ``(1) Development.--Each State shall develop a Plan, with a 
        minimum 20-year forecast period for all areas of the State, 
        that provides for the development and implementation of the 
        intermodal transportation system of the State.
            ``(2) Consultation with governments.--
                    ``(A) Metropolitan planning areas.--The Plan shall 
                be developed for each metropolitan planning area in the 
                State in cooperation with the metropolitan planning 
                organization designated for the metropolitan planning 
                area under section 5303.
                    ``(B) Nonmetropolitan areas.--With respect to 
                nonmetropolitan areas, the statewide transportation 
                plan shall be developed in consultation with affected 
                nonmetropolitan officials with responsibility for 
                transportation. The consultation process shall not 
                require the review or approval of the Secretary.
                    ``(C) Indian tribal areas.--With respect to each 
                area of the State under the jurisdiction of an Indian 
                tribal government, the Plan shall be developed in 
                consultation with the tribal government and the 
                Secretary of the Interior.
                    ``(D) Consultation, comparison, and 
                consideration.--
                            ``(i) In general.--The Plan shall be 
                        developed, as appropriate, in consultation with 
                        State and local agencies responsible for--
                                    ``(I) land use management;
                                    ``(II) natural resources;
                                    ``(III) environmental protection;
                                    ``(IV) conservation; and
                                    ``(V) historic preservation.
                            ``(ii) Comparison and consideration.--
                        Consultation under clause (i) shall involve--
                                    ``(I) comparison of transportation 
                                plans to State conservation plans or 
                                maps, if available;
                                    ``(II) comparison of transportation 
                                plans to inventories of natural or 
                                historic resources, if available; or
                                    ``(III) consideration of areas 
                                where wildlife crossing structures may 
                                be needed to ensure connectivity 
                                between wildlife habitat linkage areas.
            ``(3) Participation by interested parties.--In developing 
        the Plan, the State shall--
                    ``(A) provide citizens, affected public agencies, 
                representatives of public transportation employees, 
                freight shippers, private providers of transportation, 
                representatives of users of public transportation, 
                representatives of users of pedestrian walkways and 
                bicycle transportation facilities, providers of freight 
                transportation services, and other interested parties 
                with a reasonable opportunity to comment on the 
                proposed Plan; and
                    ``(B) to the maximum extent practicable--
                            ``(i) hold any public meetings at 
                        convenient and accessible locations and times;
                            ``(ii) employ visualization techniques to 
                        describe plans; and
                            ``(iii) make public information available 
                        in electronically accessible format and means, 
                        such as the World Wide Web.
            ``(4) Mitigation activities.--
                    ``(A) In general.--A Plan shall include a 
                discussion of--
                            ``(i) types of potential habitat, 
                        hydrological, and environmental mitigation 
                        activities that may assist in compensating for 
                        loss of habitat, wetlands, and other 
                        environmental functions; and
                            ``(ii) potential areas to carry out these 
                        activities, including a discussion of areas 
                        that may have the greatest potential to restore 
                        and maintain the habitat types and hydrological 
                        or environmental functions affected by the 
                        plan.
                    ``(B) Consultation.--The discussion described in 
                subparagraph (A) shall be developed in consultation 
                with Federal and State tribal wildlife, land 
                management, and regulatory agencies.
            ``(5) Transportation strategies.--A Plan shall identify 
        transportation strategies necessary to efficiently serve the 
        mobility needs of people.
            ``(6) Financial plan.--The Plan may include a financial 
        plan that--
                    ``(A) demonstrates how the adopted Plan can be 
                implemented;
                    ``(B) indicates resources from public and private 
                sources that are reasonably expected to be made 
                available to carry out the Plan;
                    ``(C) recommends any additional financing 
                strategies for needed projects and programs; and
                    ``(D) may include, for illustrative purposes, 
                additional projects that would be included in the 
                adopted Plan if reasonable additional resources beyond 
                those identified in the financial plan were available.
            ``(7) Selection of projects from illustrative list.--A 
        State shall not be required to select any project from the 
        illustrative list of additional projects described in paragraph 
        (6)(D).
            ``(8) Existing system.--The Plan should include capital, 
        operations and management strategies, investments, procedures, 
        and other measures to ensure the preservation and most 
        efficient use of the existing transportation system.
            ``(9) Publication of long-range transportation plans.--Each 
        Plan prepared by a State shall be published or otherwise made 
        available, including, to the maximum extent practicable, in 
        electronically accessible formats and means, such as the World 
        Wide Web.
    ``(g) Statewide Transportation Improvement Program.--
            ``(1) Development.--Each State shall develop a Program for 
        all areas of the State.
            ``(2) Consultation with governments.--
                    ``(A) Metropolitan planning areas.--With respect to 
                each metropolitan planning area in the State, the 
                Program shall be developed in cooperation with the 
                metropolitan planning organization designated for the 
                metropolitan planning area under section 5303.
                    ``(B) Nonmetropolitan areas.--With respect to each 
                nonmetropolitan area in the State, the Program shall be 
                developed in consultation with affected nonmetropolitan 
                local officials with responsibility for transportation. 
                The consultation process shall not require the review 
                or approval of the Secretary.
                    ``(C) Indian tribal areas.--With respect to each 
                area of the State under the jurisdiction of an Indian 
                tribal government, the Program shall be developed in 
                consultation with the tribal government and the 
                Secretary of the Interior.
            ``(3) Participation by interested parties.--In developing 
        the Program, the State shall provide citizens, affected public 
        agencies, representatives of public transportation employees, 
        freight shippers, private providers of transportation, 
        providers of freight transportation services, representatives 
        of users of public transit, representatives of users of 
        pedestrian walkways and bicycle transportation facilities, and 
        other interested parties with a reasonable opportunity to 
        comment on the proposed Program.
            ``(4) Included projects.--
                    ``(A) In general.--A Program developed under this 
                subsection for a State shall include federally 
                supported surface transportation expenditures within 
                the boundaries of the State.
                    ``(B) Listing of projects.--
                            ``(i) In general.--The Program shall cover 
                        a minimum of 4 years, identify projects by 
                        year, be fiscally constrained by year, and be 
                        updated not less than once every 4 years.
                            ``(ii) Publication.--An annual listing of 
                        projects for which funds have been obligated in 
                        the preceding 4 years in each metropolitan 
                        planning area shall be published or otherwise 
                        made available by the cooperative effort of the 
                        State, transit operator, and the metropolitan 
                        planning organization for public review. The 
                        listing shall be consistent with the funding 
                        categories identified in each metropolitan 
                        transportation improvement program.
            ``(C) Individual identification.--
                            ``(i) Regionally significant projects.--
                        Regionally significant projects proposed for 
                        funding under chapter 2 of title 23 shall be 
                        identified individually in the transportation 
                        improvement program.
                            ``(ii) Other projects.--Projects proposed 
                        for funding under chapter 2 of title 23 that 
                        are not determined to be regionally significant 
                        shall be grouped in 1 line item or identified 
                        individually.
                    ``(D) Consistency with statewide transportation 
                plan.--Each project included in the list described in 
                subparagraph (B) shall be--
                            ``(i) consistent with the Plan developed 
                        under this section for the State;
                            ``(ii) identical to the project or phase of 
                        the project as described in each year of the 
                        approved metropolitan transportation 
                        improvement program; and
                            ``(iii) in conformance with the applicable 
                        State air quality implementation plan developed 
                        under the Clean Air Act (42 U.S.C. 7401 et 
                        seq.), if the project is carried out in an area 
                        designated as nonattainment for ozone or carbon 
                        monoxide under that Act.
                    ``(E) Requirement of anticipated full funding.--The 
                Program shall not include a project, or an identified 
                phase of a project, unless full funding can reasonably 
                be anticipated to be available for the project within 
                the time period contemplated for completion of the 
                project.
                    ``(F) Financial plan.--The Program may include a 
                financial plan that--
                            ``(i) demonstrates how the approved Program 
                        can be implemented;
                            ``(ii) indicates resources from public and 
                        private sources that are reasonably expected to 
                        be made available to carry out the Program;
                            ``(iii) recommends any additional financing 
                        strategies for needed projects and programs; 
                        and
                            ``(iv) may include, for illustrative 
                        purposes, additional projects that would be 
                        included in the adopted transportation plan if 
                        reasonable additional resources beyond those 
                        identified in the financial plan were 
                        available.
                    ``(G) Selection of projects from illustrative 
                list.--
                            ``(i) No required selection.--
                        Notwithstanding subparagraph (F), a State shall 
                        not be required to select any project from the 
                        illustrative list of additional projects 
                        described in subparagraph (F)(iv).
                            ``(ii) Required approval by the 
                        secretary.--A State shall not include any 
                        project from the illustrative list of 
                        additional projects described in subparagraph 
                        (F)(iv) in an approved Program without the 
                        approval of the Secretary.
                    ``(H) Priorities.--The Program shall reflect the 
                priorities for programming and expenditures of funds, 
                including transportation and transit enhancement 
                activities, required by title 23 and this chapter, and 
                transportation control measures included in the State's 
                air quality implementation plan.
            ``(5) Project selection for areas with fewer than 50,000 
        individuals.--
                    ``(A) In general.--Each State, in cooperation with 
                the affected nonmetropolitan local officials with 
                responsibility for transportation, shall select 
                projects to be carried out in areas with fewer than 
                50,000 individuals from the approved Program (excluding 
                projects carried out under the National Highway System, 
                the bridge program, or the interstate maintenance 
                program under title 23 or sections 5310 and 5311 of 
                this title).
                    ``(B) Certain programs.--Each State, in 
                consultation with the affected nonmetropolitan local 
                officials with responsibility for transportation, shall 
                select, from the approved Program, projects to be 
                carried out in areas with fewer than 50,000 individuals 
                under the National Highway System, the bridge program, 
                or the Interstate maintenance program under title 23 or 
                under sections 5310 and 5311 of this title.
            ``(6) Statewide transportation improvement program 
        approval.--A Program developed under this subsection shall be 
        reviewed and based on a current planning finding approved by 
        the Secretary not less frequently than once every 4 years.
            ``(7) Planning finding.--Not less frequently than once 
        every 4 years, the Secretary shall determine whether the 
        transportation planning process through which Plans and 
        Programs are developed are consistent with this section and 
        section 5303.
            ``(8) Modifications to project priority.--Notwithstanding 
        any other provision of law, a project included in the approved 
        Program may be advanced in place of another project in the 
        program without the approval of the Secretary.
    ``(h) Funding.--Funds set aside pursuant to section 104(i) of title 
23 and 5308 of this title shall be available to carry out this section.
    ``(i) Treatment of Certain State Laws as Congestion Management 
Systems.--For purposes of this section and section 5303, State laws, 
rules, or regulations pertaining to congestion management systems or 
programs may constitute the congestion management system under section 
5303(i)(3) if the Secretary determines that the State laws, rules, or 
regulations are consistent with, and fulfill the intent of, the 
purposes of section 5303.
    ``(j) Continuation of Current Review Practice.--Any decision by the 
Secretary under this section, regarding a metropolitan or statewide 
transportation plan or the Program, shall not be considered to be a 
Federal action subject to review under the National Environmental 
Policy Act of 1969 (42 U.S.C. 4321 et seq.).''.

SEC. 3007. TRANSPORTATION MANAGEMENT AREAS.

    Section 5305 is repealed.

SEC. 3008. PRIVATE ENTERPRISE PARTICIPATION.

    Section 5306 is amended--
            (1) in subsection (a)--
                    (A) by striking ``5305 of this title'' and 
                inserting ``5308''; and
                    (B) by inserting ``, as determined by local 
                policies, criteria, and decision making,'' after 
                ``feasible'';
            (2) in subsection (b) by striking ``5303-5305 of this 
        title'' and inserting ``5303, 5304, and 5308''; and
            (3) by adding at the end the following:
    ``(c) Regulations.--Not later than 1 year after the date of 
enactment of the Federal Public Transportation Act of 2004, the 
Secretary shall issue regulations describing how the requirements under 
this chapter relating to subsection (a) shall be enforced.''.

SEC. 3009. URBANIZED AREA FORMULA GRANTS.

    (a) Technical Amendments.--Section 5307 is amended--
            (1) by striking subsections (h), (j) and (k); and
            (2) by redesignating subsections (i), (l), (m), and (n) as 
        subsections (h), (i), (j), and (k), respectively.
    (b) Definitions.--Section 5307(a) is amended--
            (1) by amending paragraph (2)(A) to read as follows:
                    ``(A) an entity designated, in accordance with the 
                planning process under sections 5303, 5304, and 5306, 
                by the chief executive officer of a State, responsible 
                local officials, and publicly owned operators of public 
                transportation, to receive and apportion amounts under 
                sections 5336 and 5337 that are attributable to 
                transportation management areas designated under 
                section 5303; or''; and
            (2) by adding at the end the following:
            ``(3) Subrecipient.--The term `subrecipient' means a State 
        or local governmental authority, a nonprofit organization, or a 
        private operator of public transportation service that may 
        receive a Federal transit program grant indirectly through a 
        recipient, rather than directly from the Federal Government.''.
    (c) General Authority.--Section 5307(b) is amended--
            (1) by amending paragraph (1) to read as follows:
            ``(1) In general.--The Secretary of Transportation may 
        award grants under this section for--
                    ``(A) capital projects, including associated 
                capital maintenance items;
                    ``(B) planning, including mobility management;
                    ``(C) transit enhancements;
                    ``(D) operating costs of equipment and facilities 
                for use in public transportation in an urbanized area 
                with a population of less than 200,000; and
                    ``(E) operating costs of equipment and facilities 
                for use in public transportation in a portion or 
                portions of an urbanized area with a population of at 
                least 200,000, but not more than 225,000, if--
                            ``(i) the urbanized area includes parts of 
                        more than 1 State;
                            ``(ii) the portion of the urbanized area 
                        includes only 1 State;
                            ``(iii) the population of the portion of 
                        the urbanized area is less than 30,000; and
                            ``(iv) the grants will not be used to 
                        provide public transportation outside of the 
                        portion of the urbanized area.'';
            (2) by amending paragraph (2) to read as follows:
            ``(2) Special rule for fiscal years 2004 through 2006--
                    ``(A) Increased flexibility.--The Secretary may 
                award grants under this section, from funds made 
                available to carry out this section for each of the 
                fiscal years 2004 through 2006, to finance the 
                operating cost of equipment and facilities for use in 
                mass transportation in an urbanized area with a 
                population of at least 200,000, as determined by the 
                2000 decennial census of population if--
                            ``(i) the urbanized area had a population 
                        of less than 200,000, as determined by the 1990 
                        decennial census of population;
                            ``(ii) a portion of the urbanized area was 
                        a separate urbanized area with a population of 
                        less than 200,000, as determined by the 1990 
                        decennial census of population;
                            ``(iii) the area was not designated as an 
                        urbanized area, as determined by the 1990 
                        decennial census of population; or
                            ``(iv) a portion of the area was not 
                        designated as an urbanized area, as determined 
                        by the 1990 decennial census, and received 
                        assistance under section 5311 in fiscal year 
                        2002.
                    ``(B) Maximum amounts in fiscal year 2004.--In 
                fiscal year 2004--
                            ``(i) amounts made available to any 
                        urbanized area under clause (i) or (ii) of 
                        subparagraph (A) shall be not more than the 
                        amount apportioned in fiscal year 2002 to the 
                        urbanized area with a population of less than 
                        200,000, as determined in the 1990 decennial 
                        census of population;
                            ``(ii) amounts made available to any 
                        urbanized area under subparagraph (A)(iii) 
                        shall be not more than the amount apportioned 
                        to the urbanized area under this section for 
                        fiscal year 2003; and
                            ``(iii) each portion of any area not 
                        designated as an urbanized area, as determined 
                        by the 1990 decennial census, and eligible to 
                        receive funds under subparagraph (A)(iv), shall 
                        receive an amount of funds to carry out this 
                        section that is not less than the amount the 
                        portion of the area received under section 5311 
                        for fiscal year 2002.
                    ``(C) Maximum amounts in fiscal year 2005.--In 
                fiscal year 2005--
                            ``(i) amounts made available to any 
                        urbanized area under clause (i) or (ii) of 
                        subparagraph (A) shall be not more than 50 
                        percent of the amount apportioned in fiscal 
                        year 2002 to the urbanized area with a 
                        population of less than 200,000, as determined 
                        in the 1990 decennial census of population;
                            ``(ii) amounts made available to any 
                        urbanized area under subparagraph (A)(iii) 
                        shall be not more than 50 percent of the amount 
                        apportioned to the urbanized area under this 
                        section for fiscal year 2003; and
                            ``(iii) each portion of any area not 
                        designated as an urbanized area, as determined 
                        by the 1990 decennial census, and eligible to 
                        receive funds under subparagraph (A)(iv), shall 
                        receive an amount of funds to carry out this 
                        section that is not less 50 percent of the 
                        amount the portion of the area received under 
                        section 5311 for fiscal year 2002.
                    ``(D) Maximum amounts in fiscal year 2006.--In 
                fiscal year 2006--
                            ``(i) amounts made available to any 
                        urbanized area under clause (i) or (ii) of 
                        subparagraph (A) shall be not more than 25 
                        percent of the amount apportioned in fiscal 
                        year 2002 to the urbanized area with a 
                        population of less than 200,000, as determined 
                        in the 1990 decennial census of population;
                            ``(ii) amounts made available to any 
                        urbanized area under subparagraph (A)(iii) 
                        shall be not more than 25 percent of the amount 
                        apportioned to the urbanized area under this 
                        section for fiscal year 2003; and
                            ``(iii) each portion of any area not 
                        designated as an urbanized area, as determined 
                        by the 1990 decennial census, and eligible to 
                        receive funds under subparagraph (A)(iv), shall 
                        receive an amount of funds to carry out this 
                        section that is not less than 25 percent of the 
                        amount the portion of the area received under 
                        section 5311 in fiscal year 2002.''; and
            (3) by striking paragraph (4).
    (d) Public Participation Requirements.--Section 5307(c)(5) is 
amended by striking ``section 5336'' and inserting ``sections 5336 and 
5337''.
    (e) Grant Recipient Requirements.--Section 5307(d)(1) is amended--
            (1) in subparagraph (A), by inserting ``, including safety 
        and security aspects of the program'' after ``program'';
            (2) in subparagraph (E), by striking ``section'' and all 
        that follows and inserting ``section, the recipient will comply 
        with sections 5323 and 5325;'';
            (3) in subparagraph (H), by striking ``sections 5301(a) and 
        (d), 5303-5306, and 5310(a)-(d) of this title'' and inserting 
        ``subsections (a) and (d) of section 5301 and sections 5303 
        through 5306'';
            (4) in subparagraph (I) by striking ``and'' at the end;
            (5) in subparagraph (J), by striking the period at the end 
        and inserting ``; and''; and
            (6) by adding at the end the following:
                    ``(K) if located in an urbanized area with a 
                population of at least 200,000, will expend not less 
                than 1 percent of the amount the recipient receives 
                each fiscal year under this section for transit 
                enhancement activities described in section 
                5302(a)(15).''.
    (f) Government's Share of Costs.--Section 5307(e) is amended--
            (1) by striking the first sentence and inserting the 
        following:
            ``(1) Capital projects.--A grant for a capital project 
        under this section shall cover 80 percent of the net project 
        cost.'';
            (2) by striking ``A grant for operating expenses'' and 
        inserting the following:
            ``(2) Operating expenses.--A grant for operating 
        expenses'';
            (3) by striking the fourth sentence and inserting the 
        following:
            ``(3) Remaining costs.--The remainder of the net project 
        cost shall be provided in cash from non-Federal sources or 
        revenues derived from the sale of advertising and concessions 
        and amounts received under a service agreement with a State or 
        local social service agency or a private social service 
        organization.''; and
            (4) by adding at the end the following: ``The prohibitions 
        on the use of funds for matching requirements under section 
        403(a)(5)(C)(vii) of the Social Security Act (42 U.S.C. 
        603(a)(5)(C)(vii)) shall not apply to the remainder.''.
    (g) Undertaking Projects in Advance.--Section 5307(g) is amended by 
striking paragraph (4).
    (h) Relationship to Other Laws.--Section 5307(k), as redesignated, 
is amended to read as follows:
    ``(k) Relationship to Other Laws.--
            ``(1) Applicable provisions.--Sections 5301, 5302, 5303, 
        5304, 5306, 5315(c), 5318, 5319, 5323, 5325, 5327, 5329, 5330, 
        5331, 5332, 5333 and 5335 apply to this section and to any 
        grant made under this section.
            ``(2) Inapplicable provisions.--
                    ``(A) In general.--Except as provided under this 
                section, no other provision of this chapter applies to 
                this section or to a grant made under this section.
                    ``(B) Title 5.--The provision of assistance under 
                this chapter shall not be construed as bringing within 
                the application of chapter 15 of title 5, any 
                nonsupervisory employee of a public transportation 
                system (or any other agency or entity performing 
                related functions) to which such chapter is otherwise 
                inapplicable.''.

SEC. 3010. PLANNING PROGRAMS.

    (a) In General.--Section 5308 is amended to read as follows:
``Sec. 5308. Planning programs
    ``(a) Grants Authorized.--Under criteria established by the 
Secretary, the Secretary may award grants to States, authorities of the 
States, metropolitan planning organizations, and local governmental 
authorities, make agreements with other departments, agencies, or 
instrumentalities of the Government, or enter into contracts with 
private nonprofit or for-profit entities to--
            ``(1) develop transportation plans and programs;
            ``(2) plan, engineer, design, and evaluate a public 
        transportation project; or
            ``(3) conduct technical studies relating to public 
        transportation, including--
                    ``(A) studies related to management, planning, 
                operations, capital requirements, and economic 
                feasibility;
                    ``(B) evaluations of previously financed projects;
                    ``(C) peer reviews and exchanges of technical data, 
                information, assistance, and related activities in 
                support of planning and environmental analyses among 
                metropolitan planning organizations and other 
                transportation planners; and
                    ``(D) other similar and related activities 
                preliminary to, and in preparation for, constructing, 
                acquiring, or improving the operation of facilities and 
                equipment.
    ``(b) Purpose.--To the extent practicable, the Secretary shall 
ensure that amounts appropriated pursuant to section 5338 to carry out 
this section and sections 5303, 5304, and 5306 are used to support 
balanced and comprehensive transportation planning that considers the 
relationships among land use and all transportation modes, without 
regard to the programmatic source of the planning amounts.
    ``(c) Metropolitan Planning Program.--
            ``(1) Allocations to States.--
                    ``(A) In general.--The Secretary shall allocate 80 
                percent of the amount made available under subsection 
                (g)(3)(A) to States to carry out sections 5303 and 5306 
                in a ratio equal to the population in urbanized areas 
                in each State, divided by the total population in 
                urbanized areas in all States, as shown by the latest 
                available decennial census of population.
                    ``(B) Minimum allocation.--Each State shall receive 
                not less than 0.5 percent of the total amount allocated 
                under this paragraph.
            ``(2) Availability of funds.--A State receiving an 
        allocation under paragraph (1) shall promptly distribute such 
        funds to metropolitan planning organizations in the State under 
        a formula--
                    ``(A) developed by the State in cooperation with 
                the metropolitan planning organizations;
                    ``(B) approved by the Secretary of Transportation;
                    ``(C) that considers population in urbanized areas; 
                and
                    ``(D) that provides an appropriate distribution for 
                urbanized areas to carry out the cooperative processes 
                described in this section.
            ``(3) Supplemental allocations.--
                    ``(A) In general.--The Secretary shall allocate 20 
                percent of the amount made available under subsection 
                (g)(3)(A) to States to supplement allocations made 
                under paragraph (1) for metropolitan planning 
                organizations.
                    ``(B) Allocation formula.--Amounts under this 
                paragraph shall be allocated under a formula that 
                reflects the additional cost of carrying out planning, 
                programming, and project selection responsibilities in 
                complex metropolitan planning areas under sections 
                5303, 5304, and 5306.
    ``(d) State Planning and Research Program.--
            ``(1) In general.--The Secretary shall allocate amounts 
        made available pursuant to subsection (g)(3)(B) to States for 
        grants and contracts to carry out sections 5304, 5306, 5315, 
        and 5322 so that each State receives an amount equal to the 
        ratio of the population in urbanized areas in that State, 
        divided by the total population in urbanized areas in all 
        States, as shown by the latest available decennial census.
            ``(2) Minimum allocation.--Each State shall receive not 
        less than 0.5 percent of the amount allocated under this 
        subsection.
            ``(3) Reallocation.--A State may authorize part of the 
        amount made available under this subsection to be used to 
        supplement amounts available under subsection (c).
    ``(e) Planning Capacity Building Program.--
            ``(1) Establishment.--The Secretary shall establish a 
        Planning Capacity Building Program (referred to in this 
        subsection as the ``Program'') to support and fund innovative 
        practices and enhancements in transportation planning.
            ``(2) Purpose.--The purpose of the Program shall be to 
        promote activities that support and strengthen the planning 
        processes required under this section and sections 5303 and 
        5304.
            ``(3) Administration.--The Program shall be administered by 
        the Federal Transit Administration in cooperation with the 
        Federal Highway Administration.
            ``(4) Use of funds.--
                    ``(A) In general.--Appropriations authorized under 
                subsection (g)(1) to carry out this subsection may be 
                used--
                            ``(i) to provide incentive grants to 
                        States, metropolitan planning organizations, 
                        and public transportation operators; and
                            ``(ii) to conduct research, disseminate 
                        information, and provide technical assistance.
                    ``(B) Grants, contracts, cooperative agreements.--
                In carrying out the activities described in 
                subparagraph (A), the Secretary may--
                            ``(i) expend appropriated funds directly; 
                        or
                            ``(ii) award grants to, or enter into 
                        contracts, cooperative agreements, and other 
                        transactions with, a Federal agency, State 
                        agency, local governmental authority, 
                        association, nonprofit or for-profit entity, or 
                        institution of higher education.
    ``(f) Government's Share of Costs.--Amounts made available to carry 
out subsections (c), (d), and (e) may not exceed 80 percent of the 
costs of the activity unless the Secretary of Transportation determines 
that it is in the interest of the Government not to require State or 
local matching funds.
    ``(g) Allocation of Funds.--Of the amounts made available under 
section 5338(b)(2)(B) for fiscal year 2005 and each fiscal year 
thereafter to carry out this section--
            ``(1) $5,000,000 shall be allocated for the Planning 
        Capacity Building Program established under subsection (e);
            ``(2) $20,000,000 shall be allocated for grants under 
        subsection (a)(2) for alternatives analyses required by section 
        5309(e)(2)(A); and
            ``(3) of the remaining amount--
                    ``(A) 82.72 percent shall be allocated for the 
                metropolitan planning program described in subsection 
                (d); and
                    ``(B) 17.28 percent shall be allocated to carry out 
                subsection (b).
    ``(h) Reallocations.--Any amount allocated under this section that 
has not been used 3 years after the end of the fiscal year in which the 
amount was allocated shall be reallocated among the States.''.
    (b) Conforming Amendment.--The item relating to section 5308 in the 
table of sections for chapter 53 is amended to read as follows:

``5308. Planning programs.''.

SEC. 3011. CAPITAL INVESTMENT PROGRAM.

    (a) Section Heading.--The section heading of section 5309 is 
amended to read as follows:
``Sec. 5309. Capital investment grants''.
    (b) General Authority.--Section 5309(a) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``(1) The Secretary of 
                Transportation may make grants and loans'' and 
                inserting the following:
            ``(1) Grants authorized.--The Secretary may award grants'';
                    (B) in subparagraph (A), by striking ``alternatives 
                analysis related to the development of systems,'';
                    (C) by striking subparagraphs (B), (C), (D), and 
                (G);
                    (D) by redesignating subparagraphs (E), (F), and 
                (H) as subparagraphs (B), (C), and (D), respectively;
                    (E) in subparagraph (C), as redesignated, by 
                striking the semicolon at the end and inserting ``, 
                including programs of bus and bus-related projects for 
                assistance to subrecipients which are public agencies, 
                private companies engaged in public transportation, or 
                private nonprofit organizations; and''; and
                    (F) in subparagraph (D), as redesignated--
                            (i) by striking ``to support fixed guideway 
                        systems''; and
                            (ii) by striking ``dedicated bus and high 
                        occupancy vehicle'';
            (2) by amending paragraph (2) to read as follows:
            ``(2) Grantee requirements.--
                    ``(A) Grantee in urbanized area.--The Secretary 
                shall require that any grants awarded under this 
                section to a recipient or subrecipient located in an 
                urbanized area shall be subject to all terms, 
                conditions, requirements, and provisions that the 
                Secretary determines to be necessary or appropriate for 
                the purposes of this section, including requirements 
                for the disposition of net increases in the value of 
                real property resulting from the project assisted under 
                this section.
                    ``(B) Grantee not in urbanized area.--The Secretary 
                shall require that any grants awarded under this 
                section to a recipient or subrecipient not located in 
                an urbanized area shall be subject to the same terms, 
                conditions, requirements, and provisions as a recipient 
                or subrecipient of assistance under section 5311.
                    ``(C) Subrecipient.--The Secretary shall require 
                that any private, nonprofit organization that is a 
                subrecipient of a grant awarded under this section 
                shall be subject to the same terms, conditions, 
                requirements, and provisions as a subrecipient of 
                assistance under section 5310.
                    ``(D) Statewide transit provider grantees.--A 
                statewide transit provider that receives a grant under 
                this section shall be subject to the terms, conditions, 
                requirements, and provisions of this section or section 
                5311, consistent with the scope and purpose of the 
                grant and the location of the project.''; and
            (3) by adding at the end the following:
            ``(3) Certification.--An applicant that has submitted the 
        certifications required under subparagraphs (A), (B), (C), and 
        (H) of section 5307(d)(1) shall be deemed to have provided 
        sufficient information upon which the Secretary may make the 
        findings required under this subsection.''.
    (c) Defined Term.--Section 5309(b) is amended to read as follows:
    ``(b) Defined Term.--As used in this section, the term 
`alternatives analysis' means a study conducted as part of the 
transportation planning process required under sections 5303 and 5304, 
which includes--
            ``(1) an assessment of a wide range of public 
        transportation alternatives designed to address a 
        transportation problem in a corridor or subarea;
            ``(2) sufficient information to enable the Secretary to 
        make the findings of project justification and local financial 
        commitment required under this section;
            ``(3) the selection of a locally preferred alternative; and
            ``(4) the adoption of the locally preferred alternative as 
        part of the long-range transportation plan required under 
        section 5303.''.
    (d) Grant Requirements.--Section 5309(d) is amended to read as 
follows:
    ``(d) Grant Requirements.--The Secretary may not approve a grant 
for a project under this section unless the Secretary determines that--
            ``(1) the project is part of an approved transportation 
        plan and program of projects required under sections 5303, 
        5304, and 5306; and
            ``(2) the applicant has, or will have--
                    ``(A) the legal, financial, and technical capacity 
                to carry out the project, including safety and security 
                aspects of the project;
                    ``(B) satisfactory continuing control over the use 
                of the equipment or facilities; and
                    ``(C) the capability and willingness to maintain 
                the equipment or facilities.''.
    (e) Major Capital Investment Projects of $75,000,000 or More.--
Section 5309(e) is amended to read as follows:
    ``(e) Major Capital Investment Projects of $75,000,000 or More.--
            ``(1) Full funding grant agreement.--The Secretary shall 
        enter into a full funding grant agreement, based on the 
        evaluations and ratings required under this subsection, with 
        each grantee receiving not less than $75,000,000 under this 
        subsection for a new fixed guideway capital project that--
                    ``(A) is authorized for final design and 
                construction; and
                    ``(B) has been rated as medium, medium-high, or 
                high, in accordance with paragraph (5)(B).
            ``(2) Determinations.--The Secretary may not award a grant 
        under this subsection for a new fixed guideway capital project 
        unless the Secretary determines that the proposed project is--
                    ``(A) based on the results of an alternatives 
                analysis and preliminary engineering;
                    ``(B) justified based on a comprehensive review of 
                its mobility improvements, environmental benefits, 
                cost-effectiveness, operating efficiencies, economic 
                development effects, and public transportation 
                supportive land use patterns and policies; and
                    ``(C) supported by an acceptable degree of local 
                financial commitment, including evidence of stable and 
                dependable financing sources to construct the project, 
                and maintain and operate the entire public 
                transportation system, while ensuring that the extent 
                and quality of existing public transportation services 
                are not degraded.
            ``(3) Evaluation of project justification.--In making the 
        determinations under paragraph (2)(B) for a major capital 
        investment grant, the Secretary shall analyze, evaluate, and 
        consider--
                    ``(A) the results of the alternatives analysis and 
                preliminary engineering for the proposed project;
                    ``(B) the reliability of the forecasts of costs and 
                utilization made by the recipient and the contractors 
                to the recipient;
                    ``(C) the direct and indirect costs of relevant 
                alternatives;
                    ``(D) factors such as--
                            ``(i) congestion relief;
                            ``(ii) improved mobility;
                            ``(iii) air pollution;
                            ``(iv) noise pollution;
                            ``(v) energy consumption; and
                            ``(vi) all associated ancillary and 
                        mitigation costs necessary to carry out each 
                        alternative analyzed;
                    ``(E) reductions in local infrastructure costs 
                achieved through compact land use development and 
                positive impacts on the capacity, utilization, or 
                longevity of other surface transportation assets and 
                facilities;
                    ``(F) the cost of suburban sprawl;
                    ``(G) the degree to which the project increases the 
                mobility of the public transportation dependent 
                population or promotes economic development;
                    ``(H) population density and current transit 
                ridership in the transportation corridor;
                    ``(I) the technical capability of the grant 
                recipient to construct the project;
                    ``(J) any adjustment to the project justification 
                necessary to reflect differences in local land, 
                construction, and operating costs; and
                    ``(K) other factors that the Secretary determines 
                to be appropriate to carry out this chapter.
            ``(4) Evaluation of local financial commitment.--
                    ``(A) In general.--In evaluating a project under 
                paragraph (2)(C), the Secretary shall require that--
                            ``(i) the proposed project plan provides 
                        for the availability of contingency amounts 
                        that the Secretary determines to be reasonable 
                        to cover unanticipated cost increases;
                            ``(ii) each proposed local source of 
                        capital and operating financing is stable, 
                        reliable, and available within the proposed 
                        project timetable; and
                            ``(iii) local resources are available to 
                        recapitalize and operate the overall proposed 
                        public transportation system, including 
                        essential feeder bus and other services 
                        necessary to achieve the projected ridership 
                        levels, while ensuring that the extent and 
                        quality of existing public transportation 
                        services are not degraded.
                    ``(B) Evaluation criteria.--In assessing the 
                stability, reliability, and availability of proposed 
                sources of local financing under paragraph (2)(C), the 
                Secretary shall consider--
                            ``(i) the reliability of the forecasts of 
                        costs and utilization made by the recipient and 
                        the contractors to the recipient;
                            ``(ii) existing grant commitments;
                            ``(iii) the degree to which financing 
                        sources are dedicated to the proposed purposes;
                            ``(iv) any debt obligation that exists, or 
                        is proposed by the recipient, for the proposed 
                        project or other public transportation purpose; 
                        and
                            ``(v) the extent to which the project has a 
                        local financial commitment that exceeds the 
                        required non-Federal share of the cost of the 
                        project, provided that if the Secretary gives 
                        priority to financing projects that include 
                        more than the non-Federal share required under 
                        subsection (h), the Secretary shall give equal 
                        consideration to differences in the fiscal 
                        capacity of State and local governments.
            ``(5) Project advancement and ratings.--
                    ``(A) Project advancement.--A proposed project 
                under this subsection shall not advance from 
                alternatives analysis to preliminary engineering or 
                from preliminary engineering to final design and 
                construction unless the Secretary determines that the 
                project meets the requirements of this section and 
                there is a reasonable likelihood that the project will 
                continue to meet such requirements.
                    ``(B) Ratings.--In making a determination under 
                subparagraph (A), the Secretary shall evaluate and rate 
                the project on a 5-point scale (high, medium-high, 
                medium, medium-low, or low) based on the results of the 
                alternatives analysis, the project justification 
                criteria, and the degree of local financial commitment, 
                as required under this subsection. In rating the 
                projects, the Secretary shall provide, in addition to 
                the overall project rating, individual ratings for each 
                of the criteria established by regulation.
            ``(6) Applicability.--This subsection shall not apply to 
        projects for which the Secretary has issued a letter of intent 
        or entered into a full funding grant agreement before the date 
        of enactment of the Federal Public Transportation Act of 2004.
            ``(7) Rulemaking.--Not later than 240 days after the date 
        of enactment of the Federal Public Transportation Act of 2004, 
        the Secretary shall issue regulations on the manner by which 
        the Secretary shall evaluate and rate projects based on the 
        results of alternatives analysis, project justification, and 
        local financial commitment, in accordance with this subsection.
            ``(8) Policy guidance.--
                    ``(A) Publication.--The Secretary shall publish 
                policy guidance regarding the new starts project review 
                and evaluation process--
                            ``(i) not later than 120 days after the 
                        date of enactment of the Federal Public 
                        Transportation Act of 2004; and
                            ``(ii) each time significant changes are 
                        made by the Secretary to the new starts project 
                        review and evaluation process and criteria, but 
                        not less frequently than once every 2 years.
                    ``(B) Public comment and response.--The Secretary 
                shall--
                            ``(i) invite public comment to the policy 
                        guidance published under subparagraph (A); and
                            ``(ii) publish a response to the comments 
                        received under clause (i).''.
    (f) Major Capital Investment Projects of Less Than $75,000,000.-- 
Section 5309(f) is amended to read as follows:
    ``(f) Major Capital Investment Projects of Less Than $75,000,000.--
            ``(1) Project construction grant agreement.--
                    ``(A) In general.--The Secretary shall enter into a 
                project construction grant agreement, based on 
                evaluations and ratings required under this subsection, 
                with each grantee receiving less than $75,000,000 under 
                this subsection for a new fixed guideway or corridor 
                improvement capital project that--
                            ``(i) is authorized by law; and
                            ``(ii) has been rated as medium, medium-
                        high, or high, in accordance with paragraph 
                        (3)(B).
                    ``(B) Contents.--
                            ``(i) In general.--An agreement under this 
                        paragraph shall specify--
                                    ``(I) the scope of the project to 
                                be constructed;
                                    ``(II) the estimated net cost of 
                                the project;
                                    ``(III) the schedule under which 
                                the project shall be constructed;
                                    ``(IV) the maximum amount of 
                                funding to be obtained under this 
                                subsection;
                                    ``(V) the proposed schedule for 
                                obligation of future Federal grants; 
                                and
                                    ``(VI) the sources of non-Federal 
                                funding.
                            ``(ii) Additional funding.--The agreement 
                        may include a commitment on the part of the 
                        Secretary to provide funding for the project in 
                        future fiscal years.
                    ``(C) Full funding grant agreement.--An agreement 
                under this paragraph shall be considered a full funding 
                grant agreement for the purposes of subsection (g).
            ``(2) Selection process.--
                    ``(A) Selection criteria.--The Secretary may not 
                award a grant under this subsection for a proposed 
                project unless the Secretary determines that the 
                project is--
                            ``(i) based on the results of planning and 
                        alternatives analysis;
                            ``(ii) justified based on a review of its 
                        public transportation supportive land use 
                        policies, cost effectiveness, and effect on 
                        local economic development; and
                            ``(iii) supported by an acceptable degree 
                        of local financial commitment.
                    ``(B) Planning and alternatives.--In evaluating a 
                project under subparagraph (A)(i), the Secretary shall 
                analyze and consider the results of planning and 
                alternatives analysis for the project.
                    ``(C) Project justification.--In making the 
                determinations under subparagraph (A)(ii), the 
                Secretary shall--
                            ``(i) determine the degree to which local 
                        land use policies are supportive of the public 
                        transportation project and the degree to which 
                        the project is likely to achieve local 
                        developmental goals;
                            ``(ii) determine the cost effectiveness of 
                        the project at the time of the initiation of 
                        revenue service;
                            ``(iii) determine the degree to which the 
                        project will have a positive effect on local 
                        economic development;
                            ``(iv) consider the reliability of the 
                        forecasts of costs and ridership associated 
                        with the project; and
                            ``(v) consider other factors that the 
                        Secretary determines to be appropriate to carry 
                        out this subsection.
                    ``(D) Local financial commitment.--For purposes of 
                subparagraph (A)(iii), the Secretary shall require that 
                each proposed local source of capital and operating 
                financing is stable, reliable, and available within the 
                proposed project timetable.
            ``(3) Advancement of project to development and 
        construction.--
                    ``(A) In general.--A proposed project under this 
                subsection may not advance from the planning and 
                alternatives analysis stage to project development and 
                construction unless--
                            ``(i) the Secretary finds that the project 
                        meets the requirements of this subsection and 
                        there is a reasonable likelihood that the 
                        project will continue to meet such 
                        requirements; and
                            ``(ii) the metropolitan planning 
                        organization has adopted the locally preferred 
                        alternative for the project into the long-range 
                        transportation plan.
                    ``(B) Evaluation.--In making the findings under 
                subparagraph (A), the Secretary shall evaluate and rate 
                the project as high, medium-high, medium, medium-low, 
                or low, based on the results of the analysis of the 
                project justification criteria and the degree of local 
                financial commitment, as required under this 
                subsection.
            ``(4) Impact report.--
                    ``(A) In general.--Not later than 240 days after 
                the date of enactment of the Federal Public 
                Transportation Act of 2004, the Federal Transit 
                Administration shall submit a report on the methodology 
                to be used in evaluating the land use and economic 
                development impacts of non-fixed guideway or partial 
                fixed guideway projects to--
                            ``(i) the Committee on Banking, Housing, 
                        and Urban Affairs of the Senate; and
                            ``(ii) the Committee on Transportation and 
                        Infrastructure of the House of Representatives.
                    ``(B) Contents.--The report submitted under 
                subparagraph (A) shall address any qualitative and 
                quantitative differences between fixed guideway and 
                non-fixed guideway projects with respect to land use 
                and economic development impacts.
            ``(5) Regulations.--Not later than 120 days after the date 
        of enactment of the Federal Public Transportation Act of 2004, 
        the Secretary shall issue regulations establishing an 
        evaluation and rating process for proposed projects under this 
        subsection that is based on the results of project 
        justification and local financial commitment, as required under 
        this subsection.''.
    (g) Full Funding Grant Agreements.--Section 5309(g)(2) is amended 
by adding at the end the following:
    ``(C) Before and after study.--
            ``(i) In general.--Each full funding grant agreement shall 
        require the applicant to conduct a study that--
                    ``(I) describes and analyzes the impacts of the new 
                start project on transit services and transit 
                ridership;
                    ``(II) evaluates the consistency of predicted and 
                actual project characteristics and performance; and
                    ``(III) identifies sources of differences between 
                predicted and actual outcomes.
            ``(ii) Information collection and analysis plan.--
                    ``(I) Submission of plan.--Applicants seeking a 
                full funding grant agreement shall submit a complete 
                plan for the collection and analysis of information to 
                identify the impacts of the new start project and the 
                accuracy of the forecasts prepared during the 
                development of the project. Preparation of this plan 
                shall be included in the full funding grant agreement 
                as an eligible activity.
                    ``(II) Contents of plan.--The plan submitted under 
                subclause (I) shall provide for--
                            ``(aa) the collection of data on the 
                        current transit system regarding transit 
                        service levels and ridership patterns, 
                        including origins and destinations, access 
                        modes, trip purposes, and rider 
                        characteristics;
                            ``(bb) documentation of the predicted 
                        scope, service levels, capital costs, operating 
                        costs, and ridership of the project;
                            ``(cc) collection of data on the transit 
                        system 2 years after the opening of the new 
                        start project, including analogous information 
                        on transit service levels and ridership 
                        patterns and information on the as-built scope 
                        and capital costs of the new start project; and
                            ``(dd) analysis of the consistency of 
                        predicted project characteristics with the 
                        after data.
    ``(D) Collection of data on current system.--To be eligible for a 
full funding grant agreement, recipients shall have collected data on 
the current system, according to the plan required, before the 
beginning of construction of the proposed new start project. Collection 
of this data shall be included in the full funding grant agreement as 
an eligible activity.
    ``(E) Public private partnership pilot program.--
            ``(i) Authorization.--The Secretary may establish a pilot 
        program to demonstrate the advantages of public-private 
        partnerships for certain fixed guideway systems development 
        projects.
            ``(ii) Identification of qualified projects.--The Secretary 
        shall identify qualified public-private partnership projects as 
        permitted by applicable State and local enabling laws and work 
        with project sponsors to enhance project delivery and reduce 
        overall costs.''.
    (h) Federal Share of Net Project Cost.--Section 5309(h) is amended 
to read as follows:
    ``(h) Federal Share of Adjusted Net Project Cost.--
            ``(1) In general.--The Secretary shall estimate the net 
        project cost based on engineering studies, studies of economic 
        feasibility, and information on the expected use of equipment 
        or facilities.
            ``(2) Adjustment for completion under budget.--The 
        Secretary may adjust the final net project cost of a major 
        capital investment project evaluated under subsections (e) and 
        (f) to include the cost of eligible activities not included in 
        the originally defined project if the Secretary determines that 
        the originally defined project has been completed at a cost 
        that is significantly below the original estimate.
            ``(3) Maximum federal share.--
                    ``(A) In general.--A grant for the project shall be 
                for 80 percent of the net project cost, or the net 
                project cost as adjusted under paragraph (2), unless 
                the grant recipient requests a lower grant percentage.
                    ``(B) Exceptions.--The Secretary may provide a 
                higher grant percentage than requested by the grant 
                recipient if--
                            ``(i) the Secretary determines that the net 
                        project cost of the project is not more than 10 
                        percent higher than the net project cost 
                        estimated at the time the project was approved 
                        for advancement into preliminary engineering; 
                        and
                            ``(ii) the ridership estimated for the 
                        project is not less than 90 percent of the 
                        ridership estimated for the project at the time 
                        the project was approved for advancement into 
                        preliminary engineering.
            ``(4) Other sources.--The costs not funded by a grant under 
        this section may be funded from--
                    ``(A) an undistributed cash surplus;
                    ``(B) a replacement or depreciation cash fund or 
                reserve; or
                    ``(C) new capital, including any Federal funds that 
                are eligible to be expended for transportation.
            ``(5) Planned extension to fixed guideway system.--In 
        addition to amounts allowed under paragraph (1), a planned 
        extension to a fixed guideway system may include the cost of 
        rolling stock previously purchased if the Secretary determines 
        that only non-Federal funds were used and that the purchase was 
        made for use on the extension. A refund or reduction of the 
        costs not funded by a grant under this section may be made only 
        if a refund of a proportional amount of the grant is made at 
        the same time.
            ``(6) Exception.--The prohibitions on the use of funds for 
        matching requirements under section 403(a)(5)(C)(vii) of the 
        Social Security Act (42 U.S.C. 603(a)(5)(C)(vii)) shall not 
        apply to amounts allowed under paragraph (4).''.
    (i) Loan Provisions and Fiscal Capacity Considerations.--Section 
5309 is amended--
            (1) by striking subsections (i), (j), (k), and (l);
            (2) by redesignating subsections (m) and (n) as subsections 
        (i) and (j), respectively;
            (3) by striking subsection (o) (as added by section 3009(i) 
        of the Federal Transit Act of 1998); and
            (4) by redesignating subsections (o) and (p) as subsections 
        (k) and (l), respectively.
    (j) Allocating Amounts.--Section 5309(i), as redesignated, is 
amended to read as follows:
    ``(i) Allocating Amounts.--
            ``(1) Fiscal year 2004.--Of the amounts made available or 
        appropriated for fiscal year 2004 under section 5338(a)(3)--
                    ``(A) $1,315,983,615 shall be allocated for 
                projects of not less than $75,000,000 for major capital 
                projects for new fixed guideway systems and extensions 
                of such systems under subsection (e) and projects for 
                new fixed guideway or corridor improvement capital 
                projects under subsection (f);
                    ``(B) $1,199,387,615 shall be allocated for capital 
                projects for fixed guideway modernization; and
                    ``(C) $603,617,520 shall be allocated for capital 
                projects for buses and bus-related equipment and 
                facilities.
            ``(2) In general.--Of the amounts made available or 
        appropriated for fiscal year 2005 and each fiscal year 
        thereafter for grants under this section pursuant to 
        subsections (b)(4) and (c) of section 5338--
                    ``(A) the amounts appropriated under section 
                5338(c) shall be allocated for major capital projects 
                for--
                            ``(i) new fixed guideway systems and 
                        extensions of not less than $75,000,000, in 
                        accordance with subsection (e); and
                            ``(ii) projects for new fixed guideway or 
                        corridor improvement capital projects, in 
                        accordance with subsection (f); and
                    ``(B) the amounts made available under section 
                5338(b)(4) shall be allocated for capital projects for 
                buses and bus-related equipment and facilities.
            ``(3) Fixed guideway modernization.--The amounts made 
        available for fixed guideway modernization under section 
        5338(b)(2)(K) for fiscal year 2005 and each fiscal year 
        thereafter shall be allocated in accordance with section 5337.
            ``(4) Preliminary engineering.--Not more that 8 percent of 
        the allocation described in paragraphs (1)(A) and (2)(A) may be 
        expended on preliminary engineering.
            ``(5) Funding for ferry boats.--Of the amounts described in 
        paragraphs (1)(A) and (2)(A), $10,400,000 shall be available in 
        each of the fiscal years 2004 through 2009 for capital projects 
        in Alaska and Hawaii for new fixed guideway systems and 
        extension projects utilizing ferry boats, ferry boat terminals, 
        or approaches to ferry boat terminals.
            ``(6) Bus and bus facility grants.--
                    ``(A) Considerations.--In making grants under 
                paragraphs (1)(C) and (2)(B), the Secretary shall 
                consider the age and condition of buses, bus fleets, 
                related equipment, and bus-related facilities.
                    ``(B) Projects not in urbanized areas.--Of the 
                amounts made available under paragraphs (1)(C) and 
                (2)(B), not less than 5.5 percent shall be available in 
                each fiscal year for projects that are not in urbanized 
                areas.
                    ``(C) Intermodal terminals.--Of the amounts made 
                available under paragraphs (1)(C) and (2)(B), not less 
                than $75,000,000 shall be available in each fiscal year 
                for intermodal terminal projects, including the 
                intercity bus portion of such projects.''.
    (k) Reports.--Section 5309 is amended by inserting at the end the 
following:
    ``(m) Reports.--
            ``(1) Annual report on funding recommendations.--
                    ``(A) In general.--Not later than the first Monday 
                of February of each year, the Secretary shall submit a 
                report on funding recommendations to--
                            ``(i) the Committee on Transportation and 
                        Infrastructure of the House of Representatives;
                            ``(ii) the Committee on Banking, Housing, 
                        and Urban Affairs of the Senate;
                            ``(iii) the Subcommittee on Transportation 
                        of the Committee on Appropriations of the House 
                        of Representatives; and
                            ``(iv) the Subcommittee on Transportation 
                        of the Committee on Appropriations of the 
                        Senate.
                    ``(B) Contents.--The report submitted under 
                subparagraph (A) shall contain--
                            ``(i) a proposal on the allocation of 
                        amounts to finance grants for capital 
                        investment projects among grant applicants;
                            ``(ii) a recommendation of projects to be 
                        funded based on--
                                    ``(I) the evaluations and ratings 
                                determined under subsection (e) and 
                                (f); and
                                    ``(II) existing commitments and 
                                anticipated funding levels for the 
                                subsequent 3 fiscal years; and
                            ``(iii) detailed ratings and evaluations on 
                        each project recommended for funding.
            ``(2) Triennial reports on project ratings.--
                    ``(A) In general.--Not later than the first Monday 
                of February, the first Monday of June, and the first 
                Monday of October of each year, the Secretary shall 
                submit a report on project ratings to--
                            ``(i) the Committee on Transportation and 
                        Infrastructure of the House of Representatives;
                            ``(ii) the Committee on Banking, Housing, 
                        and Urban Affairs of the Senate;
                            ``(iii) the Subcommittee on Transportation 
                        of the Committee on Appropriations of the House 
                        of Representatives; and
                            ``(iv) the Subcommittee on Transportation 
                        of the Committee on Appropriations of the 
                        Senate.
                    ``(B) Contents.--Each report submitted under 
                subparagraph (A) shall contain--
                            ``(i) a summary of the ratings of all 
                        capital investment projects for which funding 
                        was requested under this section;
                            ``(ii) detailed ratings and evaluations on 
                        the project of each applicant that had 
                        significant changes to the finance or project 
                        proposal or has completed alternatives analysis 
                        or preliminary engineering since the date of 
                        the latest report; and
                            ``(iii) all relevant information supporting 
                        the evaluation and rating of each updated 
                        project, including a summary of the financial 
                        plan of each updated project.
            ``(3) Before and after study reports.--Not later than the 
        first Monday of August of each year, the Secretary shall submit 
        a report containing a summary of the results of the studies 
        conducted under subsection (g)(2) to--
                    ``(A) the Committee on Transportation and 
                Infrastructure of the House of Representatives;
                    ``(B) the Committee on Banking, Housing, and Urban 
                Affairs of the Senate;
                    ``(C) the Subcommittee on Transportation of the 
                Committee on Appropriations of the House of 
                Representatives; and
                    ``(D) the Subcommittee on Transportation of the 
                Committee on Appropriations of the Senate.
            ``(4) Contractor performance assessment report.--
                    ``(A) In general.--Not later than 180 days after 
                the enactment of the Federal Public Transportation Act 
                of 2004, and each year thereafter, the Secretary shall 
                submit a report analyzing the consistency and accuracy 
                of cost and ridership estimates made by each contractor 
                to public transportation agencies developing major 
                investment projects to the committees and subcommittees 
                listed under paragraph (3).
                    ``(B) Contents.--The report submitted under 
                subparagraph (A) shall compare the cost and ridership 
                estimates made at the time projects are approved for 
                entrance into preliminary engineering with--
                            ``(i) estimates made at the time projects 
                        are approved for entrance into final design;
                            ``(ii) costs and ridership when the project 
                        commences revenue operation; and
                            ``(iii) costs and ridership when the 
                        project has been in operation for 2 years.
            ``(5) Annual general accounting office review.--
                    ``(A) Review.--The Comptroller General of the 
                United States shall conduct an annual review of the 
                processes and procedures for evaluating and rating 
                projects and recommending projects and the Secretary's 
                implementation of such processes and procedures.
                    ``(B) Report.--Not later than 90 days after the 
                submission of each report required under paragraph (1), 
                the Comptroller General shall submit a report to 
                Congress that summarizes the results of the review 
                conducted under subparagraph (A).
            ``(6) Contractor performance incentive report.--Not later 
        than 180 days after the enactment of the Federal Public 
        Transportation Act of 2004, the Secretary shall submit a report 
        to the committees and subcommittees listed under paragraph (3) 
        on the suitability of allowing contractors to public 
        transportation agencies that undertake major capital 
        investments under this section to receive performance incentive 
        awards if a project is completed for less than the original 
        estimated cost.''.

SEC. 3012. NEW FREEDOM FOR ELDERLY PERSONS AND PERSONS WITH 
              DISABILITIES.

    (a) In General.--Section 5310 is amended to read as follows:
``Sec. 5310. New freedom for elderly persons and persons with 
              disabilities
    ``(a) General Authority.--
            ``(1) Authorization.--The Secretary may award grants to a 
        State for capital public transportation projects that are 
        planned, designed, and carried out to meet the needs of elderly 
        individuals and individuals with disabilities, with priority 
        given to the needs of these individuals to access necessary 
        health care.
            ``(2) Acquisition of public transportation services.--A 
        capital public transportation project under this section may 
        include acquiring public transportation services as an eligible 
        capital expense.
            ``(3) Administrative costs.--A State may use not more than 
        15 percent of the amounts received under this section to 
        administer, plan, and provide technical assistance for a 
        project funded under this section.
    ``(b) Allotments Among States.--
            ``(1) In general.--From amounts made available or 
        appropriated in each fiscal year under subsections 
        (a)(1)(C)(iv) and (b)(2)(D) of section 5338 for grants under 
        this section, the Secretary shall allot amounts to each State 
        under a formula based on the number of elderly individuals and 
        individuals with disabilities in each State.
            ``(2) Transfer of funds.--Any funds allotted to a State 
        under paragraph (1) may be transferred by the State to the 
        apportionments made under sections 5311(c) and 5336 if such 
        funds are only used for eligible projects selected under this 
        section.
            ``(3) Reallocation of funds.--A State receiving a grant 
        under this section may reallocate such grant funds to--
                    ``(A) a private nonprofit organization;
                    ``(B) a public transportation agency or authority; 
                or
                    ``(C) a governmental authority that--
                            ``(i) has been approved by the State to 
                        coordinate services for elderly individuals and 
                        individuals with disabilities;
                            ``(ii) certifies that nonprofit 
                        organizations are not readily available in the 
                        area that can provide the services described 
                        under this subsection; or
                            ``(iii) will provide services to persons 
                        with disabilities that exceed those services 
                        required by the Americans with Disabilities 
                        Act.
    ``(c) Federal Share.--
            ``(1) Maximum.--
                    ``(A) In general.--A grant for a capital project 
                under this section may not exceed 80 percent of the net 
                capital costs of the project, as determined by the 
                Secretary.
                    ``(B) Exception.--A State described in section 
                120(d) of title 23 shall receive an increased Federal 
                share in accordance with the formula under that 
                section.
            ``(2) Remaining costs.--The costs of a capital project 
        under this section that are not funded through a grant under 
        this section--
                    ``(A) may be funded from an undistributed cash 
                surplus, a replacement or depreciation cash fund or 
                reserve, a service agreement with a State or local 
                social service agency or a private social service 
                organization, or new capital; and
                    ``(B) may be derived from amounts appropriated to 
                or made available to any Federal agency (other than the 
                Department of Transportation, except for Federal Lands 
                Highway funds) that are eligible to be expended for 
                transportation.
            ``(3) Exception.--For purposes of paragraph (2), the 
        prohibitions on the use of funds for matching requirements 
        under section 403(a)(5)(C)(vii) of the Social Security Act (42 
        U.S.C. 603(a)(5)(C)(vii)) shall not apply to Federal or State 
        funds to be used for transportation purposes.
    ``(d) Grant Requirements.--
            ``(1) In general.--A grant recipient under this section 
        shall be subject to the requirements of a grant recipient under 
        section 5307 to the extent the Secretary determines to be 
        appropriate.
            ``(2) Certification requirements.--
                    ``(A) Fund transfers.--A grant recipient under this 
                section that transfers funds to a project funded under 
                section 5336 in accordance with subsection (b)(2) shall 
                certify that the project for which the funds are 
                requested has been coordinated with private nonprofit 
                providers of services under this section.
                    ``(B) Project selection and plan development.--Each 
                grant recipient under this section shall certify that--
                            ``(i) the projects selected were derived 
                        from a locally developed, coordinated public 
                        transit-human services transportation plan; and
                            ``(ii) the plan was developed through a 
                        process that included representatives of 
                        public, private, and nonprofit transportation 
                        and human services providers and participation 
                        by the public.
                    ``(C) Allocations to subrecipients.--Each grant 
                recipient under this section shall certify that 
                allocations of the grant to subrecipients, if any, are 
                distributed on a fair and equitable basis.
    ``(e) State Program of Projects.--
            ``(1) Submission to secretary.--Each State shall annually 
        submit a program of transportation projects to the Secretary 
        for approval with an assurance that the program provides for 
        maximum feasible coordination between transportation services 
        funded under this section and transportation services assisted 
        by other Federal sources.
            ``(2) Use of funds.--Each State may use amounts made 
        available to carry out this section to provide transportation 
        services for elderly individuals and individuals with 
        disabilities if such services are included in an approved State 
        program of projects.
    ``(f) Leasing Vehicles.--Vehicles acquired under this section may 
be leased to local governmental authorities to improve transportation 
services designed to meet the needs of elderly individuals and 
individuals with disabilities.
    ``(g) Meal Delivery for Homebound Individuals.--Public 
transportation service providers receiving assistance under this 
section or section 5311(c) may coordinate and assist in regularly 
providing meal delivery service for homebound individuals if the 
delivery service does not conflict with providing public transportation 
service or reduce service to public transportation passengers.
    ``(h) Transfers of Facilities and Equipment.--With the consent of 
the recipient in possession of a facility or equipment acquired with a 
grant under this section, a State may transfer the facility or 
equipment to any recipient eligible to receive assistance under this 
chapter if the facility or equipment will continue to be used as 
required under this section.
    ``(i) Fares Not Required.--This section does not require that 
elderly individuals and individuals with disabilities be charged a 
fare.''.
    (b) Conforming Amendment.--The item relating to section 5310 in the 
table of sections for chapter 53 is amended to read as follows:

``5310. New freedom for elderly persons and persons with 
                            disabilities.''.

SEC. 3013. FORMULA GRANTS FOR OTHER THAN URBANIZED AREAS.

    (a) Definitions.--Section 5311(a) is amended to read as follows:
    ``(a) Definitions.--As used in this section, the following 
definitions shall apply:
            ``(1) Recipient.--The term `recipient' means a State or 
        Indian tribe that receives a Federal transit program grant 
        directly from the Federal Government.
            ``(2) Subrecipient.--The term `subrecipient' means a State 
        or local governmental authority, a nonprofit organization, or a 
        private operator of public transportation or intercity bus 
        service that receives Federal transit program grant funds 
        indirectly through a recipient.''.
    (b) General Authority.--Section 5311(b) is amended--
            (1) by amending paragraph (1) to read as follows:
            ``(1) Grants authorized.--Except as provided under 
        paragraph (2), the Secretary may award grants under this 
        section to recipients located in areas other than urbanized 
        areas for--
                    ``(A) public transportation capital projects;
                    ``(B) operating costs of equipment and facilities 
                for use in public transportation; and
                    ``(C) the acquisition of public transportation 
                services.'';
            (2) by redesignating paragraph (2) as paragraph (3);
            (3) by inserting after paragraph (1) the following:
            ``(2) State program.--
                    ``(A) In general.--A project eligible for a grant 
                under this section shall be included in a State program 
                for public transportation service projects, including 
                agreements with private providers of public 
                transportation service.
                    ``(B) Submission to secretary.--Each State shall 
                annually submit the program described in subparagraph 
                (A) to the Secretary.
                    ``(C) Approval.--The Secretary may not approve the 
                program unless the Secretary determines that--
                            ``(i) the program provides a fair 
                        distribution of amounts in the State; and
                            ``(ii) the program provides the maximum 
                        feasible coordination of public transportation 
                        service assisted under this section with 
                        transportation service assisted by other 
                        Federal sources.'';
            (4) in paragraph (3), as redesignated--
                    (A) by striking ``(3) The Secretary of 
                Transportation'' and inserting the following:
            ``(3) Rural transportation assistance program.--
                    ``(A) Establishment.--The Secretary'';
                    (B) by striking ``make'' and inserting ``use not 
                more than 2 percent of the amount made available to 
                carry out this section to award''; and
                    (C) by adding at the end the following:
                    ``(B) Data Collection.--
                            ``(i) Report.--Each grantee under this 
                        section shall submit an annual report to the 
                        Secretary containing information on capital 
                        investment, operations, and service provided 
                        with funds received under this section, 
                        including--
                                    ``(I) total annual revenue;
                                    ``(II) sources of revenue;
                                    ``(III) total annual operating 
                                costs;
                                    ``(IV) total annual capital costs;
                                    ``(V) fleet size and type, and 
                                related facilities;
                                    ``(VI) revenue vehicle miles; and
                                    ``(VII) ridership.''; and
            (5) by adding after paragraph (3) the following:
            ``(4) Of the amount made available to carry out paragraph 
        (3)--
                    ``(A) not more than 15 percent may be used to carry 
                out projects of a national scope; and
                    ``(B) any amounts not used under subparagraph (A) 
                shall be allocated to the States.''.
    (c) Apportionments.--Section 5311(c) is amended to read as follows:
    ``(c) Apportionments.--
            ``(1) Public transportation on indian reservations.--Of the 
        amounts made available or appropriated for each fiscal year 
        pursuant to subsections (a)(1)(C)(v) and (b)(2)(F) of section 
        5338, the following amounts shall be apportioned for grants to 
        Indian tribes for any purpose eligible under this section, 
        under such terms and conditions as may be established by the 
        Secretary:
                    ``(A) $6,000,000 for fiscal year 2005.
                    ``(B) $8,000,000 for fiscal year 2006.
                    ``(C) $10,000,000 for fiscal year 2007.
                    ``(D) $12,000,000 for fiscal year 2008.
                    ``(E) $15,000,000 for fiscal year 2009.
            ``(2) Remaining amounts.--Of the amounts made available or 
        appropriated for each fiscal year pursuant to subsections 
        (a)(1)(C)(v) and (b)(2)(F) of section 5338 that are not 
        apportioned under paragraph (1)--
                    ``(A) 20 percent shall be apportioned to the States 
                in accordance with paragraph (3); and
                    ``(B) 80 percent shall be apportioned to the States 
                in accordance with paragraph (4).
            ``(3) Apportionments based on land area in nonurbanized 
        areas.--
                    ``(A) In general.--Subject to subparagraph (B), 
                each State shall receive an amount that is equal to the 
                amount apportioned under paragraph (2)(A) multiplied by 
                the ratio of the land area in areas other than 
                urbanized areas in that State and divided by the land 
                area in all areas other than urbanized areas in the 
                United States, as shown by the most recent decennial 
                census of population.
                    ``(B) Maximum apportionment.--No State shall 
                receive more than 5 percent of the amount apportioned 
                under this paragraph.
            ``(4) Apportionments based on population in nonurbanized 
        areas.--Each State shall receive an amount equal to the amount 
        apportioned under paragraph (2)(B) multiplied by the ratio of 
        the population of areas other than urbanized areas in that 
        State divided by the population of all areas other than 
        urbanized areas in the United States, as shown by the most 
        recent decennial census of population.''.
    (d) Use for Administrative, Planning, and Technical Assistance.--
Section 5311(e) is amended--
            (1) by striking ``and Technical Assistance.--(1) The 
        Secretary of Transportation'' and inserting ``, Planning, and 
        Technical Assistance.--The Secretary'';
            (2) by striking ``to a recipient''; and
            (3) by striking paragraph (2).
    (e) Intercity Bus Transportation.--Section 5311(f) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``(1)'' and inserting the 
                following:
            ``(1) In general.--''; and
                    (B) by striking ``after September 30, 1993,''; and
            (2) in paragraph (2)--
                    (A) by striking ``A State'' and inserting ``After 
                consultation with affected intercity bus service 
                providers, a State''; and
                    (B) by striking ``of Transportation''.
    (f) Federal Share of Costs.--Section 5311(g) is amended to read as 
follows:
    ``(g) Federal Share of Costs.--
            ``(1) Maximum federal share.--
                    ``(A) Capital projects.--
                            ``(i) In general.--Except as provided under 
                        clause (ii), a grant awarded under this section 
                        for any purpose other than operating assistance 
                        may not exceed 80 percent of the net capital 
                        costs of the project, as determined by the 
                        Secretary.
                            ``(ii) Exception.--A State described in 
                        section 120(d) of title 23 shall receive a 
                        Federal share of the net capital costs in 
                        accordance with the formula under that section.
                    ``(B) Operating assistance.--
                            ``(i) In general.--Except as provided under 
                        clause (ii), a grant made under this section 
                        for operating assistance may not exceed 50 
                        percent of the net operating costs of the 
                        project, as determined by the Secretary.
                            ``(ii) Exception.--A State described in 
                        section 120(d) of title 23 shall receive a 
                        Federal share of the net operating costs equal 
                        to 62.5 percent of the Federal share provided 
                        for under subparagraph (A)(ii).
            ``(2) Other funding sources.--Funds for a project under 
        this section that are not provided for by a grant under this 
        section--
                    ``(A) may be provided from--
                            ``(i) an undistributed cash surplus;
                            ``(ii) a replacement or depreciation cash 
                        fund or reserve;
                            ``(iii) a service agreement with a State or 
                        local social service agency or a private social 
                        service organization; or
                            ``(iv) new capital; and
                    ``(B) may be derived from amounts appropriated to 
                or made available to a Federal agency (other than the 
                Department of Transportation, except for Federal Land 
                Highway funds) that are eligible to be expended for 
                transportation.
            ``(3) Use of federal grant.--A State carrying out a program 
        of operating assistance under this section may not limit the 
        level or extent of use of the Federal grant for the payment of 
        operating expenses.
            ``(4) Exception.--For purposes of paragraph (2)(B), the 
        prohibitions on the use of funds for matching requirements 
        under section 403(a)(5)(c)(vii) of the Social Security Act (42 
        U.S.C. 603(a)(5)(c)(vii)) shall not apply to Federal or State 
        funds to be used for transportation purposes.''.
    (g) Waiver Condition.--Section 5311(j)(1) is amended by striking 
``but the Secretary of Labor may waive the application of section 
5333(b)'' and inserting ``if the Secretary of Labor utilizes a Special 
Warranty that provides a fair and equitable arrangement to protect the 
interests of employees''.

SEC. 3014. RESEARCH, DEVELOPMENT, DEMONSTRATION, AND DEPLOYMENT 
              PROJECTS.

    (a) In General.--Section 5312 is amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) Research, Development, and Demonstration Projects.--
            ``(1) In general.--The Secretary may make grants, 
        contracts, cooperative agreements, or other transactions 
        (including agreements with departments, agencies, and 
        instrumentalities of the United States Government) for 
        research, development, demonstration or deployment projects, or 
        evaluation of technology of national significance to public 
        transportation that the Secretary determines will improve 
        public transportation service or help public transportation 
        service meet the total transportation needs at a minimum cost.
            ``(2) Information.--The Secretary may request and receive 
        appropriate information from any source.
            ``(3) Savings provision.--This subsection does not limit 
        the authority of the Secretary under any other law.'';
            (2) by striking subsections (b) and (c);
            (3) by redesignating subsections (d) and (e) as (b) and 
        (c), respectively.
            (4) in subsection (b), as redesignated--
                    (A) in paragraph (2), by striking ``other 
                agreements'' and inserting ``other transactions''; and
                    (B) in paragraph (5), by striking ``within the Mass 
                Transit Account of the Highway Trust Fund''; and
            (5) in subsection (c), as redesignated--
                    (A) in paragraph (2), by striking ``public and 
                private'' and inserting ``public or private''; and
                    (B) in paragraph (3), by striking ``within the Mass 
                Transit Account of the Highway Trust Fund'' .
    (b) Conforming Amendments.--
            (1) Section heading.--The heading of section 5312 is 
        amended to read as follows:
``Sec. 5312. Research, development, demonstration, and deployment 
              projects''.
            (2) Table of sections.--The item relating to section 5312 
        in the table of sections for chapter 53 is amended to read as 
        follows:

``5312. Research, development, demonstration, and deployment 
                            projects.''.

SEC. 3015. TRANSIT COOPERATIVE RESEARCH PROGRAM.

    (a) In General.--Section 5313 is amended--
            (1) by striking subsection (b);
            (2) in subsection (a)--
                    (A) in paragraph (1), by striking ``(1) The amounts 
                made available under paragraphs (1) and (2)C)(ii) of 
                section 5338(c) of this title'' and inserting ``The 
                amounts made available under subsections (a)(5)(C)(iii) 
                and (b)(2)(G)(i) of section 5338''; and
                    (B) in paragraph (2), by striking ``(2)'' and 
                inserting the following:
    ``(b) Federal Assistance.--''; and
            (3) by amending subsection (c) to read as follows:
    ``(c) Federal Share.--If there would be a clear and direct 
financial benefit to an entity under a grant or contract financed under 
this section, the Secretary shall establish a Federal share consistent 
with such benefit.''.
    (b) Conforming Amendments.--
            (1) Section heading.--The heading of section 5313 is 
        amended to read as follows:
``Sec. 5313. Transit cooperative research program''.
            (2) Table of sections.--The item relating to section 5313 
        in the table of sections for chapter 53 is amended to read as 
        follows:

``5313. Transit cooperative research program.''.

SEC. 3016. NATIONAL RESEARCH PROGRAMS.

    (a) In General.--Section 5314 is amended--
            (1) in subsection (a)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Availability of funds.--The Secretary may use amounts 
        made available under subsections (a)(5)(C)(iv) and 
        (b)(2)(G)(iv) of section 5338 for grants, contracts, 
        cooperative agreements, or other transactions for the purposes 
        described in sections 5312, 5315, and 5322.'';
                    (B) in paragraph (2), by striking ``(2) Of'' and 
                inserting the following:
            ``(2) ADA compliance.--From'';
                    (C) by amending paragraph (3) to read as follows:
            ``(3) Special demonstration initiatives.--The Secretary may 
        use not more than 25 percent of the amounts made available 
        under paragraph (1) for special demonstration initiatives, 
        subject to terms that the Secretary determines to be consistent 
        with this chapter. For a nonrenewable grant of not more than 
        $100,000, the Secretary shall provide expedited procedures for 
        complying with the requirements of this chapter.'';
                    (D) in paragraph (4)--
                            (i) by striking subparagraph (B); and
                            (ii) by redesignating subparagraph (C) as 
                        subparagraph (B); and
                    (E) by adding at the end the following:
            ``(6) Medical transportation demonstration grants.--
                    ``(A) Grants authorized.--The Secretary may award 
                demonstration grants, from funds made available under 
                paragraph (1), to eligible entities to provide 
                transportation services to individuals to access 
                dialysis treatments and other medical treatments for 
                renal disease.
                    ``(B) Eligible entities.--An entity shall be 
                eligible to receive a grant under this paragraph if the 
                entity--
                            ``(i) meets the conditions described in 
                        section 501(c)(3) of the Internal Revenue Code 
                        of 1986; or
                            ``(ii) is an agency of a State or unit of 
                        local government.
                    ``(C) Use of funds.--Grant funds received under 
                this paragraph may be used to provide transportation 
                services to individuals to access dialysis treatments 
                and other medical treatments for renal disease.
                    ``(D) Application.--
                            ``(i) In general.--Each eligible entity 
                        desiring a grant under this paragraph shall 
                        submit an application to the Secretary at such 
                        time, at such place, and containing such 
                        information as the Secretary may reasonably 
                        require.
                            ``(ii) Selection of grantees.--In awarding 
                        grants under this paragraph, the Secretary 
                        shall give preference to eligible entities from 
                        communities with--
                                    ``(I) high incidence of renal 
                                disease; and
                                    ``(II) limited access to dialysis 
                                facilities.
                    ``(E) Rulemaking.--The Secretary shall issue 
                regulations to implement and administer the grant 
                program established under this paragraph.
                    ``(F) Report.--The Secretary shall submit a report 
                on the results of the demonstration projects funded 
                under this paragraph to the Committee on Banking, 
                Housing, and Urban Affairs of the Senate and the 
                Committee on Transportation and Infrastructure of the 
                House of Representatives.''; and
            (2) by amending subsection (b) to read as follows:
    ``(b) Federal Share.--If there would be a clear and direct 
financial benefit to an entity under a grant, contract, cooperative 
agreement, or other transaction financed under subsection (a) or 
section 5312, 5313, 5315, or 5322, the Secretary shall establish a 
Federal share consistent with such benefit.''.
    (c) National Technical Assistance Center for Senior Transportation; 
Alternative Fuels Study.--Section 5314 is amended by adding at the end 
the following:
    ``(c) National Technical Assistance Center for Senior 
Transportation.--
            ``(1) Establishment.--The Secretary shall award grants to a 
        national not-for-profit organization for the establishment and 
        maintenance of a national technical assistance center.
            ``(2) Eligibility.--An organization shall be eligible to 
        receive the grant under paragraph (1) if the organization--
                    ``(A) focuses significantly on serving the needs of 
                the elderly;
                    ``(B) has demonstrated knowledge and expertise in 
                senior transportation policy and planning issues;
                    ``(C) has affiliates in a majority of the States;
                    ``(D) has the capacity to convene local groups to 
                consult on operation and development of senior 
                transportation programs; and
                    ``(E) has established close working relationships 
                with the Federal Transit Administration and the 
                Administration on Aging.
            ``(3) Use of funds.--The national technical assistance 
        center established under this section shall--
                    ``(A) gather best practices from throughout the 
                country and provide such practices to local communities 
                that are implementing senior transportation programs;
                    ``(B) work with teams from local communities to 
                identify how they are successfully meeting the 
                transportation needs of senior and any gaps in services 
                in order to create a plan for an integrated senior 
                transportation program;
                    ``(C) provide resources on ways to pay for senior 
                transportation services;
                    ``(D) create a web site to publicize and circulate 
                information on senior transportation programs;
                    ``(E) establish a clearinghouse for print, video, 
                and audio resources on senior mobility; and
                    ``(F) administer the demonstration grant program 
                established under paragraph (4).
            ``(4) Grants authorized.--
                    ``(A) In general.--The national technical 
                assistance center established under this section, in 
                consultation with the Federal Transit Administration, 
                shall award senior transportation demonstration grants 
                to--
                            ``(i) local transportation organizations;
                            ``(ii) State agencies;
                            ``(iii) units of local government; and
                            ``(iv) nonprofit organizations.
                    ``(B) Use of funds.--Grant funds received under 
                this paragraph may be used to--
                            ``(i) evaluate the state of transportation 
                        services for senior citizens;
                            ``(ii) recognize barriers to mobility that 
                        senior citizens encounter in their communities;
                            ``(iii) establish partnerships and promote 
                        coordination among community stakeholders, 
                        including public, not-for-profit, and for-
                        profit providers of transportation services for 
                        senior citizens;
                            ``(iv) identify future transportation needs 
                        of senior citizens within local communities; 
                        and
                            ``(v) establish strategies to meet the 
                        unique needs of healthy and frail senior 
                        citizens.
                    ``(C) Selection of grantees.--The Secretary shall 
                select grantees under this subsection based on a fair 
                representation of various geographical locations 
                throughout the United States.
            ``(5) Allocations.--From the funds made available for each 
        fiscal year under subsections (a)(5)(C)(iv) and (b)(2)(G)(iv) 
        of section 5338, $3,000,000 shall be allocated to carry out 
        this subsection.
    ``(d) Alternative Fuels Study.--
            ``(1) Study.--The Secretary shall conduct a study of the 
        actions necessary to facilitate the purchase of increased 
        volumes of alternative fuels (as defined in section 301 of the 
        Energy Policy Act of 1992 (42 U.S.C. 13211)) for use in public 
        transit vehicles
            ``(2) Scope of study.--The study conducted under this 
        subsection shall focus on the incentives necessary to increase 
        the use of alternative fuels in public transit vehicles, 
        including buses, fixed guideway vehicles, and ferries.
            ``(3) Contents.--The study shall consider--
                    ``(A) the environmental benefits of increased use 
                of alternative fuels in transit vehicles;
                    ``(B) existing opportunities available to transit 
                system operators that encourage the purchase of 
                alternative fuels for transit vehicle operation;
                    ``(C) existing barriers to transit system operators 
                that discourage the purchase of alternative fuels for 
                transit vehicle operation, including situations where 
                alternative fuels that do not require capital 
                improvements to transit vehicles are disadvantaged over 
                fuels that do require such improvements; and
                    ``(D) the necessary levels and type of support 
                necessary to encourage additional use of alternative 
                fuels for transit vehicle operation.
            ``(4) Recommendations.--The study shall recommend 
        regulatory and legislative alternatives that will result in the 
        increased use of alternative fuels in transit vehicles.
            ``(5) Report.--Not later than 1 year after the date of 
        enactment of the Federal Public Transportation Act of 2004, the 
        Secretary shall submit the study completed under this 
        subsection to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Transportation and 
        Infrastructure of the House of Representatives''.
    (c) Conforming Amendments.--
            (1) Section heading.--The heading for section 5314 is 
        amended to read as follows:
``Sec. 5314. National research programs''.
            (2) Table of sections.--The item relating to section 5314 
        in the table of sections for chapter 53 is amended to read as 
        follows:

``5314. National research programs.''.

SEC. 3017. NATIONAL TRANSIT INSTITUTE.

    (a) Section 5315 is amended--
            (1) by striking subsections (a) and (b) and inserting the 
        following:
    ``(a) Establishment.--The Secretary shall award a grant to Rutgers 
University to conduct a national transit institute.
    ``(b) Duties.--
            ``(1) In general.--In cooperation with the Federal Transit 
        Administration, State transportation departments, public 
        transportation authorities, and national and international 
        entities, the institute established pursuant to subsection (a) 
        shall develop and conduct training programs for Federal, State, 
        and local transportation employees, United States citizens, and 
        foreign nationals engaged or to be engaged in Government-aid 
        public transportation work.
            ``(2) Training programs.--The training programs developed 
        under paragraph (1) may include courses in recent developments, 
        techniques, and procedures related to--
                    ``(A) intermodal and public transportation 
                planning;
                    ``(B) management;
                    ``(C) environmental factors;
                    ``(D) acquisition and joint use rights of way;
                    ``(E) engineering and architectural design;
                    ``(F) procurement strategies for public 
                transportation systems;
                    ``(G) turnkey approaches to delivering public 
                transportation systems;
                    ``(H) new technologies;
                    ``(I) emission reduction technologies;
                    ``(J) ways to make public transportation accessible 
                to individuals with disabilities;
                    ``(K) construction, construction management, 
                insurance, and risk management;
                    ``(L) maintenance;
                    ``(M) contract administration;
                    ``(N) inspection;
                    ``(O) innovative finance;
                    ``(P) workplace safety; and
                    ``(Q) public transportation security.''; and
            (2) in subsection (d), by striking ``mass'' each place it 
        appears.

SEC. 3018. BUS TESTING FACILITY.

    Section 5318 is amended--
            (1) in subsection (a)--
                    (A) by striking ``Establishment.--The Secretary of 
                Transportation shall establish one facility'' and 
                inserting ``In General.--The Secretary shall maintain 1 
                facility''; and
                    (B) by striking ``established by renovating'' and 
                inserting ``maintained at''; and
            (2) in subsection (d), by striking ``section 5309(m)(1)(C) 
        of this title'' and inserting ``paragraphs (1)(C) and (2)(B) of 
        section 5309(i)''.

SEC. 3019. BICYCLE FACILITIES.

    Section 5319 is amended by striking ``5307(k)'' and inserting 
``5307(d)(1)(K)''.

SEC. 3020. SUSPENDED LIGHT RAIL TECHNOLOGY PILOT PROJECT.

    Section 5320 is repealed.

SEC. 3021. CRIME PREVENTION AND SECURITY.

    Section 5321 is repealed.

SEC. 3022. GENERAL PROVISIONS ON ASSISTANCE.

    Section 5323 is amended--
            (1) in subsection (a)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) In general.--Financial assistance provided under this 
        chapter to a State or a local governmental authority may be 
        used to acquire an interest in, or to buy property of, a 
        private company engaged in public transportation, for a capital 
        project for property acquired from a private company engaged in 
        public transportation after July 9, 1964, or to operate a 
        public transportation facility or equipment in competition 
        with, or in addition to, transportation service provided by an 
        existing public transportation company, only if--
                    ``(A) the Secretary determines that such financial 
                assistance is essential to a program of projects 
                required under sections 5303, 5304, and 5306;
                    ``(B) the Secretary determines that the program 
                provides for the participation of private companies 
                engaged in public transportation to the maximum extent 
                feasible; and
                    ``(C) just compensation under State or local law 
                will be paid to the company for its franchise or 
                property.''; and
                    (B) in paragraph (2), by striking ``(2)'' and 
                inserting the following:
            ``(2) Limitation.--'';
            (2) by amending subsection (b) to read as follows:
    ``(b) Notice and Public Hearing.--
            ``(1) In general.--An application for a grant under this 
        chapter for a capital project that will substantially affect a 
        community, or the public transportation service of a community, 
        shall include, in the environmental record for the project, 
        evidence that the applicant has--
                    ``(A) provided an adequate opportunity for public 
                review and comment on the project;
                    ``(B) held a public hearing on the project if the 
                project affects significant economic, social, or 
                environmental interests;
                    ``(C) considered the economic, social, and 
                environmental effects of the project; and
                    ``(D) found that the project is consistent with 
                official plans for developing the urban area.
            ``(2) Contents of notice.--Notice of a hearing under this 
        subsection--
                    ``(A) shall include a concise description of the 
                proposed project; and
                    ``(B) shall be published in a newspaper of general 
                circulation in the geographic area the project will 
                serve.'';
            (3) by amending subsection (c) to read as follows:
    ``(c) New Technology.--A grant for financial assistance under this 
chapter for new technology, including innovative or improved products, 
techniques, or methods, shall be subject to the requirements of section 
5309 to the extent the Secretary determines to be appropriate.'';
            (4) by amending subsection (d) to read as follows:
    ``(d) Conditions on Bus Transportation Service.--Financial 
assistance under this chapter may be used to buy or operate a bus only 
if the recipient agrees to comply with the following conditions on bus 
transportation service:
            ``(1) Charter bus service.--
                    ``(A) In general.--Except as provided under 
                subparagraph (B), a recipient may provide incidental 
                charter bus service only within its lawful service area 
                if--
                            ``(i) the recipient annually publishes, by 
                        electronic and other appropriate means, a 
                        notice--
                                    ``(I) indicating its intent to 
                                offer incidental charter bus service 
                                within its lawful service area; and
                                    ``(II) soliciting notices from 
                                private bus operators that wish to 
                                appear on a list of carriers offering 
                                charter bus service in that service 
                                area;
                            ``(ii) the recipient provides private bus 
                        operators with an annual opportunity to notify 
                        the recipient of its desire to appear on a list 
                        of carriers offering charter bus service in 
                        such service area;
                            ``(iii) upon receiving a request for 
                        charter bus service, the recipient 
                        electronically notifies the private bus 
                        operators listed as offering charter service in 
                        that service area with the name and contact 
                        information of the requestor and the nature of 
                        the charter service request; and
                            ``(iv) the recipient does not offer to 
                        provide charter bus service unless no private 
                        bus operator indicates that it is willing and 
                        able to provide the service within a 72-hour 
                        period after the receipt of such notice.
                    ``(B) Exception.--A recipient that operates 2,000 
                or fewer vehicles in fixed-route peak hour service may 
                provide incidental charter bus transportation directly 
                to --
                            ``(i) local governments; and
                            ``(ii) social service entities with limited 
                        resources.
                    ``(C) Irregularly scheduled events.--Service, other 
                than commuter service, by a recipient to irregularly 
                scheduled events, where the service is conducted in 
                whole or in part outside the service area of the 
                recipient, regardless of whether the service is 
                contracted for individually with passengers, is subject 
                to a rebuttable presumption that such service is 
                charter service.
            ``(2) Violation of agreements.--
                    ``(A) Complaints.--A complaint regarding the 
                violation of a charter bus service agreement shall be 
                submitted to the Regional Administrator of the Federal 
                Transit Administration, who shall--
                            ``(i) provide a reasonable opportunity for 
                        the recipient to respond to the complaint;
                            ``(ii) provide the recipient with an 
                        opportunity for an informal hearing; and
                            ``(iii) issue a written decision not later 
                        than 60 days after the parties have completed 
                        their submissions.
                    ``(B) Appeals.--
                            ``(i) In general.--A decision by the 
                        Regional Administrator may be appealed to a 
                        panel comprised of the Federal Transit 
                        Administrator, personnel in the Office of the 
                        Secretary of Transportation, and other persons 
                        with expertise in surface passenger 
                        transportation issues.
                            ``(ii) Standard of review.--The panel 
                        described in clause (i) shall consider the 
                        complaint de novo on all issues of fact and 
                        law.
                            ``(iii) Written decision.--The appeals 
                        panel shall issue a written decision on an 
                        appeal not later than 60 days after the 
                        completion of submissions. This decision shall 
                        be the final order of the agency and subject to 
                        judicial review in district court.
                    ``(C) Correction.--If the Secretary determines that 
                a violation of an agreement relating to the provision 
                of charter service has occurred, the Secretary shall 
                correct the violation under terms of the agreement.
                    ``(D) Remedies.--The Secretary may issue orders to 
                recipients to cease and desist in actions that violate 
                the agreement, and such orders shall be binding upon 
                the parties. In addition to any remedy spelled out in 
                the agreement, if a recipient has failed to correct a 
                violation within 60 days after the receipt of a notice 
                of violation from the Secretary, the Secretary shall 
                withhold from the recipient the lesser of--
                            ``(i) 5 percent of the financial assistance 
                        available to the recipient under this chapter 
                        for the next fiscal year; or
                            ``(ii) $200,000.
            ``(3) Regulations.--Not later than 1 year after the date of 
        enactment of the Federal Public Transportation Act of 2004, the 
        Secretary shall issue amended regulations that--
                    ``(A) implement this subsection, as revised by such 
                Act; and
                    ``(B) impose restrictions, procedures, and remedies 
                in connection with sightseeing service by a recipient.
            ``(4) Public notice.--The Secretary shall make all written 
        decisions, guidance, and other pertinent materials relating to 
        the procedures in this subsection available to the public in 
        electronic and other appropriate formats in a timely manner.'';
            (5) by striking subsection (e);
            (6) by redesignating subsection (f) as subsection (e);
            (7) in subsection (e), as redesignated--
                    (A) by striking ``(1)'' and inserting the 
                following:
            ``(1) In general.--'';
                    (B) by striking paragraph (2);
                    (C) by striking ``This subsection'' and inserting 
                the following:
            ``(2) Exceptions.--This subsection; and
                    (D) by adding at the end the following:
            ``(3) Penalty.--If the Secretary determines that an 
        applicant, governmental authority, or publicly owned operator 
        has violated the agreement required under paragraph (1), the 
        Secretary shall bar the applicant, authority, or operator from 
        receiving Federal transit assistance in an amount the Secretary 
        determines to be appropriate.'';
            (8) by inserting after subsection (e) the following:
    ``(f) Bond Proceeds Eligible for Local Share.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, a recipient of assistance under section 5307 or 5309, may 
        use the proceeds from the issuance of revenue bonds as part of 
        the local matching funds for a capital project.
            ``(2) Reimbursement by secretary.--The Secretary may 
        reimburse an eligible recipient for deposits of bond proceeds 
        in a debt service reserve that the recipient established 
        pursuant to section 5302(a)(1)(K) from amounts made available 
        to the recipient under section 5307 or 5309.'';
            (9) in subsection (g)--
                    (A) by striking ``(f)'' each place it appears and 
                inserting ``(e)''; and
                    (B) by striking ``103(e)(4) and 142 (a) or (c)'' 
                each place it appears and inserting ``133 and 142'';
            (10) by amending subsection (h) to read as follows:
    ``(h) Transfer of Lands or Interests in Lands Owned by the United 
States.--
            (1) Request by secretary.--If the Secretary determines that 
        any part of the lands or interests in lands owned by the United 
        States and made available as a result of a military base 
        closure is necessary for transit purposes eligible under this 
        chapter, including corridor preservation, the Secretary shall 
        submit a request to the head of the Federal agency supervising 
        the administration of such lands or interests in lands. Such 
        request shall include a map showing the portion of such lands 
        or interests in lands, which is desired to be transferred for 
        public transportation purposes.
            ``(2) Transfer of land.--If 4 months after submitting a 
        request under paragraph (1), the Secretary does not receive a 
        response from the Federal agency described in paragraph (1) 
        that certifies that the proposed appropriation of land is 
        contrary to the public interest or inconsistent with the 
        purposes for which such land has been reserved, or if the head 
        of such agency agrees to the utilization or transfer under 
        conditions necessary for the adequate protection and 
        utilization of the reserve, such land or interests in land may 
        be utilized or transferred to a State, local governmental 
        authority, or public transportation operator for such purposes 
        and subject to the conditions specified by such agency.
            ``(3) Reversion.--If at any time the lands or interests in 
        land utilized or transferred under paragraph (2) are no longer 
        needed for public transportation purposes, the State, local 
        governmental authority, or public transportation operator that 
        received the land shall notify to the Secretary, and such lands 
        shall immediately revert to the control of the head of the 
        Federal agency from which the land was originally 
        transferred.'';
            (11) in subsection (j)(5), by striking ``Intermodal Surface 
        Transportation Efficiency Act of 1991 (Public Law 102-240, 105 
        Stat. 1914)'' and inserting ``Federal Public Transportation Act 
        of 2004'';
            (12) by amending subsection (l) to read as follows:
    ``(l) Relationship to Other Laws.--Section 1001 of title 18 applies 
to a certificate, submission, or statement provided under this chapter. 
The Secretary may terminate financial assistance under this chapter and 
seek reimbursement directly, or by offsetting amounts, available under 
this chapter, if the Secretary determines that a recipient of such 
financial assistance has made a false or fraudulent statement or 
related act in connection with a Federal transit program.'';
            (13) in subsection (m), by inserting at the end the 
        following: ``Requirements to perform preaward and postdelivery 
        reviews of rolling stock purchases to ensure compliance with 
        subsection (j) shall not apply to private nonprofit 
        organizations or to grantees serving urbanized areas with a 
        population of fewer than 1,000,000.'';
            (14) in subsection (o), by striking ``the Transportation 
        Infrastructure Finance and Innovation Act of 1998'' and 
        inserting ``sections 181 through 188 of title 23''; and
            (15) by adding at the end the following:
    ``(p) Prohibited Use of Funds.--Grant funds received under this 
chapter may not be used to pay ordinary governmental or nonproject 
operating expenses.''.

SEC. 3023. SPECIAL PROVISIONS FOR CAPITAL PROJECTS.

    (a) In General.--Section 5324 is amended to read as follows:
``Sec. 5324. Special provisions for capital projects
    ``(a) Real Property and Relocation Services.--Whenever real 
property is acquired or furnished as a required contribution incident 
to a project, the Secretary shall not approve the application for 
financial assistance unless the applicant has made all payments and 
provided all assistance and assurances that are required of a State 
agency under sections 210 and 305 of the Uniform Relocation Assistance 
and Real Property Acquisition Policies Act of 1970 (42 U.S.C. 4630 and 
4655). The Secretary must be advised of specific references to any 
State law that are believed to be an exception to section 301 or 302 of 
such Act (42 U.S.C. 4651 and 4652).
    ``(b) Advance Real Property Acquisitions.--
            (1) In general.--The Secretary may participate in the 
        acquisition of real property for any project that may use the 
        property if the Secretary determines that external market 
        forces are jeopardizing the potential use of the property for 
        the project and if--
                    ``(A) there are offers on the open real estate 
                market to convey that property for a use that is 
                incompatible with the project under study;
                    ``(B) there is an imminent threat of development or 
                redevelopment of the property for a use that is 
                incompatible with the project under study;
                    ``(C) recent appraisals reflect a rapid increase in 
                the fair market value of the property;
                    ``(D) the property, because it is located near an 
                existing transportation facility, is likely to be 
                developed and to be needed for a future transportation 
                improvement; or
                    ``(E) the property owner can demonstrate that, for 
                health, safety, or financial reasons, retaining 
                ownership of the property poses an undue hardship on 
                the owner in comparison to other affected property 
                owners and requests the acquisition to alleviate that 
                hardship.
            ``(2) Environmental reviews.--Property acquired in 
        accordance with this subsection may not be developed in 
        anticipation of the project until all required environmental 
        reviews for the project have been completed.
            ``(3) Limitation.--The Secretary shall limit the size and 
        number of properties acquired under this subsection as 
        necessary to avoid any prejudice to the Secretary's objective 
        evaluation of project alternatives.
            ``(4) Exemption.--An acquisition under this section shall 
        be considered an exempt project under section 176 of the Clean 
        Air Act (42 U.S.C. 7506).
    ``(c) Railroad Corridor Preservation.--
            ``(1) In general.--The Secretary may assist an applicant to 
        acquire railroad right-of-way before the completion of the 
        environmental reviews for any project that may use the right-
        of-way if the acquisition is otherwise permitted under Federal 
        law. The Secretary may establish restrictions on such an 
        acquisition as the Secretary determines to be necessary and 
        appropriate.
            ``(2) Environmental reviews.--Railroad right-of-way 
        acquired under this subsection may not be developed in 
        anticipation of the project until all required environmental 
        reviews for the project have been completed.
    ``(d) Consideration of Economic, Social, and Environmental 
Interests.--
            ``(1) In general.--The Secretary may not approve an 
        application for financial assistance for a capital project 
        under this chapter unless the Secretary determines that the 
        project has been developed in accordance with the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). The 
        Secretary's findings under this paragraph shall be made a 
        matter of public record.
            ``(2) Cooperation and consultation.--In carrying out 
        section 5301(e), the Secretary shall cooperate and consult with 
        the Secretary of the Interior and the Administrator of the 
        Environmental Protection Agency on each project that may have a 
        substantial impact on the environment.''.
    (b) Conforming Amendment.--The item relating to section 5324 in the 
table of sections for chapter 53 is amended to read as follows:

``5324. Special provisions for capital projects.''.

SEC. 3024. CONTRACT REQUIREMENTS.

    (a) In General.--Section 5325 is amended to read as follows:
``Sec. 5325. Contract requirements
    ``(a) Competition.--Recipients of assistance under this chapter 
shall conduct all procurement transactions in a manner that provides 
full and open competition as determined by the Secretary.
    ``(b) Architectural, Engineering, and Design Contracts.--
            ``(1) In general.--A contract or requirement for program 
        management, architectural engineering, construction management, 
        a feasibility study, and preliminary engineering, design, 
        architectural, engineering, surveying, mapping, or related 
        services for a project for which Federal assistance is provided 
        under this chapter shall be awarded in the same manner as a 
        contract for architectural and engineering services is 
        negotiated under chapter 11 of title 40, or an equivalent 
        qualifications-based requirement of a State. This subsection 
        does not apply to the extent a State has adopted or adopts by 
        law a formal procedure for procuring those services.
            ``(2) Additional requirements.--When awarding a contract 
        described in paragraph (1), recipients of assistance under this 
        chapter shall comply with the following requirements:
                    ``(A) Any contract or subcontract awarded under 
                this chapter shall be performed and audited in 
                compliance with cost principles contained in part 31 of 
                title 48, Code of Federal Regulations (commonly known 
                as the Federal Acquisition Regulation).
                    ``(B) A recipient of funds under a contract or 
                subcontract awarded under this chapter shall accept 
                indirect cost rates established in accordance with the 
                Federal Acquisition Regulation for 1-year applicable 
                accounting periods by a cognizant Federal or State 
                government agency, if such rates are not currently 
                under dispute.
                    ``(C) After a firm's indirect cost rates are 
                accepted under subparagraph (B), the recipient of the 
                funds shall apply such rates for the purposes of 
                contract estimation, negotiation, administration, 
                reporting, and contract payment, and shall not be 
                limited by administrative or de facto ceilings.
                    ``(D) A recipient requesting or using the cost and 
                rate data described in subparagraph (C) shall notify 
                any affected firm before such request or use. Such data 
                shall be confidential and shall not be accessible or 
                provided by the group of agencies sharing cost data 
                under this subparagraph, except by written permission 
                of the audited firm. If prohibited by law, such cost 
                and rate data shall not be disclosed under any 
                circumstances.
    ``(c) Efficient Procurement.--A recipient may award a procurement 
contract under this chapter to other than the lowest bidder if the 
award furthers an objective consistent with the purposes of this 
chapter, including improved long-term operating efficiency and lower 
long-term costs.
    ``(d) Design-Build Projects.--
            ``(1) Defined term.--As used in this subsection, the term 
        `design-build project'--
                    ``(A) means a project under which a recipient 
                enters into a contract with a seller, firm, or 
                consortium of firms to design and build an operable 
                segment of a public transportation system that meets 
                specific performance criteria; and
                    ``(B) may include an option to finance, or operate 
                for a period of time, the system or segment or any 
                combination of designing, building, operating, or 
                maintaining such system or segment.
            ``(2) Financial assistance for capital costs.--Federal 
        financial assistance under this chapter may be provided for the 
        capital costs of a design-build project after the recipient 
        complies with Government requirements.
    ``(e) Rolling Stock.--
            ``(1) Acquisition.--A recipient of financial assistance 
        under this chapter may enter into a contract to expend that 
        assistance to acquire rolling stock--
                    ``(A) with a party selected through a competitive 
                procurement process; or
                    ``(B) based on--
                            ``(i) initial capital costs; or
                            ``(ii) performance, standardization, life 
                        cycle costs, and other factors.
            ``(2) Multiyear contracts.--A recipient procuring rolling 
        stock with Federal financial assistance under this chapter may 
        make a multiyear contract, including options, to buy not more 
        than 5 years of requirements for rolling stock and replacement 
        parts. The Secretary shall allow a recipient to act on a 
        cooperative basis to procure rolling stock under this paragraph 
        and in accordance with other Federal procurement requirements.
    ``(f) Examination of Records.--Upon request, the Secretary and the 
Comptroller General, or any of their representatives, shall have access 
to and the right to examine and inspect all records, documents, and 
papers, including contracts, related to a project for which a grant is 
made under this chapter.
    ``(g) Grant Prohibition.--A grant awarded under this chapter may 
not be used to support a procurement that uses an exclusionary or 
discriminatory specification.
    ``(h) Bus Dealer Requirements.--No State law requiring buses to be 
purchased through in-State dealers shall apply to vehicles purchased 
with a grant under this chapter.
    ``(i) Awards to Responsible Contractors.--
            ``(1) In general.--Federal financial assistance under this 
        chapter may be provided for contracts only if a recipient 
        awards such contracts to responsible contractors possessing the 
        ability to successfully perform under the terms and conditions 
        of a proposed procurement.
            ``(2) Criteria.--Before making an award to a contractor 
        under paragraph (1), a recipient shall consider--
                    ``(A) the integrity of the contractor;
                    ``(B) the contractor's compliance with public 
                policy;
                    ``(C) the contractor's past performance, including 
                the performance reported in the Contractor Performance 
                Assessment Reports required under section 5309(m)(4); 
                and
                    ``(D) the contractor's financial and technical 
                resources.''.
    (b) Conforming Amendments.--Chapter 53 is amended by striking 
section 5326.

SEC. 3025. PROJECT MANAGEMENT OVERSIGHT AND REVIEW.

    (a) Project Management Plan Requirements.--Section 5327(a) is 
amended--
            (1) in paragraph (11), by striking ``and'' at the end;
            (2) in paragraph (12), by striking the period at the end 
        and inserting ``; and''; and
            (3) by adding at the end the following:
            ``(13) safety and security management.''.
    (b) Limitations on Use of Available Amounts.--Section 5327(c) is 
amended--
            (1) by amending paragraph (1) to read as follows:
            ``(1) In general.--The Secretary may not use more than 1 
        percent of amounts made available for a fiscal year to carry 
        out any of sections 5307 through 5311, 5316, or 5317, or a 
        project under the National Capital Transportation Act of 1969 
        (Public Law 91-143) to make a contract to oversee the 
        construction of major projects under any of sections 5307 
        through 5311, 5316, or 5317 or under that Act.'';
            (2) in paragraph (2)--
                    (A) by striking ``(2)'' and inserting the 
                following:
            ``(2) Other allowable uses.--''; and
                    (B) by inserting ``and security'' after ``safety''; 
                and
            (3) in paragraph (3), by striking ``(3) The Government 
        shall'' and inserting the following:
            ``(3) Federal share.--Federal funds shall be used to''.

SEC. 3026. PROJECT REVIEW.

    Section 5328 is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1) by striking ``(1) When the 
                Secretary of Transportation allows a new fixed guideway 
                project to advance into the alternatives analysis stage 
                of project review, the Secretary shall cooperate with 
                the applicant'' and inserting the following:
            ``(1) Alternatives analysis.--The Secretary shall cooperate 
        with an applicant undertaking an alternatives analysis under 
        subsections (e) and (f) of section 5309'';
                    (B) in paragraph (2)--
                            (i) by striking ``(2)'' and inserting the 
                        following:
            ``(2) Advancement to preliminary engineering stage.--''; 
        and
                            (ii) by striking ``is consistent with'' and 
                        inserting ``meets the requirements of'';
                    (C) in paragraph (3)--
                            (i) by striking ``(3)'' and inserting the 
                        following:
            ``(3) Record of decision.--'';
                            (ii) by striking ``of construction''; and
                            (iii) by adding before the period at the 
                        end the following: ``if the Secretary 
                        determines that the project meets the 
                        requirements of subsection (e) or (f) of 
                        section 5309''; and
                    (D) by striking paragraph (4); and
            (2) by striking subsection (c).

SEC. 3027. INVESTIGATIONS OF SAFETY AND SECURITY RISK.

    (a) In General.--Section 5329 is amended to read as follows:
``Sec. 5329. Investigation of safety hazards and security risks
    ``(a) In General.--The Secretary may conduct investigations into 
safety hazards and security risks associated with a condition in 
equipment, a facility, or an operation financed under this chapter to 
establish the nature and extent of the condition and how to eliminate, 
mitigate, or correct it.
    ``(b) Submission of Corrective Plan.--If the Secretary establishes 
that a safety hazard or security risk warrants further protective 
measures, the Secretary shall require the local governmental authority 
receiving amounts under this chapter to submit a plan for eliminating, 
mitigating, or correcting it.
    ``(c) Withholding of Funds.--Financial assistance under this 
chapter, in an amount to be determined by the Secretary, may be 
withheld until a plan is approved and carried out.
    ``(d) Public Transportation Security.--
            ``(1) In general.--Not later than 90 days after the date of 
        enactment of the Federal Public Transportation Act of 2004, the 
        Secretary shall enter into a memorandum of understanding with 
        the Secretary of Homeland Security to define and clarify the 
        respective roles and responsibilities of the Department of 
        Transportation and the Department of Homeland Security relating 
        to public transportation security.
            ``(2) Contents.--The memorandum of understanding described 
        in paragraph (1) shall--
                    ``(A) establish national security standards for 
                public transportation agencies;
                    ``(B) establish funding priorities for grants from 
                the Department of Homeland Security to public 
                transportation agencies;
                    ``(C) create a method of coordination with public 
                transportation agencies on security matters; and
                    ``(D) address any other issues determined to be 
                appropriate by the Secretary and the Secretary of 
                Homeland Security.''.
    (b) Conforming Amendment.--The item relating to section 5329 in the 
table of sections for chapter 53 is amended to read as follows:

``5329. Investigation of safety hazards and security risks.''.

SEC. 3028. STATE SAFETY OVERSIGHT.

    (a) In General.--Section 5330 is amended--
            (1) by amending the heading to read as follows:
``Sec. 5330. Withholding amounts for noncompliance with State safety 
              oversight requirements'';
            (2) by amending subsection (a) to read as follows:
    ``(a) Application.--This section shall only apply to--
            ``(1) States that have rail fixed guideway public 
        transportation systems that are not subject to regulation by 
        the Federal Railroad Administration; and
            ``(2) States that are designing rail fixed guideway public 
        transportation systems that will not be subjected to regulation 
        by the Federal Railroad Administration.'';
            (3) in subsection (d), by striking ``affected States'' and 
        inserting the following: ``affected States--
            ``(1) shall ensure uniform safety standards and 
        enforcement; or
            ``(2) may designate''; and
            (4) in subsection (f), by striking ``Not later than 
        December 18, 1992, the'' and inserting ``The''.
    (b) Conforming Amendment.--The item relating to section 5330 in the 
table of sections for chapter 53 is amended to read as follows:

``5330. Withholding amounts for noncompliance with State safety 
                            oversight requirements.''.

SEC. 3029. SENSITIVE SECURITY INFORMATION.

    Section 40119(b) is amended--
            (1) in paragraph (1)(C), by inserting ``, transportation 
        facilities or infrastructure, or transportation employees'' 
        before the period at the end; and
            (2) by adding at the end the following:
    ``(3) A State or local government may not enact, enforce, 
prescribe, issue, or continue in effect any law, regulation, standard, 
or order to the extent it is inconsistent with this section or 
regulations prescribed under this section.''.

SEC. 3030. TERRORIST ATTACKS AND OTHER ACTS OF VIOLENCE AGAINST PUBLIC 
              TRANSPORTATION SYSTEMS.

    (a) In General.--Section 1993 of title 18, United States Code, is 
amended--
            (1) by striking ``mass'' each place it appears and 
        inserting ``public'';
            (2) in subsection (a)(5), by inserting ``controlling,'' 
        after ``operating''; and
            (3) in subsection (c)(5), by striking ``5302(a)(7) of title 
        49, United States Code,'' and inserting ``5302(a) of title 
        49,''.
    (b) Conforming Amendment.--The table of contents for chapter 97 of 
title 18, United States Code is amended by amending the item related to 
section 1993 to read as follows:

``1993. Terrorist attacks and other acts of violence against public 
                            transportation systems.''.

SEC. 3031. CONTROLLED SUBSTANCES AND ALCOHOL MISUSE TESTING.

    Section 5331 is amended--
            (1) in subsection (a)(3), by inserting before the period at 
        the end the following: ``or sections 2303a, 7101(i), or 7302(e) 
        of title 46. The Secretary may also decide that a form of 
        public transportation is covered adequately, for employee 
        alcohol and controlled substances testing purposes, under the 
        alcohol and controlled substance statutes or regulations of an 
        agency within the Department of Transportation or other Federal 
        agency''; and
            (2) in subsection (f), by striking paragraph (3).

SEC. 3032. EMPLOYEE PROTECTIVE ARRANGEMENTS.

    Section 5333(b) is amended--
            (1) in paragraph (3), by striking the period at the end and 
        inserting ``: Provided, That--
            ``(A) the protective period shall not exceed 4 years; and
            ``(B) the separation allowance shall not exceed 12 
        months.''; and
            (2) by adding at the end the following:
    ``(4) An arrangement under this subsection shall not guarantee 
continuation of employment as a result of a change in private 
contractors through competitive bidding unless such continuation is 
otherwise required under subparagraph (A), (B), or (D) of paragraph 
(2).
    ``(5) Fair and equitable arrangements to protect the interests of 
employees utilized by the Secretary of Labor for assistance to purchase 
like-kind equipment or facilities, and amendments to existing 
assistance agreements, shall be certified without referral.
    ``(6) Nothing in this subsection shall affect the level of 
protection provided to freight railroad employees.''.

SEC. 3033. ADMINISTRATIVE PROCEDURES.

    Section 5334 is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by striking ``5309-5311 of 
                this title'' and all that follows and inserting ``5309 
                through 5311;'';
                    (B) in paragraph (9), by striking ``and'' at the 
                end;
                    (C) in paragraph (10), by striking the period at 
                the end and inserting ``; and''; and
                    (D) by inserting at the end the following:
            ``(11) issue regulations as necessary to carry out the 
        purposes of this chapter.'';
            (2) by redesignating subsections (b), (c), (d), (e), (f), 
        (g), (h), (i), and (j) as subsections (c), (d), (e), (f), (g), 
        (h), (i), (j), and (k), respectively;
            (3) by adding after subsection (a) the following:
    ``(b) Prohibitions Against Regulating Operations and Charges.--
            ``(1) In general.--Except as directed by the President for 
        purposes of national defense or in the event of a national or 
        regional emergency, the Secretary may not regulate--
                    ``(A) the operation, routes, or schedules of a 
                public transportation system for which a grant is made 
                under this chapter; or
                    ``(B) the rates, fares, tolls, rentals, or other 
                charges prescribed by any public or private 
                transportation provider.
            ``(2) Compliance with agreement.--Nothing in this 
        subsection shall prevent the Secretary from requiring a 
        recipient of funds under this chapter to comply with the terms 
        and conditions of its Federal assistance agreement.''; and
            (4) in subsection (j)(1), as redesignated, by striking 
        ``carry out section 5312(a) and (b)(1) of this title'' and 
        inserting ``advise and assist the Secretary in carrying out 
        section 5312(a)''.

SEC. 3034. REPORTS AND AUDITS.

    Section 5335 is amended--
            (1) by striking subsection (b); and
            (2) in subsection (a)--
                    (A) in paragraph (1), by striking ``(1)''; and
                    (B) in paragraph (2), by striking ``(2) The 
                Secretary may make a grant under section 5307 of this 
                title'' and inserting the following:
    ``(b) Reporting and Uniform Systems.--The Secretary may award a 
grant under section 5307 or 5311''.

SEC. 3035. APPORTIONMENTS OF APPROPRIATIONS FOR FORMULA GRANTS.

    Section 5336 is amended--
            (1) by striking subsection (d);
            (2) by striking subsection (h);
            (3) by striking subsection (k);
            (4) by redesignating subsections (a) through (c) as 
        subsections (b) through (d), respectively;
            (5) by adding before subsection (b), as redesignated, the 
        following:
    ``(a) Apportionments.--Of the amounts made available for each 
fiscal year under subsections (a)(1)(C)(vi) and (b)(2)(L) of section 
5338--
            ``(1) there shall be apportioned, in fiscal year 2005 and 
        each fiscal year thereafter, $35,000,000 to certain urbanized 
        areas with populations of less than 200,000 in accordance with 
        subsection (k); and
            ``(2) any amount not apportioned under paragraph (1) shall 
        be apportioned to urbanized areas in accordance with 
        subsections (b) through (d).'';
            (6) in subsection (b), as redesignated--
                    (A) by striking ``Of the amount made available or 
                appropriated under section 5338(a) of this title'' and 
                inserting ``Of the amount apportioned under subsection 
                (a)(3)''; and
                    (B) in paragraph (2), by striking ``subsections (b) 
                and (c) of this section'' and inserting ``subsections 
                (c) and (d)'';
            (7) in subsection (c)(2), as redesignated, by striking 
        ``subsection (a)(2) of this section'' and inserting 
        ``subsection (b)(2)'';
            (8) in subsection (d), as redesignated, by striking 
        ``subsection (a)(2) of this section'' and inserting 
        ``subsection (b)(2)'';
            (9) in subsection (e)(1), by striking ``subsections (a) and 
        (h)(2) of section 5338 of this title'' and inserting 
        ``subsections (a) and (b) of section 5338'';
            (10) in subsection (g), by striking ``subsection (a)(1) of 
        this section'' each place it appears and inserting ``subsection 
        (b)(1)''; and
            (11) by adding at the end the following:
    ``(k) Small Transit Intensive Cities Factors.--The amount 
apportioned under subsection (a)(1) shall be apportioned to urbanized 
areas as follows:
            ``(1) The Secretary shall calculate a factor equal to the 
        sum of revenue vehicle hours operated within urbanized areas 
        with a population of between 200,000 and 1,000,000 divided by 
        the sum of the population of all such urbanized areas.
            ``(2) The Secretary shall designate as eligible for an 
        apportionment under this subsection all urbanized areas with a 
        population of under 200,000 for which the number of revenue 
        vehicle hours operated within the urbanized area divided by the 
        population of the urbanized area exceeds the factor calculated 
        under paragraph (1).
            ``(3) For each urbanized area qualifying for an 
        apportionment under paragraph (2), the Secretary shall 
        calculate an amount equal to the product of the population of 
        that urbanized area and the factor calculated under paragraph 
        (1).
            ``(4) For each urbanized area qualifying for an 
        apportionment under paragraph (2), the Secretary shall 
        calculate an amount equal to the difference between the number 
        of revenue vehicle hours within that urbanized area less the 
        amount calculated in paragraph (3).
            ``(5) Each urbanized area qualifying for an apportionment 
        under paragraph (2) shall receive an amount equal to the amount 
        to be apportioned under this subsection multiplied by the 
        amount calculated for that urbanized area under paragraph (4) 
        divided by the sum of the amounts calculated under paragraph 
        (4) for all urbanized areas qualifying for an apportionment 
        under paragraph (2).
    ``(l) Study on Incentives in Formula Programs.--
            ``(1) Study.--The Secretary shall conduct a study to assess 
        the feasibility and appropriateness of developing and 
        implementing an incentive funding system under sections 5307 
        and 5311 for operators of public transportation.
            ``(2) Report.--
                    ``(A) In general.--Not later than 1 year after the 
                date of enactment of the Federal Public Transportation 
                Act of 2004, the Secretary shall submit a report on the 
                results of the study conducted under paragraph (1) to 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate and the Committee on Transportation and 
                Infrastructure of the House of Representatives.
                    ``(B) Contents.--The report submitted under 
                subparagraph (A) shall include--
                            ``(i) an analysis of the availability of 
                        appropriate measures to be used as a basis for 
                        the distribution of incentive payments;
                            ``(ii) the optimal number and size of any 
                        incentive programs;
                            ``(iii) what types of systems should 
                        compete for various incentives;
                            ``(iv) how incentives should be 
                        distributed; and
                            ``(v) the likely effects of the incentive 
                        funding system.''.

SEC. 3036. APPORTIONMENTS FOR FIXED GUIDEWAY MODERNIZATION.

    Section 5337 is amended--
            (1) in subsection (a), by striking ``for each of fiscal 
        years 1998 through 2003''; and
            (2) by striking ``section 5336(b)(2)(A)'' each place it 
        appears and inserting ``section 5336(c)(2)(A)''.

SEC. 3037. AUTHORIZATIONS.

    Section 5338 is amended to read as follows:
``Sec. 5338. Authorizations
    ``(a) Fiscal Year 2004.--
            ``(1) Formula grants.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $3,053,079,920 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out sections 
                5307, 5309, 5310, and 5311 of this chapter and section 
                3038 of the Transportation Equity Act for the 21st 
                Century (49 U.S.C. 5310 note).
                    ``(B) General fund.--In addition to the amounts 
                made available under subparagraph (A), there are 
                authorized to be appropriated $763,269,980 for fiscal 
                year 2004 to carry out sections 5307, 5309, 5310, and 
                5311 of this chapter and section 3038 of the 
                Transportation Equity Act for the 21st Century (49 
                U.S.C. 5310 note).
                    ``(C) Allocation of funds.--Of the amounts made 
                available or appropriated under this paragraph--
                            ``(i) $4,821,335 shall be available to the 
                        Alaska Railroad for improvements to its 
                        passenger operations under section 5307;
                            ``(ii) $6,908,995 shall be available to 
                        provide over-the-road bus accessibility grants 
                        under section 3038 of the Transportation Equity 
                        Act for the 21st Century (49 U.S.C. 5310 note);
                            ``(iii) $90,117,950 shall be available to 
                        provide transportation services to elderly 
                        individuals and individuals with disabilities 
                        under section 5310;
                            ``(iv) $239,188,058 shall be available to 
                        provide financial assistance for other than 
                        urbanized areas under section 5311;
                            ``(v) $3,425,608,562 shall be available to 
                        provide financial assistance for urbanized 
                        areas under section 5307; and
                            ``(vi) $49,705,000 shall be available to 
                        provide financial assistance for buses and bus 
                        facilities under section 5309..
            ``(2) Job access and reverse commute.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $99,410,000 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out section 
                3037 of the Transportation Equity Act for the 21st 
                Century (49 U.S.C. 5309 note).
                    ``(B) General fund.--In addition to the amounts 
                made available under paragraph (A), there are 
                authorized to be appropriated $24,852,500 for fiscal 
                year 2004 to carry out section 3037 of the 
                Transportation Equity Act of the 21st Century (49 
                U.S.C. 5309 note).
            ``(3) Capital program grants.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $2,495,191,000 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out section 
                5309.
                    ``(B) General fund.--In addition to the amounts 
                made available under subparagraph (A), there are 
                authorized to be appropriated $623,797,750 for fiscal 
                year 2004 to carry out section 5309.
            ``(4) Planning.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $58,254,260 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out section 
                5308.
                    ``(B) General fund.--In addition to the amounts 
                made available under subparagraph (A), there are 
                authorized to be appropriated $14,315,040 for fiscal 
                year 2004 to carry out section 5308.
                    ``(C) Allocation of funds.--Of the amounts made 
                available or appropriated under this paragraph--
                            ``(i) 82.72 percent shall be allocated for 
                        metropolitan planning under section 5308(c); 
                        and
                            ``(ii) 17.28 percent shall be allocated for 
                        State planning under section 5308(d).
            ``(5) Research.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $41,951,020 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out sections 
                5311(b), 5312, 5313, 5314, 5315, and 5322.
                    ``(B) General fund.--In addition to the amounts 
                made available under subparagraph (A), there are 
                authorized to be appropriated $10,736,280 for fiscal 
                year 2004 to carry out sections 5311(b), 5312, 5313, 
                5314, 5315, and 5322.
                    ``(C) Allocation of funds.--Of the funds made 
                available or appropriated under this paragraph--
                            ``(i) not less than $3,976,400 shall be 
                        available to carry out programs of the National 
                        Transit Institute under section 5315;
                            ``(ii) not less than $5,219,025 shall be 
                        available to carry out section 5311(b)(2);
                            ``(iii) not less than $8,201,325 shall be 
                        available to carry out section 5313; and
                            ``(iv) the remainder shall be available to 
                        carry out national research and technology 
                        programs under sections 5312, 5314, and 5322.
            ``(6) University transportation research.--
                    ``(A) Trust fund.--For fiscal year 2004, $4,771,680 
                shall be available from the Mass Transit Account of the 
                Highway Trust Fund to carry out sections 5505 and 5506.
                    ``(B) General fund.--In addition to amounts made 
                available under subparagraph (A), there are authorized 
                to be appropriated $1,192,920 for fiscal year 2004 to 
                carry out sections 5505 and 5506.
                    ``(C) Allocation of funds.--Of the amounts made 
                available or appropriated under this paragraph--
                            ``(i) $1,988,200 shall be available for 
                        grants under 5506(f)(5) to the institution 
                        identified in section 5505(j)(3)(E), as in 
                        effect on the day before the date of enactment 
                        of the Federal Public Transportation Act of 
                        2004;
                            ``(ii) $1,988,200 shall be available for 
                        grants under section 5505(d) to the institution 
                        identified in section 5505(j)(4)(A), as in 
                        effect on the date specified in clause (i); and
                            ``(iii) $1,988,200 shall be available for 
                        grants under section 5505(d) to the institution 
                        identified in section 5505(j)(4)(F), as in 
                        effect on the date specified in subclause (I).
                    ``(C) Special rule.--Nothing in this paragraph 
                shall be construed to limit the transportation research 
                conducted by the centers receiving financial assistance 
                under this section.
            ``(7) Administration.--
                    ``(A) Trust fund.--For fiscal year 2004, 
                $60,043,640 shall be available from the Mass Transit 
                Account of the Highway Trust Fund to carry out section 
                5334.
            ``(B) General fund.--In addition to amounts made available 
        under subparagraph (A), there are authorized to be appropriated 
        $15,010,910 for fiscal year 2004 to carry out section 5334.
            ``(8) Grants as contractual obligations.--
            ``(A) Grants financed from highway trust fund.--A grant or 
        contract that is approved by the Secretary and financed with 
        amounts made available under paragraph (1)(A), (2)(A), (3)(A), 
        (4)(A), (5)(A), (6)(A), or (7)(A) is a contractual obligation 
        of the United States Government to pay the Federal share of the 
        cost of the project.
                    ``(B) Grants financed from general fund.--A grant 
                or contract that is approved by the Secretary and 
                financed with amounts appropriated in advance under 
                paragraph (1)(B), (2)(B), (3)(B), (4)(B), (5)(B), 
                (6)(B), or (7)(B) is a contractual obligation of the 
                United States Government to pay the Federal share of 
                the cost of the project only to the extent that amounts 
                are appropriated for such purpose by an Act of 
                Congress.
            ``(9) Availability of Amounts.--Amounts made available or 
        appropriated under paragraphs (1) through (6) shall remain 
        available until expended.''.
    ``(b) Formula Grants and Research.--
            ``(1) In general.--There shall be available from the Mass 
        Transit Account of the Highway Trust Fund to carry out sections 
        5307, 5308, 5309, 5310 through 5316, 5322, 5335, 5340, and 5505 
        of this title, and sections 3037 and 3038 of the Federal 
        Transit Act of 1998 (112 Stat. 387 et seq.)--
                    ``(A) $6,262,600,000 for fiscal year 2005;
                    ``(B) $6,577,629,000 for fiscal year 2006;
                    ``(C) $6,950,400,000 for fiscal year 2007;
                    ``(D) $7,594,760,000 for fiscal year 2008; and
                    ``(E) $8,275,320,000 for fiscal year 2009.
            ``(2) Allocation of funds.--Of the amounts made available 
        under paragraph (1) for each fiscal year--
                    ``(A) 0.092 percent shall be available for grants 
                to the Alaska Railroad under section 5307 for 
                improvements to its passenger operations;
                    ``(B) 1.75 percent shall be available to carry out 
                section 5308;
                    ``(C) 2.05 percent shall be available to provide 
                financial assistance for job access and reverse commute 
                projects under section 3037 of the Federal Transit Act 
                of 1998 (49 U.S.C. 5309 note);
                    ``(D) 3.00 percent shall be available to provide 
                financial assistance for services for elderly persons 
                and persons with disabilities under section 5310;
                    ``(E) 0.125 percent shall be available to carry out 
                section 3038 of the Transportation Equity Act for the 
                21st Century (49 U.S.C. 5310 note);
                    ``(F) 6.25 percent shall be available to provide 
                financial assistance for other than urbanized areas 
                under section 5311;
                    ``(G) 0.89 percent shall be available to carry out 
                transit cooperative research programs under section 
                5313, the National Transit Institute under section 
                5315, university research centers under section 5505, 
                and national research programs under sections 5312, 
                5313, 5314, and 5322, of which--
                            ``(i) 17.0 percent shall be allocated to 
                        carry out transit cooperative research programs 
                        under section 5313;
                            ``(ii) 7.5 percent shall be allocated to 
                        carry out programs under the National Transit 
                        Institute under section 5315, including not 
                        more than $1,000,000 to carry out section 
                        5315(a)(16);
                            ``(iii) 11.0 percent shall be allocated to 
                        carry out the university centers program under 
                        section 5505; and
                            ``(iv) any funds made available under this 
                        subparagraph that are not allocated under 
                        clauses (i) through (iii) shall be allocated to 
                        carry out national research programs under 
                        sections 5312, 5313, 5314, and 5322;
                    ``(H) $25,000,000 shall be available for each of 
                the fiscal years 2005 through 2009 to carry out section 
                5316;
                    ``(I) there shall be available to carry out section 
                5335--
                            ``(i) $3,700,000 in fiscal year 2005;
                            ``(ii) $3,900,000 in fiscal year 2006;
                            ``(iii) $4,200,000 in fiscal year 2007;
                            ``(iv) $4,600,000 in fiscal year 2008; and
                            ``(v) $5,000,000 in fiscal year 2009;
                    ``(J) 6.25 percent shall be allocated in accordance 
                with section 5340 to provide financial assistance for 
                urbanized areas under section 5307 and other than 
                urbanized areas under section 5311; and
                    ``(K) 22.0 percent shall be allocated in accordance 
                with section 5337 to provide financial assistance under 
                section 5309(i)(3); and
                    ``(L) any amounts not made available under 
                subparagraphs (A) through (K) shall be allocated in 
                accordance with section 5336 to provide financial 
                assistance for urbanized areas under section 5307.
            ``(3) University centers program.--
                    ``(A) Allocation.--Of the amounts allocated under 
                paragraph (2)(G)(iii), $1,000,000 shall be available in 
                each of the fiscal years 2005 through 2009 for Morgan 
                State University to provide transportation research, 
                training, and curriculum development.
                    ``(B) Requirements.--The university specified under 
                subparagraph (A) shall be considered a University 
                Transportation Center under section 510 of title 23, 
                and shall be subject to the requirements under 
                subsections (c), (d), (e), and (f) of such section.
                    ``(C) Report.--In addition to the report required 
                under section 510(e)(3) of title 23, the university 
                specified under subparagraph (A) shall annually submit 
                a report to the Secretary that describes the 
                university's contribution to public transportation.
            ``(4) Bus grants.--In addition to the amounts made 
        available under paragraph (1), there shall be available from 
        the Mass Transit Account of the Highway Trust Fund to carry out 
        section 5309(i)(2)(B)--
                    ``(A) $839,829,000 for fiscal year 2005;
                    ``(B) $882,075,000 for fiscal year 2006;
                    ``(C) $932,064,000 for fiscal year 2007;
                    ``(D) $1,018,474,000 for fiscal year 2008; and
                    ``(E) $1,109,739,000 for fiscal year 2009.
    ``(c) Major Capital Investment Grants.--There are authorized to be 
appropriated to carry out section 5309(i)(2)(A)--
            ``(1) $1,461,072,000 for fiscal year 2005;
            ``(2) $1,534,568,000 for fiscal year 2006;
            ``(3) $1,621,536,000 for fiscal year 2007;
            ``(4) $1,771,866,000 for fiscal year 2008; and
            ``(5) $1,930,641,000 for fiscal year 2009.
    ``(d) Administration.--There shall be available from the Mass 
Transit Account of the Highway Trust Fund to carry out section 5334--
            ``(1) $86,500,000 for fiscal year 2005;
            ``(2) $90,851,000 for fiscal year 2006;
            ``(3) $96,000,000 for fiscal year 2007;
            ``(4) $104,900,000 for fiscal year 2008; and
            ``(5) $114,300,000 for fiscal year 2009.
    ``(e) Grants as Contractual Obligations.--
            ``(1) Mass transit account funds.--A grant or contract 
        approved by the Secretary that is financed with amounts made 
        available under subsection (b)(1) or (d) is a contractual 
        obligation of the United States Government to pay the Federal 
        share of the cost of the project.
            ``(2) Appropriated funds.--A grant or contract approved by 
        the Secretary that is financed with amounts made available 
        under subsection (b)(2) or (c) is a contractual obligation of 
        the United States Government to pay the Federal share of the 
        cost of the project only to the extent that amounts are 
        appropriated in advance for such purpose by an Act of Congress.
    ``(f) Availability of Amounts.--Amounts made available by or 
appropriated under subsections (b) and (c) shall remain available until 
expended.''.

SEC. 3038. APPORTIONMENTS BASED ON GROWING STATES FORMULA FACTORS.

    (a) In General.--Chapter 53 is amended by adding at the end the 
following:
``Sec. 5340. Apportionments based on growing States and high density 
              State formula factors
    ``(a) Allocation.--Of the amounts made available for each fiscal 
year under section 5338(b)(2)(J), the Secretary shall apportion--
            ``(1) 50 percent to States and urbanized areas in 
        accordance with subsection (b); and
            ``(2) 50 percent to States and urbanized areas in 
        accordance with subsection (c).
    ``(b) Growing State Apportionments.--
            ``(1) Apportionment among states.--The amounts apportioned 
        under paragraph (a)(1) shall provide each State with an amount 
        equal to the total amount apportioned multiplied by a ratio 
        equal to the population of that State forecast for the year 
        that is 15 years after the most recent decennial census, 
        divided by the total population of all States forecast for the 
        year that is 15 years after the most recent decennial census. 
        Such forecast shall be based on the population trend for each 
        State between the most recent decennial census and the most 
        recent estimate of population made by the Secretary of 
        Commerce.
            ``(2) Apportionments between urbanized areas and other than 
        urbanized areas in each state.--
                    ``(A) In general.--The Secretary shall apportion 
                amounts to each State under paragraph (1) so that 
                urbanized areas in that State receive an amount equal 
                to the amount apportioned to that State multiplied by a 
                ratio equal to the sum of the forecast population of 
                all urbanized areas in that State divided by the total 
                forecast population of that State. In making the 
                apportionment under this subparagraph, the Secretary 
                shall utilize any available forecasts made by the 
                State. If no forecasts are available, the Secretary 
                shall utilize data on urbanized areas and total 
                population from the most recent decennial census.
                    ``(B) Remaining amounts.--Amounts remaining for 
                each State after apportionment under subparagraph (A) 
                shall be apportioned to that State and added to the 
                amount made available for grants under section 5311.
            ``(3) Apportionments among urbanized areas in each state.--
        The Secretary shall apportion amounts made available to 
        urbanized areas in each State under subsection (b)(2)(A) so 
        that each urbanized area receives an amount equal to the amount 
        apportioned under subsection (b)(2)(A) multiplied by a ratio 
        equal to the population of each urbanized area divided by the 
        sum of populations of all urbanized areas in the State. Amounts 
        apportioned to each urbanized area shall be added to amounts 
        apportioned to that urbanized area under section 5336, and made 
        available for grants under section 5307.
    ``(c) High Density State Apportionments.--Amounts to be apportioned 
under subsection (a)(2) shall be apportioned as follows:
            ``(1) Eligible states.--The Secretary shall designate as 
        eligible for an apportionment under this subsection all States 
        with a population density in excess of 370 persons per square 
        mile.
            ``(2) State urbanized land factor.--For each State 
        qualifying for an apportionment under paragraph (1), the 
        Secretary shall calculate an amount equal to the product of the 
        urban land area of urbanized areas in the State times 370 
        persons per square mile.
            ``(3) State apportionment factor.--For each State 
        qualifying for an apportionment under paragraph (1), the 
        Secretary shall calculate an amount equal to the difference 
        between the total population of the State less the amount 
        calculated in paragraph (2).
            ``(4) State apportionment.--Each State qualifying for an 
        apportionment under paragraph (1) shall receive an amount equal 
        to the amount to be apportioned under this subsection 
        multiplied by the amount calculated for the State under 
        paragraph (3) divided by the sum of the amounts calculated 
        under paragraph (3) for all States qualifying for an 
        apportionment under paragraph (1).
            ``(5) Apportionments between urbanized areas and other than 
        urbanized areas in each state.--
                    ``(A) In general.--The Secretary shall apportion 
                amounts apportioned to each State under paragraph (4) 
                so that urbanized areas in that State receive an amount 
                equal to the amount apportioned to that State 
                multiplied by a ratio equal to the sum of the 
                population of all urbanized areas in that State divided 
                by the total population of that State.
                    ``(B) Remaining amounts.--Amounts remaining for 
                each State after apportionment under subparagraph (a) 
                shall be apportioned to that State and added to the 
                amount made available for grants under section 5311.
            ``(6) Apportionments among urbanized areas in each state.--
        The Secretary shall apportion amounts made available to 
        urbanized areas in each State under subsection (c)(5)(A) so 
        that each urbanized area receives an amount equal to the amount 
        apportioned under subsection (c)(5)(A) multiplied by a ratio 
        equal to the population of each urbanized area divided by the 
        sum of populations of all urbanized areas in the State. Amounts 
        apportioned to each urbanized area shall be added to amounts 
        apportioned to that urbanized area under section 5336, and made 
        available for grants under section 5307.''.
    (b) Conforming Amendment.--The table of sections for chapter 53 is 
amended by adding at the end the following:

``5340. Apportionments based on growing States and high density States 
                            formula factors.''.

SEC. 3039. JOB ACCESS AND REVERSE COMMUTE GRANTS.

    Section 3037 of the Federal Transit Act of 1998 (49 U.S.C. 5309 
note) is amended--
            (1) in subsection (b)--
                    (A) in paragraph (1)--
                            (i) by striking ``means an individual'' and 
                        inserting the following: ``means--
                    ``(A) an individual''; and
                            (ii) by striking the period at the end and 
                        inserting ``; or
                    ``(B) an individual who is eligible for assistance 
                under the State program of Temporary Assistance to 
                Needy Families funded under part A of title IV of the 
                Social Security Act (42 U.S.C. 601 et. seq.) in the 
                State in which the recipient of a grant under this 
                section is located.''; and
                    (B) in paragraph (2), by striking ``development 
                of'' each place it appears and inserting ``development 
                and provision of'';
            (2) in subsection (i), by amending paragraph (2) to read as 
        follows:
            ``(2) Coordination.--
                    ``(A) In general.--The Secretary shall coordinate 
                activities under this section with related activities 
                under programs of other Federal departments and 
                agencies.
                    ``(B) Certification.--A recipient of funds under 
                this section shall certify that--
                            ``(i) the project has been derived from a 
                        locally developed, coordinated public transit 
                        human services transportation plan; and
                            ``(ii) the plan was developed through a 
                        process that included representatives of 
                        public, private, and nonprofit transportation 
                        and human services providers and participation 
                        by the public.'';
            (3) by amending subsection (j) to read as follows:
    ``(j) Grant Requirements.--
            ``(1) In general.--
                    ``(A) Urbanized areas.--A grant awarded under this 
                section to a public agency or private company engaged 
                in public transportation in an urbanized area shall be 
                subject to the all of the terms and conditions to which 
                a grant awarded under section 5307 of title 49, United 
                States Code, is subject, to the extent the Secretary 
                considers appropriate.
                    ``(B) Other than urbanized areas.--A grant awarded 
                under this section to a public agency or a private 
                company engaged in public transportation in an area 
                other than urbanized areas shall be subject to all of 
                the terms and conditions to which a grant awarded under 
                section 5311 of title 49, United States Code, is 
                subject, to the extent the Secretary considers 
                appropriate.
                    ``(C) Nonprofit organizations.--A grant awarded 
                under this section to a private nonprofit organization 
                shall be subject to all of the terms and conditions to 
                which a grant made under section 5310 of title 49, 
                United States Code, is subject, to the extent the 
                Secretary considers appropriate.
            ``(2) Special warranty.--
                    ``(A) In general.--Section 5333(b) of title 49, 
                United States Code, shall apply to grants under this 
                section if the Secretary of Labor utilizes a Special 
                Warranty that provides a fair and equitable arrangement 
                to protect the interests of employees.
                    ``(B) Waiver.--The Secretary may waive the 
                applicability of the Special Warranty under 
                subparagraph (A) for private non-profit recipients on a 
                case-by-case basis as the Secretary considers 
                appropriate.''; and
            (4) by striking subsections (k) and (l).

SEC. 3040. OVER-THE-ROAD BUS ACCESSIBILITY PROGRAM.

    (a) Section Heading.--The section heading for section 3038 of the 
Federal Transit Act of 1998 (49 U.S.C. 5310 note), is amended to read 
as follows:

``SEC. 3038. OVER-THE-ROAD BUS ACCESSIBILITY PROGRAM.''.

    (b) Funding.--Section 3038(g) of the Federal Transit Act of 1998 
(49 U.S.C. 5310 note) is amended to read as follows:
    ``(g) Funding.--Of the amounts made available for each fiscal year 
under subsections (a)(1)(C)(iii) and (b)(2)(E) of section 5338 of title 
49, United States Code--
            ``(1) 75 percent shall be available, and shall remain 
        available until expended, for operators of over-the-road buses, 
        used substantially or exclusively in intercity, fixed-route 
        over-the-road bus service, to finance the incremental capital 
        and training costs of the Department of Transportation's final 
        rule regarding accessibility of over-the-road buses; and
            ``(2) 25 percent shall be available, and shall remain 
        available until expended, for operators of over-the-road bus 
        service not described in paragraph (1), to finance the 
        incremental capital and training costs of the Department of 
        Transportation's final rule regarding accessibility of over-
        the-road buses.''.
    (b) Conforming Amendment.--The item relating to section 3038 in the 
table of contents for the Transportation Equity Act for the 21st 
Century (Public Law 105-178) is amended to read as follows:

``Sec. 3038. Over-the-road bus accessibility program.''.

SEC. 3041. ALTERNATIVE TRANSPORTATION IN PARKS AND PUBLIC LANDS.

    (a) In General.--Chapter 53 is amended by inserting after section 
5315 the following:
``Sec. 5316. Alternative transportation in parks and public lands
    ``(a) In General.--
            ``(1) Authorization.--
                    ``(A) In general.--The Secretary, in consultation 
                with the Secretary of the Interior, may award a grant 
                or enter into a contract, cooperative agreement, 
                interagency agreement, intraagency agreement, or other 
                transaction to carry out a qualified project under this 
                section to enhance the protection of America's National 
                Parks and public lands and increase the enjoyment of 
                those visiting the parks and public lands by ensuring 
                access to all, including persons with disabilities, 
                improving conservation and park and public land 
                opportunities in urban areas through partnering with 
                state and local governments, and improving park and 
                public land transportation infrastructure.
                    ``(B) Consultation with other agencies.--To the 
                extent that projects are proposed or funded in eligible 
                areas that are not within the jurisdiction of the 
                Department of the Interior, the Secretary of the 
                Interior shall consult with the heads of the relevant 
                Federal land management agencies in carrying out the 
                responsibilities under this section.
            ``(2) Use of funds.--A grant, cooperative agreement, 
        interagency agreement, intraagency agreement, or other 
        transaction for a qualified project under this section shall be 
        available to finance the leasing of equipment and facilities 
        for use in public transportation, subject to any regulation 
        that the Secretary may prescribe limiting the grant or 
        agreement to leasing arrangements that are more cost-effective 
        than purchase or construction.
    ``(b) Definitions.--As used in this section, the following 
definitions shall apply:
            ``(1) Eligible area.--The term `eligible area' means any 
        federally owned or managed park, refuge, or recreational area 
        that is open to the general public, including--
                    ``(A) a unit of the National Park System;
                    ``(B) a unit of the National Wildlife Refuge 
                System;
                    ``(C) a recreational area managed by the Bureau of 
                Land Management; and
                    ``(D) a recreation area managed by the Bureau of 
                Reclamation.
            ``(2) Federal land management agency.--The term `Federal 
        land management agency' means a Federal agency that manages an 
        eligible area.
            ``(3) Alternative transportation.--The term `alternative 
        transportation' means transportation by bus, rail, or any other 
        publicly or privately owned conveyance that provides to the 
        public general or special service on a regular basis, including 
        sightseeing service.
            ``(4) Qualified participant.--The term `qualified 
        participant' means--
                    ``(A) a Federal land management agency; or
                    ``(B) a State, tribal, or local governmental 
                authority with jurisdiction over land in the vicinity 
                of an eligible area acting with the consent of the 
                Federal land management agency, alone or in partnership 
                with a Federal land management agency or other 
                Governmental or nongovernmental participant.
            ``(5) Qualified project.--The term `qualified project' 
        means a planning or capital project in or in the vicinity of an 
        eligible area that--
                    ``(A) is an activity described in section 5302, 
                5303, 5304, 5308, or 5309(a)(1)(A);
                    ``(B) involves--
                            ``(i) the purchase of rolling stock that 
                        incorporates clean fuel technology or the 
                        replacement of buses of a type in use on the 
                        date of enactment of this section with clean 
                        fuel vehicles; or
                            ``(ii) the deployment of alternative 
                        transportation vehicles that introduce 
                        innovative technologies or methods;
                    ``(C) relates to the capital costs of coordinating 
                the Federal land management agency public 
                transportation systems with other public transportation 
                systems;
                    ``(D) provides a nonmotorized transportation system 
                (including the provision of facilities for pedestrians, 
                bicycles, and nonmotorized watercraft);
                    ``(E) provides waterborne access within or in the 
                vicinity of an eligible area, as appropriate to and 
                consistent with this section; or
                    ``(F) is any other alternative transportation 
                project that--
                            ``(i) enhances the environment;
                            ``(ii) prevents or mitigates an adverse 
                        impact on a natural resource;
                            ``(iii) improves Federal land management 
                        agency resource management;
                            ``(iv) improves visitor mobility and 
                        accessibility and the visitor experience;
                            ``(v) reduces congestion and pollution 
                        (including noise pollution and visual 
                        pollution); or
                            ``(vi) conserves a natural, historical, or 
                        cultural resource (excluding rehabilitation or 
                        restoration of a non-transportation facility).
    ``(c) Federal Agency Cooperative Arrangements.--The Secretary shall 
develop cooperative arrangements with the Secretary of the Interior 
that provide for--
            ``(1) technical assistance in alternative transportation;
            ``(2) interagency and multidisciplinary teams to develop 
        Federal land management agency alternative transportation 
        policy, procedures, and coordination; and
            ``(3) the development of procedures and criteria relating 
        to the planning, selection, and funding of qualified projects 
        and the implementation and oversight of the program of projects 
        in accordance with this section.
    ``(d) Limitation on Use of Available Amounts.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of the Interior, may use not more than 10 percent of 
        the amount made available for a fiscal year under section 
        5338(a)(2)(I) to carry out planning, research, and technical 
        assistance under this section, including the development of 
        technology appropriate for use in a qualified project.
            ``(2) Additional amounts.--Amounts made available under 
        this subsection are in addition to amounts otherwise available 
        to the Secretary to carry out planning, research, and technical 
        assistance under this title or any other provision of law.
            ``(3) Maximum amount.--No qualified project shall receive 
        more than 12 percent of the total amount made available to 
        carry out this section under section 5338(a)(2)(I) for any 
        fiscal year.
    ``(e) Planning Process.--In undertaking a qualified project under 
this section,
            ``(1) if the qualified participant is a Federal land 
        management agency--
                    ``(A) the Secretary, in cooperation with the 
                Secretary of the Interior, shall develop transportation 
                planning procedures that are consistent with--
                            ``(i) the metropolitan planning provisions 
                        under section 5303 of this title;
                            ``(ii) the statewide planning provisions 
                        under section 5304 of this title; and
                            ``(iii) the public participation 
                        requirements under section 5307(e); and
                    ``(B) in the case of a qualified project that is at 
                a unit of the National Park system, the planning 
                process shall be consistent with the general management 
                plans of the unit of the National Park system; and
            ``(2) if the qualified participant is a State or local 
        governmental authority, or more than one State or local 
        governmental authority in more than one State, the qualified 
        participant shall--
                    ``(A) comply with the metropolitan planning 
                provisions under section 5303 of this title;
                    ``(B) comply with the statewide planning provisions 
                under section 5304 of this title;
                    ``(C) comply with the public participation 
                requirements under section 5307(e) of this title; and
                    ``(D) consult with the appropriate Federal land 
                management agency during the planning process.
    ``(f) Cost Sharing.--
            ``(1) The Secretary, in cooperation with the Secretary of 
        the Interior, shall establish the agency share of net project 
        cost to be provided under this section to a qualified 
        participant.
            ``(2) In establishing the agency share of net project cost 
        to be provided under this section, the Secretary shall 
        consider--
                    ``(A) visitation levels and the revenue derived 
                from user fees in the eligible area in which the 
                qualified project is carried out;
                    ``(B) the extent to which the qualified participant 
                coordinates with a public transportation authority or 
                private entity engaged in public transportation;
                    ``(C) private investment in the qualified project, 
                including the provision of contract services, joint 
                development activities, and the use of innovative 
                financing mechanisms;
                    ``(D) the clear and direct benefit to the qualified 
                participant; and
                    ``(E) any other matters that the Secretary 
                considers appropriate to carry out this section.
            ``(3) Notwithstanding any other provision of law, Federal 
        funds appropriated to any Federal land management agency may be 
        counted toward the non-agency share of the net project cost of 
        a qualified project.
    ``(g) Selection of Qualified Projects.--
            ``(1) The Secretary of the Interior, after consultation 
        with and in cooperation with the Secretary, shall determine the 
        final selection and funding of an annual program of qualified 
        projects in accordance with this section.
            ``(2) In determining whether to include a project in the 
        annual program of qualified projects, the Secretary of the 
        Interior shall consider--
                    ``(A) the justification for the qualified project, 
                including the extent to which the qualified project 
                would conserve resources, prevent or mitigate adverse 
                impact, and enhance the environment;
                    ``(B) the location of the qualified project, to 
                ensure that the selected qualified projects--
                            ``(i) are geographically diverse 
                        nationwide; and
                            ``(ii) include qualified projects in 
                        eligible areas located in both urban areas and 
                        rural areas;
                    ``(C) the size of the qualified project, to ensure 
                that there is a balanced distribution;
                    ``(D) the historical and cultural significance of a 
                qualified project;
                    ``(E) safety;
                    ``(F) the extent to which the qualified project 
                would-
                            ``(i) enhance livable communities;
                            ``(ii) reduce pollution (including noise 
                        pollution, air pollution, and visual 
                        pollution);
                            ``(iii) reduce congestion; and
                            ``(iv) improve the mobility of people in 
                        the most efficient manner; and
                    ``(G) any other matters that the Secretary 
                considers appropriate to carry out this section, 
                including--
                            ``(i) visitation levels;
                            ``(ii) the use of innovative financing or 
                        joint development strategies; and
                            ``(iii) coordination with gateway 
                        communities.
    ``(h) Qualified Projects Carried Out in Advance.--
            ``(1) When a qualified participant carries out any part of 
        a qualified project without assistance under this section in 
        accordance with all applicable procedures and requirements, the 
        Secretary, in consultation with the Secretary of the Interior, 
        may pay the share of the net capital project cost of a 
        qualified project if--
                    ``(A) the qualified participant applies for the 
                payment;
                    ``(B) the Secretary approves the payment; and
                    ``(C) before carrying out that part of the 
                qualified project, the Secretary approves the plans and 
                specifications in the same manner as plans and 
                specifications are approved for other projects assisted 
                under this section.
            ``(2)(A) The cost of carrying out part of a qualified 
        project under paragraph (1) includes the amount of interest 
        earned and payable on bonds issued by a State or local 
        governmental authority, to the extent that proceeds of the bond 
        are expended in carrying out that part.
            ``(B) The rate of interest under this paragraph may not 
        exceed the most favorable rate reasonably available for the 
        qualified project at the time of borrowing.
            ``(C) The qualified participant shall certify, in a manner 
        satisfactory to the Secretary, that the qualified participant 
        has exercised reasonable diligence in seeking the most 
        favorable interest rate.
    ``(i) Relationship to Other Laws.--
            ``(1) Section 5307.--A qualified participant under this 
        section shall be subject to the requirements of sections 5307 
        and 5333(a) to the extent the Secretary determines to be 
        appropriate.
            ``(2) Other requirements.--A qualified participant under 
        this section is subject to any other terms, conditions, 
        requirements, and provisions that the Secretary determines to 
        be appropriate to carry out this section, including 
        requirements for the distribution of proceeds on disposition of 
        real property and equipment resulting from a qualified project 
        assisted under this section.
            ``(3) Project management plan.--If the amount of assistance 
        anticipated to be required for a qualified project under this 
        section is not less than $25,000,000--
                    ``(A) the qualified project shall, to the extent 
                the Secretary considers appropriate, be carried out 
                through a full funding grant agreement, in accordance 
                with section 5309(g); and
                    ``(B) the qualified participant shall prepare a 
                project management plan in accordance with section 
                5327(a).
    ``(i) Asset Management.--The Secretary, in consultation with the 
Secretary of the Interior, may transfer the interest of the Department 
of Transportation in, and control over, all facilities and equipment 
acquired under this section to a qualified participant for use and 
disposition in accordance with any property management regulations that 
the Secretary determines to be appropriate.
    ``(j) Coordination of Research and Deployment of New 
Technologies.--
            ``(1) The Secretary, in cooperation with the Secretary of 
        the Interior, may undertake, or make grants, cooperative 
        agreements, contracts (including agreements with departments, 
        agencies, and instrumentalities of the Federal Government) or 
        other transactions for research, development, and deployment of 
        new technologies in eligible areas that will--
                    ``(A) conserve resources;
                    ``(B) prevent or mitigate adverse environmental 
                impact;
                    ``(C) improve visitor mobility, accessibility, and 
                enjoyment; and
                    ``(D) reduce pollution (including noise pollution 
                and visual pollution).
            ``(2) The Secretary may request and receive appropriate 
        information from any source.
            ``(3) Grants, cooperative agreements, contracts or other 
        transactions under paragraph (1) shall be awarded from amounts 
        allocated under subsection (c)(1).
    ``(k) Innovative Financing.--A qualified project receiving 
financial assistance under this section shall be eligible for funding 
through a state infrastructure bank or other innovative financing 
mechanism available to finance an eligible project under this chapter.
    ``(l) Reports.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of the Interior, shall annually submit a report on 
        the allocation of amounts made available to assist qualified 
        projects under this section to--
                    ``(A) the Committee on Banking, Housing, and Urban 
                Affairs of the Senate; and
                    ``(B) the Committee on Transportation and 
                Infrastructure of the House of Representatives.
            ``(2) Annual and supplemental reports.--The report required 
        under paragraph (1) shall be included in the report submitted 
        under section 5309(m).''.
    (b) Conforming Amendments.--The table of sections for chapter 53 is 
amended by inserting after the item relating to section 5315 the 
following:

``5316. Alternative transportation in parks and public lands.''.

SEC. 3042. OBLIGATION CEILING.

    Notwithstanding any other provision of law, the total of all 
obligations from amounts made available from the Mass Transit Account 
of the Highway Trust Fund by, and amounts appropriated under, 
subsections (a) through (c) of section 5338 of title 49, United States 
Code, shall not exceed--
            (1) $7,265,876,900 for fiscal year 2004;
            (2) $8,650,000,000 for fiscal year 2005;
            (3) $9,085,123,000 for fiscal year 2006;
            (4) $9,600,000,000 for fiscal year 2007;
            (5) $10,490,000,000 for fiscal year 2008; and
            (6) $11,430,000,000 for fiscal year 2009.

SEC. 3043. ADJUSTMENTS FOR THE SURFACE TRANSPORTATION EXTENSION ACT OF 
              2003.

    (a) In General.--Notwithstanding any other provision of law, the 
Secretary shall reduce the total apportionments and allocations made 
for fiscal year 2004 to each grant recipient under section 5338 of 
title 49, United States Code, by the amount apportioned to that 
recipient pursuant to section 8 of the Surface Transportation Extension 
Act of 2003 (117 Stat. 1121).
    (b) Fixed Guideway Modernization Adjustment.--In making the 
apportionments described in subsection (a), the Secretary shall adjust 
the amount apportioned for fiscal year 2004 to each urbanized area for 
fixed guideway modernization to reflect the apportionment method set 
forth in 5337(a) of title 49, United States Code.

SEC. 3044. DISADVANTAGED BUSINESS ENTERPRISE.

    Section 1101(b) of the Transportation Equity Act of the 21st 
Century shall apply to all funds authorized or otherwise made available 
under this title.

SEC. 3045. INTERMODAL PASSENGER FACILITIES.

    (a) In General.--Chapter 55 of title 49, United States Code, is 
amended by adding at the end the following:

           ``SUBCHAPTER III--INTERMODAL PASSENGER FACILITIES

Sec. 5571. Policy and purposes
    ``(a) Development and Enhancement of Intermodal Passenger 
Facilities.--It is in the economic interest of the United States to 
improve the efficiency of public surface transportation modes by 
ensuring their connection with and access to intermodal passenger 
terminals, thereby streamlining the transfer of passengers among modes, 
enhancing travel options, and increasing passenger transportation 
operating efficiencies.
    ``(b) General Purposes.--The purposes of this subchapter are to 
accelerate intermodal integration among North America's passenger 
transportation modes through--
            ``(1) ensuring intercity public transportation access to 
        intermodal passenger facilities;
            ``(2) encouraging the development of an integrated system 
        of public transportation information; and
            ``(3) providing intercity bus intermodal passenger facility 
        grants.
Sec. 5572. Definitions
    ``In this subchapter--
            ``(1) `capital project' means a project for--
                    ``(A) acquiring, constructing, improving, or 
                renovating an intermodal facility that is related 
                physically and functionally to intercity bus service 
                and establishes or enhances coordination between 
                intercity bus service and transportation, including 
                aviation, commuter rail, intercity rail, public 
                transportation, seaports, and the National Highway 
                System, such as physical infrastructure associated with 
                private bus operations at existing and new intermodal 
                facilities, including special lanes, curb cuts, ticket 
                kiosks and counters, baggage and package express 
                storage, employee parking, office space, security, and 
                signage; and
                    ``(B) establishing or enhancing coordination 
                between intercity bus service and transportation, 
                including aviation, commuter rail, intercity rail, 
                public transportation, and the National Highway System 
                through an integrated system of public transportation 
                information.
            ``(2) `commuter service' means service designed primarily 
        to provide daily work trips within the local commuting area.
            ``(3) `intercity bus service' means regularly scheduled bus 
        service for the general public which operates with limited 
        stops over fixed routes connecting two or more urban areas not 
        in close proximity, which has the capacity for transporting 
        baggage carried by passengers, and which makes meaningful 
        connections with scheduled intercity bus service to more 
        distant points, if such service is available and may include 
        package express service, if incidental to passenger 
        transportation, but does not include air, commuter, water or 
        rail service.
            ``(4) `intermodal passenger facility' means passenger 
        terminal that does, or can be modified to, accommodate several 
        modes of transportation and related facilities, including some 
        or all of the following: intercity rail, intercity bus, 
        commuter rail, intracity rail transit and bus transportation, 
        airport limousine service and airline ticket offices, rent-a-
        car facilities, taxis, private parking, and other 
        transportation services.
            ``(5) `local governmental authority' includes--
                    ``(A) a political subdivision of a State;
                    ``(B) an authority of at least one State or 
                political subdivision of a State;
                    ``(C) an Indian tribe; and
                    ``(D) a public corporation, board, or commission 
                established under the laws of the State.
            ``(6) `owner or operator of a public transportation 
        facility' means an owner or operator of intercity-rail, 
        intercity-bus, commuter-rail, commuter-bus, rail-transit, bus-
        transit, or ferry services.
            ``(7) `recipient' means a State or local governmental 
        authority or a nonprofit organization that receives a grant to 
        carry out this section directly from the Federal government.
            ``(8) `Secretary' means the Secretary of Transportation.
            ``(9) `State' means a State of the United States, the 
        District of Columbia, Puerto Rico, the Northern Mariana 
        Islands, Guam, American Samoa, and the Virgin Islands.
            ``(10) `urban area' means an area that includes a 
        municipality or other built-up place that the Secretary, after 
        considering local patterns and trends of urban growth, decides 
        is appropriate for a local public transportation system to 
        serve individuals in the locality.
``Sec. 5573. Assurance of access to intermodal passenger facilities
    ``Intercity buses and other modes of transportation shall, to the 
maximum extent practicable, have access to publicly funded intermodal 
passenger facilities, including those passenger facilities seeking 
funding under section 5574.
``Sec. 5574. Intercity bus intermodal passenger facility grants
    ``(a) General Authority.--The Secretary of Transportation may make 
grants under this section to recipients in financing a capital project 
only if the Secretary finds that the proposed project is justified and 
has adequate financial commitment.
    ``(b) Competitive Grant Selection.--The Secretary shall conduct a 
national solicitation for applications for grants under this section. 
Grantees shall be selected on a competitive basis.
    ``(c) Share of Net Project Costs.--A grant shall not exceed 50 
percent of the net project cost, as determined by the Secretary.
    ``(d) Regulations.--The Secretary may promulgate such regulations 
as are necessary to carry out this section.
``Sec. 5575. Funding
    ``(a) Highway Account.--
            ``(1) There is authorized to be appropriated from the 
        Highway Trust Fund (other than the Mass Transit Account) to 
        carry out this subchapter $10,000,000 for each of fiscal years 
        2005 through 2009.
            ``(2) The funding made available under paragraph (1) shall 
        be available for obligation in the same manner as if such funds 
        were apportioned under chapter 1 of title 23 and shall be 
        subject to any obligation limitation imposed on funds for 
        Federal-aid highways and highway safety construction programs.
    ``(b) Period of Availability.--Amounts made available under 
subsection (a) shall remain available until expended.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 55 of 
title 49, United States Code, is amended by adding at the end the 
following:

           ``subchapter iii--intermodal passenger facilities
Sec.
``5571. Policy and Purposes.
``5572. Definitions.
``5573. Assurance of access to intermodal facilities.
``5574. Intercity bus intermodal facility grants.
``5575. Funding.''.

                TITLE IV--SURFACE TRANSPORTATION SAFETY

SEC. 4001. SHORT TITLE.

    This title may be cited as the ``Surface Transportation Safety 
Reauthorization Act of 2004''.

                       Subtitle A--Highway Safety

                  PART I--HIGHWAY SAFETY GRANT PROGRAM

SEC. 4101. SHORT TITLE; AMENDMENT OF TITLE 23, UNITED STATES CODE.

    (a) Short Title.--This subpart may be cited as the ``Highway Safety 
Grant Program Reauthorization Act of 2004''.
    (b) Amendment of Title 23, United States Code.--Except as otherwise 
expressly provided, whenever in this subpart an amendment or repeal is 
expressed in terms of an amendment to, or a repeal of, a section or 
other provision, the reference shall be considered to be made to a 
section or other provision of title 23, United States Code.

SEC. 4102. AUTHORIZATION OF APPROPRIATIONS.

    (a) Amounts for Fiscal Years 2004 Through 2009.--There are 
authorized to be appropriated from the Highway Trust Fund (other than 
the Mass Transit Account) to the Secretary of Transportation for the 
National Highway Traffic Safety Administration the following:
            (1) To carry out the Highway Safety Programs under section 
        402 of title 23, United States Code, $170,000,000 in fiscal 
        year 2004, $174,000,000 in fiscal year 2005, $179,000,000 in 
        fiscal year 2006, $185,000,000 in fiscal year 2007, 
        $204,000,000 in fiscal year 2008, and $207,000,000 in fiscal 
        year 2009.
            (2) To carry out the Highway Safety Research and Outreach 
        Programs under section 403 of title 23, United States Code, 
        $110,000,000 in fiscal year 2004, $112,000,000 in fiscal year 
        2005, $114,000,000 in fiscal year 2006, $116,000,000 in fiscal 
        year 2007, $118,000,000 in fiscal year 2008, and $120,000,000 
        in fiscal year 2009.
            (3) To carry out the Occupant Protection Programs under 
        section 405 of title 23, United States Code, $120,000,000 in 
        fiscal year 2004, $122,000,000 in fiscal year 2005, 
        $124,000,000 in fiscal year 2006, $126,000,000 in fiscal year 
        2007, $128,000,000 in fiscal year 2008, and $130,000,000 in 
        fiscal year 2009.
            (4) To carry out the Emergency Medical Services Program 
        under section 407A of title 23, United States Code, $5,000,000 
        in each of fiscal years 2004 through 2009.
            (5) To carry out the Impaired Driving Program under section 
        410 of title 23, United States Code, $85,000,000 in fiscal year 
        2004, $89,000,000 in fiscal year 2005, $93,000,000 in fiscal 
        year 2006, $110,000,000 in fiscal year 2007, $126,000,000 in 
        fiscal year 2008, and $130,000,000 in fiscal year 2009.
            (6) To carry out the State Traffic Safety Information 
        System Improvements under section 412 of title 23, United 
        States Code, $45,000,000 in each of fiscal years 2004 through 
        2009.
            (7) To carry out chapter 303 of title 49, United States 
        Code, $4,000,000 for each of fiscal years 2004 through 2009.
    (b) Prohibition on Other Uses.--Except as otherwise provided in 
this subtitle, the amounts allocated from the Highway Trust Fund for 
programs provided for in chapter 4 of title 23, United States Code, 
shall only be used for such programs and may not be used by States or 
local governments for construction purposes.
    (c) Effect of Revenue Deficiency.--If revenue to the Highway Trust 
Fund for a given fiscal year is lower than the amounts authorized by 
this subpart, any subsequent reductions in the overall funding for 
highway and transit programs shall not affect the highway safety 
programs provided for in chapter 4 of title 23, United States Code.
    (d) Proportional Increases.--For each fiscal year from 2004 through 
2009, if revenue to the Highway Trust Fund increases above the amounts 
for each such fiscal year set forth in the fiscal year 2004 joint 
budget resolution, then the amounts made available in such year for the 
programs in sections 402, 405, and 410 shall increase by the same 
percentage.

SEC. 4103. HIGHWAY SAFETY PROGRAMS.

    (a) Programs To Be Included.--
            (1) Motor vehicle airbags public awareness.--Section 
        402(a)(2) is amended by striking`` vehicles and to increase 
        public awareness of the benefit of motor vehicles equipped with 
        airbags'' and inserting ``vehicles,''.
            (2) Agressive driving.--Section 402(a) is further amended--
                    (A) by redesignating clause (6) as clause (8);
                    (B) by inserting after ``involving school buses,'' 
                at the end of clause (5) the following: ``(6) to reduce 
                aggressive driving and to educate drivers about 
                defensive driving, (7) to reduce accidents resulting 
                from fatigued and distracted drivers, including 
                distractions arising from the use of electronic devices 
                in vehicles,''; and
                    (C) by inserting ``aggressive driving, distracted 
                driving,'' after ``school bus accidents,''.
    (b) Apportionment.--
            (1) Tribal government programs.--Section 402(c) is amended 
        by striking ``three-fourths of 1 percent'' and inserting ``2 
        percent''.
    (c) Extra Funding for Occupant Protection and Impaired Driving 
Programs.--Section 402 is amended by inserting after subsection (g) the 
following:
    ``(h) Grants.--Funds available to States under this section may be 
used for making grants of financial assistance for programs and 
initiatives authorized by sections 405 and 410 of this title.''.
    (d) Law Enforcement Chase Training.--Section 402 is amended by 
adding at the end the following:
    ``(l) Limitation Relating to Law Enforcement Vehicular Pursuit 
Training.--No State may receive any funds available for fiscal years 
after fiscal year 2004 for programs under this chapter until the State 
submits to the Secretary a written statement that the State actively 
encourages all relevant law enforcement agencies in that State to 
follow the guidelines established for police chases issued by the 
International Association of Chiefs of Police that are in effect on the 
date of enactment of the Highway Safety Grant Program Reauthorization 
Act of 2004, or as revised and in effect after that date as determined 
by the Secretary.
    ``(m) Consolidation of Grant Applications.--The Secretary shall 
establish an approval process by which a State may apply for all grants 
included under this chapter through a single application with a single 
annual deadline. The Bureau of Indian Affairs shall establish a 
similarly simplified process for applications from Indian tribes.
    ``(n) Administrative Expenses.--Funds authorized to be appropriated 
to carry out this section shall be subject to a deduction of not to 
exceed 5 percent for the necessary costs of administering the 
provisions of this section, section 405, section 407A, section 410, and 
413 of this chapter.''.

SEC. 4104. HIGHWAY SAFETY RESEARCH AND OUTREACH PROGRAMS.

    (a) Revised Authority and Requirements.--Section 403 is amended to 
read as follows:
``Sec. 403. Highway safety research and development
    ``(a) Authority of the Secretary.--The Secretary is authorized to 
use funds appropriated to carry out this section to--
            ``(1) conduct research on all phases of highway safety and 
        traffic conditions, including accident causation, highway or 
        driver characteristics, communications, and emergency care;
            ``(2) conduct ongoing research into driver behavior and its 
        effect on traffic safety;
            ``(3) conduct research on, and launch initiatives to 
        counter, fatigued driving by drivers of motor vehicles and 
        distracted driving in such vehicles, including the effect that 
        the use of electronic devices and other factors deemed relevant 
        by the Secretary have on driving;
            ``(4) conduct training or education programs in cooperation 
        with other Federal departments and agencies, States, private 
        sector persons, highway safety personnel, and law enforcement 
        personnel;
            ``(5) conduct research on, and evaluate the effectiveness 
        of, traffic safety countermeasures, including seat belts and 
        impaired driving initiatives; and
            ``(6) conduct demonstration projects.
    ``(b) Specific Research Programs.--
            ``(1) Required programs.--The Secretary shall conduct 
        research on the following:
                    ``(A) Effects of use of controlled substances.--A 
                study on the effects of the use of controlled 
                substances on driver behavior to determine--
                            ``(i) methodologies for measuring driver 
                        impairment resulting from use of the most 
                        common controlled substances (including the use 
                        of such substances in combination with 
                        alcohol); and
                            ``(ii) effective and efficient methods for 
                        training law enforcement personnel to detect or 
                        measure the level of impairment of a driver who 
                        is under the influence of a controlled 
                        substance by the use of technology or 
                        otherwise.
                    ``(B) On-scene motor vehicle collision causation.--
                A nationally representative study to collect on-scene 
                motor vehicle collision data, and to determine crash 
                causation, for which the Secretary shall enter into a 
                contract with the National Academy of Sciences to 
                conduct a review of the research, design, methodology, 
                and implementation of the study.
                    ``(C) Toll facilities workplace safety.--A study on 
                the safety of highway toll collection facilities, 
                including toll booths, conducted in cooperation with 
                State and local highway safety organizations to 
                determine the safety of highway toll collection 
                facilities for the toll collectors who work in and 
                around such facilities and to develop best practices 
                that would be of benefit to State and local highway 
                safety organizations. The study shall consider--
                            ``(i) any problems resulting from design or 
                        construction of facilities that contribute to 
                        the occurrence of vehicle collisions with the 
                        facilities;
                            ``(ii) the safety of crosswalks used by 
                        toll collectors in transit to and from toll 
                        booths;
                            ``(iii) the extent of the enforcement of 
                        speed limits at and in the vicinity of toll 
                        facilities;
                            ``(iv) the use of warning devices, such as 
                        vibration and rumble strips, to alert drivers 
                        approaching toll facilities;
                            ``(v) the use of cameras to record traffic 
                        violations in the vicinity of toll facilities;
                            ``(vi) the use of traffic control arms in 
                        the vicinity of toll facilities;
                            ``(vii) law enforcement practices and 
                        jurisdictional issues that affect safety at and 
                        in the vicinity of toll facilities; and
                            ``(viii) data (which shall be collected in 
                        conducting the research) regarding the 
                        incidence of accidents and injuries at and 
                        around toll booth facilities.
            ``(2) Time for completion of studies.--The studies 
        conducted in subparagraphs (A), (B), and (C) of paragraph (1) 
        may be conducted in concert with other Federal departments and 
        agencies with relevant expertise. The Secretary shall submit an 
        annual report to the Senate Committee on Commerce, Science, and 
        Transportation and the House of Representatives Committee on 
        Transportation and Infrastructure on the progress of each study 
        conducted under this subsection.
            ``(3) Ongoing studies.--The studies under subparagraphs (A) 
        and (B) of paragraph (1) shall be conducted on an ongoing 
        basis.
            ``(4) Reports.--
                    ``(A) One-time study.--Not later than 2 years after 
                the date of enactment of the Highway Safety Grant 
                Program Reauthorization Act of 2004, the Secretary 
                shall submit a final report on the study referred to in 
                paragraph (1)(C) to the Committee on Commerce, Science, 
                and Transportation of the Senate and the Committee on 
                Transportation and Infrastructure of the House of 
                Representatives.
                    ``(B) Ongoing studies.--The Secretary shall submit 
                a report on the studies referred to in paragraph (3) to 
                the Committees of Congress referred to in subparagraph 
                (A) not later than December 31, 2005, and shall submit 
                additional reports on such studies to such committees 
                every 2 years. Such additional reports shall contain 
                the findings, progress, remaining challenges, research 
                objectives, and other relevant data relating to the 
                ongoing studies.
            ``(5) Research on distracted, inattentive, and fatigued 
        drivers.--In conducting research under subsection (a)(3), the 
        Secretary shall carry out not less than 5 demonstration 
        projects to evaluate new and innovative means of combatting 
        traffic system problems caused by distracted, inattentive, or 
        fatigued drivers. The demonstration projects shall be in 
        addition to any other research carried out under this 
        subsection.
    ``(c) Nationwide Traffic Safety Campaigns.--
            ``(1) Requirement for campaigns.--The Administrator of the 
        National Highway Traffic Safety Administration shall establish 
        and administer a program under which 3 high-visibility traffic 
        safety law enforcement campaigns will be carried out for the 
        purposes specified in paragraph (2) in each of years 2004 
        through 2009.
            ``(2) Purpose.--The purpose of each law enforcement 
        campaign is to achieve either or both of the following 
        objectives:
                    ``(A) Reduce alcohol-impaired or drug-impaired 
                operation of motor vehicles.
                    ``(B) Increase use of seat belts by occupants of 
                motor vehicles.
            ``(3) Advertising.--The Administrator may use, or authorize 
        the use of, funds available under this section to pay for the 
        development, production, and use of broadcast and print media 
        advertising in carrying out traffic safety law enforcement 
        campaigns under this subsection. Consideration shall be given 
        to advertising directed at non-English speaking populations, 
        including those who listen, read, or watch nontraditional 
        media.
            ``(4) Coordination with states.--The Administrator shall 
        coordinate with the States in carrying out the traffic safety 
        law enforcement campaigns under this subsection, including 
        advertising funded under paragraph (3), with a view to--
                    ``(A) relying on States to provide the law 
                enforcement resources for the campaigns out of funding 
                available under this section and sections 402, 405, and 
                410 of this title; and
                    ``(B) providing out of National Highway Traffic 
                Safety Administration resources most of the means 
                necessary for national advertising and education 
                efforts associated with the law enforcement campaigns.
            ``(5) Annual evaluation.--The Secretary shall conduct an 
        annual evaluation of the effectiveness of such initiatives.
            ``(6) Funding.--The Secretary shall use $24,000,000 in each 
        of fiscal years 2004 through 2009 for advertising and 
        educational initiatives to be carried out nationwide in support 
        of the campaigns under this section.
    ``(d) Improving Older Driver Safety.--
            ``(1) In general.--Of the funds made available under this 
        section, the Secretary shall allocate $2,000,000 in each of 
        fiscal years 2004 through 2009 to conduct a comprehensive 
        research and demonstration program to improve traffic safety 
        pertaining to older drivers. The program shall--
                    ``(A) provide information and guidelines to assist 
                physicians and other related medical personnel, 
                families, licensing agencies, enforcement officers, and 
                various public and transit agencies in enhancing the 
                safety and mobility of older drivers;
                    ``(B) improve the scientific basis of medical 
                standards and screenings strategies used in the 
                licensing of all drivers in a non-discriminatory 
                manner;
                    ``(C) conduct field tests to assess the safety 
                benefits and mobility impacts of different driver 
                licensing strategies and driver assessment and 
                rehabilitation methods;
                    ``(D) assess the value and improve the safety 
                potential of driver retraining courses of particular 
                benefit to older drivers; and
                    ``(E) conduct other activities to accomplish the 
                objectives of this action.
            ``(2) Formulation of plan.--After consultation with 
        affected parties, the Secretary shall formulate an older driver 
        traffic safety plan to guide the design and implementation of 
        this program. The plan shall be submitted to the House of 
        Representatives Committee on Transportation and Infrastructure 
        and the Senate Committee on Commerce, Science, and 
        Transportation within 180 days after the date of enactment of 
        the Highway Safety Grant Program Reauthorization Act of 2004.
    ``(e) Law Enforcement Training.--
            ``(1) Requirement for program.--The Administrator of the 
        National Highway Traffic Safety Administration shall carry out 
        a program to train law enforcement personnel of each State and 
        political subdivision thereof in police chase techniques that 
        are consistent with the police chase guidelines issued by the 
        International Association of Chiefs of Police.
            ``(2) Amount for program.--Of the amount available for a 
        fiscal year to carry out this section, $200,000 shall be 
        available for carrying out this subsection.
    ``(f) International Cooperation.--
            ``(1) Authority.--The Administrator of the National Highway 
        Traffic Safety Administration may participate and cooperate in 
        international activities to enhance highway safety.
            ``(2) Amount for program.--Of the amount available for a 
        fiscal year to carry out this section, $200,000 may be used for 
        activities authorized under paragraph (1).''.
    (b) Study on Refusal of Intoxication Testing.--
            (1) Requirement for study.--In addition to studies under 
        section 403 of title 23, United States Code, the Secretary of 
        Transportation shall carry out a study of the frequency with 
        which persons arrested for the offense of operating a motor 
        vehicle under the influence of alcohol and persons arrested for 
        the offense of operating a motor vehicle while intoxicated 
        refuse to take a test to determine blood alcohol concentration 
        levels and the effect such refusals have on the ability of 
        States to prosecute such persons for those offenses.
            (2) Consultation.--In carrying out the study under this 
        section, the Secretary shall consult with the Governors of the 
        States, the States' Attorneys General, and the United States 
        Sentencing Commission.
            (3) Report.--
                    (A) requirement for report.--Not later than 1 year 
                after the date of the enactment of this Act, the 
                Secretary shall submit a report on the results of the 
                study to the Committee on Commerce, Science, and 
                Transportation of the Senate and the Committee on 
                Transportation and Infrastructure of the House of 
                Representatives.
                    (B) Content.--The report shall include any 
                recommendation for legislation, including any 
                recommended model State legislation, and any other 
                recommendations that the Secretary considers 
                appropriate for implementing a program designed to 
                decrease the occurrence refusals by arrested persons to 
                submit to a test to determine blood alcohol 
                concentration levels.

SEC. 4105. NATIONAL HIGHWAY SAFETY ADVISORY COMMITTEE TECHNICAL 
              CORRECTION.

    Section 404(d) is amended by striking ``Commerce'' and inserting 
``Transportation''.

SEC. 4106. OCCUPANT PROTECTION GRANTS.

    Section 405 is amended--
            (1) by striking the second sentence of subsection (a)(1);
            (2) by striking ``Transportation Equity Act for the 21st 
        Century.'' in subsection (a)(2) and inserting ``Highway Safety 
        Grant Program Reauthorization Act of 2004.'';
            (3) by striking subsections (a)(3) and (4), (b), (c), and 
        (d) and redesignating subsections (e) and (f) as subsections 
        (d) and (e), respectively; and
            (4) by inserting after subsection (a) the following:
    ``(b) Occupant Protection Grants.--
            ``(1) In general.--In addition to the grants authorized by 
        subsection (a), the Secretary shall make grants in accordance 
        with this subsection.
            ``(2) Safety belt performance grants.--
                    ``(A) Primary safety belt use law.--
                            ``(i) For fiscal years 2004 and 2005, the 
                        Secretary shall make a grant to each State that 
                        enacted, and is enforcing, a primary safety 
                        belt use law for all passenger motor vehicles 
                        that became effective by December 31, 2002.
                            ``(ii) For each of fiscal years 2004 
                        through 2009, the Secretary shall, after making 
                        grants under clause (i) of this subparagraph, 
                        make a one-time grant to each State that either 
                        enacts for the first time after December 31, 
                        2002, and has in effect a primary safety belt 
                        use law for all passenger motor vehicles, or, 
                        in the case of a State that does not have such 
                        a primary safety belt use law, has a State 
                        safety belt use rate in the preceding fiscal 
                        year of at least 90 percent, as measured under 
                        criteria determined by the Secretary.
                            ``(iii) Of the funds authorized for grants 
                        under this subsection, $100,000,000 in each of 
                        fiscal years 2004 through 2009 shall be 
                        available for grants under this paragraph. The 
                        amount of a grant available to a State in each 
                        of fiscal years 2004 and 2005 under clause (i) 
                        of this subparagraph shall be equal to \1/2\ of 
                        the amount of funds apportioned to the State 
                        under section 402(c) for fiscal year 2003. The 
                        amount of a grant available to a State in 
                        fiscal year 2004 or in a subsequent fiscal year 
                        under clause (ii) of this subparagraph shall be 
                        equal to 5 times the amount apportioned to the 
                        State for fiscal year 2003 under section 
                        402(c). A State that receives a grant under 
                        clause (ii) of this subparagraph is ineligible 
                        to receive funding under subparagraph (B) for 
                        that fiscal year and the following fiscal year. 
                        The Federal share payable for grants under this 
                        subparagraph shall be 100 percent. If the total 
                        amount of grants under clause (ii) of this 
                        subparagraph for a fiscal year exceeds the 
                        amount of funds available in the fiscal year, 
                        grants shall be made to each eligible State, in 
                        the order in which its primary safety belt use 
                        law became effective or its safety belt use 
                        rate reached 90 percent, until the funds for 
                        the fiscal year are exhausted. A State that 
                        does not receive a grant for which it is 
                        eligible in a fiscal year shall receive the 
                        grant in the succeeding fiscal year so long as 
                        its law remains in effect or its safety belt 
                        use rate remains at or above 90 percent. If the 
                        total amount of grants under this subparagraph 
                        for a fiscal year is less than the amount 
                        available in the fiscal year, the Secretary 
                        shall use any funds that exceed the total 
                        amount for grants under subparagraph (B) of 
                        this paragraph.
                    ``(B) Safety belt use rate.--
                            ``(i) For each fiscal year, from 2004 
                        through 2009, the funds authorized for a grant 
                        under this subparagraph shall be awarded to 
                        States that increase their measured safety belt 
                        use rate, as determined by the Secretary, by 
                        decreasing the proportion of non-users of 
                        safety belts by 10 percent, as compared to the 
                        proportion of non-users, in the preceding 
                        fiscal year.
                            ``(ii) Each State that meets the 
                        requirement of clause (i) of this subparagraph 
                        shall be apportioned an amount of funds that is 
                        equal to the amount available under this 
                        subparagraph for the relevant fiscal year 
                        multiplied by the ratio that the funds 
                        apportioned to the State under section 402 for 
                        such fiscal year bear to the funds apportioned 
                        under section 402 for such fiscal year to all 
                        states that qualify for a grant for such fiscal 
                        year.
                            ``(iii) Of the funds authorized for grants 
                        under this subsection, $20,000,000 for fiscal 
                        year 2004, $22,000,000 for fiscal year 2005, 
                        $24,000,000 for fiscal year 2006, $26,000,000 
                        for fiscal year 2007, $28,000,000 for fiscal 
                        year 2008, and $30,000,000 for fiscal year 2009 
                        shall be available for safety belt use rate 
                        grants under this subparagraph.
                            ``(iv) The Federal share payable for grants 
                        under this subparagraph shall be 100 percent.
    ``(c) Use of Grants.--A State allocated an amount for a grant under 
subparagraph (A) or (B) of subsection (b)(2) may use the amount for 
activities eligible for assistance under sections 402, 405, and 410 of 
this title.''.

SEC. 4107. SCHOOL BUS DRIVER TRAINING.

    Section 406(c) is amended by striking the first, second, and third 
sentences.

SEC. 4108. EMERGENCY MEDICAL SERVICES.

    (a) Federal Coordination and Enhanced Support of Emergency Medical 
Services.--Chapter 4 is amended by inserting after section 407 the 
following:
``Sec. 407A. Federal coordination and enhanced support of emergency 
              medical services
    ``(a) Federal Interagency Committee on Emergency Medical 
Services.--
            ``(1) Establishment.--The Secretary of Transportation and 
        the Secretary of Homeland Security, through the Under Secretary 
        for Emergency Preparedness and Response, shall establish a 
        Federal Interagency Committee on Emergency Medical Services. In 
        establishing the Interagency Committee, the Secretary of 
        Transportation and the Secretary of Homeland Security through 
        the Under Secretary for Emergency Preparedness and Response 
        shall consult with the Secretary of Health and Human Services.
            ``(2) Membership.--The Interagency Committee shall consist 
        of the following officials, or their designees:
                    ``(A) The Administrator, National Highway Traffic 
                Safety Administration.
                    ``(B) The Director, Preparedness Division, 
                Emergency Preparedness and Response Directorate, 
                Department of Homeland Security.
                    ``(C) The Administrator, Health Resources and 
                Services Administration, Department of Health and Human 
                Services.
                    ``(D) The Director, Centers for Disease Control and 
                Prevention, Department of Health and Human Services.
                    ``(E) The Administrator, United States Fire 
                Administration, Emergency Preparedness and Response 
                Directorate, Department of Homeland Security.
                    ``(F) The Director, Center for Medicare and 
                Medicaid Services, Department of Health and Human 
                Services.
                    ``(G) The Undersecretary of Defense for Personnel 
                and Readiness.
                    ``(H) The Director, Indian Health Service, 
                Department of Health and Human Services.
                    ``(I) The Chief, Wireless Telecom Bureau, Federal 
                Communications Commission.
                    ``(J) A representative of any other Federal agency 
                identified by the Secretary of Transportation or the 
                Secretary of Homeland Security through the Under 
                Secretary for Emergency Preparedness and Response, in 
                consultation with the Secretary of Health and Human 
                Services, as having a significant role in relation to 
                the purposes of the Interagency Committee.
            ``(3) Purposes.--The purposes of the Interagency Committee 
        are as follows:
                    ``(A) To ensure coordination among the Federal 
                agencies involved with State, local, tribal, or 
                regional emergency medical services and 9-1-1 systems.
                    ``(B) To identify State, local, tribal, or regional 
                emergency medical services and 9-1-1 needs.
                    ``(C) To recommend new or expanded programs, 
                including grant programs, for improving State, local, 
                tribal, or regional emergency medical services and 
                implementing improved emergency medical services 
                communications technologies, including wireless 9-1-1.
                    ``(D) To identify ways to streamline the process 
                through which Federal agencies support State, local, 
                tribal or regional emergency medical services.
                    ``(E) To assist State, local, tribal or regional 
                emergency medical services in setting priorities based 
                on identified needs.
                    ``(F) To advise, consult, and make recommendations 
                on matters relating to the implementation of the 
                coordinated State emergency medical services programs.
            ``(4) Administration.--The Administrator of the National 
        Highway Traffic Safety Administration, in cooperation with the 
        Director, Preparedness Division, Emergency Preparedness and 
        Response Directorate, Department of Homeland Security, shall 
        provide administrative support to the Interagency Committee, 
        including scheduling meetings, setting agendas, keeping minutes 
        and records, and producing reports.
            ``(5) Leadership.--The members of the Interagency Committee 
        shall select a chairperson of the Committee annually.
            ``(6) Meetings.--The Interagency Committee shall meet as 
        frequently as is determined necessary by the chairperson of the 
        Committee.
            ``(7) Annual reports.--The Interagency Committee shall 
        prepare an annual report to Congress on the Committee's 
        activities, actions, and recommendations.
    ``(b) Coordinated Nationwide Emergency Medical Services Program.--
            ``(1) Program requirement.--The Secretary of 
        Transportation, acting through the Administrator of the 
        National Highway Traffic Safety Administration, shall 
        coordinate with officials of other Federal departments and 
        agencies, and may assist State and local governments and 
        emergency medical services organizations (whether or not a 
        firefighter organization), private industry, and other 
        interested parties, to ensure the development and 
        implementation of a coordinated nationwide emergency medical 
        services program that is designed to strengthen transportation 
        safety and public health and to implement improved emergency 
        medical services communication systems, including 9-1-1.
            ``(2) Coordinated state emergency medical services 
        program.--Each State shall establish a program, to be approved 
        by the Secretary, to coordinate the emergency medical services 
        and resources deployed throughout the State, so as to ensure--
                    ``(A) improved emergency medical services 
                communication systems, including 9-1-1;
                    ``(B) utilization of established best practices in 
                system design and operations;
                    ``(C) implementation of quality assurance programs; 
                and
                    ``(D) incorporation of data collection and analysis 
                programs that facilitate system development and data 
                linkages with other systems and programs useful to 
                emergency medical services.
            ``(3) Administration of state programs.--The Secretary may 
        not approve a coordinated State emergency medical services 
        program under this subsection unless the program--
                    ``(A) provides that the Governor of the State is 
                responsible for its administration through a State 
                office of emergency medical services that has adequate 
                powers and is suitably equipped and organized to carry 
                out such program and coordinates such program with the 
                highway safety office of the State; and
                    ``(B) authorizes political subdivisions of the 
                State to participate in and receive funds under such 
                program, consistent with a goal of achieving statewide 
                coordination of emergency medical services and 9-1-1 
                activities.
            ``(4) Funding.--
                    ``(A) Use of funds.--Funds authorized to be 
                appropriated to carry out this subsection shall be used 
                to aid the States in conducting coordinated emergency 
                medical services and 9-1-1 programs as described in 
                paragraph (2).
                    ``(B) Apportionment.--
                            ``(i) Apportionment formula.--The funds 
                        shall be apportioned as follows: 75 percent in 
                        the ratio that the population of each State 
                        bears to the total population of all the 
                        States, as shown by the latest available 
                        Federal census, and 25 percent in the ratio 
                        that the public road mileage in each State 
                        bears to the total public road mileage in all 
                        States. For the purpose of this subparagraph, a 
                        `public road' means any road under the 
                        jurisdiction of and maintained by a public 
                        authority and open to public travel. Public 
                        road mileage as used in this subsection shall 
                        be determined as of the end of the calendar 
                        year prior to the year in which the funds are 
                        apportioned and shall be certified by the 
                        Governor of the State and subject to approval 
                        by the Secretary.
                            ``(ii) Minimum apportionment.--The annual 
                        apportionment to each State shall not be less 
                        than \1/2\ of 1 percent of the total 
                        apportionment, except that the apportionment to 
                        the Secretary of the Interior on behalf of 
                        Indian tribes shall not be less than \3/4\ of 1 
                        percent of the total apportionment, and the 
                        apportionments to the Virgin Islands, Guam, 
                        American Samoa, and the Commonwealth of the 
                        Northern Mariana Islands shall not be less than 
                        \1/4\ of 1 percent of the total apportionment.
            ``(5) Applicability of chapter 1.--Section 402(d) of this 
        title shall apply in the administration of this subsection.
            ``(6) Federal share.--The Federal share of the cost of a 
        project or program funded under this subsection shall be 80 
        percent.
            ``(7) Application in indian country.--
                    ``(A) Use of terms.--For the purpose of application 
                of this subsection in Indian country, the terms `State' 
                and `Governor of the State' include the Secretary of 
                the Interior and the term `political subdivisions of 
                the State' includes an Indian tribe.
                    ``(B) Indian country defined.--In this subsection, 
                the term `Indian country' means--
                            ``(i) all land within the limits of any 
                        Indian reservation under the jurisdiction of 
                        the United States, notwithstanding the issuance 
                        of any patent and including rights-of-way 
                        running through the reservation;
                            ``(ii) all dependent Indian communities 
                        within the borders of the United States, 
                        whether within the original or subsequently 
                        acquired territory thereof and whether within 
                        or without the limits of a State; and
                            ``(iii) all Indian allotments, the Indian 
                        titles to which have not been extinguished, 
                        including rights-of-way running through such 
                        allotments.
    ``(c) State Defined.--In this section, the term `State' means each 
of the 50 States, the District of Columbia, Puerto Rico, the Virgin 
Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana 
Islands, and the Secretary of the Interior on behalf of Indian tribes.
    ``(d) Construction With Respect to District of Columbia.--In the 
administration of this section with respect to the District of 
Columbia, a reference in this section to the Governor of a State shall 
refer to the Mayor of the District of Columbia.''.
    (b) Clerical Amendment.--The chapter analysis for chapter 4 is 
amended by inserting after the item relating to section 407 the 
following:

``407A. Federal coordination and enhanced support of emergency medical 
                            services.''.

SEC. 4109. REPEAL OF AUTHORITY FOR ALCOHOL TRAFFIC SAFETY PROGRAMS.

    (a) Repeal.--Section 408 is repealed.
    (b) Clerical Amendment.--The chapter analysis for chapter 4 is 
amended by striking the item relating to section 408.

SEC. 4110. IMPAIRED DRIVING PROGRAM.

    (a) Maintenance of Effort.--Section 410(a)(2) is amended by 
striking ``the Transportation Equity Act for the 21st Century'' and 
inserting ``the Highway Safety Grant Program Reauthorization Act of 
2004''.
    (b) Revised Grant Authority.--Section 410 is amended--
            (1) by striking paragraph (3) of subsection (a) and 
        redesignating paragraph (4) as paragraph (3); and
            (2) by striking subsections (b) through (f) and inserting 
        the following:
    ``(b) Program-Related Eligibility Requirements.--To be eligible for 
a grant under this section, a State shall--
            ``(1) carry out each of the programs and activities 
        required under subsection (c);
            ``(2) comply with the additional requirements set forth in 
        subsection (d) with respect to such programs and activities; 
        and
            ``(3) comply with any additional requirements of the 
        Secretary.
    ``(c) Required State Programs and Activities.--For the purpose of 
subsection (b)(1), a State must meet the requirements of 4 of the 
following 6 criteria in order to receive a grant under this section:
            ``(1) Check-point, saturation patrol program.--
                    ``(A) A State program to conduct of a series of 
                high-visibility, Statewide law enforcement campaigns in 
                which law enforcement personnel monitor for impaired 
                driving, either through use of check-points or 
                saturation patrols, on a nondiscriminatory, lawful 
                basis for the purpose of determining whether the 
                operators of the motor vehicles are driving while under 
                the influence of alcohol or controlled substances that 
                meets the requirements of subparagraphs (B) and (C).
                    ``(B) A program meets the requirements of this 
                subparagraph only if a State organizes the campaigns in 
                cooperation with related national campaigns organized 
                by the National Highway Traffic Safety Administration, 
                but this subparagraph does not preclude a State from 
                initiating high-visibility, Statewide law enforcement 
                campaigns independently of the cooperative efforts.
                    ``(C) A program meets the requirements of this 
                subparagraph only if, for each fiscal year, a State 
                demonstrates to the Secretary that the State and the 
                political subdivisions of the State that receive funds 
                under this section have increased, in the aggregate, 
                the total number of impaired driving law enforcement 
                activities, as described in subparagraph (A) (or any 
                other similar activity approved by the Secretary), 
                initiated in such State during the preceding fiscal 
                year by a factor that the Secretary determines 
                meaningful for the State over the number of such 
                activities initiated in such State during the preceding 
                fiscal year, which shall not be less than 5 percent.
            ``(2) Prosecution and adjudication program.--For grants 
        made during fiscal years after fiscal year 2004, a State 
        prosecution and adjudication program under which--
                    ``(A) judges and prosecutors are actively 
                encouraged to prosecute and adjudicate cases of 
                defendants who repeatedly commit impaired driving 
                offenses by reducing the use of State diversion 
                programs, or other means that have the effect of 
                avoiding or expunging a permanent record of impaired 
                driving in such cases;
                    ``(B) the courts in a majority of the judicial 
                jurisdictions of the State are monitored on the courts' 
                adjudication of cases of impaired driving offenses; or
                    ``(C) annual Statewide outreach is provided for 
                judges and prosecutors on innovative approaches to the 
                prosecution and adjudication of cases of impaired 
                driving offenses that have the potential for 
                significantly improving the prosecution and 
                adjudication of such cases.
            ``(3) Impaired operator information system.--
                    ``(A) A State impaired operator information system 
                that--
                            ``(i) tracks drivers who are arrested or 
                        convicted for violation of laws prohibiting 
                        impaired operation of motor vehicles;
                            ``(ii) includes information about each case 
                        of an impaired driver beginning at the time of 
                        arrest through case disposition, including 
                        information about any trial, plea, plea 
                        agreement, conviction or other disposition, 
                        sentencing or other imposition of sanctions, 
                        and substance abuse treatment;
                            ``(iii) provides--
                                    ``(I) accessibility to the 
                                information for law enforcement 
                                personnel Statewide and for United 
                                States law enforcement personnel; and
                                    ``(II) linkage for the sharing of 
                                the information and of the information 
                                in State traffic record systems among 
                                jurisdictions and appropriate agencies, 
                                court systems and offices of the 
                                States;
                            ``(iv) shares information with the National 
                        Highway Traffic Safety Administration for 
                        compilation and use for the tracking of 
                        impaired operators of motor vehicles who move 
                        from State to State; and
                            ``(v) meets the requirements of 
                        subparagraphs (B), (C), and (D) of this 
                        paragraph, as applicable.
                    ``(B) A program meets the requirements of this 
                subparagraph only if, during fiscal years 2004 and 
                2005, a State--
                            ``(i) assesses the system used by the State 
                        for tracking drivers who are arrested or 
                        convicted for violation of laws prohibiting 
                        impaired operation of motor vehicles;
                            ``(ii) identifies ways to improve the 
                        system, as well as to enhance the capability of 
                        the system to provide information in 
                        coordination with impaired operator information 
                        systems of other States; and
                            ``(iii) develops a strategic plan that sets 
                        forth the actions to be taken and the resources 
                        necessary to achieve the identified 
                        improvements and to enhance the capability for 
                        coordination with the systems of other States.
                    ``(C) A program meets the requirements of this 
                subparagraph only if, in each of fiscal years 2006, 
                2007, and 2008, a State demonstrates to the Secretary 
                that the State has made substantial and meaningful 
                progress in improving the State's impaired operator 
                information system, and makes public a report on the 
                progress of the information system.
                    ``(D) A program meets the requirements of this 
                subparagraph only if, in fiscal year 2009, a State 
                demonstrates to the Secretary that the State's impaired 
                operator information system meets the basic standards 
                for such systems as determined by the Secretary.
            ``(4) Impaired driving performance.--The percentage of 
        fatally-injured drivers with 0.08 percent or greater blood 
        alcohol concentration in the State has decreased in each of the 
        2 most recent calendar years.
            ``(5) Impaired driving task force.--(A) Establishment of an 
        impaired driving task force that involves all relevant State, 
        tribal, and local agencies responsible for reducing alcohol 
        impairment and impaired driving and meets the requirements of 
        subparagraphs (B), (C), and (D). The purpose of the task force 
        is to oversee efforts to reduce impaired driving by 
        strengthening applicable laws, regulations, programs, and 
        policies, and to coordinate impaired driving resources and 
        programs among different jurisdictions. The impaired driving 
        task force shall include State, Tribal, and local law 
        enforcement, motor carrier safety agencies, and State alcohol 
        and drug abuse prevention agencies, State and local court 
        systems, State drivers licensing agencies, the State highway 
        safety office, and State parole and probation agencies.
            ``(B) In fiscal year 2004 and fiscal year 2005, the State 
        shall establish a statewide impaired driving task force to 
        assess the State's impaired driving system, identify the 
        opportunities for improvements in the system, and develop a 
        strategic plan that outlines the steps and resources necessary 
        to improve the system and enhance coordination among State and 
        local agencies responsible for reducing impaired driving.
            ``(C) In each subsequent fiscal year, the State 
        demonstrates progress in the implementation of top priorities 
        of the strategic plan.
            ``(D) The State provides the Secretary a copy of the 
        strategic plan developed under subparagraph and in subsequent 
        years, a report detailing the progress of the strategic plan. 
        The Secretary shall make available for public viewing each 
        strategic plan and progress report.
            ``(6) Impaired driving courts.--
                    ``(A) In general.--A program to consolidate and 
                coordinate impaired driving cases into courts that 
                specialize in impaired driving cases, with the emphasis 
                on tracking and processing offenders of impaired 
                driving laws, (hereinafter referred to as DWI courts) 
                that meets the requirements of this paragraph.
                    ``(B) Characteristics.--A DWI Court is a distinct 
                function performed by a court system for the purpose of 
                changing the behavior of alcohol or drug dependent 
                offenders arrested for driving while impaired. A DWI 
                Court can be a dedicated court with dedicated 
                personnel, including judges, prosecutors and probation 
                officers. A DWI court may be an existing court system 
                that serves the following essential DWI Court 
                functions:
                            ``(i) A DWI Court performs an assessment of 
                        high-risk offenders utilizing a team headed by 
                        the judge and including all criminal justice 
                        stakeholders (prosecutors, defense attorneys, 
                        probations officers, law enforcement personnel 
                        and others) along with alcohol/drug treatment 
                        professionals.
                            ``(ii) The DWI Court team recommends a 
                        specific plea agreement or contract for each 
                        offender that can include incarceration, 
                        treatment, and close community supervision. The 
                        agreement maximizes the probability of 
                        rehabilitation and minimizes the likelihood of 
                        recidivism.
                            ``(iii) Compliance with the agreement is 
                        verified with thorough monitoring and frequent 
                        alcohol testing. Periodic status hearings 
                        assess offender progress and allow an 
                        opportunity for modifying the sentence if 
                        necessary.
                    ``(C) Assessment.--In the first year of operation, 
                the States shall assess the number of court systems in 
                its jurisdiction that are consistently performing the 
                DWI Court functions.
                    ``(D) Plan.--In the second year of operation, the 
                State shall develop a strategic plan for increasing the 
                number of courts performing the DWI function.
                    ``(E) Progress.--In subsequent years of operation, 
                the State shall demonstrate progress in increasing the 
                number of DWI Courts and in increasing the number of 
                high-risk offenders participating in and successfully 
                completing DWI Court agreements.
    ``(d) Uses of Grants.--Grants made under this section may be used 
for programs and activities described in subsection (c) and to defray 
the following costs:
            ``(1) Labor costs, management costs, and equipment 
        procurement costs for the high-visibility, Statewide law 
        enforcement campaigns under subsection (c)(1).
            ``(2) The costs of the training of law enforcement 
        personnel and the procurement of technology and equipment, such 
        as and including video equipment and passive alcohol sensors, 
        to counter directly impaired operation of motor vehicles.
            ``(3) The costs of public awareness, advertising, and 
        educational campaigns that publicize use of sobriety check 
        points or increased law enforcement efforts to counter impaired 
        operation of motor vehicles.
            ``(4) The costs of public awareness, advertising, and 
        educational campaigns that target impaired operation of motor 
        vehicles by persons under 34 years of age.
            ``(5) The costs of the development and implementation of a 
        State impaired operator information system described in 
        subsection (c)(3).
            ``(6) The costs of operating programs that impound the 
        vehicle of an individual arrested as an impaired operator of a 
        motor vehicle for not less than 12 hours after the operator is 
        arrested.
    ``(e) Additional Authorities for Certain Authorized Uses.--
            ``(1) Combination of grant proceeds.--Grant funds used for 
        a campaign under subsection (d)(3) may be combined, or expended 
        in coordination, with proceeds of grants under section 402 of 
        this title.
            ``(2) Coordination of uses.--Grant funds used for a 
        campaign under paragraph (3) or (4) of subsection (d) may be 
        expended--
                    ``(A) in coordination with employers, schools, 
                entities in the hospitality industry, and nonprofit 
                traffic safety groups; and
                    ``(B) in coordination with sporting events and 
                concerts and other entertainment events.
    ``(f) Funding.--
            ``(1) In general.--Except as provided in paragraph (2), 
        grant funding under this section shall be allocated among 
        eligible States on the basis of the apportionment formula that 
        applies for apportionments under section 402(c) of this title.
            ``(2) High fatality-rate states.--The amount of the grant 
        funds allocated under this subsection to each of the 10 States 
        with the highest impaired driving-related fatality rate for the 
        most recent fiscal year for which the data is available 
        preceding the fiscal year of the allocation shall be twice the 
        amount that, except for this subparagraph, would otherwise be 
        allocated to the State under paragraph (1).
    ``(g) Use of Funds by High Fatality-Rate States.--
            ``(1) Required uses.--At least \1/2\ of the amounts 
        allocated to States under subsection (f)(2) shall be used for 
        the program described in subsection (c)(1).
            ``(2) Requirement for plan.--A State receiving an 
        allocation of grant funds under subsection (f)(2) shall expend 
        those funds only after consulting with the Administrator of the 
        National Highway Traffic Safety Administration regarding such 
        expenditures.
    ``(h) Definitions.--In this section:
            ``(1) Impaired operator.--The term `impaired operator' 
        means a person who, while operating a motor vehicle--
                    ``(A) has a blood alcohol content of 0.08 percent 
                or higher; or
                    ``(B) is under the influence of a controlled 
                substance.
            ``(2) Impaired driving-related fatality rate.--The term 
        `impaired driving-related fatality rate' means the rate of the 
        fatal accidents that involve impaired drivers while operating 
        motor vehicles, as calculated in accordance with regulations 
        which the Administrator of the National Highway Traffic Safety 
        Administration shall prescribe.''.
    (c) NHTSA To Issue Regulations.--Not later than 12 months after the 
date of enactment of the Highway Safety Grant Program Reauthorization 
Act of 2004, the National Highway Traffic Safety Administration shall 
issue guidelines to the States specifying the types and formats of data 
that States should collect relating to drivers who are arrested or 
convicted for violation of laws prohibiting the impaired operation of 
motor vehicles.

SEC. 4111. STATE TRAFFIC SAFETY INFORMATION SYSTEM IMPROVEMENTS.

    (a) Grant Program Authority.--Chapter 4 is amended by adding at the 
end the following:
``Sec. 412. State traffic safety information system improvements
    ``(a) Grant Authority.--Subject to the requirements of this 
section, the Secretary shall make grants of financial assistance to 
eligible States to support the development and implementation of 
effective programs by such States to--
            ``(1) improve the timeliness, accuracy, completeness, 
        uniformity, integration, and accessibility of the safety data 
        of the State that is needed to identify priorities for 
        national, State, and local highway and traffic safety programs;
            ``(2) evaluate the effectiveness of efforts to make such 
        improvements;
            ``(3) link the State data systems, including traffic 
        records, with other data systems within the State, such as 
        systems that contain medical, roadway, and economic data; and
            ``(4) improve the compatibility and interoperability of the 
        data systems of the State with national data systems and data 
        systems of other States and enhance the ability of the 
        Secretary to observe and analyze national trends in crash 
        occurrences, rates, outcomes, and circumstances.
    ``(b) First-Year Grants.--
            ``(1) Eligibility.--To be eligible for a first-year grant 
        under this section in a fiscal year, a State shall demonstrate 
        to the satisfaction of the Secretary that the State has--
                    ``(A) established a highway safety data and traffic 
                records coordinating committee with a multidisciplinary 
                membership that includes, among others, managers, 
                collectors, and users of traffic records and public 
                health and injury control data systems; and
                    ``(B) developed a multiyear highway safety data and 
                traffic records system strategic plan that addresses 
                existing deficiencies in the State's highway safety 
                data and traffic records system, is approved by the 
                highway safety data and traffic records coordinating 
                committee, and--
                            ``(i) specifies how existing deficiencies 
                        in the State's highway safety data and traffic 
                        records system were identified;
                            ``(ii) prioritizes, on the basis of the 
                        identified highway safety data and traffic 
                        records system deficiencies, the highway safety 
                        data and traffic records system needs and goals 
                        of the State, including the activities under 
                        subsection (a);
                            ``(iii) identifies performance-based 
                        measures by which progress toward those goals 
                        will be determined; and
                            ``(iv) specifies how the grant funds and 
                        any other funds of the State are to be used to 
                        address needs and goals identified in the 
                        multiyear plan.
            ``(2) Grant amount.--Subject to subsection (d)(3), the 
        amount of a first-year grant to a State for a fiscal year shall 
        the higher of--
                    ``(A) the amount determined by multiplying--
                            ``(i) the amount appropriated to carry out 
                        this section for such fiscal year, by
                            ``(ii) the ratio that the funds apportioned 
                        to the State under section 402 of this title 
                        for fiscal year 2003 bears to the funds 
                        apportioned to all States under such section 
                        for fiscal year 2003; or
                    ``(B) $300,000.
    ``(c) Successive Year Grants.--
            ``(1) Eligibility.--A State shall be eligible for a grant 
        under this subsection in a fiscal year succeeding the first 
        fiscal year in which the State receives a grant under 
        subsection (b) if the State, to the satisfaction of the 
        Secretary--
                    ``(A) submits an updated multiyear plan that meets 
                the requirements of subsection (b)(1)(B);
                    ``(B) certifies that its highway safety data and 
                traffic records coordinating committee continues to 
                operate and supports the multiyear plan;
                    ``(C) specifies how the grant funds and any other 
                funds of the State are to be used to address needs and 
                goals identified in the multiyear plan;
                    ``(D) demonstrates measurable progress toward 
                achieving the goals and objectives identified in the 
                multiyear plan; and
                    ``(E) includes a current report on the progress in 
                implementing the multiyear plan.
            ``(2) Grant amount.--Subject to subsection (d)(3), the 
        amount of a year grant made to a State for a fiscal year under 
        this subsection shall equal the higher of--
                    ``(A) the amount determined by multiplying--
                            ``(i) the amount appropriated to carry out 
                        this section for such fiscal year, by
                            ``(ii) the ratio that the funds apportioned 
                        to the State under section 402 of this title 
                        for fiscal year 2003 bears to the funds 
                        apportioned to all States under such section 
                        for fiscal year 2003; or
                    ``(B) $500,000.
    ``(d) Additional Requirements and Limitations.--
            ``(1) Model data elements.--The Secretary, in consultation 
        with States and other appropriate parties, shall determine the 
        model data elements that are useful for the observation and 
        analysis of State and national trends in occurrences, rates, 
        outcomes, and circumstances of motor vehicle traffic accidents. 
        In order to be eligible for a grant under this section, a State 
        shall submit to the Secretary a certification that the State 
        has adopted and uses such model data elements, or a 
        certification that the State will use grant funds provided 
        under this section toward adopting and using the maximum number 
        of such model data elements as soon as practicable.
            ``(2) Data on use of electronic devices.--The model data 
        elements required under paragraph (1) shall include data 
        elements, as determined appropriate by the Secretary in 
        consultation with the States and with appropriate elements of 
        the law enforcement community, on the impact on traffic safety 
        of the use of electronic devices while driving.
            ``(3) Maintenance of effort.--No grant may be made to a 
        State under this section in any fiscal year unless the State 
        enters into such agreements with the Secretary as the Secretary 
        may require to ensure that the State will maintain its 
        aggregate expenditures from all other sources for highway 
        safety data programs at or above the average level of such 
        expenditures maintained by such State in the 2 fiscal years 
        preceding the date of enactment of the Highway Safety Grant 
        Program Reauthorization Act of 2003.
            ``(4) Federal share.--The Federal share of the cost of 
        adopting and implementing in a fiscal year a State program 
        described in subsection (a) may not exceed 80 percent.
            ``(5) Limitation on use of grant proceeds.--A State may use 
        the proceeds of a grant received under this section only to 
        implement the program described in subsection (a) for which the 
        grant is made.
    ``(e) Applicability of Chapter 1.--Section 402(d) of this title 
shall apply in the administration of this section.''.
    (b) Clerical Amendment.--The chapter analysis for chapter 4 is 
amended by adding at the end the following:

``412. State traffic safety information system improvements.''.

SEC. 4112. NHTSA ACCOUNTABILITY.

    (a) In General.--Chapter 4, as amended by section 4111, is amended 
by adding at the end the following:
``Sec. 413. Agency accountability
    ``(a) Triennial State Management Reviews.--At least once every 3 
years the National Highway Traffic Safety Administration shall conduct 
a review of each State highway safety program. The review shall include 
a management evaluation of all grant programs partially or fully funded 
under this title. The Administrator shall provide review-based 
recommendations on how each State may improve the management and 
oversight of its grant activities and may provide a management and 
oversight plan.
    ``(b) Recommendations Before Submission.--In order to provide 
guidance to State highway safety agencies on matters that should be 
addressed in the State highway safety program goals and initiatives as 
part of its highway safety plan before the plan is submitted for 
review, the Administrator shall provide non-binding data-based 
recommendations to each State at least 90 days before the date on which 
the plan is to be submitted for approval.
    ``(c) State Program Review.--The Administrator shall--
            ``(1) conduct a program improvement review of any State 
        that does not make substantial progress over a 3-year period in 
        meeting its priority program goals; and
            ``(2) provide technical assistance and safety program 
        recommendations to the State for any goal not achieved.
    ``(d) Regional Harmonization.--The Administration and the Inspector 
General of the Department of Transportation shall undertake a State 
grant administrative review of the practices and procedures of the 
management reviews and program reviews conducted by Administration 
regional offices and formulate a report of best practices to be 
completed within 180 days after the date of enactment of the Highway 
Safety Grant Program Reauthorization Act of 2004.
    ``(e) Best Practices Guidelines.--
            ``(1) Uniform guidelines.--The Administration shall issue 
        uniform management review and program review guidelines based 
        on the report under subsection (d). Each regional office shall 
        use the guidelines in executing its State administrative review 
        duties.
            ``(2) Publication.--The Administration shall make the 
        following documents available via the Internet upon their 
        completion:
                    ``(A) The Administration's management review and 
                program review guidelines.
                    ``(B) State highway safety plans.
                    ``(C) State annual accomplishment reports.
                    ``(D) The Administration's State management 
                reviews.
                    ``(E) The Administration's State program 
                improvement plans.
            ``(3) Reports to state highway safety agencies.--The 
        Administrator may not make a plan, report, or review available 
        under paragraph (2) that is directed to a State highway safety 
        agency until after it has been submitted to that agency.
    ``(f) General Accounting Office Review.--The General Accounting 
Office shall analyze the effectiveness of the National Highway Traffic 
Safety Administration's oversight of traffic safety grants by seeking 
to determine the usefulness of the Administration's advice to the 
States regarding grants administration and State activities, the extent 
to which the States incorporate the Administration's recommendation 
into their highway safety plans and programs, and improvements that 
result in a State's highway safety program that may be attributable to 
the Administration's recommendations. Based on this analysis, the 
General Accounting Office shall submit a report by not later than the 
end of fiscal year 2008 to the House of Representatives Committee on 
Transportation and Infrastructure and the Senate Committee on Commerce, 
Science, and Transportation.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 4, as 
amended by section 4111, is amended by inserting after the item 
relating to section 412 the following:

``413. Agency accountability.''.

            PART II--SPECIFIC VEHICLE SAFETY-RELATED RULINGS

SEC. 4151. AMENDMENT OF TITLE 49, UNITED STATES CODE.

    Except as otherwise specifically provided, whenever in this subpart 
an amendment is expressed in terms of an amendment to a section or 
other provision of law, the reference shall be considered to be made to 
a section or other provision of title 49, United States Code.

SEC. 4152. VEHICLE CRASH EJECTION PREVENTION.

    (a) In General.--Subchapter II of chapter 301 is amended by adding 
at the end the following:
``Sec. 30128. Vehicle accident ejection protection
    ``(a) In General.--The Secretary of Transportation shall prescribe 
a safety standard under this chapter or upgrade existing Federal motor 
vehicle safety standards to reduce complete and partial occupant 
ejection from motor vehicles with a gross vehicle weight rating of not 
more than 10,000 pounds that are involved in accidents that present a 
risk of occupant ejection. In formulating the safety standard, the 
Secretary shall consider the ejection-mitigation capabilities of safety 
technologies, such as advanced side glazing, side curtains, and side 
impact air bags.
    ``(b) Door Lock and Retention Standard.--The Secretary shall 
upgrade Federal Motor Vehicle Safety Standard No. 206 to require 
manufacturers of new motor vehicles with a gross vehicle weight rating 
of not more than 10,000 pounds that are distributed in commerce for 
sale in the United States to make such modifications to door locks, 
door latches, and retention components of doors in such vehicles as the 
Secretary determines to be necessary to reduce occupant ejection from 
such vehicles in motor vehicle accidents.''.
    (b) Rulemaking Deadlines.--
            (1) Rulemaking.--The Secretary of Transportation shall 
        issue--
                    (A) a notice of a proposed rulemaking under section 
                30128 of title 49, United States Code, not later than 
                June 30, 2006; and
                    (B) a final rule under that section not later than 
                18 months after the publication of the notice of 
                proposed rulemaking.
            (2) Effective date of requirements.--In the final rule, the 
        Secretary shall set forth effective dates for the requirements 
        contained in the rule.
    (c) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary of Transportation $500,000 for each of 
fiscal years 2004 and 2005 to promulgate rules under section 30128 of 
title 49, United States Code.
    (d) Conforming Amendment.--The chapter analysis for chapter 301 is 
amended by inserting after the item relating to section 30127 the 
following:

``30128. Vehicle accident ejection protection.''.

SEC. 4153. VEHICLE BACKOVER AVOIDANCE TECHNOLOGY STUDY.

    (a) In General.--The Administrator of the National Highway Traffic 
Safety Administration shall conduct a study of effective methods for 
reducing the incidence of injury and death outside of parked passenger 
motor vehicles with a gross vehicle weight rating of not more than 
10,000 pounds attributable to movement of such vehicles. The 
Administrator shall complete the study within 1 year after the date of 
enactment of this Act and report its findings to the Senate Committee 
on Commerce, Science, and Transportation and the House of 
Representatives Committee on Energy and Commerce not later than 5 
months after the date of enactment of this Act.
    (b) Specific Issues To Be Covered.--The study required by 
subsection (a) shall--
            (1) include an analysis of backover prevention technology;
            (2) identify, evaluate, and compare the available 
        technologies for detecting people or objects behind a motor 
        vehicle with a gross vehicle weight rating of not more than 
        10,000 pounds for their accuracy, effectiveness, cost, and 
        feasibility for installation; and
            (3) provide an estimate of cost savings that would result 
        from widespread use of backover prevention devices and 
        technologies in motor vehicles with a gross vehicle weight 
        rating of not more than 10,000 pounds, including savings 
        attributable to the prevention of--
                    (A) injuries and fatalities; and
                    (B) damage to bumpers and other motor vehicle parts 
                and damage to other objects.

SEC. 4154. VEHICLE BACKOVER DATA COLLECTION.

    In conjunction with the study required in section 4153, the 
National Highway Traffic Safety Administration may establish a method 
to collect and maintain data on the number and types of injuries and 
deaths involving motor vehicles with a gross vehicle weight rating of 
not more than 10,000 pounds in non-traffic, non-accident incidents to 
assist in the analysis required in section 4153 of this Act regarding 
the inclusion of backover prevention technologies in motor vehicles 
with a gross vehicle weight rating of not more than 10,000 pounds.

SEC. 4155. AGGRESSIVITY AND INCOMPATIBILITY REDUCTION STANDARD.

    (a) In General.--Subchapter II of chapter 301, as amended by 
section 4152, is amended by adding at the end the following:
``Sec. 30129. Vehicle incompatibility and aggressivity reduction 
              standard
    ``(a) In General.--The Secretary of Transportation shall issue 
motor vehicle safety standards to reduce vehicle incompatibility and 
aggressivity for motor vehicles with a gross vehicle weight rating of 
not more than 10,000 pounds. In formulating the standards, the 
Secretary shall consider factors such as bumper height, weight, and any 
other design characteristics necessary to ensure better management of 
crash forces in frontal and side impact crashes among different types, 
sizes, and weights of motor vehicles with a gross vehicle weight rating 
of not more than 10,000 pounds in order to reduce occupant deaths and 
injuries.
    ``(b) Standards.--The Secretary shall develop a standard rating 
metric to evaluate compatibility and aggressivity among motor vehicles 
with a gross vehicle weight rating of not more than 10,000 pounds.
    ``(c) Public Information.--The Secretary shall create a public 
information program that includes vehicle ratings based on risks posed 
by vehicle incompatibility and aggressivity to occupants, risks posed 
by vehicle incompatibility and agressivity to other motorists, and 
combined risks posed by vehicle incompatibility and agressivity by 
vehicle make and model.''.
    (b) Rulemaking Deadlines.--
            (1) Rulemaking.--The Secretary of Transportation shall 
        issue--
                    (A) a notice of a proposed rulemaking under section 
                30129 of title 49, United States Code, not later than 
                January 31, 2007; and
                    (B) a final rule under that section not later than 
                18 months after the publication of the notice of 
                proposed rulemaking.
            (2) Effective date of requirements.--In the final rule, the 
        Secretary shall set forth effective dates for the requirements 
        contained in the rule.
    (c) Conforming Amendment.--The chapter analysis for chapter 301 is 
amended by inserting after the item relating to section 30128 the 
following:

``30129. Vehicle incompatibility and aggressivity reduction 
                            standard.''.

SEC. 4156. IMPROVED CRASHWORTHINESS.

    (a) Improved Crashworthiness.--Subchapter II of chapter 301, as 
amended by section 4155, is amended by adding at the end the following:
``Sec. 30130. Improved crashworthiness of motor vehicles
    ``(a) Rollovers.--
            ``(1) In general.--The Secretary of Transportation shall 
        prescribe a motor vehicle safety standard under this chapter 
        for rollover crashworthiness standards for motor vehicles with 
        a gross weight rating of not more than 10,000 pounds. In 
        formulating the safety standard, the Secretary shall consider 
        the prescription of a roof strength standard based on dynamic 
        tests that realistically duplicate the actual forces 
        transmitted to a passenger motor vehicle during an on-roof 
        rollover crash, and shall consider safety technologies and 
        design improvements such as--
                    ``(A) improved seat structure and safety belt 
                design, including seat belt pretensioners;
                    ``(B) side impact head protection airbags; and
                    ``(C) roof injury protection measures.
            ``(2) Rollover resistance standard.--The Secretary shall 
        prescribe a motor vehicle safety standard under this chapter to 
        improve on the basic design characteristics of motor vehicles 
        with a gross vehicle weight rating of not more than 10,000 
        pounds to increase their resistance to rollover. The Secretary 
        shall also consider additional technologies to improve the 
        handling of motor vehicles with a gross vehicle weight rating 
        of not more than 10,000 pounds and thereby reduce the 
        likelihood of vehicle instability and rollovers.
            ``(3) Study.--The Secretary shall conduct a study on 
        electronic stability control systems and other technologies 
        designed to improve the handling of motor vehicles with a gross 
        vehicle weight rating of not more than 10,000 pounds and shall 
        report the results of that study to the Senate Committee on 
        Commerce, Science, and Transportation and the House of 
        Representatives Committee on Transportation and Infrastructure 
        by December 31, 2005.
    ``(b) Frontal Impact Standards and Crash Tests.--
            ``(1) In general.--The Secretary shall prescribe a motor 
        vehicle safety standard under this chapter or upgrade existing 
        Federal motor vehicle safety standards to improve the 
        protection of occupants in frontal impact crashes involving 
        motor vehicles with a gross vehicle weight rating of not more 
        than 10,000 pounds.
            ``(2) Test methodology.--In determining the standard under 
        paragraph (1), the Secretary shall--
                    ``(A) evaluate additional test barriers and 
                measurements of occupant head impact and neck injuries; 
                and
                    ``(B) review frontal impact criteria, including 
                consideration of criteria established by the Insurance 
                Institute for Highway Safety.
    ``(c) Side Impact Standards and Crash Tests.--
            ``(1) In general.--The Secretary shall prescribe a motor 
        vehicle safety standard under this chapter or upgrade existing 
        Federal motor vehicle safety standards to improve the 
        protection afforded to occupants in side impact crashes 
        involving motor vehicles with a gross vehicle weight rating of 
        not more than 10,000 pounds.
            ``(2) Test methodology.--In prescribing the standard under 
        paragraph (1), the Secretary shall--
                    ``(A) evaluate additional test barriers and 
                measurements of occupant head impact and neck injuries;
                    ``(C) consider the need for additional and new 
                crash test dummies that represent the full range of 
                occupant sizes and weights; and
                    ``(D) review side impact criteria, including 
                consideration of criteria established by the Insurance 
                Institute for Highway Safety.''.
    (b) Rulemaking Deadlines.--
            (1) Rulemaking.--The Secretary of Transportation shall--
                    (A) issue a notice of a proposed rulemaking under 
                section 30130 of title 49, United States Code, not 
                later than June 30, 2006; and
                    (B) issue a final rule not later than 18 months 
                after publication of the notice of proposed rulemaking.
            (2) Effective date of requirements.--In the final rule, the 
        Secretary shall set forth effective dates for the requirements 
        contained in this rule.
    (c) Conforming Amendment.--The chapter analysis for chapter 301 is 
amended by inserting after the item relating to section 30129 the 
following:

``30130. Improved crashworthiness of passenger motor vehicles.''.

SEC. 4157. 15-PASSENGER VANS.

    (a) In General.--The Secretary of Transportation shall initiate a 
rulemaking and issue a final regulation not later than September 31, 
2005, to include all 15-passenger vans with a gross vehicle weight 
rating of not more than 10,000 pounds in the National Highway Traffic 
Safety Administration's dynamic rollover testing program and require 
such vans to comply with all existing and prospective Federal Motor 
Vehicle Safety Standards for occupant protection and vehicle crash 
avoidance that are relevant to such vehicles.
    (b) New Car Assessment Program.--The Secretary shall initiate a 
rulemaking and issue a final regulation not later than September 31, 
2005, to include all 15-passenger vans with a gross vehicle weight of 
not more than 10,000 pounds in the Administration's New Car Assessment 
Program rollover resistance program.
    (c) Vehicle Control Technology for 15-Passenger Vans.--The National 
Highway Traffic Safety Administration shall evaluate and test the 
potential of technological systems, particularly electronic stability 
control systems and rollover warning systems, to assist drivers in 
maintaining control of 15-passenger vans with a gross vehicle weight 
rating of not more than 10,000 pounds.
    (d) Certain Specialized Vehicles Excluded.--In this section, the 
term ``15-passenger van'' does not include an ambulance, tow truck, or 
other vehicle designed primarily for the transportation of property or 
special purpose equipment.

SEC. 4158. ADDITIONAL SAFETY PERFORMANCE CRITERIA FOR TIRES.

    (a) Strength and Road Hazard Protection.--The Secretary of 
Transportation shall issue a final rule to upgrade Federal Motor 
Vehicle Safety Standard No. 139 to include strength and road hazard 
protection safety performance criteria for light vehicle tires, which 
are criteria that were not addressed in the June 2003 final rule 
mandated by the Transportation Recall Enhancement, Accountability, and 
Documentation Act of 2000.
    (b) Resistance to Bead Unseating and Aging.--The Secretary of 
Transportation shall issue a final rule to upgrade Federal Motor 
Vehicle Safety Standard No. 139 to include resistance to bead unseating 
and aging safety performance criteria for passenger motor vehicle 
tires, which are criteria that were not addressed in the June, 2003, 
final rule mandated by the Transportation Recall Enhancement, 
Accountability, and Documentation Act of 2000.
    (c) Rulemaking Deadlines.--The Secretary of Transportation shall--
            (1) issue a notice of proposed rulemaking under subsection 
        (a) not later than June 30, 2005, and under subsection(b) not 
        later than December 31, 2005; and
            (2) issue a final rule relating to subsection (a) not later 
        than 18 months after June 30, 2005, and a final rule under 
        subsection (b) not later than 18 months after December 31, 
        2005.
    (d) Technology Use and Report.--The Secretary shall reconsider the 
use of shearography analysis, on a sampling basis, for regulatory 
compliance and the Administrator of the National Highway Traffic Safety 
Administration shall report to the Senate Committee on Commerce, 
Science, and Transportation and the House of Representatives Committee 
on Transportation and Infrastructure on the most cost effective methods 
of using such technology within 2 years after the date of enactment of 
the Highway Safety Grant Program Reauthorization Act of 2004.

SEC. 4159. SAFETY BELT USE REMINDERS.

    (a) Notice of Proposed Rules To Encourage More Seat Belt Use.--Not 
later than 12 months after the date of enactment of this Act, the 
Secretary of Transportation shall issue a Notice of Proposed Rulemaking 
to amend the Federal Motor Vehicle Safety Standard No. 208 for motor 
vehicles with a gross vehicle weight rating of not more than 10,000 
pounds to encourage increased seat belt usage by drivers and 
passengers. The proposed rulemaking shall take into account the 
potential safety benefits and public acceptability of alternative means 
to encourage increased seat belt usage, including intermittent or 
continuous audible or visual reminders when a driver or passenger is 
not wearing a seat belt, features to prevent operation of convenience 
or entertainment features of the vehicle when a driver or passenger is 
not wearing a seat belt, and shall consider technology, including but 
not limited to technology identified by the National Academy of 
Sciences in its study of the potential benefits of seat belt usage 
reminder technologies.
    (b) Final Rule.--Not later than 24 months after the date of 
enactment of this Act, the Secretary shall issue the final rule 
required by subsection (a).
    (c) Buzzer Law.--
            (1) In general.--Section 30124 is amended--
                    (A) by striking ``not'' the first place it appears; 
                and
                    (B) by striking ``except'' and inserting 
                ``including''.
            (2) Conforming amendment.--Section 30122 is amended by 
        striking subsection (d).

SEC. 4160. MISSED DEADLINES REPORTS.

    (a) In General.--If the Secretary of Transportation fails to meet 
any rulemaking deadline established in this subtitle, the Secretary 
shall transmit a report to the Senate Committee on Commerce, Science, 
and Transportation and the House of Representatives Committee on 
Transportation and Infrastructure within 90 days after missing the 
deadline--
            (1) explaining why the Secretary failed to meet the 
        deadline; and
            (2) setting forth a date by which the Secretary anticipates 
        that the rulemaking will be made.
    (b) Consideration of Effects.--The Secretary of Transportation 
shall consider and report the potential consequences, in terms of the 
number of deaths and the number and severity of injuries, that may 
result from not meeting any such deadline.

SEC. 4161. GRANTS FOR IMPROVING CHILD PASSENGER SAFETY PROGRAMS.

    (a) In General.--Chapter 4 of title 23, United States Code, as 
amended by section 4112 of this Act, is amended by adding at the end 
the following:
``Sec. 414. Booster seat incentive grants
    ``(a) In General.--The Secretary of Transportation shall make a 
grant under this section to any eligible State.
    ``(b) Eligibility Requirements.--
            ``(1) In general.--The Secretary shall make a grant to each 
        State that, as determined by the Secretary, enacts or has 
        enacted, and is enforcing a law requiring that children riding 
        in passenger motor vehicles (as defined in section 405(d)(4)) 
        who are too large to be secured in a child safety seat be 
        secured in a child restraint (as defined in section 7(1) of 
        Anton's Law (49 U.S.C. 30127 note)) that meets requirements 
        prescribed by the Secretary under section 3 of Anton's Law.
            ``(2) Year in which first eligible.--
                    ``(A) Early qualification.--A State that has 
                enacted a law described in paragraph (1) that is in 
                effect before October 1, 2005, is first eligible to 
                receive a grant under subsection (a) in fiscal year 
                2006.
                    ``(B) Subsequent qualification.--A State that 
                enacts a law described in paragraph (1) that takes 
                effect after September 30, 2005, is first eligible to 
                receive a grant under subsection (a) in the first 
                fiscal year beginning after the date on which the law 
                is enacted.
            ``(3) Continuing eligibility.--A State that is eligible 
        under paragraph (1) to receive a grant may receive a grant 
        during each fiscal year listed in subsection (f) in which it is 
        eligible.
            ``(4) Maximum number of grants.--A State may not receive 
        more than 4 grants under this section.
    ``(c) Grant Amount.--Amounts available for grants under this 
section in any fiscal year shall be apportioned among the eligible 
States on the basis of population.
    ``(d) Use of Grant Amounts.--
            ``(1) In general.--Of the amounts received by a State under 
        this section for any fiscal year--
                    ``(A) 50 percent shall be used for the enforcement 
                of, and education to promote public awareness of, State 
                child passenger protection laws; and
                    ``(B) 50 percent shall be used to fund programs 
                that purchase and distribute child booster seats, child 
                safety seats, and other appropriate passenger motor 
                vehicle child restraints to indigent families without 
                charge.
            ``(2) Report.--Within 60 days after the State fiscal year 
        in which a State receives a grant under this section, the State 
        shall transmit to the Secretary a report documenting the manner 
        in which grant amounts were obligated or expended and 
        identifying the specific programs supports by grant funds. The 
        report shall be in a form prescribed by the Secretary and may 
        be combined with other State grant reporting requirements under 
        this chapter.
    ``(e) Definition of Child Safety Seat.--The term `child safety 
seat' means any device (except safety belts (as such term is defined in 
section 405(d)(5)), designed for use in a motor vehicle (as such term 
is defined in section 405(d)(1)) to restrain, seat, or position a child 
who weighs 50 pounds or less.
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary of Transportation, out of the Highway 
Trust Fund--
            ``(1) $18,000,000 for fiscal year 2006;
            ``(2) $20,000,000 for fiscal year 2007;
            ``(3) $25,000,000 for fiscal year 2008; and
            ``(4) $30,000,000 for fiscal year 2009.''.
    (b) Clerical Amendment.--The chapter analysis for chapter 4 of 
title 23, United States Code, is amended by inserting after the item 
relating to section 411 the following:

``414. Booster seat incentive grants.''.

SEC. 4162. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to the Secretary of 
Transportation to carry out this subtitle and chapter 301 of title 49, 
United States Code--
            (1) $130,500,000 for fiscal year 2004;
            (2) $133,500,000 for fiscal year 2005;
            (3) $133,600,000 for fiscal year 2006;
            (4) $134,500,000 for fiscal year 2007;
            (5) $138,000,000 for fiscal year 2008; and
            (6) $141,000,000 for fiscal year 2009.

                   PART III--MISCELLANEOUS PROVISIONS

SEC. 4171. DRIVER LICENSING AND EDUCATION.

    (a) National Office of Driver Licensing and Education.--Section 105 
of title 49, United States Code, is amended by adding at the end the 
following new subsection:
    ``(f)(1) There is a National Office of Driver Licensing and 
Education in the National Highway Traffic Safety Administration.
    ``(2) The head of the National Office of Driver Licensing and 
Education is the Director.
    ``(3) The functions of the National Office of Driver Licensing and 
Education are as follows:
            ``(A) To provide States with services for coordinating the 
        motor vehicle driver training and licensing programs of the 
        States.
            ``(B) To develop and make available to the States a 
        recommended comprehensive model for motor vehicle driver 
        education and graduated licensing that incorporates the best 
        practices in driver education and graduated licensing, 
        including best practices with respect to--
                    ``(i) vehicle handling and crash avoidance;
                    ``(ii) driver behavior and risk reduction;
                    ``(iii) roadway features and associated safety 
                implications;
                    ``(iv) roadway interactions involving all types of 
                vehicles and road users, such as car-truck and 
                pedestrian-car interactions;
                    ``(v) parent education; and
                    ``(vi) other issues identified by the Director.
            ``(C) To carry out such research (pursuant to cooperative 
        agreements or otherwise) and undertake such other activities as 
        the Director determines appropriate to develop and, on an 
        ongoing basis, improve the recommended comprehensive model.
            ``(D) To provide States with technical assistance for the 
        implementation and deployment of the motor vehicle driver 
        education and licensing comprehensive model recommended under 
        subparagraph (B).
            ``(E) To develop and recommend to the States methods for 
        harmonizing the presentation of motor vehicle driver education 
        and licensing with the requirements of multistage graduated 
        licensing systems, including systems described in section 
        410(c)(4) of title 23, and to demonstrate and evaluate the 
        effectiveness of those methods in selected States.
            ``(F) To assist States with the development and 
        implementation of programs to certify driver education 
        instructors, including the development and implementation of 
        proposed uniform certification standards.
            ``(G) To provide States with financial assistance under 
        section 412 of title 23 for--
                    ``(i) the implementation of the motor vehicle 
                driver education and licensing comprehensive model 
                recommended under subparagraph (B);
                    ``(ii) the establishment or improved administration 
                of multistage graduated licensing systems; and
                    ``(iii) the support of other improvements in motor 
                vehicle driver education and licensing programs.
            ``(H) To evaluate the effectiveness of the comprehensive 
        model recommended under subparagraph (B).
            ``(I) To examine different options for delivering driver 
        education in the States.
            ``(J) To perform such other functions relating to motor 
        vehicle driver education or licensing as the Secretary may 
        require.
    ``(4) Not later than 42 months after the date of the enactment of 
the Safe, Accountable, Flexible, and Efficient Transportation Equity 
Act of 2004, the Director shall submit to Congress a report on the 
progress made by the National Office of Driver Licensing and Education 
with respect to the functions under paragraph (3).''.
    (b) Grant Program for Improvement of Driver Education and 
Licensing.--
            (1) Authority.--
                    (A) In general.--Chapter 4 of title 23, United 
                States Code, is amended by adding at the end the 
                following new section:

``SEC. 412. DRIVER EDUCATION AND LICENSING.

    ``(a) Authority.--
            ``(1) In general.--The Secretary shall carry out a program 
        to provide States, by grant, with financial assistance to 
        support the improvement of motor vehicle driver education 
        programs and the establishment and improved administration of 
        graduated licensing systems, including systems described in 
        section 410(c)(4) of this title.
            ``(2) Administrative office.--The Secretary shall 
        administer the program under this section through the Director 
        of the National Office of Driver Licensing and Education.
    ``(b) Eligibility Requirements.--
            ``(1) Regulations.--The Secretary shall prescribe in 
        regulations the eligibility requirements, application and 
        approval procedures and standards, and authorized uses of grant 
        proceeds for the grant program under this section. The 
        regulations shall, at a minimum, authorize use of grant 
        proceeds for the following activities:
                    ``(A) Quality assurance testing, including follow-
                up testing to monitor the effectiveness of--
                            ``(i) driver licensing and education 
                        programs;
                            ``(ii) instructor certification testing; 
                        and
                            ``(iii) other statistical research designed 
                        to evaluate the performance of driver education 
                        and licensing programs.
                    ``(B) Improvement of motor vehicle driver education 
                curricula.
                    ``(C) Training of instructors for motor vehicle 
                driver education programs.
                    ``(D) Testing and evaluation of motor vehicle 
                driver performance.
                    ``(E) Public education and outreach regarding motor 
                vehicle driver education and licensing.
                    ``(F) Improvements with respect to State graduated 
                licensing programs, as well as related enforcement 
                activities.
            ``(2) Consultation requirement.--In prescribing the 
        regulations, the Secretary shall consult with the following:
                    ``(A) The Administrator of the National Highway 
                Traffic Safety Administration.
                    ``(B) The heads of such other departments and 
                agencies of the United States as the Secretary 
                considers appropriate on the basis of relevant 
                interests or expertise.
                    ``(C) Appropriate officials of the governments of 
                States and political subdivisions of States.
                    ``(D) Other relevant experts.
    ``(c) Maximum Amount of Grant.--The maximum amount of a grant of 
financial assistance for a program, project, or activity under this 
section may not exceed 75 percent of the total cost of such program, 
project, or activity.''.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of such chapter is amended by adding at 
                the end the following new item:

``412. Driver education and licensing.''.
            (2) Time for promulgation of regulations.--The Secretary of 
        Transportation shall promulgate the regulations under section 
        412(b) of title 23, United States Code (as added by paragraph 
        (1)), not later than October 1, 2005.
    (c) Grant Program for Public Awareness of Organ Donation Through 
Driver Licensing Programs.--
            (1) Authority.--
                    (A) In general.--Chapter 4 of title 23, United 
                States Code (as amended by subsection (b)), is further 
                amended by adding at the end the following new section:

``SEC. 413. ORGAN DONATION THROUGH DRIVER LICENSING.

    ``(a) Authority.--
            ``(1) In general.--The Secretary shall carry out a program 
        to provide eligible recipients, by grant, with financial 
        assistance to carry out campaigns to increase public awareness 
        of, and training on, authority and procedures under State law 
        to provide for the donation of organs through a declaration 
        recorded on a motor vehicle driver license.
            ``(2) Administrative office.--The Secretary shall 
        administer the program under this section through the Director 
        of the National Office of Driver Licensing and Education.
    ``(b) Eligibility Requirements.--
            ``(1) Regulations.--The Secretary shall prescribe in 
        regulations the eligibility requirements, application and 
        approval procedures and standards, and authorized uses of grant 
        proceeds for the grant program under this section.
            ``(2) Consultation requirement.--In prescribing the 
        regulations, the Secretary shall consult with the following:
                    ``(A) The Administrator of the National Highway 
                Traffic Safety Administration.
                    ``(B) The heads of such other departments and 
                agencies of the United States as the Secretary 
                considers appropriate on the basis of relevant 
                interests or expertise.
                    ``(C) Appropriate officials of the governments of 
                States and political subdivisions of States.
                    ``(D) Representatives of private sector 
                organizations recognized for relevant expertise.''.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of such chapter is amended by adding at 
                the end the following new item:

``413. Organ donation through driver licensing.''.
            (2) Time for promulgation of regulations.--The Secretary of 
        Transportation shall promulgate the regulations under section 
        413(b) of title 23, United States Code (as added by paragraph 
        (1)), not later than October 1, 2005.
    (d) Study of National Driver Education Standards.--
            (1) Requirement for study.--The Secretary of Transportation 
        shall carry out a study to determine whether the establishment 
        and imposition of nationwide minimum standards of motor vehicle 
        driver education would improve national highway traffic safety 
        or the performance and legal compliance of novice drivers.
            (2) Time for completion of study.--The Secretary shall 
        complete the study not later than 2 years after the date of the 
        enactment of this Act.
            (3) Report.--The Secretary shall publish a report on the 
        results of the study under this section not later than 2 years 
        after the study is completed.
    (e) Authorization of Appropriations.--Of the amounts available to 
carry out section 403 of title 23, United States Code, for each of the 
fiscal years 2005 through 2010, $5,000,000 may be made available for 
each such fiscal year to carry out sections 412 and 413 of title 23, 
United States Code (as added by subsections (b) and (c), respectively).

SEC. 4172. AMENDMENT OF AUTOMOBILE INFORMATION DISCLOSURE ACT.

    (a) Safety Labeling Requirement.--Section 3 of the Automobile 
Information Disclosure Act (15 U.S.C. 1232) is amended by adding at the 
end the following:
    ``(g) if one or more safety ratings for such automobile have been 
assigned and formally published or released by the National Highway 
Traffic Safety Administration under the New Car Assessment Program, 
information about safety ratings that--
            ``(1) includes a graphic depiction of the number of stars 
        that corresponds to each such assigned safety rating displayed 
        in a clearly differentiated fashion from stars indicating the 
        unattained safety rating;
            ``(2) refers to frontal impact crash tests, side impact 
        crash tests, and rollover resistance tests (whether or not such 
        automobile has been assigned a safety rating for such tests), 
        including statements that--
                    ``(A) frontal impact crash test ratings are based 
                on risk of head and chest injury;
                    ``(B) side impact crash test ratings are based on 
                risk of chest injury; and
                    ``(C) rollover resistance ratings are based on risk 
                of rollover in the event of a single automobile crash;
            ``(3) is presented in a legible, visible, and prominent 
        fashion and covers at least--
                    ``(A) 8 percent of the total area of the label; or
                    ``(B) an area with a minimum length of 4 \1/2\ 
                inches and a minimum height of 3 \1/2\ inches; and
            ``(4) contains a heading titled `Government Safety 
        Information' and a disclaimer including the following text: 
        `Star ratings for frontal impact crash tests can only be 
        compared to other vehicles in the same weight class and those 
        plus or minus 250 pounds. Side impact and rollover ratings can 
        be compared across all vehicle weights and classes. For more 
        information on safety and testing, please visit http://
        www.nhtsa.dot.gov'; and
    ``(h) if an automobile has not been tested by the National Highway 
Traffic Safety Administration under the New Car Assessment Program, or 
safety ratings for such automobile have not been assigned in one or 
more rating categories, a statement to that effect.''.
    (b) Regulations.--Not later than January 1, 2005, the Secretary of 
Transportation shall prescribe regulations to implement the labeling 
requirements under subsections (g) and (h) of section 3 of such Act (as 
added by subsection (a)).
    (c) Conforming and Technical Amendments.--Section 3 of such Act is 
further amended--
            (1) in subsection (e), by striking ``and'' after the 
        semicolon; and
            (2) in subsection (f)--
                    (A) by adding ``and'' at the end of paragraph (3); 
                and
                    (B) by striking the period at the end and inserting 
                a semicolon.
    (d) Applicability.--The labeling requirements under subsections (g) 
and (h) of section 3 of such Act (as added by subsection (a)), and the 
regulations prescribed under subsection (b), shall apply to new 
automobiles delivered on or after--
            (1) September 1, 2005, if the regulations under subsection 
        (b) are prescribed not later than August 31, 2004; or
            (2) September 1, 2006, if the regulations under subsection 
        (b) are prescribed after August 31, 2004.

SEC. 4173. CHILD SAFETY.

    (a) Incorporation of Child Dummies in Safety Tests.--
            (1) Rulemaking required.--Not later than 2 years after the 
        date of the enactment of this Act, the Administrator of the 
        National Highway Traffic Safety Administration shall conduct a 
        rulemaking to increase utilization of child dummies, including 
        Hybrid-III child dummies, in motor vehicle safety tests, 
        including crash tests, conducted by the Administration.
            (2) Criteria.--In conducting the rulemaking under 
        subsection (a), the Administrator shall select motor vehicle 
        safety tests in which the inclusion of child dummies will lead 
        to--
                    (A) increased understanding of crash dynamics with 
                respect to children; and
                    (B) measurably improved child safety.
            (3) Report.--Not later than one year after the date of the 
        enactment of this Act, the Secretary of Transportation shall 
        publish a report regarding the implementation of this section.
    (b) Child Safety in Rollover Crashes.--
            (1) Consumer information program.--Not later than 2 years 
        after the date of the enactment of this Act, the Secretary of 
        Transportation shall implement a consumer information program 
        relating to child safety in rollover crashes. The Secretary 
        shall make information related to the program available to the 
        public following completion of the program.
            (2) Child dummy development.--
                    (A) In general.--The Administrator of the National 
                Highway Traffic Safety Administration shall initiate 
                the development of a biofidelic child crash test dummy 
                capable of measuring injury forces in a simulated 
                rollover crash.
                    (B) Reports.--The Secretary shall submit to 
                Congress a report on progress related to such 
                development--
                            (i) not later than 1 year after the date of 
                        the enactment of this Act; and
                            (ii) not later than 3 years after the date 
                        of the enactment of this Act.
    (c) Report on Enhanced Vehicle Safety Technologies.--Not later than 
2 years after the date of the enactment of this Act, the Secretary of 
Transportation shall submit to Congress a report that describes, 
evaluates, and determines the relative effectiveness of--
            (1) currently available and emerging technologies, 
        including auto-reverse functions and child-safe window 
        switches, that are designed to prevent and reduce the number of 
        injuries and deaths to children left unattended inside parked 
        motor vehicles, including injuries and deaths that result from 
        hyperthermia or are related to power windows or power sunroofs; 
        and
            (2) currently available and emerging technologies that are 
        designed to improve the performance of safety belts with 
        respect to the safety of occupants aged between 4 and 8 years 
        old.
    (d) Completion of Rulemaking Regarding Power Windows.--Not later 
than 180 days after the date of the enactment of this Act, the 
Secretary of Transportation shall--
            (1) complete the rulemaking initiated by the National 
        Highway Traffic Safety Administration that is ongoing on the 
        date of the enactment of this Act and relates to a requirement 
        that window switches be designed to reduce the accidental 
        closing by children of power windows; and
            (2) issue performance-based regulations to take effect not 
        later than September 1, 2006, requiring that window switches or 
        related technologies be designed to prevent the accidental 
        closing by children of power windows.
    (e) Database on Injuries and Deaths in Nontraffic, Noncrash 
Events.--
            (1) In general.--The Secretary of Transportation shall 
        establish a new database of, and collect data regarding, 
        injuries and deaths in nontraffic, noncrash events involving 
        motor vehicles. The database shall include information 
        regarding--
                    (A) the number, types, and proximate causes of 
                injuries and deaths resulting from such events;
                    (B) the characteristics of motor vehicles involved 
                in such events;
                    (C) the characteristics of the motor vehicle 
                operators and victims involved in such events; and
                    (D) the presence or absence in motor vehicles 
                involved in such events of advanced technologies 
                designed to prevent such injuries and deaths.
            (2) Rulemaking.--The Secretary shall conduct a rulemaking 
        regarding how to structure and compile the database.
            (3) Availability.--The Secretary shall make the database 
        available to the public.

SEC. 4174. SAFE INTERSECTIONS.

    (a) In General.--Chapter 2 of title 18, United States Code, is 
amended by adding at the end the following:
``Sec. 39. Traffic signal preemption transmitters
    ``(a) Offenses.--
            ``(1) Sale.--A person who provides for sale to unauthorized 
        users a traffic signal preemption transmitter in or affecting 
        interstate or foreign commerce shall be fined not more than 
        $10,000, imprisoned not more than 1 year, or both.
            ``(2) Possession.--A person who is an unauthorized user in 
        possession of a traffic signal preemption transmitter in or 
        affecting interstate or foreign commerce shall be fined not 
        more than $10,000, imprisoned not more than 6 months, or both.
    ``(b) Definitions.--In this section, the following definitions 
apply:
            ``(1) Traffic signal preemption transmitter.--The term 
        `traffic signal preemption transmitter' means any device or 
        mechanism that can change a traffic signal's phase.
            ``(2) Unauthorized user.--The term `unauthorized user' 
        means a user of a traffic signal preemption transmitter who is 
        not a government approved user.''.
    (b) Chapter Analysis.--The chapter analysis for chapter 2 of title 
18, United States Code, is amended by adding at the end the following:

``39. Traffic signal preemption transmitters.''.

SEC. 4175. STUDY ON INCREASED SPEED LIMITS.

    (a) Study.--
            (1) In general.--Not later than 2 years after the date of 
        enactment of this Act, the Secretary shall conduct a study to 
        examine the effects of increased speed limits enacted by States 
        after 1995.
            (2) Requirements.--The study shall collect empirical data 
        regarding--
                    (A) increases or decreases in driving speeds on 
                Interstate highways since 1995;
                    (B) correlations between changes in driving speeds 
                and accident, injury, and fatality rates;
                    (C) correlations between posted speed limits and 
                observed driving speeds;
                    (D) the overall impact on motor vehicle safety 
                resulting from the repeal of the national maximum speed 
                limit in 1995; and
                    (E) such other matters as the Secretary determines 
                to be appropriate.
    (b) Report.--Not later than 1 year after the date of completion of 
the study under subsection (a), the Secretary shall submit to Congress 
a report that describes the results of the study.

   Subtitle B--Motor Carrier Safety and Unified Carrier Registration

                     PART I--ADMINISTRATIVE MATTERS

SEC. 4201. SHORT TITLE; AMENDMENT OF TITLE 49, UNITED STATES CODE.

    (a) Short Title.--This subtitle may be cited as the ``Motor Carrier 
Safety Reauthorization Act of 2004''.
    (b) Amendment of Title 49, United States Code.--Except as otherwise 
specifically provided, whenever in this subtitle an amendment is 
expressed in terms of an amendment to a section or other provision of 
law, the reference shall be considered to be made to a section or other 
provision of title 49, United States Code.

SEC. 4202. REQUIRED COMPLETION OF OVERDUE REPORTS, STUDIES, AND 
              RULEMAKINGS.

    (a) Requirement for Completion.--By no later than 36 months after 
the date of enactment of this Act, the Secretary of Transportation 
shall complete all reports, studies, and rulemaking proceedings to 
issue regulations which Congress directed the Secretary to complete in 
previous laws and which are not yet completed, including the following:
             (1) Commercial Vehicle Driver Biometric Identifier, 
        section 9105, Truck and Bus Safety and Regulatory Reform Act of 
        1988.
             (2) General Transportation of HAZMAT, section 8(b), 
        Hazardous Materials Transportation Uniform Safety Act of 1990.
             (3) Nationally Uniform System of Permits for Interstate 
        Motor Carrier Transport of HAZMAT, section 22, Hazardous 
        Materials Transportation Uniform Safety Act of 1990.
             (4) Training for Entry-Level Drivers of Commercial Motor 
        Vehicles, section 4007 (a), Intermodal Surface Transportation 
        Efficiency Act of 1991.
             (5) Minimum Training Requirements for Operators and for 
        Training Instructors of Multiple Trailer Combination Vehicles, 
        section 4007(b)(2), Intermodal Surface Transportation 
        Efficiency Act of 1991.
             (6) Railroad-Highway Grade Crossing Safety, section 112, 
        Hazardous Materials Transportation Authorization Act of 1994.
             (7) Safety Performance History of New Drivers, section 
        114, Hazardous Materials Transportation Authorization Act of 
        1994.
             (8) Motor Carrier Replacement Information and Registration 
        System, section 103, ICC Termination Act of 1995.
             (9) General Jurisdiction Over Freight Forwarder Service, 
        section 13531, ICC Termination Act of 1995.
             (10) Waivers, Exemptions, and Pilot Programs, section 
        4007, Transportation Equity Act for the Twenty-First Century.
             (11) Safety Performance History of New Drivers, section 
        4014, Transportation Equity Act for the Twenty-First Century.
             (12) Performance-based CDL Testing, section 4019, 
        Transportation Equity Act for the Twenty-First Century.
             (13) Improved Flow of Driver History Pilot Program, 
        section 4022, Transportation Equity Act for the Twenty-First 
        Century.
             (14) Employee Protections, section 4023, Transportation 
        Equity Act for the Twenty-First Century.
             (15) Improved Interstate School Bus Safety, section 4024, 
        Transportation Equity Act for the Twenty-First Century.
             (16) Federal Motor Carrier Safety Administration 2010 
        Strategy, section 104, Motor Carrier Safety Improvement Act of 
        1999.
             (17) New Motor Carrier Entrant Requirements, section 210, 
        Motor Carrier Safety Improvement Act of 1999.
             (18) Certified Motor Carrier Safety Auditors, section 211, 
        Motor Carrier Safety Improvement Act of 1999.
             (19) Medical Certificate, section 215, Motor Carrier 
        Safety Improvement Act of 1999.
             (20) Report on Any Pilots Undertaken to Develop Innovative 
        Methods of Improving Motor Carrier Compliance with Traffic 
        Laws, section 220, Motor Carrier Safety Improvement Act of 
        1999.
             (21) Status Report on the Implementation of Electronic 
        Transmission of Data State-to-State on Convictions for All 
        Motor Vehicle Control Law Violations for CDL Holders, section 
        221, Motor Carrier Safety Improvement Act of 1999.
             (22) Assessment of Civil Penalties, section 222, Motor 
        Carrier Safety Improvement Act of 1999.
             (23) Truck Crash Causation Study, section 224, Motor 
        Carrier Safety Improvement Act of 1999.
             (24) Drug Test Results Study, section 226, Motor Carrier 
        Safety Improvement Act of 1999.
    (b) Final Rule Required.--Unless specifically permitted by law, 
rulemaking proceedings shall be considered completed for purposes of 
this section only when the Secretary has issued a final rule and the 
docket for the rulemaking proceeding is closed.
    (c) Schedule for Completion.--No fewer than one-third of the 
reports, studies, and rulemaking proceedings in subsection (a) shall be 
completed every 12 months after the date of enactment of this Act. The 
Inspector General of the Department of Transportation shall make an 
annual determination as to whether this schedule has been met.
    (d) Failure To Comply.--If the Secretary fails to complete the 
required number of reports, studies, and rulemaking proceedings 
according to the schedule set forth in subsection (c) during any fiscal 
year, the Secretary shall allocate to the States $3,000,000 from the 
amount authorized by section 31104(i)(1) of title 49, United States 
Code, for administrative expenses of the Federal Motor Carrier Safety 
Administration to conduct additional compliance reviews under section 
31102 of that title instead of obligating or expending such amount for 
those administrative expenses.
    (e) Amendments to the Listed Reports, Studies, and Rulemaking 
Proceedings.--In addition to completing the reports, studies and 
rulemaking proceedings listed in subsection (c), the Secretary shall--
            (1) amend the Interim Final Rule addressing New Motor 
        Carrier Entrant Requirements to require that a safety audit be 
        immediately converted to a compliance review and appropriate 
        enforcement actions be taken if the safety audit discloses 
        acute safety violations by the new entrant; and
            (2) eliminate a proposed provision in the rulemaking 
        proceeding addressing Commercial Van Operations Transporting 
        Nine to Fifteen Passengers which exempts commercial van 
        operations that operate within a 75-mile radius.
    (f) Completion of New Rulemaking Proceedings.--Nothing in this 
section delays or changes the deadlines specified for new reports, 
studies, or rulemaking mandates contained in this title.
    (g) Report of Other Agency Actions.--Within 12 months after the 
date of enactment of this Act, the Secretary shall submit to the Senate 
Committee on Commerce, Science, and Transportation and to the House 
Committee on Transportation and Infrastructure a report on the status 
of the following projects:
            (1) Rescinding the current regulation which prohibits truck 
        and bus drivers from viewing television and monitor screens 
        while operating commercial vehicles.
            (2) Incorporating Out-Of-Service Criteria regulations 
        enforced by the Federal Motor Carrier Safety Administration.
            (3) Revision of the safety fitness rating system of motor 
        carriers.
            (4) Amendment of Federal Motor Carrier Safety 
        Administration rules of practice for conducting motor carrier 
        administrative proceedings, investigations, disqualifications, 
        and for issuing penalties.
            (5) Requiring commercial drivers to have a sufficient 
        functional speaking and reading comprehension of the English 
        language.
            (6) Inspection, repair and maintenance of intermodal 
        container chassis and trailers.

SEC. 4203. CONTRACT AUTHORITY.

    Authorizations from the Highway Trust Fund (other than the Mass 
Transit Account) to carry out this subtitle shall be available for 
obligation on the date of their apportionment or allocation or on 
October 1 of the fiscal year for which they are authorized, whichever 
occurs first. Approval by the Secretary of a grant with funds made 
available under this title imposes upon the United States Government a 
contractual obligation for payment of the Government's share of costs 
incurred in carrying out the objectives of the grant.

                     PART II--MOTOR CARRIER SAFETY

SEC. 4221. MINIMUM GUARANTEE.

    There are authorized to be appropriated from the Highway Trust Fund 
(other than the Mass Transit Account) not less than 1.21 percent of the 
total amounts made available in any fiscal year from the Highway Trust 
Fund for purposes of this part.

SEC. 4222. AUTHORIZATION OF APPROPRIATIONS.

    (a) Administrative Expenses.--Section 31104 is amended by adding at 
the end the following:
    ``(i) Administrative expenses.--
            ``(1) There are authorized to be appropriated from the 
        Highway Trust Fund (other than the Mass Transit Account) for 
        the Secretary of Transportation to pay administrative expenses 
        of the Federal Motor Carrier Safety Administration--
                    ``(A) $202,900,000 for fiscal year 2004;
                    ``(B) $206,200,000 for fiscal year 2005;
                    ``(C) $211,400,000 for fiscal year 2006;
                    ``(D) $217,500,000 for fiscal year 2007;
                    ``(E) $222,600,000 for fiscal year 2008; and
                    ``(F) $228,500,000 for fiscal year 2009.
            ``(2) The funds authorized by this subsection shall be used 
        for personnel costs; administrative infrastructure; rent; 
        information technology; programs for research and technology, 
        information management, regulatory development (including a 
        medical review board and rules for medical examiners), 
        performance and registration information system management, and 
        outreach and education; other operating expenses and similar 
        matters; and such other expenses as may from time to time 
        become necessary to implement statutory mandates not funded 
        from other sources.
            ``(3) From the funds authorized by this section, the 
        Secretary shall ensure that compliance reviews are completed on 
        the motor carriers that have demonstrated through performance 
        data that they pose the highest safety risk. At a minimum, 
        compliance reviews shall be conducted within 6 months after 
        whenever a carrier is rated as category A or B.
            ``(4) The amounts made available under this section shall 
        remain available until expended.
            ``(5) Of the funds authorized by paragraph (1), $6,750,000 
        in each of fiscal years 2004 through 2009 shall be used to 
        carry out the medical program under section 31149.''.
    (b) Amendment to Apportionment Provision of Title 23.--Section 
104(a) of title 23, United States Code, is amended--
            (1) by striking ``exceed--'' and so much of subparagraph 
        (A) as precedes clause (i) and inserting ``exceed 1\1/6\ 
        percent of all sums so made available, as the Secretary 
        determines necessary--'';
            (2) by redesignating clause (i) and (ii) of subparagraph 
        (A) as subparagraphs (A) and (B), and indenting such clauses, 
        as so redesignated, 2 em spaces; and
            (3) by striking ``system; and'' in subparagraph (B) as so 
        redesignated, and all that follows through ``research.'' and 
        inserting ``system.''.
    (c) Grant Programs.--There are authorized to be appropriated from 
the Highway Trust Fund (other than the Mass Transit Account) for the 
following Federal Motor Carrier Safety Administration programs:
            (1) Border enforcement grants under section 31107 of title 
        49, United States Code--
                    (A) $32,000,000 for fiscal year 2004;
                    (B) $33,000,000 for fiscal year 2005;
                    (C) $33,000,000 for fiscal year 2006;
                    (D) $34,000,000 for fiscal year 2007;
                    (E) $35,000,000 for fiscal year 2008; and
                    (F) $36,000,000 for fiscal year 2009.
            (2) Performance and registration information system 
        management grant program under 31109 of title 49, United States 
        Code--
                    (A) $4,000,000 for fiscal year 2004;
                    (B) $4,000,000 for fiscal year 2005;
                    (C) $4,000,000 for fiscal year 2006;
                    (D) $4,000,000 for fiscal year 2007;
                    (E) $4,000,000 for fiscal year 2008; and
                    (F) $4,000,000 for fiscal year 2009.
            (3) Commercial driver's license and driver improvement 
        program grants under section 31318 of title 49, United States 
        Code--
                    (A) $22,000,000 for fiscal year 2004;
                    (B) $22,000,000 for fiscal year 2005;
                    (C) $23,000,000 for fiscal year 2006;
                    (D) $23,000,000 for fiscal year 2007;
                    (E) $24,000,000 for fiscal year 2008; and
                    (F) $25,000,000 for fiscal year 2009.
            (4) Deployment of the Commercial Vehicle Informations 
        Systems and Networks established under section 4241 of this 
        title, $25,000,000 for each of fiscal years 2004 through 2009.
    (d) Motor Carrier Safety Account.--Funds made available under 
subsection (c) shall be administered in the account established in the 
Treasury entitled ``Motor Carrier Safety 69-8055-0-7-401''.
    (e) Period of Availability.--The amounts made available under 
subsection (c) of this section shall remain available until expended.

SEC. 4223. MOTOR CARRIER SAFETY GRANTS.

    (a) Motor Carrier Safety Assistance Program.--
            (1) Section 31102 is amended--
                    (A) by striking ``activities by fiscal year 2000;'' 
                in subsection (b)(1)(A) and inserting ``activities for 
                commercial motor vehicles of passengers and freight;'';
                    (B) by striking ``years before December 18, 1991;'' 
                in subsection (b)(1)(E) and inserting ``years'';
                    (C) by striking ``and'' after the semicolon in 
                subsection (b)(1)(S);
                    (D) by striking ``personnel.'' in subsection 
                (b)(1)(T) and inserting ``personnel;'';
                    (E) adding at the end of subsection (b)(1) the 
                following:
            ``(U) ensures that inspections of motor carriers of 
        passengers are conducted at stations, terminals, border 
        crossings, or maintenance facilities, except in the case of an 
        imminent or obvious safety hazard;
            ``(V) provides that the State will include in the training 
        manual for the licensing examination to drive a non-commercial 
        motor vehicle and a commercial motor vehicle, information on 
        best practices for driving safely in the vicinity of commercial 
        motor vehicles and in the vicinity of non-commercial vehicles, 
        respectively; and
            ``(W) provides that the State will enforce the registration 
        requirements of section 13902 by suspending the operation of 
        any vehicle discovered to be operating without registration or 
        beyond the scope of its registration.''; and
                    (F) by striking subsection (c) and inserting the 
                following:
    ``(c) Use of Grants To Enforce Other Laws.--A State may use amounts 
received under a grant under subsection (a) of this section for the 
following activities:
            ``(1) If the activities are carried out in conjunction with 
        an appropriate inspection of the commercial motor vehicle to 
        enforce Government or State commercial motor vehicle safety 
        regulations--
                    ``(A) enforcement of commercial motor vehicle size 
                and weight limitations at locations other than fixed 
                weight facilities, at specific locations such as steep 
                grades or mountainous terrains where the weight of a 
                commercial motor vehicle can significantly affect the 
                safe operation of the vehicle, or at ports where 
                intermodal shipping containers enter and leave the 
                United States; and
                    ``(B) detection of the unlawful presence of a 
                controlled substance (as defined under section 102 of 
                the Comprehensive Drug Abuse Prevention and Control Act 
                of 1970 (21 U.S.C. 802)) in a commercial motor vehicle 
                or on the person of any occupant (including the 
                operator) of the vehicle.
            ``(2) Documented enforcement of State traffic laws and 
        regulations designed to promote the safe operation of 
        commercial motor vehicles, including documented enforcement of 
        such laws and regulations against non-commercial motor vehicles 
        when necessary to promote the safe operation of commercial 
        motor vehicles.''.
            (2) Section 31103(b) is amended--
                    (A) by inserting ``(1)'' after ``activities.--''; 
                and
                    (B) by adding at the end the following:
            ``(2) New entrant motor carrier audit funds.--From the 
        amounts designated under section 31104(f)(4), the Secretary may 
        allocate new entrant motor carrier audit funds to States and 
        local governments without requiring a matching contribution 
        from such States or local governments.''.
            (3) Section 31104(a) is amended to read as follows:
    ``(a) In General.--There are authorized to be appropriated from the 
Highway Trust Fund (other than the Mass Transit Account) to carry out 
section 31102:
            ``(1) Not more than $186,100,000 for fiscal year 2004.
            ``(2) Not more than $189,800,000 for fiscal year 2005.
            ``(3) Not more than $193,600,000 for fiscal year 2006.
            ``(4) Not more than $197,500,000 for fiscal year 2007.
            ``(5) Not more than $201,400,000 for fiscal year 2008.
            ``(6) Not more than $205,500,000 for fiscal year 2009.''.
            (4) Section 31104(f) is amended by striking paragraph (2) 
        and inserting the following:
            ``(2) High-priority activities.--The Secretary may 
        designate up to 5 percent of amounts available for allocation 
        under paragraph (1) for States, local governments, and 
        organizations representing government agencies or officials for 
        carrying out high priority activities and projects that improve 
        commercial motor vehicle safety and compliance with commercial 
        motor vehicle safety regulations, including activities and 
        projects that are national in scope, increase public awareness 
        and education, or demonstrate new technologies. The amounts 
        designated under this paragraph shall be allocated by the 
        Secretary to State agencies, local governments, and 
        organizations representing government agencies or officials 
        that use and train qualified officers and employees in 
        coordination with State motor vehicle safety agencies. At least 
        80 percent of the amounts designated under this paragraph shall 
        be awarded to State agencies and local government agencies.
            ``(3) Safety-performance incentive programs.--The Secretary 
        may designate up to 10 percent of the amounts available for 
        allocation under paragraph (1) for safety performance incentive 
        programs for States. The Secretary shall establish safety 
        performance criteria to be used to distribute incentive program 
        funds. Such criteria shall include, at a minimum, reduction in 
        the number and rate of fatal accidents involving commercial 
        motor vehicles. Allocations under this paragraph do not require 
        a matching contribution from a State.
            ``(4) New entrant audits.--The Secretary shall designate up 
        to $29,000,000 of the amounts available for allocation under 
        paragraph (1) for audits of new entrant motor carriers 
        conducted pursuant to 31144(f). The Secretary may withhold such 
        funds from a State or local government that is unable to use 
        government employees to conduct new entrant motor carrier 
        audits, and may instead utilize the funds to conduct audits in 
        those jurisdictions.''.
    (b) Grants to States for Border Enforcement.--Section 31107 is 
amended to read as follows:
``Sec. 31107. Border enforcement grants
    ``(a) General Authority.--From the funds authorized by section 
4222(c)(1) of the Motor Carrier Safety Reauthorization Act of 2004, the 
Secretary may make a grant in a fiscal year to a State that shares a 
border with another country for carrying out border commercial motor 
vehicle safety programs and related enforcement activities and 
projects.
    ``(b) Maintenance of Expenditures.--The Secretary may make a grant 
to a State under this section only if the State agrees that the total 
expenditure of amounts of the State and political subdivisions of the 
State, exclusive of United States Government amounts, for carrying out 
border commercial motor vehicle safety programs and related enforcement 
activities and projects will be maintained at a level at least equal to 
the average level of that expenditure by the State and political 
subdivisions of the State for the last 2 State or Federal fiscal years 
before October 1, 2003.''.
    (c) Grants to States for Commercial Driver's License 
Improvements.--Chapter 313 is amended by adding at the end the 
following:
``Sec. 31318. Grants for commercial driver's license program 
              improvements
    ``(a) General Authority.--From the funds authorized by section 
4222(c)(3) of the Motor Carrier Safety Reauthorization Act of 2004, the 
Secretary may make a grant to a State, except as otherwise provided in 
subsection (e), in a fiscal year to improve its implementation of the 
commercial driver's license program, providing the State is in 
substantial compliance with the requirements of section 31311 and this 
section. The Secretary shall establish criteria for the distribution of 
grants and notify the States annually of such criteria.
    ``(b) Conditions.--Except as otherwise provided in subsection (e), 
a State may use a grant under this section only for expenses directly 
related to its commercial driver's license program, including, but not 
limited to, computer hardware and software, publications, testing, 
personnel, training, and quality control. The grant may not be used to 
rent, lease, or buy land or buildings. The Secretary shall give 
priority to grants that will be used to achieve compliance with the 
requirements of the Motor Carrier Safety Improvement Act of 1999. The 
Secretary may allocate the funds appropriated for such grants in a 
fiscal year among the eligible States whose applications for grants 
have been approved, under criteria established by the Secretary.
    ``(c) Maintenance of Expenditures.--Except as otherwise provided in 
subsection (e), the Secretary may make a grant to a State under this 
section only if the State agrees that the total expenditure of amounts 
of the State and political subdivisions of the State, exclusive of 
United States Government amounts, for the operation of the commercial 
driver's license program will be maintained at a level at least equal 
to the average level of that expenditure by the State and political 
subdivisions of the State for the last 2 fiscal years before October 1, 
2003.
    ``(d) Government Share.--Except as otherwise provided in subsection 
(e), the Secretary shall reimburse a State, from a grant made under 
this section, an amount that is not more than 80 percent of the costs 
incurred by the State in a fiscal year in implementing the commercial 
driver's license improvements described in subsection (b). In 
determining those costs, the Secretary shall include in-kind 
contributions by the State.
    ``(e) High-Priority Activities.--
            ``(1) The Secretary may make a grant to a State agency, 
        local government, or organization representing government 
        agencies or officials for the full cost of research, 
        development, demonstration projects, public education, or other 
        special activities and projects relating to commercial driver 
        licensing and motor vehicle safety that are of benefit to all 
        jurisdictions or designed to address national safety concerns 
        and circumstances.
            ``(2) The Secretary may designate up to 10 percent of the 
        amounts made available under section 4222(c)(3) of the Motor 
        Carrier Safety Reauthorization Act of 2004 in a fiscal year for 
        high-priority activities under subsection (e)(1).
    ``(f) Emerging Issues.--The Secretary may designate up to 10 
percent of the amounts made available under section 4222(c)(3) of the 
Motor Carrier Safety Reauthorization Act of 2004 in a fiscal year for 
allocation to a State agency, local government, or other person at the 
discretion of the Secretary to address emerging issues relating to 
commercial driver's license improvements.
    ``(g) Apportionment.--Except as otherwise provided in subsections 
(e) and (f), all amounts available in a fiscal year to carry out this 
section shall be apportioned to States according to a formula 
prescribed by the Secretary.
    ``(h) Deduction for Administrative Expenses.--On October 1 of each 
fiscal year or as soon after that date as practicable, the Secretary 
may deduct, from amounts made available under section 4222(c)(3) of the 
Motor Carrier Safety Reauthorization Act of 2004 for that fiscal year, 
up to 0.75 percent of those amounts for administrative expenses 
incurred in carrying out this section in that fiscal year.''.
    (d) Noncompliance With CDL Requirements.--Section 31314 is amended 
by striking subsections (a) and (b) and inserting the following:
    ``(a) First Fiscal Year.--The Secretary of Transportation shall 
withhold up to 5 percent of the amount required to be apportioned to a 
State under section 104(b)(1), (3), and (4) of title 23 on the first 
day of the fiscal year after the first fiscal year beginning after 
September 30, 1992, throughout which the State does not comply 
substantially with a requirement of section 31311(a) of this title.
    ``(b) Second Fiscal Year.--The Secretary shall withhold up to 10 
percent of the amount required to be apportioned to a State under 
section 104(b)(1), (3), and (4) of title 23 on the first day of each 
fiscal year after the second fiscal year beginning after September 30, 
1992, throughout which the State does not comply substantially with a 
requirement of section 31311(a) of this title.''.
    (e) Conforming Amendments.--(1) The chapter analysis for chapter 
311 is amended--
            (A) by striking the item relating to Subchapter I, and 
        inserting the following:

         ``SUBCHAPTER I--GENERAL AUTHORITY AND STATE GRANTS'';

    and
            (B) by striking the item relating to section 31107, and 
        inserting the following:

``31107. Border enforcement grants.''.
    (2) Subchapter I of chapter 311 is amended by striking the 
subchapter heading and inserting the following:

          ``SUBCHAPTER I--GENERAL AUTHORITY AND STATE GRANTS''

    (3) The chapter analysis for chapter 313 is amended by inserting 
the following after the item relating to section 31317:

``31318. Grants for commercial driver's license program 
                            improvements.''.

SEC. 4224. CDL WORKING GROUP.

    (a) In General.--The Secretary of Transportation shall convene a 
working group to study and address current impediments and foreseeable 
challenges to the commercial driver's license program's effectiveness 
and measures needed to realize the full safety potential of the 
commercial driver's license program. The working group shall address 
such issues as State enforcement practices, operational procedures to 
detect and deter fraud, needed improvements for seamless information 
sharing between States, effective methods for accurately sharing 
electronic data between States, updated technology, and timely 
notification from judicial bodies concerning traffic and criminal 
convictions of commercial driver's license holders.
    (b) Membership.--Members of the working group should include State 
motor vehicle administrators, organizations representing government 
agencies or officials, members of the Judicial Conference, 
representatives of the trucking industry, representatives of labor 
organizations, safety advocates, and other significant stakeholders.
    (c) Report.--Within 2 years after the date of enactment of this 
Act, the Secretary, on behalf of the working group, shall complete a 
report of the working group's findings and recommendations for 
legislative, regulatory, and enforcement changes to improve the 
commercial driver's license program. The Secretary shall promptly 
transmit the report to the Senate Committee on Commerce, Science, and 
Transportation and the House of Representatives Committee on 
Transportation and Infrastructure.
    (d) Funding.--From the funds authorized by section 4222(c)(3) of 
this title, $200,000 shall be made available for each of fiscal years 
2004 and 2005 to carry out this section.

SEC. 4225. CDL LEARNER'S PERMIT PROGRAM.

    (a) In General.--Chapter 313 is amended--
            (1) by striking ``time.'' in section 31302 and inserting 
        ``license, and may have only 1 learner's permit at any time.'';
            (2) by inserting ``and learners' permits'' after 
        ``licenses'' the first place it appears in section 31308;
            (3) by striking ``licenses.'' in section 31308 and 
        inserting ``licenses and permits.'';
            (4) by redesignating paragraphs (2) and (3) of section 
        31308 as paragraphs (3) and (4), respectively, and inserting 
        after paragraph (1) the following:
            ``(2) before a commercial driver's license learner's permit 
        can be issued to an individual, the individual must pass a 
        written test on the operation of a commercial motor vehicle 
        that complies with the minimum standards prescribed by the 
        Secretary under section 31305(a) of this title;'';
            (5) by inserting ``or learner's permit'' after ``license'' 
        each place it appears in paragraphs (3) and (4), as 
        redesignated, of section 31308; and
            (6) by inserting ``or learner's permit'' after ``license'' 
        each place it appears in section 31309(b).
    (b) Conforming Amendments.--
            (1) Section 31302 is amended by inserting ``and learner's 
        permits'' in the section caption.
            (2) Sections 31308 and 31309 are each amended by inserting 
        ``and learner's permit'' after ``license'' in the section 
        captions.
            (3) The chapter analysis for chapter 313 is amended by 
        striking the item relating to section 31302 and inserting the 
        following:

``31302. Limitation on the number of driver's licenses and learner's 
                            permits.''.
            (4) The chapter analysis for chapter 313 is amended by 
        striking the items relating to sections 31308 and 31309 and 
        inserting the following:

``31308. Commercial driver's license and learner's permit.
``31309. Commercial driver's license and learner's permit information 
                            system.''.

SEC. 4226. HOBBS ACT.

    (a) Section 2342(3)(A) of title 28, United States Code, is amended 
to read as follows:
                    ``(A) the Secretary of Transportation issued 
                pursuant to section 2, 9, 37, or 41 of the Shipping 
                Act, 1916 (46 U.S.C. App. 802, 803, 808, 835, 839, and 
                841a) or pursuant to Part B or C of subtitle IV of 
                title 49 or pursuant to subchapter III of chapter 311, 
                chapter 313, and chapter 315 of Part B of subtitle VI 
                of title 49; and''.
    (b) Section 351(a) is amended to read as follows:
    ``(a) Judicial Review.--An action of the Secretary of 
Transportation in carrying out a duty or power transferred under the 
Department of Transportation Act (Public Law 89-670; 80 Stat. 931), or 
an action of the Administrator of the Federal Railroad Administration, 
Federal Motor Carrier Safety Administration, or the Federal Aviation 
Administration in carrying out a duty or power specifically assigned to 
the Administrator by that Act, may be reviewed judicially to the same 
extent and in the same way as if the action had been an action by the 
department, agency, or instrumentality of the United States Government 
carrying out the duty or power immediately before the transfer or 
assignment.''.
    (c) Section 352 is amended to read as follows:
``Sec. 352. Authority to carry out certain transferred duties and 
              powers
    ``In carrying out a duty or power transferred under the Department 
of Transportation Act (Public Law 89-670; 80 Stat. 931), the Secretary 
of Transportation and the Administrators of the Federal Railroad 
Administration, the Federal Motor Carrier Safety Administration, and 
the Federal Aviation Administration have the same authority that was 
vested in the department, agency, or instrumentality of the United 
States Government carrying out the duty or power immediately before the 
transfer. An action of the Secretary or Administrator in carrying out 
the duty or power has the same effect as when carried out by the 
department, agency, or instrumentality.''.

SEC. 4227. PENALTY FOR DENIAL OF ACCESS TO RECORDS.

    Section 521(b)(2) is amended by adding at the end the following:
    ``(E) Copying of records and access to equipment, lands, and 
buildings.--A motor carrier subject to chapter 51 of subtitle III, a 
motor carrier, broker, or freight forwarder subject to part B of 
subtitle IV, or the owner or operator of a commercial motor vehicle 
subject to part B of subtitle VI of this title who fails to allow the 
Secretary, or an employee designated by the Secretary, promptly upon 
demand to inspect and copy any record or inspect and examine equipment, 
lands, buildings and other property in accordance with sections 504(c), 
5121(c), and 14122(b) of this title shall be liable to the United 
States for a civil penalty not to exceed $500 for each offense, and 
each day the Secretary is denied the right to inspect and copy any 
record or inspect and examine equipment, lands, buildings and other 
property shall constitute a separate offense, except that the total of 
all civil penalties against any violator for all offenses related to a 
single violation shall not exceed $5,000. It shall be a defense to such 
penalty that the records did not exist at the time of the Secretary's 
request or could not be timely produced without unreasonable expense or 
effort. Nothing herein amends or supersedes any remedy available to the 
Secretary under sections 502(d), 507(c), or other provision of this 
title.''.

SEC. 4228. MEDICAL PROGRAM.

    (a) In General.--Subchapter III of chapter 311 is amended by adding 
at the end the following:
``Sec. 31149. Medical program
    ``(a) Medical Review Board.--
            ``(1) Establishment and function.--The Secretary of 
        Transportation shall establish a Medical Review Board to serve 
        as an advisory committee to provide the Federal Motor Carrier 
        Safety Administration with medical advice and recommendations 
        on driver qualification medical standards and guidelines, 
        medical examiner education, and medical research.
            ``(2) Composition.--The Medical Review Board shall be 
        appointed by the Secretary and shall consist of 5 members 
        selected from medical institutions and private practice. The 
        membership shall reflect expertise in a variety of specialties 
        relevant to the functions of the Federal Motor Carrier Safety 
        Administration.
    ``(b) Chief Medical Examiner.--The Secretary shall appoint a chief 
medical examiner for the Federal Motor Carrier Safety Administration.
    ``(c) Medical Standards and Requirements.--The Secretary, with the 
advice of the Medical Review Board and the chief medical examiner, 
shall--
            ``(1) establish, review, and revise--
                    ``(A) medical standards for applicants for and 
                holders of commercial driver's licenses that will 
                ensure that the physical condition of operators of 
                commercial motor vehicles is adequate to enable them to 
                operate the vehicles safely;
                    ``(B) requirements for periodic physical 
                examinations of such operators performed by medical 
                examiners who have received training in physical and 
                medical examination standards and are listed on a 
                national registry maintained by the Department of 
                Transportation; and
                    ``(C) requirements for notification of the chief 
                medical examiner if such an applicant or holder--
                            ``(i) fails to meet the applicable 
                        standards; or
                            ``(ii) is found to have a physical or 
                        mental disability or impairment that would 
                        interfere with the individual's ability to 
                        operate a commercial motor vehicle safely;
            ``(2) require each holder of a commercial driver's license 
        or learner's permit to have a current valid medical 
        certificate;
            ``(3) issue such certificates to such holders and 
        applicants who are found, upon examination, to be physically 
        qualified to operate a commercial motor vehicle and to meet 
        applicable medical standards; and
            ``(4) develop, as appropriate, specific courses and 
        materials for medical examiners listed in the national registry 
        established under this section, and require those medical 
        examiners to complete specific training, including refresher 
        courses, to be listed in the registry.
    ``(d) National Registry of Medical Examiners.--The Secretary, 
through the Federal Motor Carrier Safety Administration--
            ``(1) shall establish and maintain a current national 
        registry of medical examiners who are qualified to perform 
        examination, testing, inspection, and issuance of a medical 
        certificate;
            ``(2) shall delegate to those examiners the authority to 
        issue such certificates if the Medical Review Board develops a 
        system to identify the medical examination forms uniquely and 
        track them; and
            ``(3) shall remove from the registry the name of any 
        medical examiner that fails to meet the qualifications 
        established by the Secretary for being listed in the registry.
    ``(e) Consultation and Cooperation with FAA.--
            ``(1) In general.--The Administrator of the Federal Motor 
        Carrier Safety Administration shall consult the Administrator 
        of the Federal Aviation Administration with respect to 
        examinations, the issuance of certificates, standards, and 
        procedures under this section in order to take advantage of 
        such aspects of the Federal Aviation Administration's airman 
        certificate program under chapter 447 of this title as the 
        Administrator deems appropriate for carrying out this section.
            ``(2) Use of FAA-qualified examiners.--The Administrator of 
        the Federal Motor Carrier Safety Administration and the 
        Administrator of the Federal Aviation Administration are 
        authorized and encouraged to execute a memorandum of 
        understanding under which individuals holding or applying for a 
        commercial driver's license or learner's permit may be 
        examined, for purposes of this section, by medical examiners 
        who are qualified to administer medical examinations for airman 
        certificates under chapter 447 of this title and the 
        regulations thereunder--
                    ``(A) until the national registry required by 
                subsection (d) is fully established; and
                    ``(B) to the extent that the Administrators 
                determine appropriate, after that registry is 
                established.
    ``(f) Regulations.--The Secretary is authorized to promulgate such 
regulations as may be necessary to carry out this section.''.
    (b) Medical Examiners.--Section 31136(a)(3) is amended to read as 
follows:
            ``(3) the physical condition of operators of commercial 
        motor vehicles is adequate to enable them to operate the 
        vehicles safely, and the periodic physical examinations 
        required of such operators are performed by medical examiners 
        who have received training in physical and medical examination 
        standards and are listed on a national registry maintained by 
        the Department of Transportation; and''.
    (c) Definition of Medical Examiner.--Section 31132 is amended--
            (1) by redesignating paragraphs (6) through (10) as 
        paragraphs (7) through (11), respectively; and
            (2) by inserting after paragraph (5) the following:
            ``(6) `medical examiner' means an individual licensed, 
        certified, or registered in accordance with regulations issued 
        by the Federal Motor Carrier Safety Administration as a medical 
        examiner.''.
    (d) Conforming Amendment.--The chapter analysis for chapter 311 is 
amended by inserting after the item relating to section 31148 the 
following:

``31149. Medical program.''.
    (e) Effective Date.--The amendment made by subsection (a) shall 
take effect 1 year after the date of enactment of this Act.

SEC. 4229. OPERATION OF COMMERCIAL MOTOR VEHICLES BY INDIVIDUALS WHO 
              USE INSULIN TO TREAT DIABETES MELLITUS.

    (a) Revision of Final Rule.--Not later than 90 days after the date 
of the enactment of this Act, the Secretary shall revise the final rule 
to allow individuals who use insulin to treat their diabetes to operate 
commercial motor vehicles in interstate commerce. The revised final 
rule shall provide for the individual assessment of applicants who use 
insulin to treat their diabetes and who are, except for their use of 
insulin, otherwise qualified under the Federal Motor Carrier Safety 
Regulations. The revised final rule shall be consistent with the 
criteria described in section 4018 of the Transportation Equity Act for 
the 21st Century (49 U.S.C. 31305 note) and shall conclude the 
rulemaking process in the Federal Motor Carrier Safety Administration 
docket relating to qualifications of drivers with diabetes.
    (b) No History of Driving While Using Insulin Required for 
Qualification.--The Secretary may not require individuals to have 
experience operating commercial motor vehicles while using insulin in 
order to qualify to operate a commercial motor vehicle in interstate 
commerce.
    (c) History of Diabetes Control.--The Secretary may require an 
individual to have used insulin for a minimum period of time and 
demonstrated stable control of diabetes in order to qualify to operate 
a commercial motor vehicle in interstate commerce. Any such 
requirement, including any requirement with respect to the duration of 
such insulin use, shall be consistent with the findings of the expert 
medical panel reported in July 2000 in ``A Report to Congress on the 
Feasibility of a Program to Qualify Individuals with Insulin-Treated 
Diabetes Mellitus to Operate Commercial Motor Vehicles in Interstate 
Commerce as Directed by the Transportation Equity Act for the 21st 
Century''.
    (d) Applicable Standard.--The Secretary shall ensure that 
individuals who use insulin to treat their diabetes are not held to a 
higher standard than other qualified commercial drivers, except to the 
extent that limited operating, monitoring, or medical requirements are 
deemed medically necessary by experts in the field of diabetes 
medicine.

SEC. 4230. FINANCIAL RESPONSIBILITY FOR PRIVATE MOTOR CARRIERS.

    (a) Transportation of Passengers.--
            (1) Section 31138(a) is amended to read as follows:
    ``(a) General Requirement.--The Secretary of Transportation shall 
prescribe regulations to require minimum levels of financial 
responsibility sufficient to satisfy liability amounts established by 
the Secretary covering public liability and property damage for the 
transportation of passengers by motor vehicle in the United States 
between a place in a State and--
            ``(1) a place in another State;
            ``(2) another place in the same State through a place 
        outside of that State; or
            ``(3) a place outside the United States.''.
            (2) Section 31138(c) is amended by adding at the end the 
        following:
            ``(4) The Secretary may require a person, other than a 
        motor carrier as defined in section 13102(12) of this title, 
        transporting passengers by motor vehicle to file with the 
        Secretary the evidence of financial responsibility specified in 
        subsection (c)(1) of this section in an amount not less than 
        that required by this section, and the laws of the State or 
        States in which the person is operating, to the extent 
        applicable. The extent of the financial responsibility must be 
        sufficient to pay, not more than the amount of the financial 
        responsibility, for each final judgment against the person for 
        bodily injury to, or death of, an individual resulting from the 
        negligent operation, maintenance, or use of motor vehicles, or 
        for loss or damage to property, or both.''.
    (b) Transportation of Property.--Section 31139 is amended--
            (1) by striking so much of subsection (b) as precedes 
        paragraph (2) and inserting the following:
    ``(b) General Requirements and Minimum Amount.--
            ``(1) The Secretary of Transportation shall prescribe 
        regulations to require minimum levels of financial 
        responsibility sufficient to satisfy liability amounts 
        established by the Secretary covering public liability, 
        property damage, and environmental restoration for the 
        transportation of property by motor vehicle in the United 
        States between a place in a State and--
                    ``(A) a place in another State;
                    ``(B) another place in the same State through a 
                place outside of that State; or
                    ``(C) a place outside the United States.'';
            (2) by aligning the left margin of paragraph (2) of 
        subsection (b) with the left margin of paragraph (1) of that 
        subsection (as amended by paragraph (1) of this subsection); 
        and
            (3) by redesignating subsection (c) through (g) as 
        subsections (d) through (h), respectively, and inserting after 
        subsection (b) the following:
    ``(c) Filing of Evidence of Financial Responsibility.--The 
Secretary may require a motor private carrier, as defined in section 
13102 of this title, to file with the Secretary the evidence of 
financial responsibility specified in subsection (b) of this section in 
an amount not less than that required by this section, and the laws of 
the State or States in which the motor private carrier is operating, to 
the extent applicable. The amount of the financial responsibility must 
be sufficient to pay, not more than the amount of the financial 
responsibility, for each final judgment against the motor private 
carrier for bodily injury to, or death of, an individual resulting from 
negligent operation, maintenance, or use of motor vehicles, or for loss 
or damage to property, or both.''.

SEC. 4231. INCREASED PENALTIES FOR OUT-OF-SERVICE VIOLATIONS AND FALSE 
              RECORDS.

    (a) Section 521(b)(2)(B) is amended to read as follows:
            ``(B) Recordkeeping and reporting violations.--A person 
        required to make a report to the Secretary, answer a question, 
        or make, prepare, or preserve a record under section 504 of 
        this title or under any regulation issued by the Secretary 
        pursuant to subchapter III of chapter 311 (except sections 
        31138 and 31139) or section 31502 of this title about 
        transportation by motor carrier, motor carrier of migrant 
        workers, or motor private carrier, or an officer, agent, or 
        employee of that person--
                    ``(i) who does not make that report, does not 
                specifically, completely, and truthfully answer that 
                question in 30 days from the date the Secretary 
                requires the question to be answered, or does not make, 
                prepare, or preserve that record in the form and manner 
                prescribed by the Secretary, shall be liable to the 
                United States for a civil penalty in an amount not to 
                exceed $1,000 for each offense, and each day of the 
                violation shall constitute a separate offense, except 
                that the total of all civil penalties assessed against 
                any violator for all offenses related to any single 
                violation shall not exceed $10,000; or
                    ``(ii) who knowingly falsifies, destroys, 
                mutilates, or changes a required report or record, 
                knowingly files a false report with the Secretary, 
                knowingly makes or causes or permits to be made a false 
                or incomplete entry in that record about an operation 
                or business fact or transaction, or knowingly makes, 
                prepares, or preserves a record in violation of a 
                regulation or order of the Secretary, shall be liable 
                to the United States for a civil penalty in an amount 
                not to exceed $10,000 for each violation, if any such 
                action can be shown to have misrepresented a fact that 
                constitutes a violation other than a reporting or 
                recordkeeping violation.''.
    (b) Section 31310(i)(2) is amended to read as follows:
            ``(2) The Secretary shall prescribe regulations 
        establishing sanctions and penalties related to violations of 
        out-of-service orders by individuals operating commercial motor 
        vehicles. The regulations shall require at least that--
                    ``(A) an operator of a commercial motor vehicle 
                found to have committed a first violation of an out-of-
                service order shall be disqualified from operating such 
                a vehicle for at least 180 days and liable for a civil 
                penalty of at least $2,500;
                    ``(B) an operator of a commercial motor vehicle 
                found to have committed a second violation of an out-
                of-service order shall be disqualified from operating 
                such a vehicle for at least 2 years and not more than 5 
                years and liable for a civil penalty of at least 
                $5,000;
                    ``(C) an employer that knowingly allows or requires 
                an employee to operate a commercial motor vehicle in 
                violation of an out-of-service order shall be liable 
                for a civil penalty of not more than $25,000; and
                    ``(D) an employer that knowingly and willfully 
                allows or requires an employee to operate a commercial 
                motor vehicle in violation of an out-of-service order 
                shall, upon conviction, be subject for each offense to 
                imprisonment for a term not to exceed 1 year or a fine 
                under title 18, United States Code, or both.''.

SEC. 4232. ELIMINATION OF COMMODITY AND SERVICE EXEMPTIONS.

    (a) Section 13506(a) is amended--
            (1) by striking paragraphs (6), (11), (12), (13), and (15);
            (2) by redesignating paragraphs (7), (8), (9), (10), and 
        (14) as paragraphs (6), (7), (8), (9) and (10), respectively;
            (3) by inserting ``or'' after the semicolon in paragraph 
        (9), as redesignated; and
            (4) striking ``13904(d); or'' in paragraph (1), as 
        redesignated, and inserting ``14904(d).''.
    (b) Section 13507 is amended by striking ``(6), (8), (11), (12), or 
(13)'' and inserting ``(6)''.

SEC. 4233. INTRASTATE OPERATIONS OF INTERSTATE MOTOR CARRIERS.

    (a) Subsection (a) of section 31144 is amended to read as follows:
    ``(a) In General.--The Secretary shall--
            ``(1) determine whether an owner or operator is fit to 
        operate safely commercial motor vehicles, utilizing among other 
        things the accident record of an owner or operator operating in 
        interstate commerce and the accident record and safety 
        inspection record of such owner or operator in operations that 
        affect interstate commerce;
            ``(2) periodically update such safety fitness 
        determinations;
            ``(3) make such final safety fitness determinations readily 
        available to the public; and
            ``(4) prescribe by regulation penalties for violations of 
        this section consistent with section 521.''.
    (b) Subsection (c) of section 31144 is amended by adding at the end 
the following:
            ``(5) Transportation affecting interstate commerce.--Owners 
        or operators of commercial motor vehicles prohibited from 
        operating in interstate commerce pursuant to paragraphs (1) 
        through (3) of this section may not operate any commercial 
        motor vehicle that affects interstate commerce until the 
        Secretary determines that such owner or operator is fit.''.
    (c) Section 31144 is amended by redesignating subsections (d), (e), 
and the second subsection (c) as subsections (e), (f), and (g), 
respectively, and inserting after subsection (c) the following:
    ``(d) Determination of Unfitness by a State.--If a State that 
receives Motor Carrier Safety Assistance Program funds pursuant to 
section 31102 of this title determines, by applying the standards 
prescribed by the Secretary under subsection (b) of this section, that 
an owner or operator of commercial motor vehicles that has its 
principal place of business in that State and operates in intrastate 
commerce is unfit under such standards and prohibits the owner or 
operator from operating such vehicles in the State, the Secretary shall 
prohibit the owner or operator from operating such vehicles in 
interstate commerce until the State determines that the owner or 
operator is fit.''.

SEC. 4234. AUTHORITY TO STOP COMMERCIAL MOTOR VEHICLES.

    (a) In General.--Chapter 2 of title 18, United States Code, is 
amended by adding at the end the following:
``Sec. 38. Commercial motor vehicles required to stop for inspections
    ``(a) A driver of a commercial motor vehicle, as defined in section 
31132(1) of title 49, shall stop and submit to inspection of the 
vehicle, driver, cargo, and required records when directed to do so by 
an authorized employee of the Federal Motor Carrier Safety 
Administration, Department of Transportation, at or in the vicinity of 
an inspection site. The driver shall not leave the inspection site 
until authorized to do so by an authorized employee.
    ``(b) A driver of a commercial motor vehicle, as defined in 
subsection (a), who knowingly fails to stop for inspection when 
directed to do so by an authorized employee of the Federal Motor 
Carrier Safety Administration at or in the vicinity of an inspection 
site, or leaves the inspection site without authorization, shall be 
fined under this title or imprisoned not more than 1 year, or both.''.
    (b) Authority of FMCSA.--Chapter 203 of title 18, United States 
Code, is amended by adding at the end the following:
``Sec. 3064. Powers of Federal Motor Carrier Safety Administration
    ``Authorized employees of the Federal Motor Carrier Safety 
Administration may direct a driver of a commercial motor vehicle, as 
defined in 49 U.S.C. 31132(1), to stop for inspection of the vehicle, 
driver, cargo, and required records at or in the vicinity of an 
inspection site.''.
    (c) Conforming Amendments.--
            (1) The chapter analysis for chapter 2 of title 18, United 
        States Code, is amended by inserting after the item relating to 
        section 37 the following:

``38. Commercial motor vehicles required to stop for inspections.''.
            (2) The chapter analysis for chapter 203 of title 18, 
        United States Code, is amended by inserting after the item 
        relating to section 3063 the following:

``3064. Powers of Federal Motor Carrier Safety Administration.''.

SEC. 4235. REVOCATION OF OPERATING AUTHORITY.

    Section 13905(e) is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(1) Protection of safety.--Notwithstanding subchapter II 
        of chapter 5 of title 5, the Secretary--
                    ``(A) may suspend the registration of a motor 
                carrier, a freight forwarder, or a broker for failure 
                to comply with requirements of the Secretary pursuant 
                to section 13904(c) or 13906 of this title, or an order 
                or regulation of the Secretary prescribed under those 
                sections; and
                    ``(B) shall revoke the registration of a motor 
                carrier that has been prohibited from operating in 
                interstate commerce for failure to comply with the 
                safety fitness requirements of section 31144 of this 
                title.'';
            (2) by striking ``may suspend a registration''in paragraph 
        (2) and inserting ``shall revoke the registration''; and
            (3) by striking paragraph (3) and inserting the following:
            ``(3) Notice; period of suspension.--The Secretary may 
        suspend or revoke under this subsection the registration only 
        after giving notice of the suspension or revocation to the 
        registrant. A suspension remains in effect until the registrant 
        complies with the applicable sections or, in the case of a 
        suspension under paragraph (2), until the Secretary revokes the 
        suspension.''.

SEC. 4236. PATTERN OF SAFETY VIOLATIONS BY MOTOR CARRIER MANAGEMENT.

    (a) In General.--Section 31135 is amended--
            (1) by inserting ``(a) In General.--'' before ``Each''; and
            (2) by adding at the end the following:
    ``(b) Pattern of Non-Compliance.--If an officer of a motor carrier 
engages in a pattern or practice of avoiding compliance, or masking or 
otherwise concealing non-compliance, with regulations on commercial 
motor vehicle safety prescribed under this subchapter, the Secretary 
may suspend, amend, or revoke any part of the motor carrier's 
registration under section 13905 of this title.
    ``(c) List of Proposed Officers.--Each person seeking registration 
as a motor carrier under section 13902 of this title shall submit a 
list of the proposed officers of the motor carrier. If the Secretary 
determines that any of the proposed officers has previously engaged in 
a pattern or practice of avoiding compliance, or masking or otherwise 
concealing non-compliance, with regulations on commercial motor vehicle 
safety prescribed under this chapter, the Secretary may deny the 
person's application for registration as a motor carrier under section 
13902(a)(3).
    ``(d) Regulations.--The Secretary shall by regulation establish 
standards to implement subsections (b) and (c).
    ``(e) Definitions.--In this section:
            ``(1) Motor carrier.--The term motor carrier has the 
        meaning given the term in section 13102(12) of this title; and
            ``(2) Officer.--The term officer means an owner, chief 
        executive officer, chief operating officer, chief financial 
        officer, safety director, vehicle maintenance supervisor and 
        driver supervisor of a motor carrier, regardless of the title 
        attached to those functions.''.
    (b) Registration of Carriers.--Section 13902(a)(1)(B) is amended to 
read as follows:
            ``(B) any safety regulations imposed by the Secretary, the 
        duties of employers and employees established by the Secretary 
        under section 31135, and the safety fitness requirements 
        established by the Secretary under section 31144; and''.

SEC. 4237. MOTOR CARRIER RESEARCH AND TECHNOLOGY PROGRAM.

    (a) In General.--Section 31108 is amended to read as follows:
``Sec. 31108. Motor carrier research and technology program
    ``(a) Research, Technology, and Technology Transfer Activities.--
            ``(1) The Secretary of Transportation shall establish and 
        carry out a motor carrier and motor coach research and 
        technology program. The Secretary may carry out research, 
        development, technology, and technology transfer activities 
        with respect to--
                    ``(A) the causes of accidents, injuries and 
                fatalities involving commercial motor vehicles; and
                    ``(B) means of reducing the number and severity of 
                accidents, injuries and fatalities involving commercial 
                motor vehicles.
            ``(2) The Secretary may test, develop, or assist in testing 
        and developing any material, invention, patented article, or 
        process related to the research and technology program.
            ``(3) The Secretary may use the funds appropriated to carry 
        out this section for training or education of commercial motor 
        vehicle safety personnel, including, but not limited to, 
        training in accident reconstruction and detection of controlled 
        substances or other contraband, and stolen cargo or vehicles.
            ``(4) The Secretary may carry out this section--
                    ``(A) independently;
                    ``(B) in cooperation with other Federal 
                departments, agencies, and instrumentalities and 
                Federal laboratories; or
                    ``(C) by making grants to, or entering into 
                contracts, cooperative agreements, and other 
                transactions with, any Federal laboratory, State 
                agency, authority, association, institution, for-profit 
                or non-profit corporation, organization, foreign 
                country, or person.
            ``(5) The Secretary shall use funds made available to carry 
        out this section to develop, administer, communicate, and 
        promote the use of products of research, technology, and 
        technology transfer programs under this section.
    ``(b) Collaborative Research and Development.--
            ``(1) To advance innovative solutions to problems involving 
        commercial motor vehicle and motor carrier safety, security, 
        and efficiency, and to stimulate the deployment of emerging 
        technology, the Secretary may carry out, on a cost-shared 
        basis, collaborative research and development with--
                    ``(A) non-Federal entities, including State and 
                local governments, foreign governments, colleges and 
                universities, corporations, institutions, partnerships, 
                and sole proprietorships that are incorporated or 
                established under the laws of any State; and
                    ``(B) Federal laboratories.
            ``(2) In carrying out this subsection, the Secretary may 
        enter into cooperative research and development agreements (as 
        defined in section 12 of the Stevenson-Wydler Technology 
        Innovation Act of 1980 (15 U.S.C. 3710a)).
            ``(3)(A) The Federal share of the cost of activities 
        carried out under a cooperative research and development 
        agreement entered into under this subsection shall not exceed 
        50 percent, except that if there is substantial public interest 
        or benefit, the Secretary may approve a greater Federal share.
            ``(B) All costs directly incurred by the non-Federal 
        partners, including personnel, travel, and hardware or software 
        development costs, shall be credited toward the non-Federal 
        share of the cost of the activities described in subparagraph 
        (A).
            ``(4) The research, development, or use of a technology 
        under a cooperative research and development agreement entered 
        into under this subsection, including the terms under which the 
        technology may be licensed and the resulting royalties may be 
        distributed, shall be subject to the Stevenson-Wydler 
        Technology Innovation Act of 1980 (15 U.S.C. 3701 et seq.).
            ``(5) Section 5 of title 41, United States Code, shall not 
        apply to a contract or agreement entered into under this 
        section.
    ``(c) Availability of Amounts.--The amounts made available under 
section 4222(a) of the Motor Carrier Safety Reauthorization Act of 2004 
to carry out this section shall remain available until expended.
    ``(d) Contract Authority.--Approval by the Secretary of a grant 
with funds made available under section 4222(a) of the Motor Carrier 
Safety Reauthorization Act of 2004 to carry out this section imposes 
upon the United States Government a contractual obligation for payment 
of the Government's share of costs incurred in carrying out the 
objectives of the grant.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 311 is 
amended by striking the item relating to section 31108, and inserting 
the following:

``31108. Motor carrier research and technology program.''.

SEC. 4238. REVIEW OF COMMERCIAL ZONE EXEMPTION PROVISION.

    (a) In General.--Not later than 1 year after the date of enactment 
of this Act, the Secretary of Transportation shall complete a review of 
part 372 of title 49, Code of Federal Regulations, as it pertains to 
commercial zone exemptions (excluding border commercial zones) from 
Department of Transportation and Surface Transportation Board 
regulations governing interstate commerce. The Secretary shall 
determine whether such exemptions should continue to apply as written, 
should undergo revision, or should be revoked. The Secretary shall 
submit to the Senate Committee on Commerce, Science, and Transportation 
and the House of Representatives Committee on Transportation and 
Infrastructure a report of the review not later than 14 months after 
such date of enactment.
    (b) Notice.--The Secretary shall publish notice of the review 
required by subsection (a) and provide and opportunity for the public 
to submit comments on the effect of continuing, revising, or revoking 
the commercial zone exemptions in part 372 of title 49, Code of Federal 
Regulations.

SEC. 4239. INTERNATIONAL COOPERATION.

    (a) In General.--Chapter 311 is amended by inserting at the end the 
following:

                     ``Subchapter IV--Miscellaneous

``Sec. 31161. International cooperation
    ``The Secretary is authorized to use funds appropriated under 
section 31104(i) of this title to participate and cooperate in 
international activities to enhance motor carrier, commercial motor 
vehicle, driver, and highway safety by such means as exchanging 
information, conducting research, and examining needs, best practices, 
and new technology.''.
    (b) Clerical Amendment.--The chapter analysis for chapter 311 is 
amended by adding at the end the following:

                     ``SUBCHAPTER IV--MISCELLANEOUS

``31161. International cooperation.''.

SEC. 4240. PERFORMANCE AND REGISTRATION INFORMATION SYSTEM MANAGEMENT.

    (a) In General.--Section 31106(b) is amended--
            (1) by striking paragraphs (2) and (3) and inserting the 
        following:
            ``(2) Design.--The program shall link Federal motor carrier 
        safety information systems with State commercial vehicle 
        registration and licensing systems and shall be designed to 
        enable a State to--
                    ``(A) determine the safety fitness of a motor 
                carrier or registrant when licensing or registering the 
                registrant or motor carrier or while the license or 
                registration is in effect; and
                    ``(B) deny, suspend, or revoke the commercial motor 
                vehicle registrations of a motor carrier or registrant 
                that has been issued an operations out-of-service order 
                by the Secretary.
            ``(3) Conditions for participation.--The Secretary shall 
        require States, as a condition of participation in the program, 
        to--
                    ``(A) comply with the uniform policies, procedures, 
                and technical and operational standards prescribed by 
                the Secretary under subsection (a)(4);
                    ``(B) possess the authority to impose sanctions 
                relating to commercial motor vehicle registration on 
                the basis of a Federal safety fitness determination; 
                and
                    ``(C) cancel the motor vehicle registration and 
                seize the registration plates of an employer found 
                liable under section 31310(i)(2)(C) of this title for 
                knowingly allowing or requiring an employee to operate 
                a commercial motor vehicle in violation of an out-of-
                service order.''; and
            (2) by striking paragraph (4).
    (b) Performance and Registration Information System Management 
Grants.--
            (1) Subchapter I of chapter 311, as amended by this title, 
        is further amended by adding at the end the following:
``Sec. 31109. Performance and Registration Information System 
              Management
    ``(a) In General.--From the funds authorized by section 4222(c)(2) 
of the Motor Carrier Safety Reauthorization Act of 2004, the Secretary 
may make a grant in a fiscal year to a State to implement the 
performance and registration information system management requirements 
of section 31106(b).
    ``(b) Availability of Amounts.--Amounts made available to a State 
under section 4222(c)(2) of the Motor Carrier Safety Reauthorization 
Act of 2004 to carry out this section shall remain available until 
expended.
    ``(c) Secretary's Approval.--Approval by the Secretary of a grant 
to a State under section 4222(c)(2) of the Motor Carrier Safety 
Reauthorization Act of 2004 to carry out this section is a contractual 
obligation of the Government for payment of the amount of the grant.''.
            (2) Conforming amendment.--The chapter analysis for chapter 
        311 is amended by inserting after the item relating to section 
        31108 the following:

``31109. Performance and Registration Information System Management.''.

SEC. 4241. COMMERCIAL VEHICLE INFORMATION SYSTEMS AND NETWORKS 
              DEPLOYMENT.

    (a) In General.--The Secretary shall carry out a commercial vehicle 
information systems and networks program to--
            (1) improve the safety and productivity of commercial 
        vehicles; and
            (2) reduce costs associated with commercial vehicle 
        operations and Federal and State commercial vehicle regulatory 
        requirements.
    (b) Purpose.--The program shall advance the technological 
capability and promote the deployment of intelligent transportation 
system applications for commercial vehicle operations, including 
commercial vehicle, commercial driver, and carrier-specific information 
systems and networks.
    (c) Core Deployment Grants.--
            (1) In general.--The Secretary shall make grants to 
        eligible States for the core deployment of commercial vehicle 
        information systems and networks.
            (2) Eligibility.--To be eligible for a core deployment 
        grant under this section, a State--
                    (A) shall have a commercial vehicle information 
                systems and networks program plan and a top level 
                system design approved by the Secretary;
                    (B) shall certify to the Secretary that its 
                commercial vehicle information systems and networks 
                deployment activities, including hardware procurement, 
                software and system development, and infrastructure 
                modifications, are consistent with the national 
                intelligent transportation systems and commercial 
                vehicle information systems and networks architectures 
                and available standards, and promote interoperability 
                and efficiency to the extent practicable; and
                    (C) shall agree to execute interoperability tests 
                developed by the Federal Motor Carrier Safety 
                Administration to verify that its systems conform with 
                the national intelligent transportation systems 
                architecture, applicable standards, and protocols for 
                commercial vehicle information systems and networks.
            (3) Amount of grants.--The maximum aggregate amount a State 
        may receive under this section for the core deployment of 
        commercial vehicle information systems and networks may not 
        exceed $2,500,000.
            (4) Use of funds.--Funds from a grant under this subsection 
        may only be used for the core deployment of commercial vehicle 
        information systems and networks. Eligible States that have 
        either completed the core deployment of commercial vehicle 
        information systems and networks or completed such deployment 
        before core deployment grant funds are expended may use the 
        remaining core deployment grant funds for the expanded 
        deployment of commercial vehicle information systems and 
        networks in their State.
    (d) Expanded Deployment Grants.--
            (1) In general.--For each fiscal year, from the funds 
        remaining after the Secretary has made core deployment grants 
        under subsection (c) of this section, the Secretary may make 
        grants to each eligible State, upon request, for the expanded 
        deployment of commercial vehicle information systems and 
        networks.
            (2) Eligibility.--Each State that has completed the core 
        deployment of commercial vehicle information systems and 
        networks is eligible for an expanded deployment grant.
            (3) Amount of grants.--Each fiscal year, the Secretary may 
        distribute funds available for expanded deployment grants 
        equally among the eligible States, but not to exceed $1,000,000 
        per State.
            (4) Use of funds.--A State may use funds from a grant under 
        this subsection only for the expanded deployment of commercial 
        vehicle information systems and networks.
    (e) Federal Share.--The Federal share of the cost of a project 
payable from funds made available to carry out this section shall not 
exceed 50 percent. The total Federal share of the cost of a project 
payable from all eligible sources shall not exceed 80 percent.
    (f) Applicability of Title 23, United States Code.--Funds 
authorized to be appropriated under section 4222(c)(4) shall be 
available for obligation in the same manner and to the same extent as 
if such funds were apportioned under chapter 1 of title 23, United 
States Code, except that such funds shall remain available until 
expended.
    (g) Definitions.--In this section:
            (1) Commercial vehicle information systems and networks.--
        The term ``commercial vehicle information systems and 
        networks'' means the information systems and communications 
        networks that provide the capability to--
                    (A) improve the safety of commercial vehicle 
                operations;
                    (B) increase the efficiency of regulatory 
                inspection processes to reduce administrative burdens 
                by advancing technology to facilitate inspections and 
                increase the effectiveness of enforcement efforts;
                    (C) advance electronic processing of registration 
                information, driver licensing information, fuel tax 
                information, inspection and crash data, and other 
                safety information;
                    (D) enhance the safe passage of commercial vehicles 
                across the United States and across international 
                borders; and
                    (E) promote the communication of information among 
                the States and encourage multistate cooperation and 
                corridor development.
            (2) Commercial vehicle operations.--The term ``commercial 
        vehicle operations''--
                    (A) means motor carrier operations and motor 
                vehicle regulatory activities associated with the 
                commercial movement of goods, including hazardous 
                materials, and passengers; and
                    (B) with respect to the public sector, includes the 
                issuance of operating credentials, the administration 
                of motor vehicle and fuel taxes, and roadside safety 
                and border crossing inspection and regulatory 
                compliance operations.
            (3) Core deployment.--The term ``core deployment'' means 
        the deployment of systems in a State necessary to provide the 
        State with the following capabilities:
                    (A) Safety information exchange.--Safety 
                information exchange to--
                            (i) electronically collect and transmit 
                        commercial vehicle and driver inspection data 
                        at a majority of inspection sites;
                            (ii) connect to the Safety and Fitness 
                        Electronic Records system for access to 
                        interstate carrier and commercial vehicle data, 
                        summaries of past safety performance, and 
                        commercial vehicle credentials information; and
                            (iii) exchange carrier data and commercial 
                        vehicle safety and credentials information 
                        within the State and connect to Safety and 
                        Fitness Electronic Records for access to 
                        interstate carrier and commercial vehicle data.
                    (B) Interstate credentials administration.--
                Interstate credentials administration to--
                            (i) perform end-to-end processing, 
                        including carrier application, jurisdiction 
                        application processing, and credential 
                        issuance, of at least the International 
                        Registration Plan and International Fuel Tax 
                        Agreement credentials and extend this 
                        processing to other credentials, including 
                        intrastate, titling, oversize/overweight, 
                        carrier registration, and hazardous materials;
                            (ii) connect to the International 
                        Registration Plan and International Fuel Tax 
                        Agreement clearinghouses; and
                            (iii) have at least 10 percent of the 
                        transaction volume handled electronically, and 
                        have the capability to add more carriers and to 
                        extend to branch offices where applicable.
                    (C) Roadside screening.--Roadside electronic 
                screening to electronically screen transponder-equipped 
                commercial vehicles at a minimum of 1 fixed or mobile 
                inspection sites and to replicate this screening at 
                other sites.
            (4) Expanded deployment.--The term ``expanded deployment'' 
        means the deployment of systems in a State that exceed the 
        requirements of an core deployment of commercial vehicle 
        information systems and networks, improve safety and the 
        productivity of commercial vehicle operations, and enhance 
        transportation security.

SEC. 4242. OUTREACH AND EDUCATION.

    (a) In General.--The Secretary of Transportation, through the 
National Highway Traffic Safety Administration and the Federal Motor 
Carrier Safety Administration, may undertake outreach and education 
initiatives, including the ``Share the Road Safely'' program, that may 
reduce the number of highway accidents, injuries, and fatalities 
involving commercial motor vehicles. The Secretary may not use funds 
authorized by this part for the ``Safety Is Good Business'' program.
    (b) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary for fiscal year 2004 to carry out this 
section--
            (1) $250,000 for the Federal Motor Carrier Safety 
        Administration; and
            (2) $750,000 for the National Highway Traffic Safety 
        Administration.

SEC. 4243. OPERATION OF RESTRICTED PROPERTY-CARRYING UNITS ON NATIONAL 
              HIGHWAY SYSTEM.

    (a) Restricted Property-Carrying Unit Defined.--Section 31111(a) is 
amended--
            (1) by redesignating paragraph (3) as paragraph (4); and
            (2) by inserting after paragraph (2) the following:
            ``(3) Restricted property-carrying unit.--The term 
        `restricted property-carrying unit' means any trailer, semi-
        trailer, container, or other property-carrying unit that is 
        longer than 53 feet.''.
    (b) Prohibition on Operation of Restricted Property-Carrying 
Units.--
            (1) In general.--Section 31111(b)(1)(C) is amended to read 
        as follows:
            ``(C) allows operation on any segment of the National 
        Highway System, including the Interstate System, of a 
        restricted property-carrying unit unless the operation is 
        specified on the list published under subsection (h);''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect 270 days after the date of enactment of this 
        subsection.
    (c) Limitations.--Section 31111 is amended by adding at the end the 
following:
    ``(h) Restricted Property-Carrying Units.--
            ``(1) Applicability of prohibition.--
                    ``(A) In general.--Notwithstanding subsection 
                (b)(1)(C), a restricted property-carrying unit may 
                continue to operate on a segment of the National 
                Highway System if the operation of such unit is 
                specified on the list published under paragraph (2).
                    ``(B) Applicability of state laws and 
                regulations.--All operations specified on the list 
                published under paragraph (2) shall continue to be 
                subject to all State statutes, regulations, limitations 
                and conditions, including routing-specific, commodity-
                specific, and configuration-specific designations and 
                all other restrictions, in force on June 1, 2003.
                    ``(C) Fire-fighting units.--Subsection (b)(1)(C) 
                shall not apply to the operation of a restricted 
                property-carrying unit that is used exclusively for 
                fire-fighting.
            ``(2) Listing of restricted property-carrying units.--
                    ``(A) In general.--Not later than 60 days after the 
                date of enactment of the Motor Carrier Safety 
                Reauthorization Act of 2004, the Secretary shall 
                initiate a proceeding to determine and publish a list 
                of restricted property-carrying units that were 
                authorized by State officials pursuant to State statute 
                or regulation on June 1, 2003, and in actual and lawful 
                operation on a regular or periodic basis (including 
                seasonal operations) on or before June 1, 2003.
                    ``(B) Limitation.--A restricted property-carrying 
                unit may not be included on the list published under 
                subparagraph (A) on the basis that a State law or 
                regulation could have authorized the operation of the 
                unit at some prior date by permit or otherwise.
                    ``(C) Publication of final list.--Not later than 
                270 days after the date of enactment of this 
                subsection, the Secretary shall publish a final list of 
                restricted property-carrying units described in 
                subparagraph (A).
                    ``(D) Updates.--The Secretary shall update the list 
                published under subparagraph (C) as necessary to 
                reflect new designations made to the National Highway 
                System.
            ``(3) Applicability of prohibition.--The prohibition 
        established by subsection (b)(1)(C) shall apply to any new 
        designation made to the National Highway System and remain in 
        effect on those portions of the National Highway System that 
        cease to be designated as part of the National Highway System.
            ``(4) Limitation on statutory construction.--This 
        subsection does not prevent a State from further restricting in 
        any manner or prohibiting the operation of a restricted 
        property-carrying unit; except that such restrictions or 
        prohibitions shall be consistent with the requirements of this 
        section and sections 31112 through 31114.''.
    (d) Enforcement.--The second sentence of section 141(a) of title 
23, United States Code, is amended by striking ``section 31112'' and 
inserting ``sections 31111 and 31112''.

SEC. 4244. OPERATION OF LONGER COMBINATION VEHICLES ON NATIONAL HIGHWAY 
              SYSTEM.

    (a) In General.--Section 31112 is amended--
            (1) by redesignating subsections (f) and (g) as subsections 
        (g) and (h), respectively; and
            (2) by inserting after subsection (e) the following:
    ``(f) National Highway System.--
            ``(1) General rule.--A State may not allow, on a segment of 
        the National Highway System that is not covered under 
        subsection (b) or (c), the operation of a commercial motor 
        vehicle combination (except a vehicle or load that cannot be 
        dismantled easily or divided easily and that has been issued a 
        special permit under applicable State law) with more than 1 
        property-carrying unit (not including the truck tractor) whose 
        property-carrying units are more than--
                    ``(A) the maximum combination trailer, semitrailer, 
                or other type of length limitation allowed by law or 
                regulation of that State on June 1, 2003; or
                    ``(B) the length of the property-carrying units of 
                those commercial motor vehicle combinations, by 
                specific configuration, in actual and lawful operation 
                on a regular or periodic basis (including continuing 
                seasonal operation) in that State on or before June 1, 
                2003.
            ``(2) Additional limitations.--
                    ``(A) Applicability of state restrictions.--A 
                commercial motor vehicle combination whose operation in 
                a State is not prohibited under paragraph (1) may 
                continue to operate in the State on highways described 
                in paragraph (1) only in compliance with all State 
                laws, regulations, limitations, and conditions, 
                including routing-specific and configuration-specific 
                designations and all other restrictions in force in the 
                State on June 1, 2003. Subject to regulations 
                prescribed by the Secretary under subsection (h), the 
                State may make minor adjustments of a temporary and 
                emergency nature to route designations and vehicle 
                operating restrictions in effect on June 1, 2003, for 
                specific safety purposes and road construction.
                    ``(B) Additional state restrictions.--This 
                subsection does not prevent a State from further 
                restricting in any manner or prohibiting the operation 
                of a commercial motor vehicle combination subject to 
                this section, except that such restrictions or 
                prohibitions shall be consistent with this section and 
                sections 31113(a), 31113(b), and 31114.
                    ``(C) Minor adjustments.--A State making a minor 
                adjustment of a temporary and emergency nature as 
                authorized by subparagraph (A) or further restricting 
                or prohibiting the operation of a commercial motor 
                vehicle combination as authorized by subparagraph (B) 
                shall advise the Secretary not later than 30 days after 
                the action. The Secretary shall publish a notice of the 
                action in the Federal Register.
            ``(3) List of state length limitations.--
                    ``(A) State submissions.--Not later than 60 days 
                after the date of enactment of the Motor Carrier Safety 
                Reauthorization Act of 2004, each State shall submit to 
                the Secretary for publication a complete list of State 
                length limitations applicable to commercial motor 
                vehicle combinations operating in the State on the 
                highways described in paragraph (1). The list shall 
                indicate the applicable State laws and regulations 
                associated with the length limitations. If a State does 
                not submit the information as required, the Secretary 
                shall complete and file the information for the State.
                    ``(B) Publication of interim list.--Not later than 
                90 days after the date of enactment of the Motor 
                Carrier Safety Reauthorization Act of 2004, the 
                Secretary shall publish an interim list in the Federal 
                Register consisting of all information submitted under 
                subparagraph (A). The Secretary shall review for 
                accuracy all information submitted by a State under 
                subparagraph (A) and shall solicit and consider public 
                comment on the accuracy of the information.
                    ``(C) Limitation.--A law or regulation may not be 
                included on the list submitted by a State or published 
                by the Secretary merely because it authorized, or could 
                have authorized, by permit or otherwise, the operation 
                of commercial motor vehicle combinations not in actual 
                operation on a regular or periodic basis on or before 
                June 1, 2003.
                    ``(D) Publication of final list.--Except as revised 
                under this subparagraph or subparagraph (E), the list 
                shall be published as final in the Federal Register not 
                later than 270 days after the date of enactment of the 
                Motor Carrier Safety Reauthorization Act of 2004. In 
                publishing the final list, the Secretary shall make any 
                revisions necessary to correct inaccuracies identified 
                under subparagraph (B). After publication of the final 
                list, commercial motor vehicle combinations prohibited 
                under paragraph (1) may not operate on a highway 
                described in paragraph (1) except as published on the 
                list.
                    ``(E) Inaccuracies.--On the Secretary's own motion 
                or on request by any person (including a State), the 
                Secretary shall review the list published under 
                subparagraph (D). If the Secretary decides there is 
                reason to believe a mistake was made in the accuracy of 
                the list, the Secretary shall begin a proceeding to 
                decide whether a mistake was made. If the Secretary 
                decides there was a mistake, the Secretary shall 
                publish the correction.''.
    (b) Conforming Amendments.--Section 31112 is amended--
            (1) by inserting ``126(e) or'' before ``127(d)'' in 
        subsection (g)(1) (as redesignated by subsection (a) of this 
        section);
            (2) by inserting ``(or June 1, 2003, with respect to 
        highways described in subsection (f)(1))'' after ``June 2, 
        1991'' in subsection (g)(3) (as redesignated by subsection (a) 
        of this section); and
            (3) by striking ``Not later than June 15, 1992, the 
        Secretary'' in subsection (h)(2) (as redesignated by subsection 
        (a) of this section) and inserting ``The Secretary''; and
            (4) by inserting ``or (f)'' in subsection (h)(2) (as 
        redesignated by subsection (a) of this section) after 
        ``subsection (d)''.

SEC. 4245. APPLICATION OF SAFETY STANDARDS TO CERTAIN FOREIGN MOTOR 
              CARRIERS.

    (a) Application of Safety Standards.--Section 30112 is amended--
            (1) by striking ``person'' in subsection (a) and inserting 
        ``person, including a foreign motor carrier,''; and
            (2) by adding at the end the following:
    ``(c) Definitions.--In this section:
            ``(1) Foreign motor carrier.--The term `foreign motor 
        carrier' has the meaning given that term in section 13102 of 
        this title.
            ``(2) Import.--The term `import' means transport by any 
        means into the United States, on a permanent or temporary 
        basis, including the transportation of a motor vehicle into the 
        United States for the purpose of providing the transportation 
        of cargo or passengers.''.
    (b) Requirement for Certificate of Compliance.--Section 30115 is 
amended by adding at the end the following:
    ``(c) Application to Foreign Motor Carriers.--
            ``(1) In general.--The requirement for certification 
        described in subsection (a) shall apply to a foreign motor 
        carrier that imports a motor vehicle or motor vehicle equipment 
        into the United States. Such certification shall be made to the 
        Secretary of Transportation prior to the import of the vehicle 
        or equipment.
            ``(2) Definitions.--In this subsection:
                    ``(A) Foreign motor carrier.--The term `foreign 
                motor carrier' has the meaning given that term in 
                section 13102 of this title.
                    ``(B) Import.--The term `import' has the meaning 
                given that term in section 30112 of this title.''.
    (c) Time for Compliance.--The amendments made by sections (a) and 
(b) shall take effect on September 1, 2004.

SEC. 4246. BACKGROUND CHECKS FOR MEXICAN AND CANADIAN DRIVERS HAULING 
              HAZARDOUS MATERIALS.

    (a) In General.--No commercial motor vehicle operator registered to 
operate in Mexico or Canada may operate a commercial motor vehicle 
transporting a hazardous material in commerce in the United States 
until the operator has undergone a background records check similar to 
the background records check required for commercial motor vehicle 
operators licensed in the United States to transport hazardous 
materials in commerce.
    (b) Definitions.--In this section:
            (1) Hazardous materials.--The term ``hazardous material'' 
        means any material determined by the Secretary of 
        Transportation to be a hazardous material for purposes of this 
        section.
            (2) Commercial motor vehicle.--The term ``commercial motor 
        vehicle'' has the meaning given that term by section 31101 of 
        title 49, United States Code.
    (c) Effective Date.--This section takes effect on April 1, 2004.

SEC. 4247. EXEMPTION OF DRIVERS OF UTILITY SERVICE VEHICLES.

    Section 345 of the National Highway System Designation Act of 1995 
(49 U.S.C. 31136 note) is amended--
            (1) by striking paragraph (4) of subsection (a) and 
        inserting the following:
            ``(4) Drivers of utility service vehicles.--
                    ``(A) Inapplicability of federal regulations.--Such 
                regulations may not apply to a driver of a utility 
                service vehicle.
                    ``(B) Prohibition on state regulations.--A State, a 
                political subdivision of a State, an interstate agency, 
                or other entity consisting of 2 or more States, may not 
                enact or enforce any law, rule, regulation, or standard 
                that imposes requirements on a driver of a utility 
                service vehicle that are similar to the requirements 
                contained in such regulations.'';
            (2) by striking ``Nothing'' in subsection (b) and inserting 
        ``Except as provided in subsection (a)(4), nothing''; and
            (3) by striking ``paragraph (2)'' in the first sentence of 
        subsection (c) and inserting ``an exemption under paragraph (2) 
        or (4)''.

SEC. 4248. OPERATION OF COMMERCIAL MOTOR VEHICLES TRANSPORTING 
              AGRICULTURAL COMMODITIES AND FARM SUPPLIES.

    (a) Exemption From Hours-of-Service Requirements.--
            (1) In general.--Section 345(c) of the National Highway 
        System Designation Act of 1995 (49 U.S.C. 31136 note), as 
        amended by section 4247(3) of this title, is amended by 
        striking ``paragraph (2) or (4)'' and inserting ``paragraph 
        (1), (2), or (4) of that subsection)''.
            (2) Applicability.--The exemption provided by section 
        345(a)(1) of the National Highway System Designation Act of 
        1995 (49 U.S.C. 31136 note) shall apply to a person 
        transporting agricultural commodities or farm supplies for 
        agricultural purposes under that section on and after the date 
        of enactment of this Act regardless of any action taken by the 
        Secretary of Transportation under section 345(c) of that Act 
        before the date of enactment of this Act.
    (b) Definition of Agricultural Commodity.--Section 345(e) of the 
National Highway System Designation Act of 1995 (49 U.S.C. 31136 note) 
is amended--
            (1) by redesignating paragraphs (3), (4), (5), and (6) as 
        paragraphs (5), (6), (4), and (7), respectively, and moving the 
        paragraphs so as to appear in numerical order; and
            (2) by inserting after paragraph (2) the following:
            ``(3) Agricultural commodity.--The term `agricultural 
        commodity' has the meaning given the term in section 102 of the 
        Agricultural Trade Act of 1978 (7 U.S.C. 5602).''.

SEC. 4249. SAFETY PERFORMANCE HISTORY SCREENING.

    (a) In General.--Subchapter III of chapter 311, as amended by 
section 4228, is amended by adding at the end the following:
``Sec. 31150. Safety performance history screening
    ``(a) In General.--The Secretary of Transportation shall provide 
companies conducting pre-employment screening services for the motor 
carrier industry electronic access to--
            ``(1) commercial motor vehicle accident reports,
            ``(2) inspection reports that contain no driver-related 
        safety violations, and
            ``(3) serious driver-related safety violation inspection 
        reports that are contained in the Motor Carrier Management 
        Information System.
    ``(b) Establishment.--Prior to making information available to such 
companies under subsection (a), the Secretary shall--
            ``(1) ensure that any information released is done in 
        accordance with the Fair Credit Reporting Act (15 U.S.C. 1681 
        et seq.) and all applicable Federal laws;
            ``(2) require the driver applicant's written consent as a 
        condition of releasing the information;
            ``(3) ensure that the information made available to 
        companies providing pre-employment screening services is not 
        released to any other unauthorized company or individual, 
        unless expressly authorized or required by law; and
            ``(4) provide a procedure for drivers to remedy incorrect 
        information in a timely manner.
    ``(c) Design.--To be eligible to have access to information under 
subsection (a), a company conducting pre-employment screening services 
for the motor carrier industry shall utilize a screening process--
            ``(1) that is designed to assist the motor carrier industry 
        in assessing an individual driver's crash and serious safety 
        violation inspection history as a pre-employment condition;
            ``(2) the use of which is not mandatory; and
            ``(3) which is used only during the pre-employment 
        assessment of a driver-applicant.
    ``(d) Serious Driver-Related Safety Violations.--In this section, 
the term `serious driver-related safety violation' means a violation 
listed in the North American Standard Driver Out-of-service Criteria 
that prohibits the continued operation of a commercial motor 
vehicle.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 311, as 
amended by section 4228, is amended by inserting after the item 
relating to section 31149 the following:

``31150. Safety performance history screening.''.

SEC. 4250. COMPLIANCE REVIEW AUDIT.

    Within 1 year after the date of enactment of this Act, the 
Inspector General for the Department of Transportation shall audit the 
compliance reviews performed by the Federal Motor Carrier Safety 
Administration in fiscal year 2003 and submit a report to the Senate 
Committee on Commerce, Science, and Transportation and the House of 
Representatives Committee on Transportation and Infrastructure on--
            (1) the enforcement actions taken as a result of the 
        compliance reviews, including fines, suspension or revocation 
        of operating authority, unsatisfactory ratings, and follow-up 
        actions to ensure compliance with Federal motor carrier safety 
        regulations;
            (2) whether compliance reviews are or should be performed 
        on a corporate-wide basis for all affiliates of the motor 
        carrier selected for a compliance review as a result of its 
        Safety Status Measurement System ranking or the submission of a 
        complaint;
            (3) whether the enforcement actions taken by the Federal 
        Motor Carrier Safety Administration are adequate to assure 
        future compliance of the motor carrier with Federal safety 
        regulations and what deterrent effect those enforcement actions 
        may have industry-wide;
            (4) whether the methodology for calculating the crash rate 
        of commercial motor vehicles in the Safety Status Measurement 
        System would be more appropriately based on the number of 
        vehicle miles driven by a motor carrier rather than the number 
        of trucks operated by the carrier;
            (5) whether the public access information in the Safety 
        Status Measurement System meets the agency's requirements under 
        the Data Quality Act; and
            (6) the existing information Selection System Indicators 
        criteria and weighting and whether the safety evaluation area 
        containing data on accidents should receive higher priority for 
        complaince reviews and inspection selection.

                 PART III--UNIFIED CARRIER REGISTRATION

SEC. 4261. SHORT TITLE.

    This part may be cited as the ``Unified Carrier Registration Act of 
2004''.

SEC. 4262. RELATIONSHIP TO OTHER LAWS.

    Except as provided in section 14504 of title 49, United States 
Code, and sections 14504a and 14506 of title 49, United States Code, as 
added by this part, this part is not intended to prohibit any State or 
any political subdivision of any State from enacting, imposing, or 
enforcing any law or regulation with respect to a motor carrier, motor 
private carrier, broker, freight forwarder, or leasing company that is 
not otherwise prohibited by law.

SEC. 4263. INCLUSION OF MOTOR PRIVATE AND EXEMPT CARRIERS.

    (a) Persons Registered To Provide Transportation or Service as a 
Motor Carrier or Motor Private Carrier.--Section 13905 is amended by--
            (1) redesignating subsections (b), (c), (d), and (e) as 
        subsections (c), (d), (e), and (f), respectively; and
            (2) inserting after subsection (a) the following:
    ``(b) Person Registered With Secretary.--Any person having 
registered with the Secretary to provide transportation or service as a 
motor carrier or motor private carrier under this title, as in effect 
on January 1, 2002, but not having registered pursuant to section 
13902(a) of this title, shall be deemed, for purposes of this part, to 
be registered to provide such transportation or service for purposes of 
sections 13908 and 14504a of this title.''.
    (b) Security Requirement.--Section 13906(a) is amended by--
            (1) redesignating paragraphs (2) and (3) as paragraphs (3) 
        and (4), respectively; and
            (2) inserting the following:
            ``(2) Security Requirement.--Not later than 120 days after 
        the date of enactment of the Unified Carrier Registration Act 
        of 2004, any person, other than a motor private carrier, 
        registered with the Secretary to provide transportation or 
        service as a motor carrier under section 13905(b) of this title 
        shall file with the Secretary a bond, insurance policy, or 
        other type of security approved by the Secretary, in an amount 
        not less than required by sections 31138 and 31139 of this 
        title.''.

SEC. 4264. UNIFIED CARRIER REGISTRATION SYSTEM.

    (a) Section 13908 is amended to read as follows:
``Sec. 13908. Registration and other reforms
    ``(a) Establishment of Unified Carrier Registration System.--The 
Secretary, in cooperation with the States, representatives of the motor 
carrier, motor private carrier, freight forwarder and broker 
industries, and after notice and opportunity for public comment, shall 
issue within 1 year after the date of enactment of the Unified Carrier 
Registration Act of 2004 regulations to establish, an online, Federal 
registration system to be named the Unified Carrier Registration System 
to replace--
            ``(1) the current Department of Transportation 
        identification number system, the Single State Registration 
        System under section 14504 of this title;
            ``(2) the registration system contained in this chapter and 
        the financial responsibility information system under section 
        13906; and
            ``(3) the service of process agent systems under sections 
        503 and 13304 of this title.
    ``(b) Role as Clearinghouse and Depository of Information.--The 
Unified Carrier Registration System shall serve as a clearinghouse and 
depository of information on, and identification of, all foreign and 
domestic motor carriers, motor private carriers, brokers, and freight 
forwarders, and others required to register with the Department, 
including information with respect to a carrier's safety rating, 
compliance with required levels of financial responsibility, and 
compliance with the provisions of section 14504a of this title. The 
Secretary shall ensure that Federal agencies, States, representatives 
of the motor carrier industry, and the public have access to the 
Unified Carrier Registration System, including the records and 
information contained in the System.
    ``(c) Procedures for Correcting Information.--Not later than 60 
days after the effective date of this section, the Secretary shall 
prescribe regulations establishing procedures that enable a motor 
carrier to correct erroneous information contained in any part of the 
Unified Carrier Registration System.
    ``(d) Fee System.--The Secretary shall establish, under section 
9701 of title 31, a fee system for the Unified Carrier Registration 
System according to the following guidelines:
            ``(1) Registration and filing evidence of financial 
        responsibility.--The fee for new registrants shall as nearly as 
        possible cover the costs of processing the registration and 
        conducting the safety audit or examination, if required, but 
        shall not exceed $300.
            ``(2) Evidence of financial responsibility.--The fee for 
        filing evidence of financial responsibility pursuant to this 
        section shall not exceed $10 per filing. No fee shall be 
        charged for a filing for purposes of designating an agent for 
        service of process or the filing of other information relating 
        to financial responsibility.
            ``(3) Access and retrieval fees.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the fee system shall include a 
                nominal fee for the access to or retrieval of 
                information from the Unified Carrier Registration 
                System to cover the costs of operating and upgrading 
                the System, including the personnel costs incurred by 
                the Department and the costs of administration of the 
                Unified Carrier Registration Agreement.
                    ``(B) Exceptions.--There shall be no fee charged--
                            ``(i) to any agency of the Federal 
                        Government or a State government or any 
                        political subdivision of any such government 
                        for the access to or retrieval of information 
                        and data from the Unified Carrier Registration 
                        System for its own use; or
                            ``(ii) to any representative of a motor 
                        carrier, motor private carrier, leasing 
                        company, broker, or freight forwarder (as each 
                        is defined in section 14504a of this title) for 
                        the access to or retrieval of the individual 
                        information related to such entity from the 
                        Unified Carrier Registration System for the 
                        individual use of such entity.''.

SEC. 4265. REGISTRATION OF MOTOR CARRIERS BY STATES.

    (a) Termination of Registration Provisions.--Section 14504 is 
amended by adding at the end the following:
    ``(d) Termination of Provisions.--Subsections (b) and (c) shall 
cease to be effective on the first January 1st occurring more than 12 
months after the date of enactment of the Unified Carrier Registration 
Act of 2004.''.
    (b) Unified Carrier Registration System Plan and Agreement.--
Chapter 145 is amended by inserting after section 14504 the following:
``Sec. 14504a. Unified carrier registration system plan and agreement
    ``(a) Definitions.--In this section and section 14506 of this 
title:
            ``(1) Commercial motor vehicle.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `commercial motor vehicle' 
                has the meaning given the term in section 31101 of this 
                title.
                    ``(B) Exception.--With respect to motor carriers 
                required to make any filing or pay any fee to a State 
                with respect to the motor carrier's authority or 
                insurance related to operation within such State, the 
                term `commercial motor vehicle' means any self-
                propelled vehicle used on the highway in commerce to 
                transport passengers or property for compensation 
                regardless of the gross vehicle weight rating of the 
                vehicle or the number of passengers transported by such 
                vehicle.
            ``(2) Base-state.--
                    ``(A) In general.--The term `Base-State' means, 
                with respect to the Unified Carrier Registration 
                Agreement, a State--
                            ``(i) that is in compliance with the 
                        requirements of subsection (e); and
                            ``(ii) in which the motor carrier, motor 
                        private carrier, broker, freight forwarder or 
                        leasing company maintains its principal place 
                        of business.
                    ``(B) Designation of base-state.--A motor carrier, 
                motor private carrier, broker, freight forwarder or 
                leasing company may designate another State in which it 
                maintains an office or operating facility as its Base-
                State in the event that--
                            ``(i) the State in which the motor carrier, 
                        motor private carrier, broker, freight 
                        forwarder or leasing company maintains its 
                        principal place of business is not in 
                        compliance with the requirements of subsection 
                        (e); or
                            ``(ii) the motor carrier, motor private 
                        carrier, broker, freight forwarder or leasing 
                        company does not have a principal place of 
                        business in the United States.
            ``(3) Intrastate fee.--The term `intrastate fee' means any 
        fee, tax, or other type of assessment, including per vehicle 
        fees and gross receipts taxes, imposed on a motor carrier or 
        motor private carrier for the renewal of the intrastate 
        authority or insurance filings of such carrier with a State.
            ``(4) Leasing company.--The term `leasing company' means a 
        lessor that is engaged in the business of leasing or renting 
        for compensation motor vehicles without drivers to a motor 
        carrier, motor private carrier, or freight forwarder.
            ``(5) Motor carrier.--The term `motor carrier' has the 
        meaning given the term in section 13102(12) of this title, but 
        shall include all carriers that are otherwise exempt from the 
        provisions of part B of this title pursuant to the provisions 
        of chapter 135 of this title or exemption actions by the former 
        Interstate Commerce Commission under this title.
            ``(6) Participating state.--The term `participating state' 
        means a State that has complied with the requirements of 
        subsection (e) of this section.
            ``(7) SSRS.--The term `SSRS' means the Single State 
        Registration System in effect on the date of enactment of the 
        Unified Carrier Registration Act of 2004.
            ``(8) Unified carrier registration agreement.--The terms 
        `Unified Carrier Registration Agreement' and `UCR Agreement' 
        mean the interstate agreement developed under the Unified 
        Carrier Registration Plan governing the collection and 
        distribution of registration and financial responsibility 
        information provided and fees paid by motor carriers, motor 
        private carriers, brokers, freight forwarders and leasing 
        companies pursuant to this section.
            ``(9) Unified carrier registration plan.--The terms 
        `Unified Carrier Registration Plan' and `UCR Plan' mean the 
        organization of State, Federal and industry representatives 
        responsible for developing, implementing and administering the 
        Unified Carrier Registration Agreement.
            ``(10) Vehicle registration.--The term `vehicle 
        registration' means the registration of any commercial motor 
        vehicle under the International Registration Plan or any other 
        registration law or regulation of a jurisdiction.
    ``(b) Applicability of Provisions to Freight Forwarders.--A Freight 
forwarder that operates commercial motor vehicles and is not required 
to register as a carrier pursuant to section 13903(b) of this title 
shall be subject to the provisions of this section as if a motor 
carrier.
    ``(c) Unreasonable Burden.--For purposes of this section, it shall 
be considered an unreasonable burden upon interstate commerce for any 
State or any political subdivision of a State, or any political 
authority of 2 or more States--
            ``(1) to enact, impose, or enforce any requirement or 
        standards, or levy any fee or charge on any interstate motor 
        carrier or interstate motor private carrier in connection 
        with--
                    ``(A) the registration with the State of the 
                interstate operations of a motor carrier or motor 
                private carrier;
                    ``(B) the filing with the State of information 
                relating to the financial responsibility of a motor 
                carrier or motor private carrier pursuant to sections 
                31138 or 31139 of this title;
                    ``(C) the filing with the State of the name of the 
                local agent for service of process of a motor carrier 
                or motor private carrier pursuant to sections 503 or 
                13304 of this title; or
                    ``(D) the annual renewal of the intrastate 
                authority, or the insurance filings, of a motor carrier 
                or motor private carrier, or other intrastate filing 
                requirement necessary to operate within the State, if 
                the motor carrier or motor private carrier is--
                            ``(i) registered in compliance with section 
                        13902 or section 13905(b) of this title; and
                            ``(ii) in compliance with the laws and 
                        regulations of the State authorizing the 
                        carrier to operate in the State pursuant to 
                        section 14501(c)(2)(A) of this title
                except with respect to--
                                    ``(I) intrastate service provided 
                                by motor carriers of passengers that is 
                                not subject to the preemptive 
                                provisions of section 14501(a) of this 
                                title,
                                    ``(II) motor carriers of property, 
                                motor private carriers, brokers, or 
                                freight forwarders, or their services 
                                or operations, that are described in 
                                subparagraphs (B) and (C) of section 
                                14501(c)(2) and section 14506(c)(3) or 
                                permitted pursuant to section 14506(b) 
                                of this title, and
                                    ``(III) the intrastate 
                                transportation of waste or recycables 
                                by any carrier); or
            ``(2) to require any interstate motor carrier or motor 
        private carrier to pay any fee or tax, not proscribed by 
        paragraph (1)(D) of this subsection, that a motor carrier or 
        motor private carrier that pays a fee which is proscribed by 
        that paragraph is not required to pay.
    ``(d) Unified Carrier Registration Plan.--
            ``(1) Board of directors.--
                    ``(A) Governance of plan.--The Unified Carrier 
                Registration Plan shall be governed by a Board of 
                Directors consisting of representatives of the 
                Department of Transportation, Participating States, and 
                the motor carrier industry.
                    ``(B) Number.--The Board shall consist of 15 
                directors.
                    ``(C) Composition.--The Board shall be composed of 
                directors appointed as follows:
                            ``(i) Federal motor carrier safety 
                        administration.--The Secretary shall appoint 1 
                        director from each of the Federal Motor Carrier 
                        Safety Administration's 4 Service Areas (as 
                        those areas were defined by the Federal Motor 
                        Carrier Safety Administration on January 1, 
                        2003), from among the chief administrative 
                        officers of the State agencies responsible for 
                        overseeing the administration of the UCR 
                        Agreement.
                            ``(ii) State agencies.--The Secretary shall 
                        appoint 5 directors from the professional 
                        staffs of State agencies responsible for 
                        overseeing the administration of the UCR 
                        Agreement in their respective States. Nominees 
                        for these 5 directorships shall be submitted to 
                        the Secretary by the national association of 
                        professional employees of the State agencies 
                        responsible for overseeing the administration 
                        of the UCR Agreement in their respective 
                        States.
                            ``(iii) Motor carrier industry.--The 
                        Secretary shall appoint 5 directors from the 
                        motor carrier industry. At least 1 of the 
                        appointees shall be an employee of the national 
                        trade association representing the general 
                        motor carrier of property industry.
                            ``(iv) Department of transportation.--The 
                        Secretary shall appoint the Deputy 
                        Administrator of the Federal Motor Carrier 
                        Safety Administration, or such other 
                        presidential appointee from the United States 
                        Department of Transportation, as the Secretary 
                        may designate, to serve as a director.
                    ``(D) Chairperson and vice-chairperson.--The 
                Secretary shall designate 1 director as Chairperson and 
                1 director as Vice-Chairperson of the Board. The 
                Chairperson and Vice-Chairperson shall serve in such 
                capacity for the term of their appointment as 
                directors.
                    ``(E) Term.--In appointing the initial Board, the 
                Secretary shall designate 5 of the appointed directors 
                for initial terms of 3 years, 5 of the appointed 
                directors for initial terms of 2 years, and 5 of the 
                appointed directors for initial terms of 1 year. 
                Thereafter, all directors shall be appointed for terms 
                of 3 years, except that the term of the Deputy 
                Administrator or other individual designated by the 
                Secretary under subparagraph (C)(iv) shall be at the 
                discretion of the Secretary. A director may be 
                appointed to succeed himself or herself. A director may 
                continue to serve on the Board until his or her 
                successor is appointed.
            ``(2) Rules and regulations governing the ucr agreement.--
        The Board of Directors shall develop the rules and regulations 
        to govern the UCR Agreement and submit such rules and 
        regulations to the Secretary for approval and adoption. The 
        rules and regulations shall--
                    ``(A) prescribe uniform forms and formats, for--
                            ``(i) the annual submission of the 
                        information required by a Base-State of a motor 
                        carrier, motor private carrier, leasing 
                        company, broker, or freight forwarder;
                            ``(ii) the transmission of information by a 
                        Participating State to the Unified Carrier 
                        Registration System;
                            ``(iii) the payment of excess fees by a 
                        State to the designated depository and the 
                        distribution of fees by the depository to those 
                        States so entitled; and
                            ``(iv) the providing of notice by a motor 
                        carrier, motor private carrier, broker, freight 
                        forwarder, or leasing company to the Board of 
                        the intent of such entity to change its Base-
                        State, and the procedures for a State to object 
                        to such a change under subparagraph (C) of this 
                        paragraph;
                    ``(B) provide for the administration of the Unified 
                Carrier Registration Agreement, including procedures 
                for amending the Agreement and obtaining clarification 
                of any provision of the Agreement;
                    ``(C) provide procedures for dispute resolution 
                that provide due process for all involved parties; and
                    ``(D) designate a depository.
            ``(3) Compensation and expenses.--Except for the 
        representative of the Department of Transportation appointed 
        pursuant to paragraph 1(D), no director shall receive any 
        compensation or other benefits from the Federal Government for 
        serving on the Board or be considered a Federal employee as a 
        result of such service. All Directors shall be reimbursed for 
        expenses they incur attending duly called meetings of the 
        Board. In addition, the Board may approve the reimbursement of 
        expenses incurred by members of any subcommittee or task force 
        appointed pursuant to paragraph (5). The reimbursement of 
        expenses to directors and subcommittee and task force members 
        shall be based on the then applicable rules of the General 
        Service Administration governing reimbursement of expenses for 
        travel by Federal employees.
            ``(4) Meetings.--
                    ``(A) In general.--The Board shall meet at least 
                once per year. Additional meetings may be called, as 
                needed, by the Chairperson of the Board, a majority of 
                the directors, or the Secretary.
                    ``(B) Quorum.--A majority of directors shall 
                constitute a quorum.
                    ``(C) Voting.--Approval of any matter before the 
                Board shall require the approval of a majority of all 
                directors present at the meeting.
                    ``(D) Open meetings.--Meetings of the Board and any 
                subcommittees or task forces appointed pursuant to 
                paragraph (5) of this section shall be subject to the 
                provisions of section 552b of title 5.
            ``(5) Subcommittees.--
                    ``(A) Industry advisory subcommittee.--The 
                Chairperson shall appoint an Industry Advisory 
                Subcommittee. The Industry Advisory Subcommittee shall 
                consider any matter before the Board and make 
                recommendations to the Board.
                    ``(B) Other subcommittees.--The Chairperson shall 
                appoint an Audit Subcommittee, a Dispute Resolution 
                Subcommittee, and any additional subcommittees and task 
                forces that the Board determines to be necessary.
                    ``(C) Membership.--The chairperson of each 
                subcommittee shall be a director. The other members of 
                subcommittees and task forces may be directors or non-
                directors.
                    ``(D) Representation on subcommittees.--Except for 
                the Industry Advisory Subcommittee (the membership of 
                which shall consist solely of representatives of 
                entities subject to the fee requirements of subsection 
                (f) of this section), each subcommittee and task force 
                shall include representatives of the Federal Motor 
                Carrier Safety Administration, the Participating 
                States, and the motor carrier industry.
            ``(6) Delegation of authority.--The Board may contract with 
        any private commercial or non-profit entity or any agency of a 
        State to perform administrative functions required under the 
        Unified Carrier Registration Agreement, but may not delegate 
        its decision or policy-making responsibilities.
            ``(7) Determination of fees.--The Board shall determine the 
        annual fees to be assessed carriers, leasing companies, 
        brokers, and freight forwarders pursuant to the Unified Carrier 
        Registration Agreement. In determining the level of fees to be 
        assessed in the next Agreement year, the Board shall consider--
                    ``(A) the administrative costs associated with the 
                Unified Carrier Registration Plan and the Agreement;
                    ``(B) whether the revenues generated in the 
                previous year and any surplus or shortage from that or 
                prior years enable the Participating States to achieve 
                the revenue levels set by the Board; and
                    ``(C) the parameters for fees set forth in 
                subsection (f)(1).
            ``(8) Liability protections for directors.--No individual 
        appointed to serve on the Board shall be liable to any other 
        director or to any other party for harm, either economic or 
        non-economic, caused by an act or omission of the individual 
        arising from the individual's service on the Board if--
                    ``(A) the individual was acting within the scope of 
                his or her responsibilities as a director; and
                    ``(B) the harm was not caused by willful or 
                criminal misconduct, gross negligence, reckless 
                misconduct, or a conscious, flagrant indifference to 
                the right or safety of the party harmed by the 
                individual.
            ``(9) Inapplicability of federal advisory committee act.--
        The Federal Advisory Committee Act (5 U.S.C. App.) shall not 
        apply to the Unified Carrier Registration Plan or its 
        committees.
            ``(10) Certain fees not affected.--This section does not 
        limit the amount of money a State may charge for vehicle 
        registration or the amount of any fuel use tax a State may 
        impose pursuant to the International Fuel Tax Agreement.
    ``(e) State Participation.--
            ``(1) State plan.--No State shall be eligible to 
        participate in the Unified Carrier Registration Plan or to 
        receive any revenues derived under the Agreement, unless the 
        State submits to the Secretary, not later than 3 years after 
        the date of enactment of the Unified Carrier Registration Act 
        of 2004, a plan--
                    ``(A) identifying the State agency that has or will 
                have the legal authority, resources, and qualified 
                personnel necessary to administer the Unified Carrier 
                Registration Agreement in accordance with the rules and 
                regulations promulgated by the Board of Directors of 
                the Unified Carrier Registration Plan; and
                    ``(B) containing assurances that an amount at least 
                equal to the revenue derived by the State from the 
                Unified Carrier Registration Agreement shall be used 
                for motor carrier safety programs, enforcement, and 
                financial responsibility, or the administration of the 
                UCR Plan and UCR Agreement.
            ``(2) Amended plans.--A State may change the agency 
        designated in the plan submitted under this subsection by 
        filing an amended plan with the Secretary and the Chairperson 
        of the Unified Carrier Registration Plan.
            ``(3) Withdrawal of plan.--In the event a State withdraws, 
        or notifies the Secretary that it is withdrawing, the plan 
        submitted under this subsection, the State may no longer 
        participate in the Unified Carrier Registration Agreement or 
        receive any portion of the revenues derived under the 
        Agreement.
            ``(4) Termination of eligibility.--If a State fails to 
        submit a plan to the Secretary as required by paragraph (1) or 
        withdraws its plan under paragraph (3), the State shall be 
        prohibited from subsequently submitting or resubmitting a plan 
        or participating in the Agreement.
            ``(5) Provision of plan to chairperson.--The Secretary 
        shall provide a copy of each plan submitted under this 
        subsection to the initial Chairperson of the Board of Directors 
        of the Unified Carrier Registration Plan not later than 90 days 
        of appointing the Chairperson.
    ``(f) Contents of Unified Carrier Registration Agreement.--The 
Unified Carrier Registration Agreement shall provide the following:
            ``(1) Determination of fees.--
                    ``(A) Fees charged motor carriers, motor private 
                carriers, or freight forwarders in connection with the 
                filing of proof of financial responsibility under the 
                UCR Agreement shall be based on the number of 
                commercial motor vehicles owned or operated by the 
                motor carrier, motor private carrier, or freight 
                forwarder. Brokers and leasing companies shall pay the 
                same fees as the smallest bracket of motor carriers, 
                motor private carriers, and freight forwarders.
                    ``(B) The fees shall be determined by the Board 
                with the approval of the Secretary.
                    ``(C) The Board shall develop no more than 6 and no 
                less than 4 ranges of carriers by size of fleet.
                    ``(D) The fee scale shall be progressive and use 
                different vehicle ratios for different ranges of 
                carrier fleet size.
                    ``(E) The Board may adjust the fees within a 
                reasonable range on an annual basis if the revenues 
                derived from the fees--
                            ``(i) are insufficient to provide the 
                        revenues to which the States are entitled under 
                        this section; or
                            ``(ii) exceed those revenues.
            ``(2) Determination of ownership or operation.--Commercial 
        motor vehicles owned or operated by a motor carrier, motor 
        private carrier, or freight forwarder shall mean those 
        commercial motor vehicles registered in the name of the motor 
        carrier, motor private carrier, or freight forwarder or 
        controlled by the motor carrier, motor private carrier, or 
        freight forwarder under a long term lease during a vehicle 
        registration year.
            ``(3) Calculation of number of commercial motor vehicles 
        owned or operated.--The number of commercial motor vehicles 
        owned or operated by a motor carrier, motor private carrier, or 
        freight forwarder for purposes of subsection (e)(1) shall be 
        based either on the number of commercial motor vehicles the 
        motor carrier, motor private carrier, or freight forwarder has 
        indicated it operates on its most recently filed MCS-150 or the 
        total number of such vehicles it owned or operated for the 12-
        month period ending on June 30 of the year immediately prior to 
        the each registration year of the Unified Carrier Registration 
        System.
            ``(4) Payment of fees.--Motor carriers, motor private 
        carriers, leasing companies, brokers, and freight forwarders 
        shall pay all fees required under this section to their Base-
        State pursuant to the UCR Agreement.
    ``(g) Payment of Fees.--Revenues derived under the UCR Agreement 
shall be allocated to Participating States as follows:
            ``(1) A State that participated in the Single State 
        Registration System in the last calendar year ending before the 
        date of enactment of the Unified Carrier Registration Act of 
        2004 and complies with the requirements of subsection (e) of 
        this section is entitled to receive a portion of the UCR 
        Agreement revenues generated under the Agreement equivalent to 
        the revenues it received under the SSRS in the last calendar 
        year ending before the date of enactment of the Unified Carrier 
        Registration Act of 2004, as long as the State continues to 
        comply with the provisions of subsection (e).
            ``(2) A State that collected intrastate registration fees 
        from interstate motor carriers, interstate motor private 
        carriers, or interstate exempt carriers and complies with the 
        requirements of subsection (e) of this section is entitled to 
        receive an additional portion of the UCR Agreement revenues 
        generated under the Agreement equivalent to the revenues it 
        received from such interstate carriers in the last calendar 
        year ending before the date of enactment of the Unified Carrier 
        Registration Act of 2004, as long as the State continues to 
        comply with the provisions of subsection (e).
            ``(3) States that comply with the requirements of 
        subsection (e) of this section but did not participate in SSRS 
        during the last calendar year ending before the date of 
        enactment of the Unified Carrier Registration Act of 2004 shall 
        be entitled to an annual allotment not to exceed $500,000 from 
        the UCR Agreement revenues generated under the Agreement as 
        long as the State continues to comply with the provisions of 
        subsection (e).
            ``(4) The amount of UCR Agreement revenues to which a State 
        is entitled under this section shall be calculated by the Board 
        and approved by the Secretary.
    ``(h) Distribution of UCR Agreement Revenues.--
            ``(1) Eligibility.--Each State that is in compliance with 
        the provisions of subsection (e) shall be entitled to a portion 
        of the revenues derived from the UCR Agreement in accordance 
        with subsection (g).
            ``(2) Entitlement to revenues.--A State that is in 
        compliance with the provisions of subsection (e) may retain an 
        amount of the gross revenues it collects from motor carriers, 
        motor private carriers, brokers, freight forwarders and leasing 
        companies under the UCR Agreement equivalent to the portion of 
        revenues to which the State is entitled under subsection (g). 
        All revenues a Participating State collects in excess of the 
        amount to which the State is so entitled shall be forwarded to 
        the depository designated by the Board under subsection 
        (d)(2)(D).
            ``(3) Distribution of funds from depository.--The excess 
        funds collected in the depository shall be distributed as 
        follows:
                    ``(A) Excess funds shall be distributed on a pro 
                rata basis to each Participating State that did not 
                collect revenues under the UCR Agreement equivalent to 
                the amount such State is entitled under subsection (g), 
                except that the sum of the gross UCR Agreement revenues 
                collected by a Participating State and the amount 
                distributed to it from the depository shall not exceed 
                the amount to which the State is entitled under 
                subsection (g).
                    ``(B) Any excess funds held by the depository after 
                all distributions under subparagraph (A) have been made 
                shall be used to pay the administrative costs of the 
                UCR Plan and the UCR Agreement.
                    ``(C) Any excess funds held by the depository after 
                distributions and payments under subparagraphs (A) and 
                (B) shall be retained in the depository, and the UCR 
                Agreement fees for motor carriers, motor private 
                carriers, leasing companies, freight forwarders, and 
                brokers for the next fee year shall be reduced by the 
                Board accordingly.
    ``(i) Enforcement.--
            ``(1) Civil actions.--Upon request by the Secretary of 
        Transportation, the Attorney General may bring a civil action 
        in a court of competent jurisdiction to enforce compliance with 
        this section and with the terms of the Unified Carrier 
        Registration Agreement.
            ``(2) Venue.--An action under this section may be brought 
        only in the Federal court sitting in the State in which an 
        order is required to enforce such compliance.
            ``(3) Relief.--Subject to section 1341 of title 28, the 
        court, on a proper showing--
                    ``(A) shall issue a temporary restraining order or 
                a preliminary or permanent injunction; and
                    ``(B) may issue an injunction requiring that the 
                State or any person comply with this section.
            ``(4) Enforcement by states.--Nothing in this section--
                    ``(A) prohibits a Participating State from issuing 
                citations and imposing reasonable fines and penalties 
                pursuant to applicable State laws and regulations on 
                any motor carrier, motor private carrier, freight 
                forwarder, broker, or leasing company for failure to--
                            ``(i) submit documents as required under 
                        subsection (d)(2); or
                            ``(ii) pay the fees required under 
                        subsection (f); or
                    ``(B) authorizes a State to require a motor 
                carrier, motor private carrier, or freight forwarder to 
                display as evidence of compliance any form of 
                identification in excess of those permitted under 
                section 14506 of this title on or in a commercial motor 
                vehicle.
    ``(j) Application to Intrastate Carriers.--Notwithstanding any 
other provision of this section, a State may elect to apply the 
provisions of the UCR Agreement to motor carriers and motor private 
carriers subject to its jurisdiction that operate solely in intrastate 
commerce within the borders of the State.''.

SEC. 4266. IDENTIFICATION OF VEHICLES.

    Chapter 145 is amended by adding at the end the following:
``Sec. 14506. Identification of vehicles
    ``(a) Restriction on Requirements.--No State, political subdivision 
of a State, interstate agency, or other political agency of 2 or more 
States may enact or enforce any law, rule, regulation standard, or 
other provision having the force and effect of law that requires a 
motor carrier, motor private carrier, freight forwarder, or leasing 
company to display any form of identification on or in a commercial 
motor vehicle, other than forms of identification required by the 
Secretary of Transportation under section 390.21 of title 49, Code of 
Federal Regulations.
    ``(b) Exception.--Notwithstanding paragraph (a), a State may 
continue to require display of credentials that are required--
            ``(1) under the International Registration Plan under 
        section 31704 of this title;
            ``(2) under the International Fuel Tax Agreement under 
        section 31705 of this title;
            ``(3) in connection with Federal requirements for hazardous 
        materials transportation under section 5103 of this title; or
            ``(4) in connection with the Federal vehicle inspection 
        standards under section 31136 of this title.''.

SEC. 4267. USE OF UCR AGREEMENT REVENUES AS MATCHING FUNDS.

    Section 31103(a) is amended by inserting ``Amounts generated by the 
Unified Carrier Registration Agreement, under section 14504a of this 
title and received by a State and used for motor carrier safety 
purposes may be included as part of the State's share not provided by 
the United States.'' after ``United States Government.''.

SEC. 4268. CLERICAL AMENDMENTS.

    (a) Section 13906 Caption.--The section caption for section 13906 
is amended by inserting ``motor private carriers,'' after ``motor 
carriers,''.
    (b) Table of Contents.--The chapter analysis for chapter 139 is 
amended by striking the item relating to section 13906 and inserting 
the following:

``13906. Security of motor carriers, motor private carriers, brokers, 
                            and freight forwarders.''.

                   Subtitle C--Household Goods Movers

SEC. 4301. SHORT TITLE; AMENDMENT OF TITLE 49, UNITED STATES CODE.

    (a) Short Title.--This subtitle may be cited as the ``Household 
Goods Mover Oversight Enforcement and Reform Act of 2004''.
    (b) Amendment of Title 49, United States Code.--Except as otherwise 
specifically provided, whenever in this subtitle an amendment is 
expressed in terms of an amendment to a section or other provision of 
law, the reference shall be considered to be made to a section or other 
provision of title 49, United States Code.

SEC. 4302. FINDINGS; SENSE OF CONGRESS.

    The Congress finds the following:
            (1) There are approximately 1,500,000 interstate household 
        moves every year. While the vast majority of these interstate 
        moves are completed successfully, consumer complaints have been 
        increasing since the Interstate Commerce Commission was 
        abolished in 1996 and oversight of the household goods industry 
        was transferred to the Department of Transportation.
            (2) While the overwhelming majority of household goods 
        carriers are honest and operate within the law, there appears 
        to be a growing criminal element that is exploiting a perceived 
        void in Federal and State enforcement efforts. The growing 
        criminal element tends to prey upon consumers.
            (3) The movement of an individual's household goods is 
        unique and differs from the movement of a commercial shipment. 
        A consumer may utilize a moving company once or twice in the 
        consumer's lifetime and entrust virtually all of the consumer's 
        worldly goods to a mover.
            (4) Federal resources are inadequate to properly police or 
        deter, on a nationwide basis, those movers who willfully 
        violate Federal regulations governing the household goods 
        industry and knowingly prey on consumers who are in a 
        vulnerable position. It is appropriate that a Federal-State 
        partnership be created to enhance enforcement against 
        fraudulent moving companies.

SEC. 4303. DEFINITIONS.

    In this title, the terms ``carrier'', ``household goods'', ``motor 
carrier'', ``Secretary'', and ``transportation'' have the meaning given 
such terms in section 13102 of title 49, United States Code.

SEC. 4304. PAYMENT OF RATES.

    Section 13707(b) is amended by adding at the end the following:
            ``(3) Shipments of household goods.--
                    ``(A) In general.--A carrier providing 
                transportation for a shipment of household goods shall 
                give up possession of the household goods transported 
                at the destination upon payment of--
                            ``(i) 100 percent of the charges contained 
                        in a binding estimate provided by the carrier;
                            ``(ii) not more than 110 percent of the 
                        charges contained in a nonbinding estimate 
                        provided by the carrier; or
                            ``(iii) in the case of a partial delivery 
                        of the shipment, the prorated percentage of the 
                        charges calculated in accordance with 
                        subparagraph (B).
                    ``(B) Calculation of prorated charges.--For 
                purposes of subparagraph (A)(iii), the prorated 
                percentage of the charges shall be the percentage of 
                the total charges due to the carrier as described in 
                clause (i) or (ii) of subparagraph (A) that is equal to 
                the percentage of the weight of that portion of the 
                shipment delivered to the total weight of the shipment.
                    ``(C) Post-contract services.--Subparagraph (A) 
                does not apply to additional services requested by a 
                shipper after the contract of service is executed that 
                were not included in the estimate.
                    ``(D) Impracticable operations.--Subparagraph (A) 
                does apply to impracticable operations, as defined by 
                the applicable carrier tariff, if the shipper agrees to 
                pay the charges for such operations within 30 days 
                after the goods are delivered.''.

SEC. 4305. HOUSEHOLD GOODS CARRIER OPERATIONS.

    Section 14104 is amended--
            (1) by striking paragraph (1) of subsection (b) and 
        inserting the following:
            ``(1) Requirement for written estimate.--A motor carrier 
        providing transportation of household goods subject to 
        jurisdiction under subchapter I of chapter 135 shall provide to 
        a prospective shipper a written estimate of all charges related 
        to the transportation of the household goods, including charges 
        for--
                    ``(A) packing;
                    ``(B) unpacking;
                    ``(C) loading;
                    ``(D) unloading; and
                    ``(E) handling of the shipment from the point of 
                origin to the final destination (whether that 
                destination is storage or transit).'';
            (2) by redesignating paragraph (2) of such subsection as 
        paragraph (4); and
            (3) by inserting after paragraph (1), as amended by 
        paragraph (1), the following:
            ``(2) Other information.--At the time that a motor carrier 
        provides the written estimate required by paragraph (1), the 
        motor carrier shall provide the shipper a copy of the 
        Department of Transportation publication FMCSA-ESA-03-005 (or 
        its successor edition or publication) entitled `Ready to 
        Move?'. Before the execution of a contract for service, a motor 
        carrier shall provide the shipper a copy of the Department of 
        Transportation publication OCE 100, entitled `Your Rights and 
        Responsibilities When You Move' required by section 375.2 of 
        title 49, Code of Federal Regulations (or any corresponding 
        similar regulation).
            ``(3) Binding and nonbinding estimates.--The written 
        estimate required by paragraph (1) may be either binding or 
        nonbinding. The written estimate shall be based on a visual 
        inspection of the household goods if the household goods are 
        located within a 50-mile radius of the location of the 
        carrier's household goods agent preparing the estimate. The 
        Secretary may not prohibit any such carrier from charging a 
        prospective shipper for providing a written, binding estimate 
        for the transportation and related services.'';
            (4) by redesignating subsection (c) as subsection (e); and
            (5) by inserting after subsection (b), as amended by 
        paragraphs (1) and (2), the following:
    ``(c) Notification of Final Charges.--If the final charges for a 
shipment of household goods exceed 100 percent of a binding estimate or 
110 percent of a nonbinding estimate, the motor carrier shall provide 
the shipper an itemized statement of the charges. The statement shall 
be provided to the shipper within 24 hours prior to the delivery of the 
shipment unless the shipper waives this requirement or the shipper 
cannot be reached by fax, regular mail, or electronic mail. Such 
notification shall--
            ``(1) be delivered in writing at the motor carrier's 
        expense; and
            ``(2) disclose the requirements of section 13707(b)(3) of 
        this title regarding payment for delivery of a shipment of 
        household goods.
    ``(d) Requirement for Inventory.--A motor carrier providing 
transportation of a shipment of household goods, as defined in section 
13102(10), that is subject to jurisdiction under subchapter I of 
chapter 135 of this title shall, before or at the time of loading the 
shipment, prepare a written inventory of all articles tendered and 
accepted by the motor carrier for transportation. Such inventory 
shall--
            ``(1) list or otherwise reasonably identify each item 
        tendered for transportation;
            ``(2) be signed by the shipper and the motor carrier, or 
        the agent of the shipper or carrier, at the time the shipment 
        is loaded and at the time the shipment is unloaded at the final 
        destination;
            ``(3) be attached to, and considered part of, the bill of 
        lading; and
            ``(4) be subject to the same requirements of the Secretary 
        for record inspection and preservation that apply to bills of 
        lading.''.

SEC. 4306. LIABILITY OF CARRIERS UNDER RECEIPTS AND BILLS OF LADING.

    Section 14706(f) is amended--
            (1) by resetting the text as a paragraph indented 2 ems 
        from the left margin and inserting ``(1) In general.--'' before 
        ``A carrier''; and
            (2) by adding at the end, the following:
            ``(2) Full value protection obligation.--Unless the carrier 
        receives a waiver in writing under paragraph (3), a carrier's 
        maximum liability for household goods that are lost, damaged, 
        destroyed, or otherwise not delivered to the final destination 
        is an amount equal to the replacement value of such goods, 
        subject to a maximum amount equal to the declared value of the 
        shipment, subject to rules issued by the Surface Transportation 
        Board and applicable tariffs.
            ``(3) Application of rates.--The released rates established 
        by the Board under paragraph (1) (commonly known as `released 
        rates') shall not apply to the transportation of household 
        goods by a carrier unless the liability of the carrier for the 
        full value of such household goods under paragraph (2) is 
        waived in writing by the shipper.''.

SEC. 4307. DISPUTE SETTLEMENT FOR SHIPMENTS OF HOUSEHOLD GOODS.

    (a) In General.--Section 14708(a) is amended--
            (1) by resetting the text as a paragraph indented 2 ems 
        from the left margin and inserting ``(1) Requirement to 
        offer.--'' before ``As a condition''; and
            (2) by striking ``shippers of household goods concerning 
        damage or loss to the household goods transported.'' and 
        inserting ``shippers. The carrier may not require the shipper 
        to agree to use arbitration as a means to settle such a 
        dispute.''; and
            (3) by inserting at the end, the following:
            ``(2) Requirements for carriers.--If a dispute with a 
        carrier providing transportation of household goods involves a 
        claim that is--
                    ``(A) not more than $10,000 and the shipper 
                requests arbitration, such arbitration shall be binding 
                on the parties; or
                    ``(B) for more than $10,000 and the shipper 
                requests arbitration, such arbitration shall be binding 
                on the parties only if the carrier agrees to 
                arbitration.''.
    (b) Arbitration Requirements.--
            (1) In general.--Section 14708(b) is amended--
                    (A) by striking paragraph (4) and inserting the 
                following:
            ``(4) Independence of arbitrator.--The Secretary shall 
        establish a system for the certification of persons authorized 
        to arbitrate or otherwise settle a dispute between a shipper of 
        household goods and a carrier. The Secretary shall ensure that 
        each person so certified is--
                    ``(A) independent of the parties to the dispute;
                    ``(B) capable, as determined under such regulations 
                as the Secretary may issue, to resolve such disputes 
                fairly and expeditiously; and
                    ``(C) authorized and able to obtain from the 
                shipper or carrier any material and relevant 
                information to the extent necessary to carry out a fair 
                and expeditious decisionmaking process.'';
                    (B) by striking paragraph (6); and
                    (C) by redesignating paragraphs (7) and (8) as 
                paragraphs (6) and (7), respectively.
            (2) Conforming amendment.--Section 14708(d)(3)(A) is 
        amended by striking ``(b)(8)'' and inserting ``(b)(7)''.
    (c) Attorney's Fees to Carriers.--Section 14708(e) is further 
amended by striking ``only if'' and all that follows through the period 
at the end and inserting ``if--
            ``(1) the court proceeding is to enforce a decision 
        rendered in favor of the carrier through arbitration under this 
        section and is instituted after the shipper has a reasonable 
        opportunity to pay any charges required by such decision; or
            ``(2) the shipper brought such action in bad faith--
                    ``(A) after resolution of such dispute through 
                arbitration under this section; or
                    ``(B) after institution of an arbitration 
                proceeding by the shipper to resolve such dispute under 
                this section but before--
                            ``(i) the period provided under subsection 
                        (b)(7) for resolution of such dispute 
                        (including, if applicable, an extension of such 
                        period under such subsection) ends; and
                            ``(ii) a decision resolving such dispute is 
                        rendered.''.
    (d) Review and Report on Dispute Settlement Programs.--
            (1) Review and report.--Not later than 18 months after the 
        date of enactment of this Act, the Secretary of Transportation 
        shall complete a review of the outcomes and the effectiveness 
        of the programs carried out under title 49, United States Code, 
        to settle disputes between motor carriers and shippers and 
        submit a report on the review to the Senate Committee on 
        Commerce, Science, and Transportation and the House of 
        Representatives Committee on Transportation and Infrastructure. 
        The report shall describe--
                    (A) the subject of, and amounts at issue is, the 
                disputes;
                    (B) patterns in disputes or settlements;
                    (C) the prevailing party in disputes, if 
                identifiable; and
                    (D) any other matters the Secretary considers 
                appropriate.
            (2) Requirement for public comment.--The Secretary shall 
        publish notice of the review required by paragraph (1) and 
        provide an opportunity for the public to submit comments on the 
        effectiveness of such programs. Notwithstanding any 
        confidentiality or non-disclosure provision in a settlement 
        agreement between a motor carrier and a shipper, it shall not 
        be a violation of that provision for a motor carrier or shipper 
        to submit a copy of the settlement agreement, or to provide 
        information included in the agreement, to the Secretary for use 
        in evaluating dispute settlement programs under this 
        subsection. Notwithstanding anything to the contrary in section 
        552 of title 5, United States Code, the Secretary may not post 
        on the Department of Transportation's electronic docket system, 
        or make available to any requester in paper or electronic 
        format, any information submitted to the Secretary by a motor 
        carrier or shipper under the preceding sentence. The Secretary 
        shall use the settlement agreements or other information 
        submitted by a motor carrier or shipper solely to evaluate the 
        effectiveness of dispute settlement programs and shall not 
        include in the report required by this subsection the names or, 
        or other identifying information concerning, motor carriers or 
        shippers that submitted comments or information under this 
        subsection.

SEC. 4308. ENFORCEMENT OF REGULATIONS RELATED TO TRANSPORTATION OF 
              HOUSEHOLD GOODS.

    (a) Nonpreemption of Intrastate Transportation of Household 
Goods.--Section 14501(c)(2)(B) is amended by inserting ``intrastate'' 
before ``transportation''.
    (b) Enforcement of Federal Law With Respect to Interstate Household 
Goods Carriers.--
            (1) In general.--Chapter 147 is amended by adding at the 
        end the following:
``Sec. 14710. Enforcement of Federal laws and regulations with respect 
              to transportation of household goods
    ``(a) Enforcement by States.--Notwithstanding any other provision 
of this title, a State authority may enforce the consumer protection 
provisions, as determined by the Secretary of Transportation, of this 
title that are related to the transportation of household goods in 
interstate commerce. Any fine or penalty imposed on a carrier in a 
proceeding under this subsection shall, notwithstanding any provision 
of law to the contrary, be paid to and retained by the State.
    ``(b) State Authority Defined.--The term `State authority' means an 
agency of a State that has authority under the laws of the State to 
regulate the intrastate movement of household goods.
``Sec. 14711. Enforcement by State attorneys general
    ``(a) In General.--A State, as parens patriae, may bring a civil 
action on behalf of its residents in an appropriate district court of 
the United States to enforce the consumer protection provisions, as 
determined by the Secretary of Transportation, of this title that are 
related to the transportation of household goods in interstate 
commerce, or regulations or orders of the Secretary or the Board 
thereunder, or to impose the civil penalties authorized by this part or 
such regulation or order, whenever the attorney general of the State 
has reason to believe that the interests of the residents of the State 
have been or are being threatened or adversely affected by a carrier or 
broker providing transportation subject to jurisdiction under 
subchapter I or III of chapter 135 of this title, or a foreign motor 
carrier providing transportation registered under section 13902 of this 
title, that is engaged in household goods transportation that violates 
this part or a regulation or order of the Secretary or Board, as 
applicable, promulgated under this part.
    ``(b) Notice.--The State shall serve written notice to the 
Secretary or the Board, as the case may be, of any civil action under 
subsection (a) prior to initiating such civil action. The notice shall 
include a copy of the complaint to be filed to initiate such civil 
action, except that if it is not feasible for the State to provide such 
prior notice, the State shall provide such notice immediately upon 
instituting such civil action.
    ``(c) Authority To Intervene.--Upon receiving the notice required 
by subsection (b), the Secretary or Board may intervene in such civil 
action and upon intervening--
            ``(1) be heard on all matters arising in such civil action; 
        and
            ``(2) file petitions for appeal of a decision in such civil 
        action.
    ``(d) Construction.--For purposes of bringing any civil action 
under subsection (a), nothing in this section shall prevent the 
attorney general of a State from exercising the powers conferred on the 
attorney general by the laws of such State to conduct investigations or 
to administer oaths or affirmations or to compel the attendance of 
witnesses or the production of documentary and other evidence.
    ``(e) Venue; Service of Process.--In a civil action brought under 
subsection (a)--
            ``(1) the venue shall be a judicial district in which--
                    ``(A) the carrier, foreign motor carrier, or broker 
                operates;
                    ``(B) the carrier, foreign motor carrier, or broker 
                was authorized to provide transportation at the time 
                the complaint arose; or
                    ``(C) where the defendant in the civil action is 
                found;
            ``(2) process may be served without regard to the 
        territorial limits of the district or of the State in which the 
        civil action is instituted; and
            ``(3) a person who participated with a carrier or broker in 
        an alleged violation that is being litigated in the civil 
        action may be joined in the civil action without regard to the 
        residence of the person.
    ``(f) Enforcement of State Law.--Nothing contained in this section 
shall prohibit an authorized State official from proceeding in State 
court to enforce a criminal statute of such State.''.
            (2) Conforming amendment.--The analysis for chapter 147 is 
        amended by inserting after the item relating to section 14709 
        the following:

``14710. Enforcement of Federal laws and regulations with respect to 
                            transportation of household goods.
``14711. Enforcement by State attorneys general.''.

SEC. 4309. WORKING GROUP FOR DEVELOPMENT OF PRACTICES AND PROCEDURES TO 
              ENHANCE FEDERAL-STATE RELATIONS.

    (a) In General.--Not later than 90 days after the date of enactment 
of this Act, the Secretary shall establish a working group of State 
attorneys general, State authorities that regulate the movement of 
household goods, and Federal and local law enforcement officials for 
the purpose of developing practices and procedures to enhance the 
Federal-State partnership in enforcement efforts, exchange of 
information, and coordination of enforcement efforts with respect to 
interstate transportation of household goods and making legislative and 
regulatory recommendations to the Secretary concerning such enforcement 
efforts.
    (b) Consultation.--In carrying out subsection (a), the working 
group shall consult with industries involved in the transportation of 
household goods, the public, and other interested parties.

SEC. 4310. CONSUMER HANDBOOK ON DOT WEBSITE.

    Within 6 months after the date of enactment of this Act, the 
Secretary shall take such action as may be necessary to ensure that the 
Department of Transportation publication OCE 100, entitled ``Your 
Rights and Responsibilities When You Move'' required by section 375.2 
of title 49, Code of Federal Regulations (or any corresponding similar 
regulation), is prominently displayed, and available in language that 
is readily understandable by the general public, on the website of the 
Department of Transportation.

SEC. 4311. INFORMATION ABOUT HOUSEHOLD GOODS TRANSPORTATION ON 
              CARRIERS' WEBSITES.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary shall modify the regulations contained in part 375 of title 
49, Code of Federal Regulations, to require a motor carrier or broker 
that is subject to such regulations and that establishes and maintains 
a website to prominently display on the website--
            (1) the number assigned to the motor carrier or broker by 
        the Department of Transportation;
            (2) the OCE 100 publication referred to in section 4310; 
        and
            (3) in the case of a broker, a list of all motor carriers 
        providing transportation of household goods used by the broker 
        and a statement that the broker is not a motor carrier 
        providing transportation of household goods.

SEC. 4312. CONSUMER COMPLAINTS.

    (a) Requirement for Database.--Subchapter II of chapter 141 is 
amended by adding at the end the following:
``Sec. 14124. Consumer complaints
    ``(a) Establishment of System and Database.--The Secretary of 
Transportation shall--
            ``(1) establish a system to--
                    ``(A) file and log a complaint made by a shipper 
                that relates to motor carrier transportation of 
                household goods; and
                    ``(B) to solicit information gathered by a State 
                regarding the number and type of complaints involving 
                the interstate transportation of household goods;
            ``(2) establish a database of such complaints; and
            ``(3) develop a procedure--
                    ``(A) to provide the public access to the database;
                    ``(B) to forward a complaint, including the motor 
                carrier bill of lading number related to the complaint 
                to a motor carrier named in such complaint and to an 
                appropriate State authority (as defined in section 
                14710(c) in the State in which the complainant resides; 
                and
                    ``(C) to permit a motor carrier to challenge 
                information in the database.
    ``(b) Requirement for Annual Reports.--The Secretary shall issue 
regulations requiring a motor carrier that provides transportation of 
household goods to submit to the Secretary, not later than March 31st 
of each year, an annual report covering the 12-month period ending on 
the preceding March 31st that includes--
            ``(1) the number of interstate shipments of household goods 
        that the motor carrier received from shippers and that were 
        delivered to a final destination during the preceding calendar 
        year;
            ``(2) the number and general category of complaints lodged 
        against the motor carrier during the preceding calendar year;
            ``(3) the number of shipments described in paragraph (1) 
        that resulted in the filing of a claim against the motor 
        carrier for loss or damage to the shipment for an amount in 
        excess of $500 during the preceding calendar year; and
            ``(4) the number of shipments described in paragraph (3) 
        that were--
                    ``(A) resolved during the preceding calendar year; 
                or
                    ``(B) pending on the last day of the preceding 
                calendar year.
    ``(c) Summary to Congress.--The Secretary shall transmit a summary 
each year of the complaints filed and logged under subsection (a) for 
the preceding calendar year to the Senate Committee on Commerce, 
Science, and Transportation and the House of Representatives Committee 
on Transportation and Infrastructure.''.
    (b) Conforming Amendment.--The analysis for chapter 141 is amended 
by inserting after the item relating to section 14123 the following:

``14124. Consumer complaints.''.

SEC. 4313. REVIEW OF LIABILITY OF CARRIERS.

    (a) Review.--Not later than 1 year after the date of enactment of 
this Act, the Surface Transportation Board shall complete a review of 
the current Federal regulations regarding the level of liability 
protection provided by motor carriers that provide transportation of 
household goods and revise such regulations, if necessary, to provide 
enhanced protection in the case of loss or damage.
    (b) Determinations.--The review required by subsection (a) shall 
include a determination of--
            (1) whether the current regulations provide adequate 
        protection;
            (2) the benefits of purchase by a shipper of insurance to 
        supplement the carrier's limitations on liability;
            (3) whether there are abuses of the current regulations 
        that leave the shipper unprotected in the event of loss and 
        damage to a shipment of household goods; and
            (4) whether the section 14706 of title 49, United States 
        Code, should be modified or repealed.

SEC. 4314. CIVIL PENALTIES RELATING TO HOUSEHOLD GOODS BROKERS.

    Section 14901(d) is amended--
            (1) by resetting the text as a paragraph indented 2 ems 
        from the left margin and inserting ``(1) In general.--'' before 
        ``If a carrier''; and
            (2) by adding at the end the following:
            ``(2) Estimate of broker without carrier agreement.--If a 
        broker for transportation of household goods subject to 
        jurisdiction under subchapter I of chapter 135 of this title 
        makes an estimate of the cost of transporting any such goods 
        before entering into an agreement with a carrier to provide 
        transportation of household goods subject to such jurisdiction, 
        the broker is liable to the United States for a civil penalty 
        of not less than $10,000 for each violation.
            ``(3) Unauthorized transportation.--If a person provides 
        transportation of household goods subject to jurisdiction under 
        subchapter I of chapter 135 this title or provides broker 
        services for such transportation without being registered under 
        chapter 139 of this title to provide such transportation or 
        services as a motor carrier or broker, as the case may be, such 
        person is liable to the United States for a civil penalty of 
        not less than $25,000 for each violation.''.

SEC. 4315. CIVIL AND CRIMINAL PENALTY FOR FAILING TO GIVE UP POSSESSION 
              OF HOUSEHOLD GOODS.

    (a) In General.--Chapter 149 is amended by adding at the end the 
following:
``Sec. 14915. Penalties for failure to give up possession of household 
              goods
    ``(a) Civil Penalty.--Whoever is found to have failed to give up 
possession of household goods is liable to the United States for a 
civil penalty of not less than $10,000. Each day a carrier is found to 
have failed to give up possession of household goods may constitute a 
separate violation. If such person is a carrier or broker, the 
Secretary may suspend for a period of not less than 6 months the 
registration of such carrier or broker under chapter 139 of this title.
    ``(b) Criminal Penalty.--Whoever has been convicted of having 
failed to give up possession of household goods shall be fined under 
title 18 or imprisoned for not more than 2 years, or both.
    ``(c) Failure To Give Up Possession of Household Goods Defined.--
For purposes of this section, the term `failed to give up possession of 
household goods' means the knowing and willful failure of a motor 
carrier to deliver to, or unload at, the destination of a shipment of 
household goods that is subject to jurisdiction under subchapter I or 
III of chapter 135 of this title, for which charges have been estimated 
by the motor carrier providing transportation of such goods, and for 
which the shipper has tendered a payment described in clause (i), (ii), 
or (iii) of section 13707(b)(3)(A) of this title.''.
    (b) Conforming Amendment.--The analysis for such chapter is amended 
by adding at the end the following:

``14915. Penalties for failure to give up possession of household 
                            goods.''.

SEC. 4316. PROGRESS REPORT.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary shall transmit to Congress a report on the progress being 
made in implementing the provisions of this title.

SEC. 4317. ADDITIONAL REGISTRATION REQUIREMENTS FOR MOTOR CARRIERS OF 
              HOUSEHOLD GOODS.

    Section 13902(a) is amended--
            (1) by striking paragraphs (2) and (3);
            (2) by redesignating paragraph (4) as paragraph (5) and 
        inserting after paragraph (1) the following:
    ``(2) Additional registration requirements for household goods 
transportation.--Notwithstanding paragraph (1), the Secretary may 
register a person to provide transportation of household goods (as 
defined in section 13102(10) of this title) only after that person--
                    ``(A) provides evidence of participation in an 
                arbitration program and provides a copy of the notice 
                of that program as required by section 14708(b)(2) of 
                this title;
                    ``(B) identifies its tariff and provides a copy of 
                the notice of the availability of that tariff for 
                inspection as required by section 13702(c) of this 
                title;
                    ``(C) provides evidence that it has access to, has 
                read, is familiar with, and will observe all laws 
                relating to consumer protection, estimating, consumers' 
                rights and responsibilities, and options for 
                limitations of liability for loss and damage; and
                    ``(D) discloses any relationship involving common 
                stock, common ownership, common management, or common 
                familial relationships between that person and any 
                other motor carrier, freight forwarder, or broker of 
                household goods within the past 3 years.
            ``(3) Consideration of evidence; findings.--The Secretary 
        shall consider, and, to the extent applicable, make findings on 
        any evidence demonstrating that the registrant is unable to 
        comply with any applicable requirement of paragraph (1) or, in 
        the case of a registrant to which paragraph (2) applies, 
        paragraph (1) or (2).
            ``(4) Withholding.--If the Secretary determines that a 
        registrant under this section does not meet, or is not able to 
        meet, any requirement of paragraph (1) or, in the case of a 
        registrant to which paragraph (2) applies, paragraph (1) or 
        (2), the Secretary shall withhold registration.''; and
            (3) by adding at the end of paragraph (5), as redesignated, 
        ``In the case of a registration for the transportation of 
        household goods (as defined in section 13102(10 of this title), 
        the Secretary may also hear a complaint on the ground that the 
        registrant fails or will fail to comply with the requirements 
        of paragraph (2) of this subsection.''.

   Subtitle D--Hazardous Materials Transportation Safety and Security

SEC. 4401. SHORT TITLE.

    This subtitle may be cited as the ``Hazardous Material 
Transportation Safety and Security Reauthorization Act of 2004''.

SEC. 4402. AMENDMENT OF TITLE 49, UNITED STATES CODE.

    Except as otherwise expressly provided, whenever in this subtitle 
an amendment or repeal is expressed in terms of an amendment to, or 
repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of title 49, 
United States Code.

  PART I--GENERAL AUTHORITIES ON TRANSPORTATION OF HAZARDOUS MATERIALS

SEC. 4421. PURPOSE.

    The text of section 5101 is amended to read as follows:
    ``The purpose of this chapter is to protect against the risks to 
life, property, and the environment that are inherent in the 
transportation of hazardous material in intrastate, interstate, and 
foreign commerce.''.

SEC. 4422. DEFINITIONS.

    Section 5102 is amended as follows:
            (1) Commerce.--Paragraph (1) is amended--
                    (A) by striking ``or'' after the semicolon in 
                subparagraph (A);
                    (B) by striking the ``State.'' in subparagraph (B) 
                and inserting ``State; or''; and
                    (C) by adding at the end the following:
                    ``(C) on a United States-registered aircraft.''.
            (2) Hazmat employee.--Paragraph (3) is amended to read as 
        follows:
            ``(3) `hazmat employee' means an individual--
                    ``(A) who--
                            ``(i) is employed or used by a hazmat 
                        employer; or
                            ``(ii) is self-employed, including an 
                        owner-operator of a motor vehicle, vessel, or 
                        aircraft, transporting hazardous material in 
                        commerce; and
                    ``(B) who performs a function regulated by the 
                Secretary under section 5103(b)(1) of this title.''.
            (3) Hazmat employer.--Paragraph (4) is amended to read as 
        follows:
            ``(4) `hazmat employer' means a person--
                    ``(A) who--
                            ``(i) employs or uses at least 1 hazmat 
                        employee; or
                            ``(ii) is self-employed, including an 
                        owner-operator of a motor vehicle, vessel, or 
                        aircraft, transporting hazardous material in 
                        commerce; and
                    ``(B) who performs, or employs or uses at least 1 
                hazmat employee to perform, a function regulated by the 
                Secretary under section 5103(b)(1) of this title.''.
            (4) Imminent hazard.--Paragraph (5) is amended by inserting 
        ``relating to hazardous material'' after ``of a condition''.
            (5) Motor carrier.--Paragraph (7) is amended to read as 
        follows:
            ``(7) `motor carrier'--
                    ``(A) means a motor carrier, motor private carrier, 
                and freight forwarder as those terms are defined in 
                section 13102 of this title; but
                    ``(B) does not include a freight forwarder, as so 
                defined, if the freight forwarder is not performing a 
                function relating to highway transportation.''.
            (6) National response team.--Paragraph (8) is amended--
                    (A) by striking ``national response team'' both 
                places it appears and inserting ``National Response 
                Team''; and
                    (B) by striking ``national contingency plan'' and 
                inserting ``National Contingency Plan''.
            (7) Person.--Paragraph (9)(A) is amended by striking 
        ``offering'' and all that follows and inserting ``that--
                            ``(i) offers hazardous material for 
                        transportation in commerce;
                            ``(ii) transports hazardous material to 
                        further a commercial enterprise; or
                            ``(iii) manufactures, designs, inspects, 
                        tests, reconditions, marks, or repairs a 
                        packaging or packaging component that is 
                        represented as qualified for use in 
                        transporting hazardous material in commerce; 
                        but''.
            (8) Secretary of transportation.--Section 5101 is further 
        amended--
                    (A) by redesignating paragraphs (11), (12), and 
                (13), as paragraphs (12), (13), and (14), respectively; 
                and
                    (B) by inserting after paragraph (10) the 
                following:
            ``(11) `Secretary' means the Secretary of Transportation 
        except as otherwise provided.''.

SEC. 4423. GENERAL REGULATORY AUTHORITY.

    (a) Reference to Secretary of Transportation.--Section 5103(a) is 
amended by striking ``of Transportation''.
    (b) Designating Material as Hazardous.--Section 5103(a) is further 
amended--
            (1) by striking ``etiologic agent'' and all that follows 
        through ``corrosive material,'' and inserting ``infectious 
        substance, flammable or combustible liquid, solid, or gas, 
        toxic, oxidizing, or corrosive material,''; and
            (2) by striking ``decides'' and inserting ``determines''.
    (c) Regulations for Safe Transportation.--Section 5103(b)(1)(A) is 
amended to read as follows:
                    ``(A) apply to a person who--
                            ``(i) transports hazardous material in 
                        commerce;
                            ``(ii) causes hazardous material to be 
                        transported in commerce;
                            ``(iii) manufactures, designs, inspects, 
                        tests, reconditions, marks, or repairs a 
                        packaging or packaging component that is 
                        represented as qualified for use in 
                        transporting hazardous material in commerce;
                            ``(iv) prepares or accepts hazardous 
                        material for transportation in commerce;
                            ``(v) is responsible for the safety of 
                        transporting hazardous material in commerce;
                            ``(vi) certifies compliance with any 
                        requirement under this chapter;
                            ``(vii) misrepresents whether such person 
                        is engaged in any activity under clause (i) 
                        through (vi) of this subparagraph; or
                            ``(viii) performs any other act or function 
                        relating to the transportation of hazardous 
                        material in commerce; and''.
    (d) Technical Amendment Regarding Consultation.--Section 5103 is 
amended--
            (1) by striking subsection (b)(1)(C); and
            (2) by adding at the end the following:
    ``(c) Consultation.--When prescribing a security regulation or 
issuing a security order that affects the safety of the transportation 
of hazardous material, the Secretary of Homeland Security shall consult 
with the Secretary of Transportation.''.

SEC. 4424. LIMITATION ON ISSUANCE OF HAZMAT LICENSES.

    (a) Reference to Secretary of Transportation.--Section 5103a is 
amended by striking ``of Transportation'' each place it appears in 
subsections (a)(1), (c)(1)(B), and (d) and inserting ``of Homeland 
Security''.
    (b) Covered Hazardous Materials.--Section 5103a(b) is amended by 
striking ``with respect to--'' and all that follows and inserting 
``with respect to any material defined as hazardous material by the 
Secretary for which the Secretary requires placarding of a commercial 
motor vehicle transporting that material in commerce.''.
    (c) Recommendations on Chemical or Biological Materials.--Section 
5103a is further amended--
            (1) by redesignating subsections (c), (d), and (e) as 
        subsections (d), (e), and (f), respectively; and
            (2) by inserting after subsection (b) the following:
    ``(c) Recommendations on Chemical and Biological Materials.--The 
Secretary of Health and Human Services shall recommend to the Secretary 
any chemical or biological material or agent for regulation as a 
hazardous material under section 5103(a) of this title if the Secretary 
of Health and Human Services determines that such material or agent is 
a threat to the national security of the United States.''.
    (d) Conforming Amendment.--Section 5103a(a)(1) is amended by 
striking ``subsection (c)(1)(B),'' and inserting ``subsection 
(d)(1)(B),''.

SEC. 4425. REPRESENTATION AND TAMPERING.

    (a) Representation.--Section 5104(a) is amended--
            (1) by striking ``a container,'' and all that follows 
        through ``packaging) for'' and inserting ``a package, component 
        of a package, or packaging for''; and
            (2) by striking ``the container'' and all that follows 
        through ``packaging) meets'' and inserting ``the package, 
        component of a package, or packaging meets''.
    (b) Tampering.--Section 5104(b) is amended--
            (1) by inserting ``, without authorization from the owner 
        or custodian,'' after ``may not'';
            (2) by striking ``unlawfully''; and
            (3) by inserting ``component of a package, or packaging,'' 
        after ``package,'' in paragraph (2).

SEC. 4426. TRANSPORTING CERTAIN HIGHLY RADIOACTIVE MATERIAL.

    (a) Repeal of Routes and Modes Study.--Section 5105 is amended by 
striking subsection (d).
    (b) Repeal of Requirement for Inspections of Certain Motor 
Vehicles.--Section 5105 is amended by striking subsection (e).

SEC. 4427. HAZMAT EMPLOYEE TRAINING REQUIREMENTS AND GRANTS.

    (a) Reference to Secretary of Transportation.--Section 5107 is 
amended by striking ``of Transportation'' each place it appears in 
subsections (a), (b), (c) (other than in paragraph (1)), (d), and (f).
    (b) Training Grants.--Section 5107(e) is amended--
            (1) by striking ``section 5127(c)(3)'' and inserting 
        ``section 5128(b)(1) of this title'';
            (2) by inserting ``and, to the extent determined 
        appropriate by the Secretary, grants for such instructors to 
        train hazmat employees'' after ``employees'' in the first 
        sentence thereof.

SEC. 4428. REGISTRATION.

    (a) Reference to Secretary of Transportation.--Section 5108 is 
amended by striking ``of Transportation'' each place it appears in 
subsections (a), (b) (other than following ``Department''), (d), (e), 
(f), (g), (h), and (i).
    (b) Persons Required To File.--
            (1) Requirement to file.--Section 5108(a)(1)(B) is amended 
        by striking ``class A or B explosive'' and inserting ``Division 
        1.1, 1.2, or 1.3 explosive material''.
            (2) Authority to require to file.--Section 5108(a)(2)(B) is 
        amended to read as follows:
            ``(B) a person manufacturing, designing, inspecting, 
        testing, reconditioning, marking, or repairing a package or 
        packaging component that is represented as qualified for use in 
        transporting hazardous material in commerce.''.
            (3) No transportation without filing.--Section 5108(a)(3) 
        is amended by striking ``fabricate,'' and all that follows 
        through ``package or'' and inserting ``design, inspect, test, 
        recondition, mark, or repair a package, packaging component, 
        or''.
    (c) Form and Content of Filings.--Section 5108(b)(1)(C) by striking 
``the activity.'' and inserting ``any of the activities.''.
    (d) Filing.--Section 5108(c) is amended to read as follows:
    ``(c) Filing.--Each person required to file a registration 
statement under subsection (a) of this section shall file the statement 
in accordance with regulations prescribed by the Secretary.''.
    (e) Fees.--Section 5108(g)(1) is amended by striking ``may 
establish,'' and inserting ``shall establish,''.
    (f) Relationship to Other Laws.--Section 5108(i)(2)(B) is amended 
by inserting ``an Indian tribe,'' after ``subdivision of a State,''.
    (g) Registration and Annual Fees.--
            (1) Reduction in cap.--Section 5108(g)(2)(A) is amended by 
        striking ``$5,000'' and inserting ``$2,000''.
            (2) Rulemaking.--Any rule, regulation, or order issued by 
        the Secretary of Transportation under which the assessment, 
        payment, or collection of fees under section 5108(g) of title 
        49, United States Code, was suspended or terminated before the 
        date of enactment of this Act is declared null and void 
        effective 30 days after such date of enactment. Beginning on 
        the 31st day after such date of enactment, the fee schedule 
        established by the Secretary and set forth at 65 Federal 
        Register 7297 (as modified by the rule set forth at 67 Federal 
        Register 58343) shall take effect and apply until such time as 
        it may be modified by a rulemaking proceeding.
            (3) Planning and training grants.--Notwithstanding any 
        other provision of law to the contrary, including any 
        limitation on the amount of grants authorized by section 5116 
        of title 49, United States Code, not contained in that section, 
        the Secretary shall make grants under that section from the 
        account established under section 5116(i) to reduce the balance 
        in that account over the 6 fiscal year period beginning with 
        fiscal year 2004, but in no fiscal year shall the grants 
        distributed exceed the level authorized by section 5116 of 
        title 49, United States Code.

SEC. 4429. SHIPPING PAPERS AND DISCLOSURE.

    (a) Reference to Secretary of Transportation.--Section 5110(a) is 
amended by striking ``of Transportation''.
    (b) Disclosure Considerations and Requirements.--Section 5110 is 
amended--
            (1) by striking ``under subsection (b) of this section.'' 
        in subsection (a) and inserting ``in regulations.'';
            (2) by striking subsection (b); and
            (3) by redesignating subsections (c), (d), and (e) as 
        subsections (b), (c), and (d), respectively.
    (c) Retention of Papers.--The first sentence of section 5110(d), as 
redesignated by subsection (b)(3) of this section, is amended to read 
as follows: ``The person who provides the shipping paper, and the 
carrier required to keep it, under this section shall retain the paper, 
or an electronic format of it, for a period of 3 years after the date 
the shipping paper is provided to the carrier, with the paper and 
format to be accessible through their respective principal places of 
business.''.

SEC. 4430. RAIL TANK CARS.

    (a) Repeal of Requirements.--Section 5111 is repealed.
    (b) Clerical Amendment.--The chapter analysis for chapter 51 is 
amended by striking the item relating to section 5111.

SEC. 4431. HIGHWAY ROUTING OF HAZARDOUS MATERIAL.

    The second sentence of section 5112(a)(1) is amended by striking 
``However, the Secretary of Transportation'' and inserting ``The 
Secretary''.

SEC. 4432. UNSATISFACTORY SAFETY RATINGS.

    (a) In General.--The text of section 5113 is amended to read as 
follows:
    ``A violation of section 31144(c)(3) of this title shall be 
considered a violation of this chapter, and shall be subject to the 
penalties in sections 5123 and 5124 of this title.''.
    (b) Conforming Amendments.--The first subsection (c) of section 
31144 is amended--
            (1) by striking ``sections 521(b)(5)(A) and 5113'' in 
        paragraph (1) and inserting ``section 521(b)(5)(A) of this 
        title''; and
            (2) by adding at the end of paragraph (3) ``A violation of 
        this paragraph by an owner or operator transporting hazardous 
        material shall be considered a violation of chapter 51 of this 
        title, and shall be subject to the penalties in sections 5123 
        and 5124 of this title.''.

SEC. 4433. AIR TRANSPORTATION OF IONIZING RADIATION MATERIAL.

    Section 5114(b) is amended by striking ``of Transportation''.

SEC. 4434. TRAINING CURRICULUM FOR THE PUBLIC SECTOR.

    (a) In General.--Section 5115(a) is amended to read as follows:
    ``(a) In General.--In coordination with the Director of the Federal 
Emergency Management Agency, the Chairman of the Nuclear Regulatory 
Commission, the Administrator of the Environmental Protection Agency, 
the Secretaries of Labor, Energy, and Health and Human Services, and 
the Director of the National Institute of Environmental Health 
Sciences, and using existing coordinating mechanisms of the National 
Response Team and, for radioactive material, the Federal Radiological 
Preparedness Coordinating Committee, the Secretary shall maintain a 
current curriculum of lists of courses necessary to train public sector 
emergency response and preparedness teams in matters relating to the 
transportation of hazardous material.''.
    (b) Requirements.--Section 5115(b) is amended--
            (1) by striking ``developed'' in the matter preceding 
        paragraph (1) and inserting ``maintained''; and
            (2) by striking ``under other United States Government 
        grant programs'' in paragraph (1)(C) and all that follows and 
        inserting ``with Federal assistance; and''.
    (c) Training on Compliance With Legal Requirements.--Section 
5115(c)(3) is amended by striking ``Association.'' and inserting 
``Association or by any other voluntary organization establishing 
consensus-based standards that the Secretary considers appropriate.''.
    (d) Distribution and Publication.--Section 5115(d) is amended--
            (1) by striking ``national response team--'' and inserting 
        ``National Response Team--''; and
            (2) by striking ``publish a list'' in paragraph (2) and all 
        that follows and inserting ``publish and distribute the list of 
        courses maintained under this section, and of any programs 
        utilizing such courses.''.

SEC. 4435. PLANNING AND TRAINING GRANTS; EMERGENCY PREPAREDNESS FUND.

    (a) Reference to Secretary of Transportation.--Section 5116 is 
amended by striking ``of Transportation'' each place it appears in 
subsections (a), (b), (c), (d), (g), and (i).
    (b) Government Share of Costs.--Section 5116(e) is amended by 
striking the second sentence.
    (c) Monitoring and Technical Assistance.--Section 5116(f) is 
amended by striking ``national response team'' and inserting ``National 
Response Team''.
    (d) Delegation of Authority.--Section 5116(g) is amended by 
striking ``Government grant programs'' and inserting ``Federal 
financial assistance programs''.
    (e) Emergency Preparedness Fund.--
            (1) Name of fund.--Section 5116(i) is amended by inserting 
        after ``an account'' the following: ``(to be known as the 
        `Emergency Preparedness Fund')''.
            (2) Publication of emergency response guide.--Section 
        5116(i) is further amended--
                    (A) by striking ``collects under section 
                5108(g)(2)(A) of this title and'';
                    (B) by striking ``and'' after the semicolon in 
                paragraph (2);
                    (C) by redesignating paragraph (3) as paragraph 
                (4); and
                    (D) by inserting after paragraph (2) the following:
            ``(3) to publish and distribute an emergency response 
        guide; and''.
            (3) Conforming amendment.--Section 5108(g)(2)(C) is amended 
        by striking ``the account the Secretary of the Treasury 
        establishes'' and inserting ``the Emergency Response Fund 
        established''.
    (f) Reports.--Section 5116(k) is amended--
            (1) by striking the first sentence and inserting ``The 
        Secretary shall make available to the public annually 
        information on the allocation and uses of planning grants under 
        subsection (a), training grants under subsection (b), and 
        grants under subsection (j) of this section and under section 
        5107 of this title.''; and
            (2) by striking ``Such report'' in the second sentence and 
        inserting ``The information''.

SEC. 4436. SPECIAL PERMITS AND EXCLUSIONS.

    (a) Special Permits and Exclusions.--
            (1) In general.--Section 5117(a)(1) is amended by striking 
        ``the Secretary of Transportation may issue'' and all that 
        follows through ``in a way'' and inserting ``the Secretary may 
        issue, modify, or terminate a special permit authorizing 
        variances from this chapter, or a regulation prescribed under 
        section 5103(b), 5104, 5110, or 5112 of this title, to a person 
        performing a function regulated by the Secretary under section 
        5103(b)(1) of this title in a way''.
            (2) Duration.--Section 5117(a)(2) is amended to read as 
        follows:
    ``(2) A special permit under this subsection--
                    ``(A) shall be effective when first issued for not 
                more than 2 years; and
                    ``(B) may be renewed for successive periods of not 
                more than 4 years each.''.
    (b) References to Special Permits.--Section 5117 is further 
amended--
            (1) by striking ``an exemption'' each place it appears and 
        inserting ``a special permit''; and
            (2) by striking ``the exemption'' each place it appears and 
        inserting ``the special permit''.
    (c) Conforming and Clerical Amendments.--
            (1) Conforming amendment.--The heading of section 5117 is 
        amended to read as follows:
``Sec. 5117. Special permits and exclusions''
            (2) Clerical amendment.--The chapter analysis for chapter 
        51 is amended by striking the item relating to section 5117 and 
        inserting the following:

``5117. Special permits and exclusions.''.
    (d) Repeal of Section 5118.--
            (1) Section 5118 is repealed.
            (2) The chapter analysis for chapter 51 is amended by 
        striking the item relating to section 5118 and inserting the 
        following:

``5118. Repealed.''.

SEC. 4437. UNIFORM FORMS AND PROCEDURES.

    The text of section 5119 is amended to read as follows:
    ``(a) In General.--The Secretary may prescribe regulations to 
establish uniform forms and regulations for States on the following:
            ``(1) To register and issue permits to persons that 
        transport or cause to be transported hazardous material by 
        motor vehicles in a State.
            ``(2) To permit the transportation of hazardous material in 
        a State.
    ``(b) Uniformity in Forms and Procedures.--In prescribing 
regulations under subsection (a) of this section, the Secretary shall 
develop procedures to eliminate discrepancies among the States in 
carrying out the activities covered by the regulations.
    ``(c) Limitation.--The regulations prescribed under subsection (a) 
of this section may not define or limit the amount of any fees imposed 
or collected by a State for any activities covered by the regulations.
    ``(d) Effective Date.--
            ``(1) In general.--Except as provided in paragraph (2) of 
        this subsection, the regulations prescribed under subsection 
        (a) of this section shall take effect 1 year after the date on 
        which prescribed.
            ``(2) Extension.--The Secretary may extend the 1-year 
        period in subsection (a) for an additional year for good cause.
    ``(e) State Regulations.--After the regulations prescribed under 
subsection (a) of this section take effect under subsection (d) of this 
section, a State may establish, maintain, or enforce a requirement 
relating to the same subject matter only if the requirement is 
consistent with applicable requirements with respect to such activity 
in the regulations.
    ``(f) Interim State Programs.--Pending the prescription of 
regulations under subsection (a) of this section, States may 
participate in the program of uniform forms and procedures recommended 
by the Alliance for Uniform Hazmat Transportation Procedures.''.

SEC. 4438. INTERNATIONAL UNIFORMITY OF STANDARDS AND REQUIREMENTS.

    Section 5120 is amended by striking ``of Transportation'' each 
place it appears in subsections (a), (b), and (c)(1).

SEC. 4439. HAZARDOUS MATERIALS TRANSPORTATION SAFETY AND SECURITY.

    The text of section 5121 is amended to read as follows:
    ``(a) General Authority.--
            ``(1) To carry out this chapter, the Secretary may 
        investigate, conduct tests, make reports, issue subpoenas, 
        conduct hearings, require the production of records and 
        property, take depositions, and conduct research, development, 
        demonstration, and training activities.
            ``(2) Except as provided in subsections (c) and (d) of this 
        section, the Secretary shall provide notice and an opportunity 
        for a hearing before issuing an order directing compliance with 
        this chapter, a regulation prescribed under this chapter, or an 
        order, special permit, or approval issued under this chapter.
    ``(b) Records, Reports, Property, and Information.--A person 
subject to this chapter shall--
            ``(1) maintain records, make reports, and provide property 
        and information that the Secretary by regulation or order 
        requires; and
            ``(2) make the records, reports, property, and information 
        available for inspection when the Secretary undertakes an 
        inspection or investigation.
    ``(c) Inspections and Investigations.--
            ``(1) A designated officer or employee of the Secretary 
        may--
                    ``(A) inspect and investigate, at a reasonable time 
                and in a reasonable way, records and property relating 
                to a function described in section 5103(b)(1) of this 
                title;
                    ``(B) except for packaging immediately adjacent to 
                the hazardous material contents, gain access to, open, 
                and examine a package offered for or in transportation 
                when the officer or employees has an objectively 
                reasonable and articulable belief that the package may 
                contain hazardous material;
                    ``(C) remove from transportation a package or 
                related packages in a shipment offered for or in 
                transportation for which--
                            ``(i) such officer or employee has an 
                        objectively reasonable and articulable belief 
                        that the package may pose an imminent hazard; 
                        and
                            ``(ii) such officer or employee 
                        contemporaneously documents such belief in 
                        accordance with procedures set forth in 
                        regulations prescribed under subsection (e) of 
                        this section;
                    ``(D) gather information from the offeror, carrier, 
                packaging manufacturer or retester, or other person 
                responsible for a package or packages to ascertain the 
                nature and hazards of the contents of the package or 
                packages;
                    ``(E) as necessary under terms and conditions 
                prescribed by the Secretary, order the offeror, 
                carrier, or other person responsible for a package or 
                packages to have the package or packages transported to 
                an appropriate facility, opened, examined, and 
                analyzed; and
                    ``(F) when safety might otherwise be compromised, 
                authorize properly qualified personnel to assist in 
                activities carried out under this paragraph.
            ``(2) An officer or employee acting under the authority of 
        the Secretary under this subsection shall display proper 
        credentials when requested.
            ``(3) In instances when, as a result of an inspection or 
        investigation under this subsection, an imminent hazards is not 
        found to exist, the Secretary shall, in accordance with 
        procedures set forth in regulations prescribed under subsection 
        (e) of this section, assist the safe resumption of 
        transportation of the package, packages, or transport unit 
        concerned.
    ``(d) Emergency Orders.--
            ``(1) If, upon inspection, investigation, testing, or 
        research, the Secretary determines that a violation of a 
        provision of this chapter, or a regulation prescribed under 
        this chapter, or an unsafe condition or practice, constitutes 
        or is causing an imminent hazard, the Secretary may issue or 
        impose emergency restrictions, prohibitions, recalls, or out-
        of-service orders, without notice or an opportunity for a 
        hearing, but only to the extent necessary to abate the imminent 
        hazard.
            ``(2) The action of the Secretary under paragraph (1) of 
        this subsection shall be in a written emergency order that--
                    ``(A) describes the violation, condition, or 
                practice that constitutes or is causing the imminent 
                hazard;
                    ``(B) states the restrictions, prohibitions, 
                recalls, or out-of-service orders issued or imposed; 
                and
                    ``(C) describe the standards and procedures for 
                obtaining relief from the order.
            ``(3) After taking action under paragraph (1) of this 
        subsection, the Secretary shall provide for review of the 
        action under section 554 of title 5 if a petition for review is 
        filed within 20 calendar days of the issuance of the order for 
        the action.
            ``(4) If a petition for review of an action is filed under 
        paragraph (3) of this subsection and the review under that 
        paragraph is not completed by the end of the 30-day period 
        beginning on the date the petition is filed, the action shall 
        cease to be effective at the end of such period unless the 
        Secretary determines, in writing, that the imminent hazard 
        providing a basis for the action continues to exist.
            ``(5) In this subsection, the term `out-of-service order' 
        means a requirement that an aircraft, vessel, motor vehicle, 
        train, railcar, locomotive, other vehicle, transport unit, 
        transport vehicle, freight container, potable tank, or other 
        package not be moved until specified conditions have been met.
    ``(e) Regulations.--The Secretary shall prescribe in accordance 
with section 553 of title 5 regulations to carry out the authority in 
subsections (c) and (d) of this section.
    ``(f) Facility, Staff, and Reporting System on Risks, Emergencies, 
and Actions.--
            ``(1) The Secretary shall--
                    ``(A) maintain a facility and technical staff 
                sufficient to provide, within the United States 
                Government, the capability of evaluating a risk 
                relating to the transportation of hazardous material 
                and material alleged to be hazardous;
                    ``(B) maintain a central reporting system and 
                information center capable of providing information and 
                advice to law enforcement and firefighting personnel, 
                and other interested individuals, and officers and 
                employees of the United States Government and State and 
                local governments on meeting an emergency relating to 
                the transportation of hazardous material; and
                    ``(C) conduct a continuous review on all aspects of 
                transporting hazardous material to decide on and take 
                appropriate actions to ensure safe transportation of 
                hazardous material.
            ``(2) Paragraph (1) of this subsection shall not prevent 
        the Secretary from making a contract with a private entity for 
        use of a supplemental reporting system and information center 
        operated and maintained by the contractor.
    ``(g) Grants, Cooperative Agreements, and Other Transactions.--The 
Secretary may enter into grants, cooperative agreements, and other 
transactions with a person, agency, or instrumentality of the United 
States, a unit of State or local government, an Indian tribe, a foreign 
government (in coordination with the Department of State), an 
educational institution, or other appropriate entity--
            ``(1) to expand risk assessment and emergency response 
        capabilities with respect to the security of transportation of 
        hazardous material;
            ``(2) to conduct research, development, demonstration, risk 
        assessment and emergency response planning and training 
        activities; or
            ``(3) to otherwise carry out this chapter.
    ``(h) Reports.--
            ``(1) The Secretary shall, once every 2 years, submit to 
        the Senate Committee on Commerce, Science, and Transportation 
        and the House of Representatives Committee on Transportation 
        and Infrastructure a comprehensive report on the transportation 
        of hazardous material during the preceding 2 calendar years. 
        Each report shall include, for the period covered by such 
        report--
                    ``(A) a statistical compilation of the accidents, 
                incidents, and casualties related to the transportation 
                of hazardous material during such period;
                    ``(B) a list and summary of applicable Government 
                regulations, criteria, orders, and special permits;
                    ``(C) a summary of the basis for each special 
                permit issued;
                    ``(D) an evaluation of the effectiveness of 
                enforcement activities relating to the transportation 
                of hazardous material during such period, and of the 
                degree of voluntary compliance with regulations;
                    ``(E) a summary of outstanding problems in carrying 
                out this chapter, set forth in order of priority; and
                    ``(F) any recommendations for legislative or 
                administrative action that the Secretary considers 
                appropriate.
            ``(2) Before December 31, 2005, and every 3 years 
        thereafter, the Secretary, through the Bureau of Transportation 
        Statistics and in consultation with other Federal departments 
        and agencies, shall submit a report to the Senate Committee on 
        Commerce, Science, and Transportation and the House of 
        Representatives Committee on Transportation and Infrastructure 
        on the transportation of hazardous material in all modes of 
        transportation during the preceding 3 calendar years. Each 
        report shall include, for the period covered by such report--
                    ``(A) a summary of the hazardous material 
                shipments, deliveries, and movements during such 
                period, set forth by hazardous materials type, by 
                tonnage and ton-miles, and by mode, both domestically 
                and across United States borders; and
                    ``(B) a summary of shipment estimates during such 
                period as a proxy for risk.
    ``(i) Security Sensitive Information.--
            ``(1) If the Secretary determines that particular 
        information may reveal a vulnerability of a hazardous material 
        to attack during transportation in commerce, or may facilitate 
        the diversion of hazardous material during transportation in 
        commerce for use in an attack on people or property, the 
        Secretary may disclose such information only--
                    ``(A) to the owner, custodian, offeror, or carrier 
                of such hazardous material;
                    ``(B) to an officer, employee, or agent of the 
                United States Government, or a State or local 
                government, including volunteer fire departments, 
                concerned with carrying out transportation safety laws, 
                protecting hazardous material in the course of 
                transportation in commerce, protecting public safety or 
                national security, or enforcing Federal law designed to 
                protect public health or the environment; or
                    ``(C) in an administrative or judicial proceeding 
                brought under this chapter, under other Federal law 
                intended to protect public health or the environment, 
                or under other Federal law intended to address 
                terrorist actions or threats of terrorist actions.
            ``(2) The Secretary may make determinations under paragraph 
        (1) of this subsection with respect categories of information 
        in accordance with regulations prescribed by the Secretary.
            ``(3) A release of information pursuant to a determination 
        under paragraph (1) of this subsection shall not be treated as 
        a release of such information to the public for purposes of 
        section 552 of title 5.''.

SEC. 4440. ENFORCEMENT.

    (a) Reference to Secretary of Transportation.--Section 5122(a) is 
amended by striking ``of Transportation''.
    (b) General.--Section 5122(a) is further amended--
            (1) by striking ``chapter or a regulation prescribed or 
        order''in the first sentence and inserting ``chapter, a 
        regulation prescribed under this chapter, or an order, special 
        permit, or approval''; and
            (2) by striking the second sentence and inserting ``In an 
        action under this subsection, the court may award appropriate 
        relief, including a temporary or permanent injunction, civil 
        penalties under section 5123 of this title, and punitive 
        damages.''.
    (c) Imminent Hazards.--Section 5122(b)(1)(B) is amended by striking 
``ameliorate'' and inserting ``mitigate''.

SEC. 4441. CIVIL PENALTIES.

    (a) Reference to Secretary of Transportation.--Section 5123(b) is 
amended by striking ``of Transportation''.
    (b) Penalty.--Section 5123(a)(1) is amended--
            (1) by striking ``chapter or a regulation prescribed or 
        order'' and inserting ``chapter, a regulation prescribed under 
        this chapter, or an order, special permit, or approval''; and
            (2) by striking ``$25,000'' and inserting ``$100,000''.
    (c) Hearing Requirement.--Section 5123(b) is amended by striking 
``chapter or a regulation prescribed'' and inserting ``chapter, a 
regulation prescribed under this chapter, or an order, special permit, 
or approval issued''.
    (d) Civil Actions To Collect.--Section 5123(d) is amended by 
striking ``section.'' and inserting ``section and any accrued interest 
on the civil penalty as calculated in accordance with section 1005 of 
the Oil Pollution Act of 1990 (33 U.S.C. 2705). In the civil action, 
the amount and appropriateness of the civil penalty shall not be 
subject to review.''.
    (e) Effective Date.--(1) The amendments made by subsections (b) and 
(c) of this section shall take effect on the date of the enactment of 
this Act, and shall apply with respect to violations described in 
section 5123(a) of title 49, United States Code (as amended by this 
section), that occur on or after that date.
    (2) The amendment made by subsection (d) of this section shall 
apply with respect to civil penalties imposed on violations described 
in section 5123(a) of title 49, United States Code (as amended by this 
section), which violations occur on or after the date of the enactment 
of this Act.

SEC. 4442. CRIMINAL PENALTIES.

    (a) In General.--Section 5124 is amended--
            (1) by inserting ``(a) In General.--'' before ``A person''; 
        and
            (2) by striking ``chapter or a regulation prescribed or 
        order'' and inserting ``chapter, a regulation prescribed under 
        this chapter, or an order, special permit, or approval''.
    (b) Additional Matters.--That section is further amended by adding 
at the end the following:
    ``(b) Aggravated Violations.--A person knowingly violating section 
5104(b) of this title or willfully violating this chapter or a 
regulation prescribed, or an order, special permit, or approval issued, 
under this chapter, who thereby causes the release of hazardous 
material shall be fined under title 18, imprisoned for not more than 20 
years, or both.
    ``(c) Separate Violations.--A separate violation occurs for each 
day the violation, committed by a person who transports or causes to be 
transported hazardous material, continues.''.

SEC. 4443. PREEMPTION.

    (a) Reference to Secretary of Transportation.--Section 5125(b)(2) 
is amended by striking ``of Transportation''.
    (b) Purposes.--Section 5125 is amended--
            (1) by redesignating subsections (a), (b), (c), (d), (e), 
        (f), and (g) as subsections (b), (c), (d), (e), (f), (g), and 
        (h), respectively;
            (2) by inserting before subsection (b), as so redesignated, 
        the following:
    ``(a) Purposes.--The Secretary shall exercise the authority in this 
section--
            ``(1) to achieve uniform regulation of the transportation 
        of hazardous material;
            ``(2) to eliminate rules that are inconsistent with the 
        regulations prescribed under this chapter; and
            ``(3) to otherwise promote the safe and efficient movement 
        of hazardous material in commerce.'';
            (3) by striking subsection (g), as redesignated; and
            (4) by redesignating subsection (h), as redesignated, as 
        subsection (g).
    (c) General Preemption.--Section 5125(b), as redesignated by 
subsection (b)(1) of this section, is further amended by striking 
``General.--Except as provided in subsection (b), (c), and (e)'' and 
inserting ``Preemption Generally.--Except as provided in subsections 
(c), (d), and (f)''.
    (d) Substantive Differences.--Section 5125(c), as so redesignated, 
is further amended--
            (1) in the matter preceding subparagraph (A) of paragraph 
        (1), by striking ``subsection (c)'' and inserting ``subsection 
        (d)'';
            (2) by striking subparagraph (E) of paragraph (1) and 
        inserting the following:
            ``(E) the manufacturing, designing, inspecting, testing, 
        reconditioning, or repairing of a packaging or packaging 
        component that is represented as qualified for use in 
        transporting hazardous material in commerce.''; and
            (3) by striking ``prescribes after November 16, 1990. 
        However, the'' in paragraph (2) and inserting ``prescribes. 
        The''.
    (e) Decisions on Preemption.--Section 5125(e), as so redesignated, 
is further amended by striking ``subsection (a), (b)(1), or (c) of this 
section.'' in the first sentence and inserting ``subsection (b), 
(c)(1), or (d) of this section or section 5119(b) of this title.''.
    (f) Waiver of Preemption.--Section 5125(f), as so redesignated, is 
further amended by striking ``subsection (a), (b)(1), or (c) of this 
section.'' and inserting ``subsection (b), (c)(1), or (d) of this 
section or section 5119(b) of this title.''.
    (g) Emergency Waiver of Preemption; Additional Matters.--Section 
5125 is further amended--
            (1) by redesignating subsection (g), as redesignated by 
        subsection (b)(4) of this section, as subsection (j); and
            (2) by inserting after subsection (f), as redesignated by 
        subsection (b)(1) of this section, the following:
    ``(g) Emergency Waiver of Preemption.--
            ``(1) The Secretary may, upon a finding of good cause, 
        waive the preemption of a requirement of a State, political 
        subdivision of a State, or Indian tribe under this section 
        without prior notice or an opportunity for public comment 
        thereon.
            ``(2) For purposes of paragraph (1) of this subsection, 
        good cause exists when--
                    ``(A) there is a potential threat that hazardous 
                material being transported in commerce may be used in 
                an attack on people or property; and
                    ``(B) notice and an opportunity for public comment 
                thereon are impracticable or contrary to the public 
                interest.
            ``(3)(A) A waiver of preemption under paragraph (1) of this 
        subsection shall be in effect for a period specified by the 
        Secretary, but not more than 6 months.
            ``(B) If the Secretary determines before the expiration of 
        a waiver of preemption under subparagraph (A) of this paragraph 
        that the potential threat providing the basis for the waiver 
        continues to exist, the Secretary may, after providing notice 
        and an opportunity for public comment thereon, extend the 
        duration of the waiver for such period after the expiration of 
        the waiver under that subparagraph as the Secretary considers 
        appropriate.
            ``(4) An action of the Secretary under paragraph (1) or (3) 
        of this subsection shall be in writing and shall set forth the 
        standards and procedures for seeking reconsideration of the 
        action.
            ``(5) After taking action under paragraph (1) or (3) of 
        this subsection, the Secretary shall provide for review of the 
        action if a petition for review of the action is filed within 
        20 calendar days after the date of the action.
            ``(6) If a petition for review of an action is filed under 
        paragraph (5) of this subsection and review of the action is 
        not completed by the end of the 30-day period beginning on the 
        date the petition is filed, the waiver under this subsection 
        shall cease to be effective at the end of such period unless 
        the Secretary determines, in writing, that the potential threat 
        providing the basis for the waiver continues.
    ``(h) Application of Each Preemption Standard.--Each standard for 
preemption in subsection (b), (c)(1), or (d) of this section, and in 
section 5119(b) of this title, is independent in its application to a 
requirement of a State, political subdivision of a State, or Indian 
tribe.
    ``(i) Non-Federal Enforcement Standards.--This section does not 
apply to any procedure, penalty, required mental state, or other 
standard utilized by a State, political subdivision of a State, or 
Indian tribe to enforce a requirement applicable to the transportation 
of hazardous material.''.

SEC. 4444. RELATIONSHIP TO OTHER LAWS.

    Section 5126 is amended--
            (1) by striking ``or causes to be transported hazardous 
        material,'' in subsection (a) and inserting ``hazardous 
        material, or causes hazardous material to be transported,'';
            (2) by striking ``manufactures,'' and all that follows 
        through ``or sells'' in subsection (a) and inserting 
        ``manufactures, designs, inspects, tests, reconditions, marks, 
        or repairs a packaging or packaging component that is 
        represented'';
            (3) by striking ``must'' in subsection (a) and inserting 
        ``shall'';
            (4) by striking ``manufacturing,'' in subsection (a) and 
        all that follows through ``testing'' and inserting 
        ``manufacturing, designing, inspecting, testing, 
        reconditioning, marking, or repairing''; and
            (5) by striking ``39.'' in subsection (b)(2) and inserting 
        ``39, except in the case of an imminent hazard.''.

SEC. 4445. JUDICIAL REVIEW.

    (a) In General.--Chapter 51 is amended--
            (1) by redesignating section 5127 as section 5128; and
            (2) by inserting after section 5126 the following:
``Sec. 5127. Judicial review
    ``(a) Filing and Venue.--Except as provided in section 20114(c) of 
this title, a person suffering legal wrong or adversely affected or 
aggrieved by a final action of the Secretary under this chapter may 
petition for review of the final action in the United States Court of 
Appeals for the District of Columbia or in the court of appeals of the 
United States for the circuit in which the person or resides or has the 
principal place of business. The petition shall be filed not more than 
60 days after the action of the Secretary becomes final.
    ``(b) Procedures.--When a petition on a final action is filed under 
subsection (a) of this section, the clerk of the court shall 
immediately send a copy of the petition to the Secretary. The Secretary 
shall file with the court a record of any proceeding in which the final 
action was issued as provided in section 2112 of title 28.
    ``(c) Authority of Court.--The court in which a petition on a final 
action is filed under subsection (a) of this section has exclusive 
jurisdiction, as provided in subchapter II of chapter 5 of title 5 to 
affirm or set aside any part of the final action and may order the 
Secretary to conduct further proceedings. Findings of fact by the 
Secretary, if supported by substantial evidence, are conclusive.
    ``(d) Requirement for Prior Objections.--In reviewing a final 
action under this section, the court may consider an objection to the 
final action only if--
            ``(1) the objection was made in the course of a proceeding 
        or review conducted by the Secretary; or
            ``(2) there was a reasonable ground for not making the 
        objection in the proceeding.''.
    (b) Clerical Amendment.--The chapter analysis for chapter 51 is 
amended by striking the item relating to section 5127 and inserting the 
following:

``5127. Judicial review.
``5128. Authorization of appropriations.''.

SEC. 4446. AUTHORIZATION OF APPROPRIATIONS.

    Section 5128, as redesignated by section 4445 of this title, is 
amended to read as follows:
``Sec. 5128. Authorization of appropriations
    ``(a) General.--In order to carry out this chapter (except sections 
5107(e), 5108(g), 5112, 5113, 5115, 5116, and 5119 of this title), the 
following amounts are authorized to be appropriated to the Secretary:
            ``(1) For fiscal year 2004, not more than $24,981,000.
            ``(2) For fiscal year 2005, not more than $27,000,000.
            ``(3) For fiscal year 2006, not more than $29,000,000.
            ``(4) For each of fiscal years 2007 through 2009, not more 
        than $30,000,000.
    ``(b) Emergency Preparedness Fund.--There shall be available from 
the Emergency Preparedness Fund under section 5116(i) of this title, 
amounts as follows:
            ``(1) To carry out section 5107(e) of this title, 
        $4,000,000 for each of fiscal years 2004 through 2009.
            ``(2) To carry out section 5115 of this title, $200,000 for 
        each of fiscal years 2004 through 2009.
            ``(3) To carry out section 5116(a) of this title, 
        $8,000,000 for each of fiscal years 2004 through 2009.
            ``(4) To carry out section 5116(b) of this title, 
        $13,800,000 for each of fiscal years 2004 through 2009.
            ``(5) To carry out section 5116(f) of this title, $150,000 
        for each of fiscal years 2004 through 2009.
            ``(6) To carry out section 5116(i)(4) of this title, 
        $150,000 for each of fiscal years 2004 through 2009.
            ``(7) To carry out section 5116(j) of this title, 
        $1,000,000 for each of fiscal years 2004 through 2009.
            ``(8) To publish and distribute an emergency response 
        guidebook under section 5116(i)(3) of title 49, United States 
        Code, $500,000 for each of fiscal years 2004 through 2009.
    ``(c) Section 5121 Reports.--There are authorized to be 
appropriated to the Secretary of Transportation for the use of the 
Bureau of Transportation Statistics such sums as may be necessary to 
carry out section 5121(h) of this title.''.
    ``(d) Credit to Appropriations.--The Secretary may credit to any 
appropriation to carry out this chapter an amount received from a 
State, political subdivision of a State, Indian tribe, or other public 
authority or private entity for expenses the Secretary incurs in 
providing training to the State, political subdivision, Indian tribe, 
or other authority or entity.
    ``(e) Availability of Amounts.--Amounts available under subsections 
(a) and (b) of this section shall remain available until expended.''.

SEC. 4447. ADDITIONAL CIVIL AND CRIMINAL PENALTIES.

    (a) Title 49 Penalties.--Section 46312 is amended--
            (1) by striking ``part--'' in subsection (a) and inserting 
        ``part or chapter 51 of this title--''; and
            (2) by inserting ``or chapter 51 of this title'' in 
        subsection (b) after ``under this part''.
    (b) Title 18 Penalties.--Section 3663(a)(1)(A) of title 18, United 
States Code, is amended by inserting ``5124,'' before ``46312,''.

                         PART II--OTHER MATTERS

SEC. 4461. ADMINISTRATIVE AUTHORITY FOR RESEARCH AND SPECIAL PROGRAMS 
              ADMINISTRATION.

    Section 112 is amended--
            (1) by redesignating subsection (e) as subsection (f); and
            (2) by inserting after subsection (d) the following:
    ``(e) Administrative Authorities.--
            ``(1) Grants, cooperative agreements, and other 
        transactions.--The Administrator may enter into grants, 
        cooperative agreements, and other transactions with Federal 
        agencies, State and local government agencies, other public 
        entities, private organizations, and other persons--
                    ``(A) to conduct research into transportation 
                service and infrastructure assurance; and
                    ``(B) to carry out other research activities of the 
                Administration.
            ``(2) Limitation on disclosure of certain information.--
                    ``(A) Limitation.--If the Administrator determines 
                that particular information developed in research 
                sponsored by the Administration may reveal a systemic 
                vulnerability of transportation service or 
                infrastructure, such information may be disclosed only 
                to--
                            ``(i) a person responsible for the security 
                        of the transportation service or 
                        infrastructure; or
                            ``(ii) a person responsible for protecting 
                        public safety; or
                            ``(iii) an officer, employee, or agent of 
                        the Federal Government, or a State or local 
                        government, who, as determined by the 
                        Administrator, has need for such information in 
                        the performance of official duties.
                    ``(B) Treatment of release.--The release of 
                information under subparagraph (A) shall not be treated 
                as a release to the public for purposes of section 552 
                of title 5.''.

SEC. 4462. MAILABILITY OF HAZARDOUS MATERIALS.

    (a) Nonmailability Generally.--Section 3001 of title 39, United 
States Code, is amended--
            (1) by redesignating subsection (n) as subsection (o); and
            (2) by inserting after subsection (m) the following:
    ``(n)(1) Except as otherwise authorized by law or regulations of 
the Postal Service under section 3018 of this title, hazardous material 
is nonmailable.
    ``(2) In this subsection, the term `hazardous material' means a 
substance or material designated by the Secretary of Transportation as 
hazardous material under section 5103(a) of title 49.''.
    (b) Mailability.--
            (1) In General.--Chapter 30 of title 39, United States 
        Code, is amended by adding at the end the following:
``Sec. 3018. Hazardous material
    ``(a) In General.--The Postal Service shall prescribe regulations 
for the safe transportation of hazardous material in the mails.
    ``(b) Prohibitions.--No person may--
            ``(1) mail or cause to be mailed hazardous material that 
        has been declared by statute or Postal Service regulation to be 
        nonmailable;
            ``(2) mail or cause to be mailed hazardous material in 
        violation of any statute or Postal Service regulation 
        restricting the time, place, or manner in which hazardous 
        material may be mailed; or
            ``(3) manufacture, distribute, or sell any container, 
        packaging kit, or similar device that--
                    ``(A) is represented, marked, certified, or sold by 
                such person for use in the mailing of hazardous 
                material; and
                    ``(B) fails to conform with any statute or Postal 
                Service regulation setting forth standards for a 
                container, packaging kit, or similar device used for 
                the mailing of hazardous material.
    ``(c) Civil Penalty.--
            ``(1) In general.--A person who knowingly violates this 
        section or a regulation prescribed under this section shall be 
        liable to the Postal Service for--
                    ``(A) a civil penalty of at least $250, but not 
                more than $100,000, for each violation;
                    ``(B) the costs of any clean-up associated with 
                such violation; and
                    ``(C) damages.
            ``(2) Knowing action.--A person acts knowingly for purposes 
        of paragraph (1) when--
                    ``(A) the person has actual knowledge of the facts 
                giving rise to the violation; or
                    ``(B) a reasonable person acting in the 
                circumstances and exercising reasonable care would have 
                had that knowledge.
            ``(3) Knowledge of statute or regulation not element of 
        offense.--Knowledge of the existence of a statutory provision 
        or Postal Service regulation is not an element of an offense 
        under this subsection.
            ``(4) Separate violations.--
                    ``(A) Violations over time.--A separate violation 
                under this subsection occurs for each day hazardous 
                material, mailed or cause to be mailed in noncompliance 
                with this section, is in the mail.
                    ``(B) Separate items.--A separate violation under 
                this subsection occurs for each item containing 
                hazardous material that is mailed or caused to be 
                mailed in noncompliance with this section.
    ``(d) Hearings.--The Postal Service may determine that a person has 
violated this section or a regulation prescribed under this section 
only after notice and an opportunity for a hearing.
    ``(e) Penalty Considerations.--In determining the amount of a civil 
penalty for a violation of this section, the Postal Service shall 
consider--
            ``(1) the nature, circumstances, extent, and gravity of the 
        violation;
            ``(2) with respect to the person who committed the 
        violation, the degree of culpability, any history of prior 
        violations, the ability to pay, and any effect on the ability 
        to continue in business;
            ``(3) the impact on Postal Service operations; and
            ``(4) any other matters that justice requires.
    ``(f) Civil Actions To Collect.--
            ``(1) In general.--In accordance with section 4409(d) of 
        this title, a civil action may be commenced in an appropriate 
        district court of the United States to collect a civil penalty, 
        clean-up costs, and damages assessed under subsection (c).
            ``(2) Limitation.--In a civil action under paragraph (1), 
        the validity, amount, and appropriateness of the civil penalty, 
        clean-up costs, and damages covered by the civil action shall 
        not be subject to review.
            ``(3) Compromise.--The Postal Service may compromise the 
        amount a civil penalty, clean-up costs, and damages assessed 
        under subsection (c) before commencing a civil action with 
        respect to such civil penalty, clean-up costs, and damages 
        under paragraph (1).
    ``(g) Civil Judicial Penalties.--
            ``(1) In general.--At the request of the Postal Service, 
        the Attorney General may bring a civil action in an appropriate 
        district court of the United States to enforce this section or 
        a regulation prescribed under this section.
            ``(2) Relief.--The court in a civil action under paragraph 
        (1) may award appropriate relief, including a temporary or 
        permanent injunction, civil penalties as determined in 
        accordance with this section, or punitive damages.
            ``(3) Construction.--A civil action under this subsection 
        shall be in lieu of civil penalties for the same violation 
        under subsection (c)(1)(A).
    ``(h) Deposit of Amounts Collected.--Amounts collected under this 
section shall be deposited into the Postal Service Fund under section 
2003 of this title.''.
            (2) Conforming amendment.--The chapter analysis for chapter 
        30 of title 39, United States Code, is amended by adding at the 
        end the following:

``3018. Hazardous material.''.
    (c) Conforming Amendment.--Section 2003(b) of title 39, United 
States Code, is amended--
            (1) by striking ``and'' after the semicolon in paragraph 
        (7);
            (2) by striking ``purposes.'' in paragraph (8) and 
        inserting ``purposes; and''; and
            (3) by adding at the end the following:
            ``(9) any amounts collected under section 3018 of this 
        title.''.

SEC. 4463. CRIMINAL MATTERS.

    Section 845(a)(1) of title 18, United States Code, is amended by 
striking ``which are regulated'' and all that follows and inserting 
``that is subject to the authority of the Departments of Transportation 
and Homeland Security;''.

SEC. 4464. CARGO INSPECTION PROGRAM.

    (a) In General.--The Secretary of Transportation may establish a 
program of random inspections of cargo at points of entry into the 
United States for the purpose of determining the extent to which 
undeclared hazardous material is being offered for transportation in 
commerce through such points of entry.
    (b) Inspections.--Under the program under subsection (a)--
            (1) an officer of the Department of Transportation who is 
        not located at a point of entry into the United States may 
        select at random cargo shipments at points of entry into the 
        United States for inspection; and
            (2) an officer or employee of the Department may open and 
        inspect each cargo shipment so selected for the purpose 
        described in subsection (a).
    (c) Coordination.--The Secretary of Transportation shall coordinate 
any inspections under the program under subsection (a) with the 
Secretary of Homeland Security.
    (d) Disposition of Hazardous Materials.--The Secretary of 
Transportation shall provide for the appropriate handling and 
disposition of any hazardous material discovered pursuant to 
inspections under the program under subsection (a).

SEC. 4465. INFORMATION ON HAZMAT REGISTRATIONS.

    The Administrator of the Department of Transportation's Research 
and Special Programs Administration shall--
            (1) transmit current hazardous material registrant 
        information to the Federal Motor Carrier Safety Administration 
        to cross reference the registrant's Federal motor carrier 
        registration number; and
            (2) notify the Federal Motor Carrier Safety Administration 
        immediately, and provide a registrant's United States 
        Department of Transportation identification number to the 
        Administration, whenever a new registrant registers to 
        transport hazardous materials as a motor carrier.

SEC. 4466. REPORT ON APPLYING HAZARDOUS MATERIALS REGULATIONS TO 
              PERSONS WHO REJECT HAZARDOUS MATERIALS.

    Within 6 months after the date of enactment of this Act, the 
Secretary of Transportation shall complete an assessment of the costs 
and benefits of subjecting persons who reject hazardous material for 
transportation in commerce to the hazardous materials laws and 
regulations. In completing this assessment, the Secretary shall--
            (1) estimate the number of affected employers and 
        employees;
            (2) determine what actions would be required by them to 
        comply with such laws and regulations; and
            (3) consider whether and to what extent the application of 
        Federal hazardous materials laws and regulations should be 
        limited to--
                    (A) particular modes of transportation;
                    (B) certain categories of employees; or
                    (C) certain classes or categories of hazardous 
                materials.

                 PART III--SANITARY FOOD TRANSPORTATION

SEC. 4481. SHORT TITLE.

    This part may be cited as the ``Sanitary Food Transportation Act of 
2004''.

SEC. 4482. RESPONSIBILITIES OF THE SECRETARY OF HEALTH AND HUMAN 
              SERVICES.

    (a) Unsanitary Transport Deemed Adulteration.--Section 402 of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 342) is amended by 
adding at the end the following:
    ``(i) Noncompliance With Sanitary Transportation Practices.--If the 
food is transported under conditions that are not in compliance with 
the sanitary transportation practices prescribed by the Secretary under 
section 416.''.
    (b) Sanitary Transportation Requirements.--Chapter IV of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 341 et seq.) is amended 
by adding at the end the following:

``SEC. 416. SANITARY TRANSPORTATION PRACTICES.

    ``(a) Definitions.--In this section:
            ``(1) Bulk vehicle.--The term `bulk vehicle' includes a 
        tank truck, hopper truck, rail tank car, hopper car, cargo 
        tank, portable tank, freight container, or hopper bin, and any 
        other vehicle in which food is shipped in bulk, with the food 
        coming into direct contact with the vehicle.
            ``(2) Transportation.--The term `transportation' means any 
        movement in commerce by motor vehicle or rail vehicle.
    ``(b) Regulations.--The Secretary shall by regulation require 
shippers, carriers by motor vehicle or rail vehicle, receivers, and 
other persons engaged in the transportation of food to use sanitary 
transportation practices prescribed by the Secretary to ensure that 
food is not transported under conditions that may render the food 
adulterated.
    ``(c) Contents.--The regulations shall--
            ``(1) prescribe such practices as the Secretary determines 
        to be appropriate relating to--
                    ``(A) sanitation;
                    ``(B) packaging, isolation, and other protective 
                measures;
                    ``(C) limitations on the use of vehicles;
                    ``(D) information to be disclosed--
                            ``(i) to a carrier by a person arranging 
                        for the transport of food; and
                            ``(ii) to a manufacturer or other person 
                        that--
                                    ``(I) arranges for the 
                                transportation of food by a carrier; or
                                    ``(II) furnishes a tank vehicle or 
                                bulk vehicle for the transportation of 
                                food; and
                    ``(E) recordkeeping; and
            ``(2) include--
                    ``(A) a list of nonfood products that the Secretary 
                determines may, if shipped in a bulk vehicle, render 
                adulterated food that is subsequently transported in 
                the same vehicle; and
                    ``(B) a list of nonfood products that the Secretary 
                determines may, if shipped in a motor vehicle or rail 
                vehicle (other than a tank vehicle or bulk vehicle), 
                render adulterated food that is simultaneously or 
                subsequently transported in the same vehicle.
    ``(d) Waivers.--
            ``(1) In general.--The Secretary may waive any requirement 
        under this section, with respect to any class of persons, 
        vehicles, food, or nonfood products, if the Secretary 
        determines that the waiver--
                    ``(A) will not result in the transportation of food 
                under conditions that would be unsafe for human or 
                animal health; and
                    ``(B) will not be contrary to the public interest.
            ``(2) Publication.--The Secretary shall publish in the 
        Federal Register any waiver and the reasons for the waiver.
    ``(e) Preemption.--
            ``(1) In general.--No State or political subdivision of a 
        State may directly or indirectly establish or continue in 
        effect, as to any food in interstate commerce, any authority or 
        requirement concerning transportation of food that is not 
        identical to an authority or requirement under this section.
            ``(2) Applicability.--This subsection applies to 
        transportation that occurs on or after the effective date of 
        the regulations promulgated under subsection (b).
    ``(f) Assistance of Other Agencies.--The Secretary of 
Transportation, the Secretary of Agriculture, the Administrator of the 
Environmental Protection Agency, and the heads of other Federal 
agencies, as appropriate, shall provide assistance on request, to the 
extent resources are available, to the Secretary for the purposes of 
carrying out this section.''.
    (c) Inspection of Transportation Records.--
            (1) Requirement.--Section 703 of the Federal Food, Drug, 
        and Cosmetic Act (21 U.S.C. 373) is amended--
                    (A) by striking the section heading and all that 
                follows through ``For the purpose'' and inserting the 
                following:

``SEC. 703. RECORDS.

    ``(a) In General.--For the purpose''; and
                    (B) by adding at the end the following:
    ``(b) Food Transportation Records.--A shipper, carrier by motor 
vehicle or rail vehicle, receiver, or other person subject to section 
416 shall, on request of an officer or employee designated by the 
Secretary, permit the officer or employee, at reasonable times, to have 
access to and to copy all records that the Secretary requires to be 
kept under section 416(c)(1)(E).''.
            (2) Conforming amendment.--Subsection (a) of section 703 of 
        the Federal Food, Drug, and Cosmetic Act (as designated by 
        paragraph (1)(A)) is amended by striking ``carriers.'' and 
        inserting ``carriers, except as provided in subsection (b)''.
    (d) Prohibited Acts.--
            (1) Records inspection.--Section 301(e) of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 331(e)) is amended by 
        inserting ``416,'' before ``504,'' each place it appears.
            (2) Unsafe food transportation.--Section 301 of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 331) is amended by 
        adding at the end the following:
    ``(hh) Noncompliance With Sanitary Transportation Practices.--The 
failure by a shipper, carrier by motor vehicle or rail vehicle, 
receiver, or any other person engaged in the transportation of food to 
comply with the sanitary transportation practices prescribed by the 
Secretary under section 416.''.

SEC. 4483. DEPARTMENT OF TRANSPORTATION REQUIREMENTS.

    Chapter 57, is amended to read as follows:

               ``CHAPTER 57--SANITARY FOOD TRANSPORTATION

``Sec.
``5701. Food transportation safety inspections.
``Sec. 5701. Food transportation safety inspections
    ``(a) Inspection Procedures.--
            ``(1) In general.--The Secretary of Transportation, in 
        consultation with the Secretary of Health and Human Services 
        and the Secretary of Agriculture, shall--
                    ``(A) establish procedures for transportation 
                safety inspections for the purpose of identifying 
                suspected incidents of contamination or adulteration 
                of--
                            ``(i) food in violation of regulations 
                        promulgated under section 416 of the Federal 
                        Food, Drug, and Cosmetic Act; and
                            ``(ii) meat subject to detention under 
                        section 402 of the Federal Meat Inspection Act 
                        (21 U.S.C. 672); and
                            ``(iii) poultry products subject to 
                        detention under section 19 of the Poultry 
                        Products Inspection Act (21 U.S.C. 467a); and
                    ``(B) train personnel of the Department of 
                Transportation in the appropriate use of the 
                procedures.
            ``(2) Applicability.--The procedures established under 
        paragraph (1) of this subsection shall apply, at a minimum, to 
        Department of Transportation personnel that perform commercial 
        motor vehicle or railroad safety inspections.
    ``(b) Notification of Secretary of Health and Human Services or 
Secretary of Agriculture.--The Secretary of Transportation shall 
promptly notify the Secretary of Health and Human Services or the 
Secretary of Agriculture, as applicable, of any instances of potential 
food contamination or adulteration of a food identified during 
transportation safety inspections.
    ``(c) Use of State Employees.--The means by which the Secretary of 
Transportation carries out subsection (b) of this section may include 
inspections conducted by State employees using funds authorized to be 
appropriated under sections 31102 through 31104 of this title.''.

SEC. 4484. EFFECTIVE DATE.

    This part takes effect on October 1, 2003.

            Subtitle E--Recreational Boating Safety Programs

SEC. 4501. SHORT TITLE.

    This subtitle may be cited as the ``Sport Fishing and Recreational 
Boating Safety Act''.

      PART I--FEDERAL AID IN SPORT FISH RESTORATION ACT AMENDMENTS

SEC. 4521. AMENDMENT OF FEDERAL AID IN FISH RESTORATION ACT.

    Except as otherwise expressly provided, whenever in this subtitle 
an amendment or repeal is expressed in terms of an amendment to, or 
repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Act 
entitled ``An Act to provide that the United States shall aid the 
States in fish restoration and management projects, and for other 
purposes,'' approved August 9, 1950 (64 Stat. 430; 16 U.S.C. 777 et 
seq.).

SEC. 4522. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--Section 3 (16 U.S.C. 777b) is amended--
            (1) by striking ``the succeeding fiscal year.'' in the 
        third sentence and inserting ``succeeding fiscal years.''; and
            (2) by striking ``in carrying on the research program of 
        the Fish and Wildlife Service in respect to fish of material 
        value for sport and recreation.'' and inserting ``to supplement 
        the 55.3 percent of each annual appropriation to be apportioned 
        among the States, as provided for in section 4(b) of this 
        title.''.
    (b) Conforming Amendments.--
            (1) In general.--Section 3 of the Dingell-Johnson Sport 
        Fish Restoration Act (16 U.S.C. 777b) is amended in the first 
        sentence--
                    (A) by striking ``Sport Fish Restoration Account'' 
                and inserting ``Sport Fish Restoration Trust Fund''; 
                and
                    (B) by striking ``that Account'' and inserting 
                ``that Trust Fund, except as provided in section 
                9504(c) of the Internal Revenue Code of 1986''.
            (2) Effective date.--The amendments made by paragraph (1) 
        take effect on October 1, 2004.

SEC. 4523. DIVISION OF ANNUAL APPROPRIATIONS.

    Section 4 (16 U.S.C. 777c) is amended--
            (1) by striking subsections (a) through (d) and 
        redesignating subsections (e), (f), and (g) as subsections (b), 
        (c), and (d);
            (2) by inserting before subsection (b), as redesignated, 
        the following:
    ``(a) In General.--For fiscal years 2004 through 2009, each annual 
appropriation made in accordance with the provisions of section 3 of 
this title shall be distributed as follows:
            ``(1) Coastal wetlands.--18 percent to the Secretary of the 
        Interior for distribution as provided in the Coastal Wetlands 
        Planning, Protection, and Restoration Act (16 U.S.C. 3951 et 
        seq.).
            ``(2) Boating safety.--18 percent to the Secretary of 
        Homeland Security for State recreational boating safety 
        programs under section 13106 of title 46, United States Code.
            ``(3) Clean vessel act.--1.9 percent to the Secretary of 
        the Interior for qualified projects under section 5604(c) of 
        the Clean Vessel Act of 1992 (33 U.S.C. 1322 note).
            ``(4) Boating infrastructure.--1.9 percent to the Secretary 
        of the Interior for obligation for qualified projects under 
        section 7404(d) of the Sportfishing and Boating Safety Act of 
        1998 (16 U.S.C. 777g-1(d)).
            ``(5) National outreach and communications.--1.9 percent to 
        the Secretary of the Interior for the National Outreach and 
        Communications Program under section 8(d) of this title. Such 
        amounts shall remain available for 3 fiscal years, after which 
        any portion thereof that is unobligated by the Secretary for 
        that program may be expended by the Secretary under subsection 
        (b) of this section.
            ``(6) Set-aside for expenses for administration of this 
        chapter.--
                    ``(A) In general.--2.1 percent to the Secretary of 
                the Interior for expenses for administration incurred 
                in implementation of this title, in accordance with 
                this section, section 9, and section 14 of this title.
                    ``(B) Apportionment of unobligated funds.--If any 
                portion of the amount made available to the Secretary 
                under subparagraph (A) remains unexpended and 
                unobligated at the end of a fiscal year, that portion 
                shall be apportioned among the States, on the same 
                basis and in the same manner as other amounts made 
                available under this title are apportioned among the 
                States under subsection (b) of this section, within 60 
                days after the end of that fiscal year. Any amount 
                apportioned among the States under this subparagraph 
                shall be in addition to any amounts otherwise available 
                for apportionment among the States under subsection (b) 
                for the fiscal year.'';
            (3) by striking ``of the Interior, after the distribution, 
        transfer, use, and deduction under subsections (a), (b), (c), 
        and (d), respectively, and after deducting amounts used for 
        grants under section 14, shall apportion the remainder'' in 
        subsection (b), as redesignated, and inserting ``shall 
        apportion 55.3 percent'';
            (4) by striking ``per centum'' each place it appears in 
        subsection (b), as redesignated, and inserting ``percent'';
            (5) by striking ``subsections (a), (b)(3)(A), (b)(3)(B), 
        and (c)'' in paragraph (1) of subsection (d), as redesignated, 
        and inserting ``paragraphs (1), (3), (4), and (5) of subsection 
        (a)''; and
            (6) by adding at the end the following:
    ``(e) Transfer of Certain Funds.--Amounts available under 
paragraphs (3) and (4) of subsection (a) that are unobligated by the 
Secretary after 3 fiscal years shall be transferred to the Secretary of 
Homeland Security and shall be expended for State recreational boating 
safety programs under section 13106(a) of title 46, United States 
Code.''.

SEC. 4524. MAINTENANCE OF PROJECTS.

    Section 8 (16 U.S.C. 777g) is amended--
            (1) by striking ``in carrying out the research program of 
        the Fish and Wildlife Service in respect to fish of material 
        value for sport or recreation.'' in subsection (b)(2) and 
        inserting ``to supplement the 55.3 percent of each annual 
        appropriation to be apportioned among the States under section 
        4(b) of this title.''; and
            (2) by striking ``subsection (c) or (d) of section 4'' in 
        subsection (d)(3) and inserting ``paragraph (5) or (6) of 
        section 4(a)''.

SEC. 4525. BOATING INFRASTRUCTURE.

    Section 7404(d)(1) of the Sportfishing and Boating Safety Act of 
1998 (16 U.S.C. 777g-1(d)(1)) is amended by striking ``section 
4(b)(3)(B)'' and inserting ``section 4(a)(4)''.

SEC. 4526. REQUIREMENTS AND RESTRICTIONS CONCERNING USE OF AMOUNTS FOR 
              EXPENSES FOR ADMINISTRATION.

    Section 9 (16 U.S.C. 777h) is amended--
            (1) by striking ``section 4(d)(1)'' in subsection (a) and 
        inserting ``section 4(a)(6)''; and
            (2) by striking ``section 4(d)(1)'' in subsection (b)(1) 
        and inserting ``section 4(a)(6)''.

SEC. 4527. PAYMENTS OF FUNDS TO AND COOPERATION WITH PUERTO RICO, THE 
              DISTRICT OF COLUMBIA, GUAM, AMERICAN SAMOA, THE 
              COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS, AND THE 
              VIRGIN ISLANDS.

    Section 12 (16 U.S.C. 777k) is amended by striking ``in carrying on 
the research program of the Fish and Wildlife Service in respect to 
fish of material value for sport or recreation.'' and inserting ``to 
supplement the 55.3 percent of each annual appropriation to be 
apportioned among the States under section 4(b) of this title.''.

SEC. 4528. MULTISTATE CONSERVATION GRANT PROGRAM.

    Section 14 (16 U.S.C. 777m) is amended--
            (1) by striking so much of subsection (a) as precedes 
        paragraph (2) and inserting the following:
    ``(a) In General.--
            ``(1) Amount for grants.--For each of fiscal years 2004 
        through 2009, 0.9 percent of each annual appropriation made in 
        accordance with the provisions of section 3 of this title shall 
        be distributed to the Secretary of the Interior for making 
        multistate conservation project grants in accordance with this 
        section.'';
            (2) by striking ``section 4(e)'' each place it appears in 
        subsection (a)(2)(B) and inserting ``section 4(b)''; and
            (3) by striking ``Of the balance of each annual 
        appropriation made under section 3 remaining after the 
        distribution and use under subsections (a), (b), and (c) of 
        section 4 for each fiscal year and after deducting amounts used 
        for grants under subsection (a)--'' in subsection (e) and 
        inserting ``Of amounts made available under section 4(a)(6) for 
        each fiscal year--''.

                  PART II--CLEAN VESSEL ACT AMENDMENTS

SEC. 4541. GRANT PROGRAM.

    Section 5604(c)(2) of the Clean Vessel Act of 1992 (33 U.S.C. 1322 
note) is amended--
            (1) by striking subparagraph (A); and
            (2) by redesignating subparagraphs (B) and (C) as 
        subparagraphs (A) and (B), respectively.

        PART III--RECREATIONAL BOATING SAFETY PROGRAM AMENDMENTS

SEC. 4561. STATE MATCHING FUNDS REQUIREMENT.

    Section 13103(b) of title 46, United States Code, is amended by 
striking ``one-half'' and inserting ``75 percent''.

SEC. 4562. AVAILABILITY OF ALLOCATIONS.

    Section 13104(a) of title 46, United States Code, is amended--
            (1) by striking ``2 years'' in paragraph (1) and inserting 
        ``3 years''; and
            (2) by striking ``2-year'' in paragraph (2) and inserting 
        ``3-year''.

SEC. 4563. AUTHORIZATION OF APPROPRIATIONS FOR STATE RECREATIONAL 
              BOATING SAFETY PROGRAMS.

    Section 13106(c) of title 46, United States Code, is amended--
            (1) by striking ``Secretary of Transportation under 
        paragraphs (2) and (3) of section 4(b)'' and inserting 
        ``Secretary under subsections (a)(2) and (e) of section 4''; 
        and
            (2) by inserting ``a minimum of'' before ``$2,083,333''.

SEC. 4564. MAINTENANCE OF EFFORT FOR STATE RECREATIONAL BOATING SAFETY 
              PROGRAMS.

    (a) In General.--Chapter 131 of title 46, United States Code, is 
amended by inserting after section 13106 the following:
``Sec. 13107. Maintenance of effort for State recreational boating 
              safety programs
    ``(a) In General.--The amount payable to a State for a fiscal year 
from an allocation under section 13103 of this chapter shall be reduced 
if the usual amounts expended by the State for the State's recreational 
boating safety program, as determined under section 13105 of this 
chapter, for the previous fiscal year is less than the average of the 
total of such expenditures for the 3 fiscal years immediately preceding 
that previous fiscal year. The reduction shall be proportionate, as a 
percentage, to the amount by which the level of State expenditures for 
such previous fiscal year is less than the average of the total of such 
expenditures for the 3 fiscal years immediately preceding that previous 
fiscal year.
    ``(b) Reduction of Threshhold.--If the total amount available for 
allocation and distribution under this chapter in a fiscal year for all 
participating State recreational boating safety programs is less than 
such amount for the preceding fiscal year, the level of State 
expenditures required under subsection (a) of this section for the 
preceding fiscal year shall be decreased proportionately.
    ``(c) Waiver.--
            ``(1) In general.--Upon the written request of a State, the 
        Secretary may waive the provisions of subsection (a) of this 
        section for 1 fiscal year if the Secretary determines that a 
        reduction in expenditures for the State's recreational boating 
        safety program is attributable to a non- selective reduction in 
        expenditures for the programs of all Executive branch agencies 
        of the State government, or for other reasons if the State 
        demonstrates to the Secretary's satisfaction that such waiver 
        is warranted.
            ``(2) 30-day decision.--The Secretary shall approve or deny 
        a request for a waiver not later than 30 days after the date 
        the request is received.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 131 of 
title 46, United States Code, is amended by inserting after the item 
relating to section 13106 the following:

``13107. Maintenance of effort for State recreational boating safety 
                            programs.''.

                         PART IV--MISCELLANEOUS

SEC. 4581. TECHNICAL CORRECTION TO HOMELAND SECURITY ACT.

    Section 1511(e)(2) of the Homeland Security Act of 2002 (Pub. L. 
107-296) is amended by striking ``and to any funds provided to the 
Coast Guard from the Aquatic Resources Trust Fund of the Highway Trust 
Fund for boating safety programs.'' and inserting ``and any funds 
provided to the Coast Guard from the Highway Trust Fund and transferred 
into the Sport Fish Restoration Account of the Aquatic Resources Trust 
Fund for boating safety programs.''.

                    Subtitle F--Rail Transportation

                             PART I--AMTRAK

SEC. 4601. AUTHORIZATION OF APPROPRIATIONS.

    The text of section 24104 of title 49, United States Code, is 
amended to read as follows:
    ``There are authorized to be appropriated to the Secretary of 
Transportation $2,000,000,000 for each of fiscal years 2004, 2005, 
2006, 2007, 2008, and 2009 for the benefit of Amtrak for operating 
expenses.''.

SEC. 4602. ESTABLISHMENT OF BUILD AMERICA CORPORATION.

    There is established a nonprofit corporation, to be known as the 
``Build America Corporation''. The Build America Corporation is not an 
agency or establishment of the United States Government. The purpose of 
the Corporation is to support qualified projects described in section 
4603(c)(2) through the issuance of Build America bonds. The Corporation 
shall be subject, to the extent consistent with this section, to the 
laws of the State of Delaware applicable to corporations not for 
profit.

SEC. 4603. FEDERAL BONDS FOR TRANSPORTATION INFRASTRUCTURE.

    (a) Use of Bond Proceeds.--The proceeds from the sale of--
            (1) any bonds authorized, issued, or guaranteed by the 
        Federal Government that are available to fund passenger rail 
        projects pursuant to any Federal law (enacted before, on, or 
        after the date of the enactment of this Act), and
            (2) any Build America bonds issued by the Build America 
        Corporation as authorized by section 4602,
may be used to fund a qualified project if the Secretary of 
Transportation determines that the qualified project is a cost-
effective alternative for efficiently maximizing mobility of 
individuals and goods.
    (b) Compliance of Beneficiaries With Certain Standards.--A 
recipient of proceeds of a grant, loan, Federal tax-credit bonds, or 
any other form of financial assistance provided under this title shall 
comply with the standards described in section 24312 of title 49, 
United States Code, as in effect on June 25, 2003, with respect to any 
qualified project described in subsection (c)(1) in the same manner 
that the National Passenger Railroad Corporation is required to comply 
with such standards for construction work financed under an agreement 
entered into under section 24308(a) of such title.
    (c) Qualified Project Defined.--In this section--
            (1) In general.--Except as provided in paragraph (2), the 
        term ``qualified project'' means any transportation 
        infrastructure project of any governmental unit or other person 
        that is proposed by a State, including a highway project, a 
        transit system project, a railroad project, an airport project, 
        a port project, and an inland waterways project.
            (2) Build america corporation projects.--
                    (A) In general.--With respect to any Build America 
                bonds issued by the Build America Corporation as 
                authorized by section 4602, the term ``qualified 
                project'' means any--
                            (i) qualified highway project,
                            (ii) qualified public transportation 
                        project, and
                            (iii) congestion relief project,
                proposed by 1 or more States and approved by the Build 
                America Corporation, which meets the requirements under 
                clauses (i), (ii), and (iii) of subparagraph (D).
                    (B) Qualified highway project.--The term 
                ``qualified highway project'' means a project for 
                highway facilities or other facilities which are 
                eligible for assistance under title 23, United States 
                Code.
                    (C) Qualified public transportation project.--The 
                term ``qualified public transportation project'' means 
                a project for public transportation facilities or other 
                facilities which are eligible for assistance under 
                chapter 53 of title 49, United States Code.
                    (D) Congestion relief project.--The term 
                ``congestion relief project'' means an intermodal 
                freight transfer facility, freight rail facility, 
                freight movement corridor, intercity passenger rail or 
                facility, intercity bus vehicle or facility, border 
                crossing facility, or other public or private facility 
                approved as a congestion relief project by the 
                Secretary of Transportation. In making such approvals, 
                the Secretary of Transportation shall--
                            (i) consider the economic, environmental, 
                        mobility, and national security improvements to 
                        be realized through the project, and
                            (ii) give preference to projects with 
                        national or regional significance, including 
                        any projects sponsored by a coalition of States 
                        or a combination of States and private sector 
                        entities, in terms of generating economic 
                        benefits, supporting international commerce, or 
                        otherwise enhancing the national transportation 
                        system.
                    (D) Additional requirements for qualified 
                projects.--For purposes of subparagraph (A)--
                            (i) Costs of qualified projects.--The 
                        requirement of this clause is met if the costs 
                        of the qualified project funded by Build 
                        America bonds only relate to capital 
                        investments in depreciable assets and do not 
                        include any costs relating to operations, 
                        maintenance, or rolling stock.
                            (ii) Applicability of federal law.--The 
                        requirement of this clause is met if the 
                        requirements of any Federal law, including 
                        titles 23, 40, and 49 of the United States 
                        Code, which would otherwise apply to projects 
                        to which the United States is a party or to 
                        funds made available under such law and 
                        projects assisted with those funds are applied 
                        to--
                                    (I) funds made available under 
                                Build America bonds for similar 
                                qualified projects, and
                                    (II) similar qualified projects 
                                assisted by the Build America 
                                Corporation through the use of such 
                                funds.
                            (iii) Utilization of updated construction 
                        technology for qualified projects.--The 
                        requirement of this clause is met if the 
                        appropriate State agency relating to the 
                        qualified project has updated its accepted 
                        construction technologies to match a list 
                        prescribed by the Secretary of Transportation 
                        and in effect on the date of the approval of 
                        the project as a qualified project.

                 PART II--RAILROAD TRACK MODERNIZATION

SEC. 4631. SHORT TITLE.

    This part may be cited as the ``Railroad Track Modernization Act of 
2004''.

SEC. 4632. CAPITAL GRANTS FOR RAILROAD TRACK.

    (a) Authority.--Chapter 223 of title 49, United States Code, is 
amended to read as follows:

            ``CHAPTER 223--CAPITAL GRANTS FOR RAILROAD TRACK

``Sec.
``22301. Capital grants for railroad track.
``Sec. 22301. Capital grants for railroad track
    ``(a) Establishment of Program.--
            ``(1) Establishment.--The Secretary of Transportation shall 
        establish a program of capital grants for the rehabilitation, 
        preservation, or improvement of railroad track (including 
        roadbed, bridges, and related track structures) of class II and 
        class III railroads. Such grants shall be for rehabilitating, 
        preserving, or improving track used primarily for freight 
        transportation to a standard ensuring that the track can be 
        operated safely and efficiently, including grants for 
        rehabilitating, preserving, or improving track to handle 
        286,000 pound rail cars. Grants may be provided under this 
        chapter--
                    ``(A) directly to the class II or class III 
                railroad; or
                    ``(B) with the concurrence of the class II or class 
                III railroad, to a State or local government.
            ``(2) State cooperation.--Class II and class III railroad 
        applicants for a grant under this chapter are encouraged to 
        utilize the expertise and assistance of State transportation 
        agencies in applying for and administering such grants. State 
        transportation agencies are encouraged to provide such 
        expertise and assistance to such railroads.
            ``(3) Regulations.--
                    ``(A) In general.--The Secretary shall prescribe 
                regulations to carry out the program under this 
                section.
                    ``(B) Criteria.--In developing the regulations, the 
                Secretary shall establish criteria that--
                            ``(i) condition the award of a grant to a 
                        railroad on reasonable assurances by the 
                        railroad that the facilities to be 
                        rehabilitated and improved will be economically 
                        and efficiently utilized;
                            ``(ii) ensure that the award of a grant is 
                        justified by present and probable future demand 
                        for rail services by the railroad to which the 
                        grant is to be awarded;
                            ``(iii) ensure that consideration is given 
                        to projects that are part of a State-sponsored 
                        rail plan; and
                            ``(iv) ensure that all such grants are 
                        awarded on a competitive basis.
    ``(b) Maximum Federal Share.--The maximum Federal share for 
carrying out a project under this section shall be 80 percent of the 
project cost. The non-Federal share may be provided by any non-Federal 
source in cash, equipment, or supplies. Other in-kind contributions may 
be approved by the Secretary on a case by case basis consistent with 
this chapter.
    ``(c) Project Eligibility.--For a project to be eligible for 
assistance under this section the track must have been operated or 
owned by a class II or class III railroad as of the date of the 
enactment of the Railroad Track Modernization Act of 2004.
    ``(d) Use of Funds.--Grants provided under this section shall be 
used to implement track capital projects as soon as possible. In no 
event shall grant funds be contractually obligated for a project later 
than the end of the third Federal fiscal year following the year in 
which the grant was awarded. Any funds not so obligated by the end of 
such fiscal year shall be returned to the Secretary for reallocation.
    ``(e) Additional Purpose.--In addition to making grants for 
projects as provided in subsection (a), the Secretary may also make 
grants to supplement direct loans or loan guarantees made under title V 
of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 
U.S.C. 822(d)), for projects described in the last sentence of section 
502(d) of such title. Grants made under this subsection may be used, in 
whole or in part, for paying credit risk premiums, lowering rates of 
interest, or providing for a holiday on principal payments.
    ``(f) Employee Protection.--The Secretary shall require as a 
condition of any grant made under this section that the recipient 
railroad provide a fair arrangement at least as protective of the 
interests of employees who are affected by the project to be funded 
with the grant as the terms imposed under section 11326(a), as in 
effect on the date of the enactment of the Railroad Track Modernization 
Act of 2001.
    ``(g) Labor Standards.--
            ``(1) Prevailing wages.--The Secretary shall ensure that 
        laborers and mechanics employed by contractors and 
        subcontractors in construction work financed by a grant made 
        under this section will be paid wages not less than those 
        prevailing on similar construction in the locality, as 
        determined by the Secretary of Labor under the Act of March 3, 
        1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.). 
        The Secretary shall make a grant under this section only after 
        being assured that required labor standards will be maintained 
        on the construction work.
            ``(2) Wage rates.--Wage rates in a collective bargaining 
        agreement negotiated under the Railway Labor Act (45 U.S.C. 151 
        et seq.) are deemed for purposes of this subsection to comply 
        with the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 
        U.S.C. 276a et seq.).''.
    (b) Conforming Amendment.--The item relating to chapter 223 in the 
table of chapters of subtitle V of title 49, United States Code, is 
amended to read as follows:

``223. CAPITAL GRANTS FOR RAILROAD TRACK....................   22301''.

SEC. 4633. REGULATIONS.

    (a) Regulations.--The Secretary of Transporation shall prescribe 
under subsection (a)(3) of section 22301 of title 49, United States 
Code (as added by section 4601), interim and final regulations for the 
administration of the grant program under such section as follows:
            (1) Interim regulations.--The Secretary shall prescribe the 
        interim regulations to implement the program not later than 
        December 31, 2003.
            (2) Final regulations.--The Secretary shall prescribe the 
        final regulations not later than October 1, 2004.
    (b) Inapplicability of Rulemaking Procedure to Interim 
Regulations.--Subchapter II of chapter 5 of title 5, United States 
Code, shall not apply to the issuance of an interim regulation or to 
any amendment of such an interim regulation.
    (c) Criteria.--The requirement for the establishment of criteria 
under subparagraph (B) of section 22301(a)(3) of title 49, United 
States Code, applies to the interim regulations as well as to the final 
regulations.

SEC. 4634. STUDY OF GRANT-FUNDED PROJECTS.

    (a) Requirement for Study.--The Secretary of Transportation shall 
conduct a study of the projects carried out with grant assistance under 
section 22301 of title 49, United States Code (as added by section 
4601), to determine the public interest benefits associated with the 
light density railroad networks in the States and their contribution to 
a multimodal transportation system.
    (b) Report.--Not later than March 31, 2004, the Secretary shall 
submit to Congress a report on the results of the study under 
subsection (a). The report shall include any recommendations that the 
Secretary considers appropriate regarding the eligibility of light 
density rail networks for Federal infrastructure financing.

SEC. 4635. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to the Secretary of 
Transportation $350,000,000 for each of fiscal years 2004, 2005, and 
2006 for carrying out section 22301 of title 49, United States Code (as 
added by section 4601).

         PART III--OTHER RAIL TRANSPORTATION-RELATED PROVISIONS

SEC. 4661. CAPITAL GRANTS FOR RAIL LINE RELOCATION PROJECTS.

    (a) Establishment of Program.--
            (1) Program requirements.--Chapter 201 of title 49, United 
        States Code, is amended by adding at the end of subchapter II 
        the following:
``Sec. 20154. Capital grants for rail line relocation projects
    ``(a) Establishment of Program.--The Secretary of Transportation 
shall carry out a grant program to provide financial assistance for 
local rail line relocation projects.
    ``(b) Eligibility.--A State is eligible for a grant under this 
section for any project for the improvement of the route or structure 
of a rail line passing through a municipality of the State that--
            ``(1) is carried out for the purpose of mitigating the 
        adverse effects of rail traffic on safety, motor vehicle 
        traffic flow, or economic development in the municipality;
            ``(2) involves a lateral or vertical relocation of any 
        portion of the rail line within the municipality to avoid a 
        closing of a grade crossing or the construction of a road 
        underpass or overpass; and
            ``(3) meets the costs-benefits requirement set forth in 
        subsection (c).
    ``(c) Costs-Benefits Requirement.--A grant may be awarded under 
this section for a project for the relocation of a rail line only if 
the benefits of the project for the period equal to the estimated 
economic life of the relocated rail line exceed the costs of the 
project for that period, as determined by the Secretary considering the 
following factors:
            ``(1) The effects of the rail line and the rail traffic on 
        motor vehicle and pedestrian traffic, safety, and area commerce 
        if the rail line were not so relocated.
            ``(2) The effects of the rail line, relocated as proposed, 
        on motor vehicle and pedestrian traffic, safety, and area 
        commerce.
            ``(3) The effects of the rail line, relocated as proposed, 
        on the freight and passenger rail operations on the rail line.
    ``(d) Considerations for Approval of Grant Applications.--In 
addition to considering the relationship of benefits to costs in 
determining whether to award a grant to an eligible State under this 
section, the Secretary shall consider the following factors:
            ``(1) The capability of the State to fund the rail line 
        relocation project without Federal grant funding.
            ``(2) The requirement and limitation relating to allocation 
        of grant funds provided in subsection (e).
            ``(3) Equitable treatment of the various regions of the 
        United States.
    ``(e) Allocation Requirements.--
            ``(1) Grants not greater than $20,000,000.--At least 50 
        percent of all grant funds awarded under this section out of 
        funds appropriated for a fiscal year shall be provided as grant 
        awards of not more than $20,000,000 each.
            ``(2) Limitation per project.--Not more than 25 percent of 
        the total amount available for carrying out this section for a 
        fiscal year may be provided for any 1 project in that fiscal 
        year.
    ``(f) Federal Share.--The total amount of a grant awarded under 
this section for a rail line relocation project shall be 90 percent of 
the shared costs of the project, as determined under subsection (g)(4).
    ``(g) State Share.--
            ``(1) Percentage.--A State shall pay 10 percent of the 
        shared costs of a project that is funded in part by a grant 
        awarded under this section.
            ``(2) Forms of contributions.--The share required by 
        paragraph (1) may be paid in cash or in kind.
            ``(3) In-kind contributions.--The in-kind contributions 
        that are permitted to be counted under paragraph (2) for a 
        project for a State are as follows:
                    ``(A) A contribution of real property or tangible 
                personal property (whether provided by the State or a 
                person for the State).
                    ``(B) A contribution of the services of employees 
                of the State, calculated on the basis of costs incurred 
                by the State for the pay and benefits of the employees, 
                but excluding overhead and general administrative 
                costs.
                    ``(C) A payment of any costs that were incurred for 
                the project before the filing of an application for a 
                grant for the project under this section, and any in-
                kind contributions that were made for the project 
                before the filing of the application, if and to the 
                extent that the costs were incurred or in-kind 
                contributions were made, as the case may be, to comply 
                with a provision of a statute required to be satisfied 
                in order to carry out the project.
            ``(4) Costs not shared.--
                    ``(A) In general.--For the purposes of subsection 
                (f) and this subsection, the shared costs of a project 
                in a municipality do not include any cost that is 
                defrayed with any funds or in-kind contribution that a 
                source other than the municipality makes available for 
                the use of the municipality without imposing at least 1 
                of the following conditions:
                            ``(i) The condition that the municipality 
                        use the funds or contribution only for the 
                        project.
                            ``(ii) The condition that the availability 
                        of the funds or contribution to the 
                        municipality is contingent on the execution of 
                        the project.
                    ``(B) Determinations of the secretary.--The 
                Secretary shall determine the amount of the costs, if 
                any, that are not shared costs under this paragraph and 
                the total amount of the shared costs. A determination 
                of the Secretary shall be final.
            ``(h) Multistate Agreements To Combine Amounts.--Two or 
        more States (not including political subdivisions of States) 
        may, pursuant to an agreement entered into by the States, 
        combine any part of the amounts provided through grants for a 
        project under this section if--
                    ``(1) the project will benefit each of the States 
                entering into the agreement; and
                    ``(2) the agreement is not a violation of a law of 
                any such State.
    ``(i) Regulations.--The Secretary shall prescribe regulations for 
carrying out this section.
    ``(j) State Defined.--In this section, the term `State' includes, 
except as otherwise specifically provided, a political subdivision of a 
State.
    ``(k) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary for use in carrying out this section 
$350,000,000 for each of the fiscal years 2004 through 2008.''.
            (2) Clerical amendment.--The chapter analysis for such 
        chapter is amended by adding at the end the following:

``20154. Capital grants for rail line relocation projects.''.
    (b) Regulations.--
            (1) Interim regulations.--Not later than October 1, 2003, 
        the Secretary of Transportation shall issue temporary 
        regulations to implement the grant program under section 20154 
        of title 49, United States Code, as added by subsection (a). 
        Subchapter II of chapter 5 of title 5, United States Code, 
        shall not apply to the issuance of a temporary regulation under 
        this subsection or of any amendment of such a temporary 
        regulation.
            (2) Final regulations.--Not later than April 1, 2004, the 
        Secretary shall issue final regulations implementing the 
        program.

SEC. 4662. USE OF CONGESTION MITIGATION AND AIR QUALITY IMPROVEMENT 
              FUNDS FOR BOSTON TO PORTLAND PASSENGER RAIL SERVICE.

    Notwithstanding any other provision of law, funds authorized to be 
appropriated under section 1101(5) that are made available to the State 
of Maine may be used to support, through December 15, 2006, the 
operation of passenger rail service between Boston, Massachusetts, and 
Portland, Maine.

     TITLE V--HIGHWAY REAUTHORIZATION AND EXCISE TAX SIMPLIFICATION

SEC. 5000. SHORT TITLE; AMENDMENT OF 1986 CODE.

    (a) Short Title.--This title may be cited as the ``Highway 
Reauthorization and Excise Tax Simplification Act of 2004''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this title an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

                 Subtitle A--Trust Fund Reauthorization

SEC. 5001. EXTENSION OF HIGHWAY TRUST FUND AND AQUATIC RESOURCES TRUST 
              FUND EXPENDITURE AUTHORITY AND RELATED TAXES.

    (a) Highway Trust Fund Expenditure Authority.--
            (1) Highway account.--Paragraph (1) of section 9503(c) 
        (relating to transfers from Highway Trust Fund for certain 
        repayments and credits) is amended--
                    (A) in the matter before subparagraph (A), by 
                striking ``March 1, 2004'' and inserting ``October 1, 
                2009'',
                    (B) by striking ``or'' at the end of subparagraph 
                (E),
                    (C) by striking the period at the end of 
                subparagraph (F) and inserting ``, or'',
                    (D) by inserting after subparagraph (F), the 
                following new subparagraph:
                    ``(G) authorized to be paid out of the Highway 
                Trust Fund under the Safe, Accountable, Flexible, and 
                Efficient Transportation Equity Act of 2004.'', and
                    (E) in the matter after subparagraph (G), as added 
                by subparagraph (D), by striking ``Surface 
                Transportation Extension Act of 2003'' and inserting 
                ``Safe, Accountable, Flexible, and Efficient 
                Transportation Equity Act of 2004''.
            (2) Mass transit account.--Paragraph (3) of section 9503(e) 
        (relating to establishment of Mass Transit Account) is 
        amended--
                    (A) in the matter before subparagraph (A), by 
                striking ``March 1, 2004'' and inserting ``October 1, 
                2009'',
                    (B) by striking ``or'' at the end of subparagraph 
                (C),
                    (C) by striking the period at the end of 
                subparagraph (D) and inserting ``, or'',
                    (D) by inserting after subparagraph (D), the 
                following new subparagraph:
                    ``(E) the Safe, Accountable, Flexible, and 
                Efficient Transportation Equity Act of 2004,'', and
                    (E) in the matter after subparagraph (E), as added 
                by subparagraph (D), by striking ``Surface 
                Transportation Extension Act of 2003'' and inserting 
                ``Safe, Accountable, Flexible, and Efficient 
                Transportation Equity Act of 2004''.
            (3) Exception to limitation on transfers.--Subparagraph (B) 
        of section 9503(b)(5) (relating to limitation on transfers to 
        Highway Trust Fund) is amended by striking ``March 1, 2004'' 
        and inserting ``October 1, 2009''.
    (b) Aquatic Resources Trust Fund Expenditure Authority.--
            (1) Sport fish restoration account.--Paragraph (2) of 
        section 9504(b) (relating to Sport Fish Restoration Account) is 
        amended by striking ``Surface Transportation Extension Act of 
        2003'' each place it appears and inserting ``Safe, Accountable, 
        Flexible, and Efficient Transportation Equity Act of 2004''.
            (2) Boat safety account.--Section 9504(c) (relating to 
        expenditures from Boat Safety Account) is amended--
                    (A) by striking ``March 1, 2004'' and inserting 
                ``October 1, 2009'', and
                    (B) by striking ``Surface Transportation Extension 
                Act of 2003'' and inserting ``Safe, Accountable, 
                Flexible, and Efficient Transportation Equity Act of 
                2004''.
            (3) Exception to limitation on transfers.--Paragraph (2) of 
        section 9504(d) (relating to limitation on transfers to Aquatic 
        Resources Trust Fund) is amended by striking ``March 1, 2004'' 
        and inserting ``October 1, 2009''.
            (4) Technical correction.--The last sentence of paragraph 
        (2) of section 9504(b) is amended by striking ``subparagraph 
        (B)'', and inserting ``subparagraph (C)''.
    (c) Extension of Taxes.--
            (1) In general.--The following provisions are each amended 
        by striking ``2005'' each place it appears and inserting 
        ``2009'':
                    (A) Section 4041(a)(1)(C)(iii)(I) (relating to rate 
                of tax on certain buses).
                    (B) Section 4041(a)(2)(B) (relating to rate of tax 
                on special motor fuels).
                    (C) Section 4041(m)(1)(A) (relating to certain 
                alcohol fuels produced from natural gas).
                    (D) Section 4051(c) (relating to termination of tax 
                on heavy trucks and trailers).
                    (E) Section 4071(d) (relating to termination of tax 
                on tires).
                    (F) Section 4081(d)(1) (relating to termination of 
                tax on gasoline, diesel fuel, and kerosene).
                    (G) Section 4481(e) (relating to period tax in 
                effect).
                    (H) Section 4482(c)(4) (relating to taxable 
                period).
                    (I) Section 4482(d) (relating to special rule for 
                taxable period in which termination date occurs).
            (2) Floor stocks refunds.--Section 6412(a)(1) (relating to 
        floor stocks refunds) is amended--
                    (A) by striking ``2005'' each place it appears and 
                inserting ``2009'', and
                    (B) by striking ``2006'' each place it appears and 
                inserting ``2010''.
    (d) Extension of Certain Exemptions.--The following provisions are 
each amended by striking ``2005'' and inserting ``2009'':
            (1) Section 4221(a) (relating to certain tax-free sales).
            (2) Section 4483(g) (relating to termination of exemptions 
        for highway use tax).
    (e) Extension of Deposits Into, and Certain Transfers From, Trust 
Fund.--
            (1) In general.--Subsections (b), (c)(2), (c)(3), 
        (c)(4)(A)(i), and (c)(5)(A) of section 9503 (relating to the 
        Highway Trust Fund) are amended--
                    (A) by striking ``2005'' each place it appears and 
                inserting ``2009'', and
                    (B) by striking ``2006'' each place it appears and 
                inserting ``2010''.
            (2) Conforming amendments to land and water conservation 
        fund.--Section 201(b) of the Land and Water Conservation Fund 
        Act of 1965 (16 U.S.C. 460l-11(b)) is amended--
                    (A) by striking ``2003'' and inserting ``2007'', 
                and
                    (B) by striking ``2004'' each place it appears and 
                inserting ``2008''.
    (f) Extension of Tax Benefits for Qualified Methanol and Ethanol 
Fuel Produced From Coal.--Section 4041(b)(2) (relating to qualified 
methanol and ethanol fuel) is amended--
            (1) by striking ``2007'' in subparagraph (C)(ii) and 
        inserting ``2010'', and
            (2) by striking ``October 1, 2007'' in subparagraph (D) and 
        inserting ``January 1, 2011''.
    (g) Prohibition on Use of Highway Account for Rail Projects.--
Section 9503(c) (relating to transfers from Highway Trust Fund for 
certain repayments and credits) is amended by adding at the end the 
following new paragraph:
            ``(6) Prohibition on use of highway account for certain 
        rail projects.--With respect to rail projects beginning after 
        the date of the enactment of this paragraph, no amount shall be 
        available from the Highway Account (as defined in subsection 
        (e)(5)(B)) for any rail project, except for any rail project 
        involving publicly owned rail facilities or any rail project 
        yielding a public benefit.''.
    (h) Highway Trust Fund Expenditures for Highway Use Tax Evasion 
Projects.--Section 9503(c), as amended by subsection (g), is amended to 
add at the end the following new paragraph:
            ``(7) Highway use tax evasion projects.--From amounts 
        available in the Highway Trust Fund, there is authorized to be 
        expended--
                    ``(A) for each fiscal year after 2003 to the 
                Internal Revenue Service--
                            ``(i) $30,000,000 for enforcement of fuel 
                        tax compliance, including the per-certification 
                        of tax-exempt users,
                            ``(ii) $10,000,000 for Xstars, and
                            ``(iii) $10,000,000 for xfirs, and
                    ``(B) for each fiscal year after 2003 to the 
                Federal Highway Administration, $50,000,000 to be 
                allocated $1,000,000 to each State to combat fuel tax 
                evasion on the State level.''.
    (i) Effective Date.--The amendments made by and provisions of this 
section shall take effect on the date of the enactment of this Act.

SEC. 5002. FULL ACCOUNTING OF FUNDS RECEIVED BY THE HIGHWAY TRUST FUND.

    (a) In General.--Section 9503(c) (relating to transfers from 
Highway Trust Fund for certain repayments and credits), as amended by 
section 5001 of this Act, is amended by striking paragraph (2) and 
redesignating paragraphs (3), (4), (5), (6), and (7) as paragraphs (2), 
(3), (4), (5), and (6), respectively.
    (b) Interest on Unexpended Balances Credited to Trust Fund.--
Section 9503 (relating to the Highway Trust Fund) is amended by 
striking subsection (f).
    (c) Conforming Amendments.--
            (1) Section 9503(b)(4)(D) is amended by striking 
        ``paragraph (4)(D) or (5)(B)'' and inserting ``paragraph (3)(D) 
        or (4)(B)''.
            (2) Paragraph (2) of section 9503(c) (as redesignated by 
        subsection (a)) is amended by adding at the end the following 
        new sentence: ``The amounts payable from the Highway Trust Fund 
        under this paragraph shall be determined by taking into account 
        only the portion of the taxes which are deposited into the 
        Highway Trust Fund.''.
            (3) Section 9504(a)(2) is amended by striking ``section 
        9503(c)(4), section 9503(c)(5)'' and inserting ``section 
        9503(c)(3), section 9503(c)(4)''.
            (4) Paragraph (2) of section 9504(b), as amended by section 
        5001 of this Act, is amended by striking ``section 9503(c)(5)'' 
        and inserting ``section 9503(c)(4)''.
            (5) Section 9504(e) is amended by striking ``section 
        9503(c)(4)'' and inserting ``section 9503(c)(3)''.
    (d) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to amounts paid for 
        which no transfer from the Highway Trust Fund has been made 
        before April 1, 2004.
            (2) Interest credited.--The amendment made by subsection 
        (b) shall take effect on the date of the enactment of this Act.

SEC. 5003. MODIFICATION OF ADJUSTMENTS OF APPORTIONMENTS.

    (a) In General.--Section 9503(d) (relating to adjustments for 
apportionments) is amended--
            (1) by striking ``24-month'' in paragraph (1)(B) and 
        inserting ``48-month'', and
            (2) by striking ``2 years''' in the heading for paragraph 
        (3) and inserting ``4 years'''.
    (b) Measurement of Net Highway Receipts.--Section 9503(d) is 
amended by redesignating paragraph (6) as paragraph (7) and by 
inserting after paragraph (5) the following new paragraph:
            ``(6) Measurement of net highway receipts.--For purposes of 
        making any estimate under paragraph (1) of net highway receipts 
        for periods ending after the date specified in subsection 
        (b)(1), the Secretary shall treat--
                    ``(A) each expiring provision of subsection (b) 
                which is related to appropriations or transfers to the 
                Highway Trust Fund to have been extended through the 
                end of the 48-month period referred to in paragraph 
                (1)(B), and
                    ``(B) with respect to each tax imposed under the 
                sections referred to in subsection (b)(1), the rate of 
                such tax during the 48-month period referred to in 
                paragraph (1)(B) to be the same as the rate of such tax 
                as in effect on the date of such estimate.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

            Subtitle B--Volumetric Ethanol Excise Tax Credit

SEC. 5101. SHORT TITLE.

    This subtitle may be cited as the ``Volumetric Ethanol Excise Tax 
Credit (VEETC) Act of 2004''.

SEC. 5102. ALCOHOL AND BIODIESEL EXCISE TAX CREDIT AND EXTENSION OF 
              ALCOHOL FUELS INCOME TAX CREDIT.

    (a) In General.--Subchapter B of chapter 65 (relating to rules of 
special application) is amended by inserting after section 6425 the 
following new section:

``SEC. 6426. CREDIT FOR ALCOHOL FUEL AND BIODIESEL MIXTURES.

    ``(a) Allowance of Credits.--There shall be allowed as a credit 
against the tax imposed by section 4081 an amount equal to the sum of--
            ``(1) the alcohol fuel mixture credit, plus
            ``(2) the biodiesel mixture credit.
    ``(b) Alcohol Fuel Mixture Credit.--
            ``(1) In general.--For purposes of this section, the 
        alcohol fuel mixture credit is the product of the applicable 
        amount and the number of gallons of alcohol used by the 
        taxpayer in producing any alcohol fuel mixture for sale or use 
        in a trade or business of the taxpayer.
            ``(2) Applicable amount.--For purposes of this subsection--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the applicable amount is 52 cents (51 
                cents in the case of any sale or use after 2004).
                    ``(B) Mixtures not containing ethanol.--In the case 
                of an alcohol fuel mixture in which none of the alcohol 
                consists of ethanol, the applicable amount is 60 cents.
            ``(3) Alcohol fuel mixture.--For purposes of this 
        subsection, the term `alcohol fuel mixture' means a mixture of 
        alcohol and a taxable fuel which--
                    ``(A) is sold by the taxpayer producing such 
                mixture to any person for use as a fuel,
                    ``(B) is used as a fuel by the taxpayer producing 
                such mixture, or
                    ``(C) is removed from the refinery by a person 
                producing such mixture.
            ``(4) Other definitions.--For purposes of this subsection--
                    ``(A) Alcohol.--The term `alcohol' includes 
                methanol and ethanol but does not include--
                            ``(i) alcohol produced from petroleum, 
                        natural gas, or coal (including peat), or
                            ``(ii) alcohol with a proof of less than 
                        190 (determined without regard to any added 
                        denaturants).
                Such term also includes an alcohol gallon equivalent of 
                ethyl tertiary butyl ether or other ethers produced 
                from such alcohol.
                    ``(B) Taxable fuel.--The term `taxable fuel' has 
                the meaning given such term by section 4083(a)(1).
            ``(5) Termination.--This subsection shall not apply to any 
        sale, use, or removal for any period after December 31, 2010.
    ``(c) Biodiesel Mixture Credit.--
            ``(1) In general.--For purposes of this section, the 
        biodiesel mixture credit is the product of the applicable 
        amount and the number of gallons of biodiesel used by the 
        taxpayer in producing any biodiesel mixture for sale or use in 
        a trade or business of the taxpayer.
            ``(2) Applicable amount.--For purposes of this subsection--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the applicable amount is 50 cents.
                    ``(B) Amount for agri-biodiesel.--In the case of 
                any biodiesel which is agri-biodiesel, the applicable 
                amount is $1.00.
            ``(3) Biodiesel mixture.--For purposes of this section, the 
        term `biodiesel mixture' means a mixture of biodiesel and 
        diesel fuel (as defined in section 4083(a)(3)), determined 
        without regard to any use of kerosene, which--
                    ``(A) is sold by the taxpayer producing such 
                mixture to any person for use as a fuel,
                    ``(B) is used as a fuel by the taxpayer producing 
                such mixture, or
                    ``(C) is removed from the refinery by a person 
                producing such mixture.
            ``(4) Certification for biodiesel.--No credit shall be 
        allowed under this section unless the taxpayer obtains a 
        certification (in such form and manner as prescribed by the 
        Secretary) from the producer of the biodiesel which identifies 
        the product produced and the percentage of biodiesel and agri-
        biodiesel in the product.
            ``(5) Other definitions.--Any term used in this subsection 
        which is also used in section 40A shall have the meaning given 
        such term by section 40A.
            ``(6) Termination.--This subsection shall not apply to any 
        sale, use, or removal for any period after December 31, 2006.
    ``(d) Mixture not used as a fuel, etc.--
            ``(1) Imposition of tax.--If--
                    ``(A) any credit was determined under this section 
                with respect to alcohol or biodiesel used in the 
                production of any alcohol fuel mixture or biodiesel 
                mixture, respectively, and
                    ``(B) any person--
                            ``(i) separates the alcohol or biodiesel 
                        from the mixture, or
                            ``(ii) without separation, uses the mixture 
                        other than as a fuel,
                then there is hereby imposed on such person a tax equal 
                to the product of the applicable amount and the number 
                of gallons of such alcohol or biodiesel.
            ``(2) Applicable laws.--All provisions of law, including 
        penalties, shall, insofar as applicable and not inconsistent 
        with this section, apply in respect of any tax imposed under 
        paragraph (1) as if such tax were imposed by section 4081 and 
        not by this section.
    ``(e) Coordination With Exemption From Excise Tax.--Rules similar 
to the rules under section 40(c) shall apply for purposes of this 
section.''.
    (b) Registration Requirement.--Section 4101(a)(1) (relating to 
registration), as amended by sections 5211 and 5242 of this Act, is 
amended by inserting ``and every person producing or importing 
biodiesel (as defined in section 40A(d)(1)) or alcohol (as defined in 
section 6426(b)(4)(A))'' after ``4081''.
    (c) Additional Amendments.--
            (1) Section 40(c) is amended by striking ``subsection 
        (b)(2), (k), or (m) of section 4041, section 4081(c), or 
        section 4091(c)'' and inserting ``section 4041(b)(2), section 
        6426, or section 6427(e)''.
            (2) Paragraph (4) of section 40(d) is amended to read as 
        follows:
            ``(4) Volume of alcohol.--For purposes of determining under 
        subsection (a) the number of gallons of alcohol with respect to 
        which a credit is allowable under subsection (a), the volume of 
        alcohol shall include the volume of any denaturant (including 
        gasoline) which is added under any formulas approved by the 
        Secretary to the extent that such denaturants do not exceed 5 
        percent of the volume of such alcohol (including 
        denaturants).''.
            (3) Section 40(e)(1) is amended--
                    (A) by striking ``2007'' in subparagraph (A) and 
                inserting ``2010'', and
                    (B) by striking ``2008'' in subparagraph (B) and 
                inserting ``2011''.
            (4) Section 40(h) is amended--
                    (A) by striking ``2007'' in paragraph (1) and 
                inserting ``2010'', and
                    (B) by striking ``, 2006, or 2007'' in the table 
                contained in paragraph (2) and inserting ``through 
                2010''.
            (5) Section 4041(b)(2)(B) is amended by striking ``a 
        substance other than petroleum or natural gas'' and inserting 
        ``coal (including peat)''.
            (6) Section 4041 is amended by striking subsection (k).
            (7) Section 4081 is amended by striking subsection (c).
            (8) Paragraph (2) of section 4083(a) is amended to read as 
        follows:
            ``(2) Gasoline.--The term `gasoline'--
                    ``(A) includes any gasoline blend, other than 
                qualified methanol or ethanol fuel (as defined in 
                section 4041(b)(2)(B)), partially exempt methanol or 
                ethanol fuel (as defined in section 4041(m)(2)), or a 
                denatured alcohol, and
                    ``(B) includes, to the extent prescribed in 
                regulations--
                            ``(i) any gasoline blend stock, and
                            ``(ii) any product commonly used as an 
                        additive in gasoline (other than alcohol).
        For purposes of subparagraph (B)(i), the term `gasoline blend 
        stock' means any petroleum product component of gasoline.''.
            (9) Section 6427 is amended by inserting after subsection 
        (d) the following new subsection:
    ``(e) Alcohol or Biodiesel Used To Produce Alcohol Fuel and 
Biodiesel Mixtures or Used as Fuels.--Except as provided in subsection 
(k)--
            ``(1) Used to produce a mixture.--If any person produces a 
        mixture described in section 6426 in such person's trade or 
        business, the Secretary shall pay (without interest) to such 
        person an amount equal to the alcohol fuel mixture credit or 
        the biodiesel mixture credit with respect to such mixture.
            ``(2) Used as fuel.--If alcohol (as defined in section 
        40(d)(1)) or biodiesel (as defined in section 40A(d)(1)) or 
        agri-biodiesel (as defined in section 40A(d)(2)) which is not 
        in a mixture described in section 6426--
                    ``(A) is used by any person as a fuel in a trade or 
                business, or
                    ``(B) is sold by any person at retail to another 
                person and placed in the fuel tank of such person's 
                vehicle,
        the Secretary shall pay (without interest) to such person an 
        amount equal to the alcohol credit (as determined under section 
        40(b)(2)) or the biodiesel credit (as determined under section 
        40A(b)(2)) with respect to such fuel.
            ``(3) Coordination with other repayment provisions.--No 
        amount shall be payable under paragraph (1) with respect to any 
        mixture with respect to which an amount is allowed as a credit 
        under section 6426.
            ``(4) Termination.--This subsection shall not apply with 
        respect to--
                    ``(A) any alcohol fuel mixture (as defined in 
                section 6426(b)(3)) or alcohol (as so defined) sold or 
                used after December 31, 2010, and
                    ``(B) any biodiesel mixture (as defined in section 
                6426(c)(3)) or biodiesel (as so defined) or agri-
                biodiesel (as so defined) sold or used after December 
                31, 2006.''.
            (10) Section 6427(i)(3) is amended--
                    (A) by striking ``subsection (f)'' both places it 
                appears in subparagraph (A) and inserting ``subsection 
                (e)(1)'',
                    (B) by striking ``gasoline, diesel fuel, or 
                kerosene used to produce a qualified alcohol mixture 
                (as defined in section 4081(c)(3))'' in subparagraph 
                (A) and inserting ``a mixture described in section 
                6426'',
                    (C) by adding at the end of subparagraph (A) the 
                following new flush sentence:
                ``In the case of an electronic claim, this subparagraph 
                shall be applied without regard to clause (i).'',
                    (D) by striking ``subsection (f)(1)'' in 
                subparagraph (B) and inserting ``subsection (e)(1)'',
                    (E) by striking ``20 days of the date of the filing 
                of such claim'' in subparagraph (B) and inserting ``45 
                days of the date of the filing of such claim (20 days 
                in the case of an electronic claim)'', and
                    (F) by striking ``alcohol mixture'' in the heading 
                and inserting ``alcohol fuel and biodiesel mixture''.
            (11) Section 9503(b)(1) is amended by adding at the end the 
        following new flush sentence:
        ``For purposes of this paragraph, taxes received under sections 
        4041 and 4081 shall be determined without reduction for credits 
        under section 6426.''.
            (12) Section 9503(b)(4), as amended by section 5101 of this 
        Act, is amended--
                    (A) by adding ``or'' at the end of subparagraph 
                (C),
                    (B) by striking the comma at the end of 
                subparagraph (D)(iii) and inserting a period, and
                    (C) by striking subparagraphs (E) and (F).
            (13) The table of sections for subchapter B of chapter 65 
        is amended by inserting after the item relating to section 6425 
        the following new item:

``Sec. 6426. Credit for alcohol fuel and biodiesel mixtures.''.
            (14) Tariff schedule.--Headings 9901.00.50 and 9901.00.52 
        of the Harmonized Tariff Schedule of the United States (19 
        U.S.C. 3007) are each amended in the effective period column by 
        striking ``10/1/2007'' each place it appears and inserting ``1/
        1/2011''.
    (d) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        fuel sold or used after September 30, 2004.
            (2) Registration requirement.--The amendment made by 
        subsection (b) shall take effect on April 1, 2005.
            (3) Extension of alcohol fuels credit.--The amendments made 
        by paragraphs (3), (4), and (14) of subsection (c) shall take 
        effect on the date of the enactment of this Act.
            (4) Repeal of general fund retention of certain alcohol 
        fuels taxes.--The amendments made by subsection (c)(12) shall 
        apply to fuel sold or used after September 30, 2003.
    (e) Format for Filing.--The Secretary of the Treasury shall 
describe the electronic format for filing claims described in section 
6427(i)(3)(B) of the Internal Revenue Code of 1986 (as amended by 
subsection (c)(10)(C)) not later than September 30, 2004.

SEC. 5103. BIODIESEL INCOME TAX CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
(relating to business related credits) is amended by inserting after 
section 40 the following new section:

``SEC. 40A. BIODIESEL USED AS FUEL.

    ``(a) General Rule.--For purposes of section 38, the biodiesel 
fuels credit determined under this section for the taxable year is an 
amount equal to the sum of--
            ``(1) the biodiesel mixture credit, plus
            ``(2) the biodiesel credit.
    ``(b) Definition of Biodiesel Mixture Credit and Biodiesel 
Credit.--For purposes of this section--
            ``(1) Biodiesel mixture credit.--
                    ``(A) In general.--The biodiesel mixture credit of 
                any taxpayer for any taxable year is 50 cents for each 
                gallon of biodiesel used by the taxpayer in the 
                production of a qualified biodiesel mixture.
                    ``(B) Qualified biodiesel mixture.--The term 
                `qualified biodiesel mixture' means a mixture of 
                biodiesel and diesel fuel (as defined in section 
                4083(a)(3)), determined without regard to any use of 
                kerosene, which--
                            ``(i) is sold by the taxpayer producing 
                        such mixture to any person for use as a fuel, 
                        or
                            ``(ii) is used as a fuel by the taxpayer 
                        producing such mixture.
                    ``(C) Sale or use must be in trade or business, 
                etc.--Biodiesel used in the production of a qualified 
                biodiesel mixture shall be taken into account--
                            ``(i) only if the sale or use described in 
                        subparagraph (B) is in a trade or business of 
                        the taxpayer, and
                            ``(ii) for the taxable year in which such 
                        sale or use occurs.
                    ``(D) Casual off-farm production not eligible.--No 
                credit shall be allowed under this section with respect 
                to any casual off-farm production of a qualified 
                biodiesel mixture.
            ``(2) Biodiesel credit.--
                    ``(A) In general.--The biodiesel credit of any 
                taxpayer for any taxable year is 50 cents for each 
                gallon of biodiesel which is not in a mixture with 
                diesel fuel and which during the taxable year--
                            ``(i) is used by the taxpayer as a fuel in 
                        a trade or business, or
                            ``(ii) is sold by the taxpayer at retail to 
                        a person and placed in the fuel tank of such 
                        person's vehicle.
                    ``(B) User credit not to apply to biodiesel sold at 
                retail.--No credit shall be allowed under subparagraph 
                (A)(i) with respect to any biodiesel which was sold in 
                a retail sale described in subparagraph (A)(ii).
            ``(3) Credit for agri-biodiesel.--In the case of any 
        biodiesel which is agri-biodiesel, paragraphs (1)(A) and (2)(A) 
        shall be applied by substituting `$1.00' for `50 cents'.
            ``(4) Certification for biodiesel.--No credit shall be 
        allowed under this section unless the taxpayer obtains a 
        certification (in such form and manner as prescribed by the 
        Secretary) from the producer or importer of the biodiesel which 
        identifies the product produced and the percentage of biodiesel 
        and agri-biodiesel in the product.
    ``(c) Coordination With Credit Against Excise Tax.--The amount of 
the credit determined under this section with respect to any biodiesel 
shall be properly reduced to take into account any benefit provided 
with respect to such biodiesel solely by reason of the application of 
section 6426 or 6427(e).
    ``(d) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Biodiesel.--The term `biodiesel' means the monoalkyl 
        esters of long chain fatty acids derived from plant or animal 
        matter which meet--
                    ``(A) the registration requirements for fuels and 
                fuel additives established by the Environmental 
                Protection Agency under section 211 of the Clean Air 
                Act (42 U.S.C. 7545), and
                    ``(B) the requirements of the American Society of 
                Testing and Materials D6751.
            ``(2) Agri-biodiesel.--The term `agri-biodiesel' means 
        biodiesel derived solely from virgin oils, including esters 
        derived from virgin vegetable oils from corn, soybeans, 
        sunflower seeds, cottonseeds, canola, crambe, rapeseeds, 
        safflowers, flaxseeds, rice bran, and mustard seeds, and from 
        animal fats.
            ``(3) Mixture or biodiesel not used as a fuel, etc.--
                    ``(A) Mixtures.--If--
                            ``(i) any credit was determined under this 
                        section with respect to biodiesel used in the 
                        production of any qualified biodiesel mixture, 
                        and
                            ``(ii) any person--
                                    ``(I) separates the biodiesel from 
                                the mixture, or
                                    ``(II) without separation, uses the 
                                mixture other than as a fuel,
                then there is hereby imposed on such person a tax equal 
                to the product of the rate applicable under subsection 
                (b)(1)(A) and the number of gallons of such biodiesel 
                in such mixture.
                    ``(B) Biodiesel.--If--
                            ``(i) any credit was determined under this 
                        section with respect to the retail sale of any 
                        biodiesel, and
                            ``(ii) any person mixes such biodiesel or 
                        uses such biodiesel other than as a fuel,
                then there is hereby imposed on such person a tax equal 
                to the product of the rate applicable under subsection 
                (b)(2)(A) and the number of gallons of such biodiesel.
                    ``(C) Applicable laws.--All provisions of law, 
                including penalties, shall, insofar as applicable and 
                not inconsistent with this section, apply in respect of 
                any tax imposed under subparagraph (A) or (B) as if 
                such tax were imposed by section 4081 and not by this 
                chapter.
            ``(4) Pass-thru in the case of estates and trusts.--Under 
        regulations prescribed by the Secretary, rules similar to the 
        rules of subsection (d) of section 52 shall apply.
    ``(e) Termination.--This section shall not apply to any sale or use 
after December 31, 2006.''.
    (b) Credit Treated as Part of General Business Credit.--Section 
38(b) (relating to current year business credit) is amended by striking 
``plus'' at the end of paragraph (14), by striking the period at the 
end of paragraph (15) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(16) the biodiesel fuels credit determined under section 
        40A(a).''.
    (c) Conforming Amendments.--
            (1) Section 39(d) is amended by adding at the end the 
        following new paragraph:
            ``(11) No carryback of biodiesel fuels credit before 
        effective date.--No portion of the unused business credit for 
        any taxable year which is attributable to the biodiesel fuels 
        credit determined under section 40A may be carried back to a 
        taxable year ending on or before September 30, 2004.''.
            (2)(A) Section 87 is amended to read as follows:

``SEC. 87. ALCOHOL AND BIODIESEL FUELS CREDITS.

    ``Gross income includes--
            ``(1) the amount of the alcohol fuels credit determined 
        with respect to the taxpayer for the taxable year under section 
        40(a), and
            ``(2) the biodiesel fuels credit determined with respect to 
        the taxpayer for the taxable year under section 40A(a).''.
            (B) The item relating to section 87 in the table of 
        sections for part II of subchapter B of chapter 1 is amended by 
        striking ``fuel credit'' and inserting ``and biodiesel fuels 
        credits''.
            (3) Section 196(c) is amended by striking ``and'' at the 
        end of paragraph (9), by striking the period at the end of 
        paragraph (10) and inserting ``, and'', and by adding at the 
        end the following new paragraph:
            ``(11) the biodiesel fuels credit determined under section 
        40A(a).''.
            (4) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 is amended by adding after the item 
        relating to section 40 the following new item:

``Sec. 40A. Biodiesel used as fuel.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to fuel produced, and sold or used, after September 30, 2004, in 
taxable years ending after such date.

                   Subtitle C--Fuel Fraud Prevention

SEC. 5200. SHORT TITLE.

    This subtitle may be cited as the ``Fuel Fraud Prevention Act of 
2004''.

                       PART I--AVIATION JET FUEL

SEC. 5211. TAXATION OF AVIATION-GRADE KEROSENE.

    (a) Rate of Tax.--
            (1) In general.--Subparagraph (A) of section 4081(a)(2) is 
        amended by striking ``and'' at the end of clause (ii), by 
        striking the period at the end of clause (iii) and inserting 
        ``, and'', and by adding at the end the following new clause:
                            ``(iv) in the case of aviation-grade 
                        kerosene, 21.8 cents per gallon.''.
            (2) Commercial aviation.--Paragraph (2) of section 4081(a) 
        is amended by adding at the end the following new subparagraph:
                    ``(C) Taxes imposed on fuel used in commercial 
                aviation.--In the case of aviation-grade kerosene which 
                is removed from any refinery or terminal directly into 
                the fuel tank of an aircraft for use in commercial 
                aviation, the rate of tax under subparagraph (A)(iv) 
                shall be 4.3 cents per gallon.''.
            (3) Nontaxable uses.--
                    (A) In general.--Section 4082 is amended by 
                redesignating subsections (e) and (f) as subsections 
                (f) and (g), respectively, and by inserting after 
                subsection (d) the following new subsection:
    ``(e) Aviation-Grade Kerosene.--In the case of aviation-grade 
kerosene which is exempt from the tax imposed by section 4041(c) (other 
than by reason of a prior imposition of tax) and which is removed from 
any refinery or terminal directly into the fuel tank of an aircraft, 
the rate of tax under section 4081(a)(2)(A)(iv) shall be zero.''.
                    (B) Conforming amendments.--
                            (i) Subsection (b) of section 4082 is 
                        amended by adding at the end the following new 
                        flush sentence: ``The term `nontaxable use' 
                        does not include the use of aviation-grade 
                        kerosene in an aircraft.''.
                            (ii) Section 4082(d) is amended by striking 
                        paragraph (1) and by redesignating paragraphs 
                        (2) and (3) as paragraphs (1) and (2), 
                        respectively.
            (4) Nonaircraft use of aviation-grade kerosene.--
                    (A) In general.--Subparagraph (B) of section 
                4041(a)(1) is amended by adding at the end the 
                following new sentence: ``This subparagraph shall not 
                apply to aviation-grade kerosene.''.
                    (B) Conforming amendment.--The heading for 
                paragraph (1) of section 4041(a) is amended by 
                inserting ``and kerosene'' after ``diesel fuel''.
    (b) Commercial Aviation.--Section 4083 is amended redesignating 
subsections (b) and (c) as subsections (c) and (d), respectively, and 
by inserting after subsection (a) the following new subsection:
    ``(b) Commercial Aviation.--For purposes of this subpart, the term 
`commercial aviation' means any use of an aircraft in a business of 
transporting persons or property for compensation or hire by air, 
unless properly allocable to any transportation exempt from the taxes 
imposed by section 4261 and 4271 by reason of section 4281 or 4282 or 
by reason of section 4261(h).''.
    (c) Refunds.--
            (1) In general.--Paragraph (4) of section 6427(l) is 
        amended to read as follows:
            ``(4) Refunds for aviation-grade kerosene.--
                    ``(A) No refund of certain taxes on fuel used in 
                commercial aviation.--In the case of aviation-grade 
                kerosene used in commercial aviation (as defined in 
                section 4083(b)) (other than supplies for vessels or 
                aircraft within the meaning of section 4221(d)(3)), 
                paragraph (1) shall not apply to so much of the tax 
                imposed by section 4081 as is attributable to--
                            ``(i) the Leaking Underground Storage Tank 
                        Trust Fund financing rate imposed by such 
                        section, and
                            ``(ii) so much of the rate of tax specified 
                        in section 4081(a)(2)(A)(iv) as does not exceed 
                        4.3 cents per gallon.
                    ``(B) Payment to ultimate, registered vendor.--With 
                respect to aviation-grade kerosene, if the ultimate 
                purchaser of such kerosene waives (at such time and in 
                such form and manner as the Secretary shall prescribe) 
                the right to payment under paragraph (1) and assigns 
                such right to the ultimate vendor, then the Secretary 
                shall pay the amount which would be paid under 
                paragraph (1) to such ultimate vendor, but only if such 
                ultimate vendor--
                            ``(i) is registered under section 4101, and
                            ``(ii) meets the requirements of 
                        subparagraph (A), (B), or (D) of section 
                        6416(a)(1).''.
            (2) Time for filing claims.--Paragraph (4) of section 
        6427(i) is amended by striking ``subsection (l)(5)'' and 
        inserting ``paragraph (4)(B) or (5) of subsection (l)''.
            (3) Conforming amendment.--Subparagraph (B) of section 
        6427(l)(2) is amended to read as follows:
                    ``(B) in the case of aviation-grade kerosene--
                            ``(i) any use which is exempt from the tax 
                        imposed by section 4041(c) other than by reason 
                        of a prior imposition of tax, or
                            ``(ii) any use in commercial aviation 
                        (within the meaning of section 4083(b)).''.
    (d) Repeal of Prior Taxation of Aviation Fuel.--
            (1) In general.--Part III of subchapter A of chapter 32 is 
        amended by striking subpart B and by redesignating subpart C as 
        subpart B.
            (2) Conforming amendments.--
                    (A) Section 4041(c) is amended to read as follows:
    ``(c) Aviation-Grade Kerosene.--
            ``(1) In general.--There is hereby imposed a tax upon 
        aviation-grade kerosene--
                    ``(A) sold by any person to an owner, lessee, or 
                other operator of an aircraft for use in such aircraft, 
                or
                    ``(B) used by any person in an aircraft unless 
                there was a taxable sale of such fuel under 
                subparagraph (A).
            ``(2) Exemption for previously taxed fuel.--No tax shall be 
        imposed by this subsection on the sale or use of any aviation-
        grade kerosene if tax was imposed on such liquid under section 
        4081 and the tax thereon was not credited or refunded.
            ``(3) Rate of tax.--The rate of tax imposed by this 
        subsection shall be the rate of tax specified in section 
        4081(a)(2)(A)(iv) which is in effect at the time of such sale 
        or use.''.
                    (B) Section 4041(d)(2) is amended by striking 
                ``section 4091'' and inserting ``section 4081''.
                    (C) Section 4041 is amended by striking subsection 
                (e).
                    (D) Section 4041 is amended by striking subsection 
                (i).
                    (E) Section 4041(m)(1) is amended to read as 
                follows:
            ``(1) In general.--In the case of the sale or use of any 
        partially exempt methanol or ethanol fuel, the rate of the tax 
        imposed by subsection (a)(2) shall be--
                    ``(A) after September 30, 1997, and before 
                September 30, 2009--
                            ``(i) in the case of fuel none of the 
                        alcohol in which consists of ethanol, 9.15 
                        cents per gallon, and
                            ``(ii) in any other case, 11.3 cents per 
                        gallon, and
                    ``(B) after September 30, 2009--
                            ``(i) in the case of fuel none of the 
                        alcohol in which consists of ethanol, 2.15 
                        cents per gallon, and
                            ``(ii) in any other case, 4.3 cents per 
                        gallon.''.
                    (F) Sections 4101(a), 4103, 4221(a), and 6206 are 
                each amended by striking ``, 4081, or 4091'' and 
                inserting ``or 4081''.
                    (G) Section 6416(b)(2) is amended by striking 
                ``4091 or''.
                    (H) Section 6416(b)(3) is amended by striking ``or 
                4091'' each place it appears.
                    (I) Section 6416(d) is amended by striking ``or to 
                the tax imposed by section 4091 in the case of refunds 
                described in section 4091(d)''.
                    (J) Section 6427 is amended by striking subsection 
                (f).
                    (K) Section 6427(j)(1) is amended by striking ``, 
                4081, and 4091'' and inserting ``and 4081''.
                    (L)(i) Section 6427(l)(1) is amended to read as 
                follows:
            ``(1) In general.--Except as otherwise provided in this 
        subsection and in subsection (k), if any diesel fuel or 
        kerosene on which tax has been imposed by section 4041 or 4081 
        is used by any person in a nontaxable use, the Secretary shall 
        pay (without interest) to the ultimate purchaser of such fuel 
        an amount equal to the aggregate amount of tax imposed on such 
        fuel under section 4041 or 4081, as the case may be, reduced by 
        any refund paid to the ultimate vendor under paragraph 
        (4)(B).''.
                    (ii) Paragraph (5)(B) of section 6427(l) is amended 
                by striking ``Paragraph (1)(A) shall not apply to 
                kerosene'' and inserting ``Paragraph (1) shall not 
                apply to kerosene (other than aviation-grade 
                kerosene)''.
                    (M) Subparagraph (B) of section 6724(d)(1) is 
                amended by striking clause (xv) and by redesignating 
                the succeeding clauses accordingly.
                    (N) Paragraph (2) of section 6724(d) is amended by 
                striking subparagraph (W) and by redesignating the 
                succeeding subparagraphs accordingly.
                    (O) Paragraph (1) of section 9502(b) is amended by 
                adding ``and'' at the end of subparagraph (B) and by 
                striking subparagraphs (C) and (D) and inserting the 
                following new subparagraph:
                    ``(C) section 4081 with respect to aviation 
                gasoline and aviation-grade kerosene, and''.
                    (P) The last sentence of section 9502(b) is amended 
                to read as follows:
``There shall not be taken into account under paragraph (1) so much of 
the taxes imposed by section 4081 as are determined at the rate 
specified in section 4081(a)(2)(B).''.
                    (Q) Subsection (b) of section 9508 is amended by 
                striking paragraph (3) and by redesignating paragraphs 
                (4) and (5) as paragraphs (3) and (4), respectively.
                    (R) Section 9508(c)(2)(A) is amended by striking 
                ``sections 4081 and 4091'' and inserting ``section 
                4081''.
                    (S) The table of subparts for part III of 
                subchapter A of chapter 32 is amended to read as 
                follows:

``Subpart A. Motor and aviation fuels.
``Subpart B. Special provisions applicable to fuels tax.''.
                    (T) The heading for subpart A of part III of 
                subchapter A of chapter 32 is amended to read as 
                follows:

                ``Subpart A--Motor and Aviation Fuels''.

                    (U) The heading for subpart B of part III of 
                subchapter A of chapter 32 is amended to read as 
                follows:

       ``Subpart B--Special Provisions Applicable to Fuels Tax''.

    (e) Effective Date.--The amendments made by this section shall 
apply to aviation-grade kerosene removed, entered, or sold after 
September 30, 2004.
    (f) Floor Stocks Tax.--
            (1) In general.--There is hereby imposed on aviation-grade 
        kerosene held on October 1, 2004, by any person a tax equal 
        to--
                    (A) the tax which would have been imposed before 
                such date on such kerosene had the amendments made by 
                this section been in effect at all times before such 
                date, reduced by
                    (B) the tax imposed before such date under section 
                4091 of the Internal Revenue Code of 1986, as in effect 
                on the day before the date of the enactment of this 
                Act.
            (2) Liability for tax and method of payment.--
                    (A) Liability for tax.--The person holding the 
                kerosene on October 1, 2004, to which the tax imposed 
                by paragraph (1) applies shall be liable for such tax.
                    (B) Method and time for payment.--The tax imposed 
                by paragraph (1) shall be paid at such time and in such 
                manner as the Secretary of the Treasury shall 
                prescribe, including the nonapplication of such tax on 
                de minimis amounts of kerosene.
            (3) Transfer of floor stock tax revenues to trust funds.--
        For purposes of determining the amount transferred to any trust 
        fund, the tax imposed by this subsection shall be treated as 
        imposed by section 4081 of the Internal Revenue Code of 1986--
                    (A) at the Leaking Underground Storage Tank Trust 
                Fund financing rate under such section to the extent of 
                0.1 cents per gallon, and
                    (B) at the rate under section 4081(a)(2)(A)(iv) to 
                the extent of the remainder.
            (4) Held by a person.--For purposes of this section, 
        kerosene shall be considered as held by a person if title 
        thereto has passed to such person (whether or not delivery to 
        the person has been made).
            (5) Other laws applicable.--All provisions of law, 
        including penalties, applicable with respect to the tax imposed 
        by section 4081 of such Code shall, insofar as applicable and 
        not inconsistent with the provisions of this subsection, apply 
        with respect to the floor stock tax imposed by paragraph (1) to 
        the same extent as if such tax were imposed by such section.

SEC. 5212. TRANSFER OF CERTAIN AMOUNTS FROM THE AIRPORT AND AIRWAY 
              TRUST FUND TO THE HIGHWAY TRUST FUND TO REFLECT HIGHWAY 
              USE OF JET FUEL.

    (a) In General.--Section 9502(d) is amended by adding at the end 
the following new paragraph:
            ``(7) Transfers from the trust fund to the highway trust 
        fund.--
                    ``(A) In general.--The Secretary shall pay annually 
                from the Airport and Airway Trust Fund into the Highway 
                Trust Fund an amount (as determined by him) equivalent 
                to amounts received in the Airport and Airway Trust 
                Fund which are attributable to fuel that is used 
                primarily for highway transportation purposes.
                    ``(B) Amounts transferred to mass transit 
                account.--The Secretary shall transfer 11 percent of 
                the amounts paid into the Highway Trust Fund under 
                subparagraph (A) to the Mass Transit Account 
                established under section 9503(e).''.
    (b) Conforming Amendments.--
            (1) Subsection (a) of section 9503 is amended--
                    (A) by striking ``appropriated or credited'' and 
                inserting ``paid, appropriated, or credited'', and
                    (B) by striking ``or section 9602(b)'' and 
                inserting ``, section 9502(d)(7), or section 9602(b)''.
            (2) Subsection (e)(1) of section 9503 is amended by 
        striking ``or section 9602(b)'' and inserting ``, section 
        9502(d)(7), or section 9602(b)''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

                           PART II--DYED FUEL

SEC. 5221. DYE INJECTION EQUIPMENT.

    (a) In General.--Section 4082(a)(2) (relating to exemptions for 
diesel fuel and kerosene) is amended by inserting ``by mechanical 
injection'' after ``indelibly dyed''.
    (b) Dye Injector Security.--Not later than June 30, 2004, the 
Secretary of the Treasury shall issue regulations regarding mechanical 
dye injection systems described in the amendment made by subsection 
(a), and such regulations shall include standards for making such 
systems tamper resistant.
    (c) Penalty for Tampering With or Failing To Maintain Security 
Requirements for Mechanical Dye Injection Systems.--
            (1) In general.--Part I of subchapter B of chapter 68 
        (relating to assessable penalties) is amended by adding after 
        section 6715 the following new section:

``SEC. 6715A. TAMPERING WITH OR FAILING TO MAINTAIN SECURITY 
              REQUIREMENTS FOR MECHANICAL DYE INJECTION SYSTEMS.

    ``(a) Imposition of Penalty--
            ``(1) Tampering.--If any person tampers with a mechanical 
        dye injection system used to indelibly dye fuel for purposes of 
        section 4082, then such person shall pay a penalty in addition 
        to the tax (if any).
            ``(2) Failure to maintain security requirements.--If any 
        operator of a mechanical dye injection system used to indelibly 
        dye fuel for purposes of section 4082 fails to maintain the 
        security standards for such system as established by the 
        Secretary, then such operator shall pay a penalty.
    ``(b) Amount of Penalty.--The amount of the penalty under 
subsection (a) shall be--
            ``(1) for each violation described in paragraph (1), the 
        greater of--
                    ``(A) $25,000, or
                    ``(B) $10 for each gallon of fuel involved, and
            ``(2) for each--
                    ``(A) failure to maintain security standards 
                described in paragraph (2), $1,000, and
                    ``(B) failure to correct a violation described in 
                paragraph (2), $1,000 per day for each day after which 
                such violation was discovered or such person should 
                have reasonably known of such violation.
    ``(c) Joint and Several Liability.--
            ``(1) In general.--If a penalty is imposed under this 
        section on any business entity, each officer, employee, or 
        agent of such entity or other contracting party who willfully 
        participated in any act giving rise to such penalty shall be 
        jointly and severally liable with such entity for such penalty.
            ``(2) Affiliated groups.--If a business entity described in 
        paragraph (1) is part of an affiliated group (as defined in 
        section 1504(a)), the parent corporation of such entity shall 
        be jointly and severally liable with such entity for the 
        penalty imposed under this section.''.
            (2) Clerical amendment.--The table of sections for part I 
        of subchapter B of chapter 68 is amended by adding after the 
        item related to section 6715 the following new item:

``Sec. 6715A. Tampering with or failing to maintain security 
                            requirements for mechanical dye injection 
                            systems.''.
    (d) Effective Date.--The amendments made by subsections (a) and (c) 
shall take effect 180 days after the date on which the Secretary issues 
the regulations described in subsection (b).

SEC. 5222. ELIMINATION OF ADMINISTRATIVE REVIEW FOR TAXABLE USE OF DYED 
              FUEL.

    (a) In General.--Section 6715 is amended by inserting at the end 
the following new subsection:
    ``(e) No Administrative Appeal for Third and Subsequent 
Violations.--In the case of any person who is found to be subject to 
the penalty under this section after a chemical analysis of such fuel 
and who has been penalized under this section at least twice after the 
date of the enactment of this subsection, no administrative appeal or 
review shall be allowed with respect to such finding except in the case 
of a claim regarding--
            ``(1) fraud or mistake in the chemical analysis, or
            ``(2) mathematical calculation of the amount of the 
        penalty.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to penalties assessed after the date of the enactment of this Act.

SEC. 5223. PENALTY ON UNTAXED CHEMICALLY ALTERED DYED FUEL MIXTURES.

    (a) In General.--Section 6715(a) (relating to dyed fuel sold for 
use or used in taxable use, etc.) is amended by striking ``or'' in 
paragraph (2), by inserting ``or'' at the end of paragraph (3), and by 
inserting after paragraph (3) the following new paragraph:
            ``(4) any person who has knowledge that a dyed fuel which 
        has been altered as described in paragraph (3) sells or holds 
        for sale such fuel for any use which the person knows or has 
        reason to know is not a nontaxable use of such fuel,''.
    (b) Conforming Amendment.--Section 6715(a)(3) is amended by 
striking ``alters, or attempts to alter,'' and inserting ``alters, 
chemically or otherwise, or attempts to so alter,''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5224. TERMINATION OF DYED DIESEL USE BY INTERCITY BUSES.

    (a) In General.--Paragraph (3) of section 4082(b) (relating to 
nontaxable use) is amended to read as follows:
            ``(3) any use described in section 
        4041(a)(1)(C)(iii)(II).''.
    (b) Ultimate Vendor Refund.--Subsection (b) of section 6427 is 
amended by adding at the end the following new paragraph:
            ``(4) Refunds for use of diesel fuel in certain intercity 
        buses.--
                    ``(A) In general.--With respect to any fuel to 
                which paragraph (2)(A) applies, if the ultimate 
                purchaser of such fuel waives (at such time and in such 
                form and manner as the Secretary shall prescribe) the 
                right to payment under paragraph (1) and assigns such 
                right to the ultimate vendor, then the Secretary shall 
                pay the amount which would be paid under paragraph (1) 
                to such ultimate vendor, but only if such ultimate 
                vendor--
                            ``(i) is registered under section 4101, and
                            ``(ii) meets the requirements of 
                        subparagraph (A), (B), or (D) of section 
                        6416(a)(1).
                    ``(B) Credit cards.--For purposes of this 
                paragraph, if the sale of such fuel is made by means of 
                a credit card, the person extending credit to the 
                ultimate purchaser shall be deemed to be the ultimate 
                vendor.''.
    (c) Payment of Refunds.--Subparagraph (A) of section 6427(i)(4), as 
amended by section 5211 of this Act, is amended by inserting 
``subsections (b)(4) and'' after ``filed under''.
    (b) Effective Date.--The amendments made by this section shall 
apply to fuel sold after September 30, 2004.

       PART III--MODIFICATION OF INSPECTION OF RECORDS PROVISIONS

SEC. 5231. AUTHORITY TO INSPECT ON-SITE RECORDS.

    (a) In General.--Section 4083(d)(1)(A) (relating to administrative 
authority), as amended by section 5211 of this Act, is amended by 
striking ``and'' at the end of clause (i) and by inserting after clause 
(ii) the following new clause:
                            ``(iii) inspecting any books and records 
                        and any shipping papers pertaining to such 
                        fuel, and''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5232. ASSESSABLE PENALTY FOR REFUSAL OF ENTRY.

    (a) In General.--Part I of subchapter B of chapter 68 (relating to 
assessable penalties), as amended by section 5221 of this Act, is 
amended by adding at the end the following new section:

``SEC. 6717. REFUSAL OF ENTRY.

    ``(a) In General.--In addition to any other penalty provided by 
law, any person who refuses to admit entry or refuses to permit any 
other action by the Secretary authorized by section 4083(d)(1) shall 
pay a penalty of $1,000 for such refusal.
    ``(b) Joint and Several Liability.--
            ``(1) In general.--If a penalty is imposed under this 
        section on any business entity, each officer, employee, or 
        agent of such entity or other contracting party who willfully 
        participated in any act giving rise to such penalty shall be 
        jointly and severally liable with such entity for such penalty.
            ``(2) Affiliated groups.--If a business entity described in 
        paragraph (1) is part of an affiliated group (as defined in 
        section 1504(a)), the parent corporation of such entity shall 
        be jointly and severally liable with such entity for the 
        penalty imposed under this section.
    ``(c) Reasonable Cause Exception.--No penalty shall be imposed 
under this section with respect to any failure if it is shown that such 
failure is due to reasonable cause.''.
    (b) Conforming Amendments.--
            (1) Section 4083(d)(3), as amended by section 5211 of this 
        Act, is amended--
                    (A) by striking ``entry.--The penalty'' and 
                inserting: ``entry.--
                    ``(A) Forfeiture.--The penalty'', and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(B) Assessable penalty.--For additional 
                assessable penalty for the refusal to admit entry or 
                other refusal to permit an action by the Secretary 
                authorized by paragraph (1), see section 6717.''.
            (2) The table of sections for part I of subchapter B of 
        chapter 68, as amended by section 5221 of this Act, is amended 
        by adding at the end the following new item:

``Sec. 6717. Refusal of entry.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

            PART IV--REGISTRATION AND REPORTING REQUIREMENTS

SEC. 5241. REGISTRATION OF PIPELINE OR VESSEL OPERATORS REQUIRED FOR 
              EXEMPTION OF BULK TRANSFERS TO REGISTERED TERMINALS OR 
              REFINERIES.

    (a) In General.--Section 4081(a)(1)(B) (relating to exemption for 
bulk transfers to registered terminals or refineries) is amended--
            (1) by inserting ``by pipeline or vessel'' after 
        ``transferred in bulk'', and
            (2) by inserting ``, the operator of such pipeline or 
        vessel,'' after ``the taxable fuel''.
    (b) Civil Penalty for Carrying Taxable Fuels by Nonregistered 
Pipelines or Vessels.--
            (1) In general.--Part I of subchapter B of chapter 68 
        (relating to assessable penalties), as amended by section 5232 
        of this Act, is amended by adding at the end the following new 
        section:

``SEC. 6718. CARRYING TAXABLE FUELS BY NONREGISTERED PIPELINES OR 
              VESSELS.

    ``(a) Imposition of Penalty.--If any person knowingly transfers any 
taxable fuel (as defined in section 4083(a)(1)) in bulk pursuant to 
section 4081(a)(1)(B) to an unregistered, such person shall pay a 
penalty in addition to the tax (if any).
    ``(b) Amount of Penalty.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        amount of the penalty under subsection (a) on each act shall be 
        an amount equal to the greater of--
                    ``(A) $10,000, or
                    ``(B) $1 per gallon.
            ``(2) Multiple violations.--In determining the penalty 
        under subsection (a) on any person, paragraph (1) shall be 
        applied by increasing the amount in paragraph (1) by the 
        product of such amount and the number of prior penalties (if 
        any) imposed by this section on such person (or a related 
        person or any predecessor of such person or related person).
    ``(c) Joint and Several Liability.--
            ``(1) In general.--If a penalty is imposed under this 
        section on any business entity, each officer, employee, or 
        agent of such entity or other contracting party who willfully 
        participated in any act giving rise to such penalty shall be 
        jointly and severally liable with such entity for such penalty.
            ``(2) Affiliated groups.--If a business entity described in 
        paragraph (1) is part of an affiliated group (as defined in 
        section 1504(a)), the parent corporation of such entity shall 
        be jointly and severally liable with such entity for the 
        penalty imposed under this section.
    ``(d) Reasonable Cause Exception.--No penalty shall be imposed 
under this section with respect to any failure if it is shown that such 
failure is due to reasonable cause.''.
            (2) Clerical amendment.--The table of sections for part I 
        of subchapter B of chapter 68, as amended by section 5232 of 
        this Act, is amended by adding at the end the following new 
        item:

``Sec. 6718. Carrying taxable fuels by nonregistered pipelines or 
                            vessels.''.
    (c) Publication of Registered Persons.--Not later than June 30, 
2004, the Secretary of the Treasury shall publish a list of persons 
required to be registered under section 4101 of the Internal Revenue 
Code of 1986.
    (d) Effective Date.--The amendments made by subsections (a) and (b) 
shall take effect on October 1, 2004.

SEC. 5242. DISPLAY OF REGISTRATION.

    (a) In General.--Subsection (a) of section 4101 (relating to 
registration) is amended--
            (1) by striking ``Every'' and inserting the following:
            ``(1) In general.--Every'', and
            (2) by adding at the end the following new paragraph:
            ``(2) Display of registration.--Every operator of a vessel 
        required by the Secretary to register under this section shall 
        display proof of registration through an electronic 
        identification device prescribed by the Secretary on each 
        vessel used by such operator to transport any taxable fuel.''.
    (b) Civil Penalty for Failure to Display Registration.--
            (1) In general.--Part I of subchapter B of chapter 68 
        (relating to assessable penalties), as amended by section 5241 
        of this Act, is amended by adding at the end the following new 
        section:

``SEC. 6719. FAILURE TO DISPLAY REGISTRATION OF VESSEL.

    ``(a) Failure to Display Registration.--Every operator of a vessel 
who fails to display proof of registration pursuant to section 
4101(a)(2) shall pay a penalty of $500 for each such failure. With 
respect to any vessel, only one penalty shall be imposed by this 
section during any calendar month.
    ``(b) Multiple Violations.--In determining the penalty under 
subsection (a) on any person, subsection (a) shall be applied by 
increasing the amount in subsection (a) by the product of such amount 
and the number of prior penalties (if any) imposed by this section on 
such person (or a related person or any predecessor of such person or 
related person).
    ``(c) Reasonable Cause Exception.--No penalty shall be imposed 
under this section with respect to any failure if it is shown that such 
failure is due to reasonable cause.''.
            (2) Clerical amendment.--The table of sections for part I 
        of subchapter B of chapter 68, as amended by section 5241 of 
        this Act, is amended by adding at the end the following new 
        item:

``Sec. 6719. Failure to display registration of vessel.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

SEC. 5243. REGISTRATION OF PERSONS WITHIN FOREIGN TRADE ZONES, ETC.

    (a) In General.--Section 4101(a), as amended by section 5242 of 
this Act, is amended by redesignating paragraph (2) as paragraph (3), 
and by inserting after paragraph (1) the following new paragraph:
            ``(2) Registration of persons within foreign trade zones, 
        etc..--The Secretary shall require registration by any person 
        which--
                    ``(A) operates a terminal or refinery within a 
                foreign trade zone or within a customs bonded storage 
                facility, or
                    ``(B) holds an inventory position with respect to a 
                taxable fuel in such a terminal.''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

SEC. 5244. PENALTIES FOR FAILURE TO REGISTER AND FAILURE TO REPORT.

    (a) Increased Penalty.--Subsection (a) of section 7272 (relating to 
penalty for failure to register) is amended by inserting ``($10,000 in 
the case of a failure to register under section 4101)'' after ``$50''.
    (b) Increased Criminal Penalty.--Section 7232 (relating to failure 
to register under section 4101, false representations of registration 
status, etc.) is amended by striking ``$5,000'' and inserting 
``$10,000''.
    (c) Assessable Penalty for Failure to Register.--
            (1) In general.--Part I of subchapter B of chapter 68 
        (relating to assessable penalties), as amended by section 5242 
        of this Act, is amended by adding at the end the following new 
        section:

``SEC. 6720. FAILURE TO REGISTER.

    ``(a) Failure to Register.--Every person who is required to 
register under section 4101 and fails to do so shall pay a penalty in 
addition to the tax (if any).
    ``(b) Amount of Penalty.--The amount of the penalty under 
subsection (a) shall be--
            ``(1) $10,000 for each initial failure to register, and
            ``(2) $1,000 for each day thereafter such person fails to 
        register.
    ``(c) Reasonable Cause Exception.--No penalty shall be imposed 
under this section with respect to any failure if it is shown that such 
failure is due to reasonable cause.''.
            (2) Clerical amendment.--The table of sections for part I 
        of subchapter B of chapter 68, as amended by section 5242 of 
        this Act, is amended by adding at the end the following new 
        item:

``Sec. 6720. Failure to register.''.
    (d) Assessable Penalty for Failure to Report.--
            (1) In general.--Part II of subchapter B of chapter 68 
        (relating to assessable penalties) is amended by adding at the 
        end the following new section:

``SEC. 6725. FAILURE TO REPORT INFORMATION UNDER SECTION 4101.

    ``(a) In General.--In the case of each failure described in 
subsection (b) by any person with respect to a vessel or facility, such 
person shall pay a penalty of $10,000 in addition to the tax (if any).
    ``(b) Failures Subject to Penalty.--For purposes of subsection (a), 
the failures described in this subsection are--
            ``(1) any failure to make a report under section 4101(d) on 
        or before the date prescribed therefor, and
            ``(2) any failure to include all of the information 
        required to be shown on such report or the inclusion of 
        incorrect information.
    ``(c) Reasonable Cause Exception.--No penalty shall be imposed 
under this section with respect to any failure if it is shown that such 
failure is due to reasonable cause.''.
            (2) Clerical amendment.--The table of sections for part II 
        of subchapter B of chapter 68 is amended by adding at the end 
        the following new item:

``Sec. 6725. Failure to report information under section 4101.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to failures pending or occurring after September 30, 2004.

SEC. 5245. INFORMATION REPORTING FOR PERSONS CLAIMING CERTAIN TAX 
              BENEFITS.

    (a) In General.--Subpart C of part III of subchapter A of chapter 
32 is amended by adding at the end the following new section:

``SEC. 4104. INFORMATION REPORTING FOR PERSONS CLAIMING CERTAIN TAX 
              BENEFITS.

    ``(a) In General.--The Secretary shall require any person claiming 
tax benefits--
            ``(1) under the provisions of section 34, 40, and 40A to 
        file a return at the time such person claims such benefits (in 
        such manner as the Secretary may prescribe), and
            ``(2) under the provisions of section 4041(b)(2), 6426, or 
        6427(e) to file a monthly return (in such manner as the 
        Secretary may prescribe).
    ``(b) Contents of Return.--Any return filed under this section 
shall provide such information relating to such benefits and the 
coordination of such benefits as the Secretary may require to ensure 
the proper administration and use of such benefits.
    ``(c) Enforcement.--With respect to any person described in 
subsection (a) and subject to registration requirements under this 
title, rules similar to rules of section 4222(c) shall apply with 
respect to any requirement under this section.''.
    (b) Conforming Amendment.--The table of sections for subpart C of 
part III of subchapter A of chapter 32 is amended by adding at the end 
the following new item:

``Sec. 4104. Information reporting for persons claiming certain tax 
                            benefits.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

SEC. 5246. ELECTRONIC REPORTING.

    (a) In General.--Section 4101(d), as amended by section 5273 of 
this Act, is amended by adding at the end the following new sentence: 
``Any person who is required to report under this subsection and who 
has 25 or more reportable transactions in a month shall file such 
report in electronic format.''.
    (b) Effective Date.--The amendments made by this section shall 
apply on October 1, 2004.

                            PART V--IMPORTS

SEC. 5251. TAX AT POINT OF ENTRY WHERE IMPORTER NOT REGISTERED.

    (a) Tax at Point of Entry Where Importer Not Registered.--
            (1) In general.--Subpart C of part III of subchapter A of 
        chapter 31, as amended by section 5245 of this Act, is amended 
        by adding at the end the following new section:

``SEC. 4105. TAX AT ENTRY WHERE IMPORTER NOT REGISTERED.

    ``(a) In General.--Any tax imposed under this part on any person 
not registered under section 4101 for the entry of a fuel into the 
United States shall be imposed at the time and point of entry.
    ``(b) Enforcement of Assessment.--If any person liable for any tax 
described under subsection (a) has not paid the tax or posted a bond, 
the Secretary may--
            ``(1) seize the fuel on which the tax is due, or
            ``(2) detain any vehicle transporting such fuel,
until such tax is paid or such bond is filed.
    ``(c) Levy of Fuel.--If no tax has been paid or no bond has been 
filed within 5 days from the date the Secretary seized fuel pursuant to 
subsection (b), the Secretary may sell such fuel as provided under 
section 6336.''.
            (2) Conforming amendment.--The table of sections for 
        subpart C of part III of subchapter A of chapter 31 of the 
        Internal Revenue Code of 1986, as amended by section 5245 of 
        this Act, is amended by adding after the last item the 
        following new item:

``Sec. 4105. Tax at entry where importer not registered.''.
    (b) Denial of Entry Where Tax Not Paid.--The Secretary of Homeland 
Security is authorized to deny entry into the United States of any 
shipment of a fuel which is taxable under section 4081 of the Internal 
Revenue Code of 1986 if the person entering such shipment fails to pay 
the tax imposed under such section or post a bond in accordance with 
the provisions of section 4105 of such Code.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5252. RECONCILIATION OF ON-LOADED CARGO TO ENTERED CARGO.

    (a) In General.--Subsection (a) of section 343 of the Trade Act of 
2002 is amended by inserting at the end the following new paragraph:
            ``(4) In General.--Subject to paragraphs (2) and (3), not 
        later than 1 year after the enactment of this paragraph, the 
        Secretary of Homeland Security, together with the Secretary of 
        the Treasury, shall promulgate regulations providing for the 
        transmission to the Internal Revenue Service, through an 
        electronic data interchange system, of information pertaining 
        to cargo of taxable fuels (as defined in section 4083 of the 
        Internal Revenue Code of 1986) destined for importation into 
        the United States prior to such importation.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

                   PART VI--MISCELLANEOUS PROVISIONS

SEC. 5261. TAX ON SALE OF DIESEL FUEL WHETHER SUITABLE FOR USE OR NOT 
              IN A DIESEL-POWERED VEHICLE OR TRAIN.

    (a) In General.--Section 4083(a)(3) is amended--
            (1) by striking ``The term'' and inserting the following:
                    ``(A) In general.--The term'', and
            (2) by inserting at the end the following new subparagraph:
                    ``(B) Liquid sold as diesel fuel.--The term `diesel 
                fuel' includes any liquid which is sold as or offered 
                for sale as a fuel in a diesel-powered highway vehicle 
                or a diesel-powered train.''.
    (b) Conforming Amendments.--
            (1) Section 40A(b)(1)(B), as amended by section 5103 of 
        this Act, is amended by striking ``4083(a)(3)'' and inserting 
        ``4083(a)(3)(A)''.
            (2) Section 6426(c)(3), as added by section 5102 of this 
        Act, is amended by striking ``4083(a)(3)'' and inserting 
        ``4083(a)(3)(A)''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5262. MODIFICATION OF ULTIMATE VENDOR REFUND CLAIMS WITH RESPECT 
              TO FARMING.

    (a) In General.--
            (1) Refunds.--Section 6427(l) is amended by adding at the 
        end the following new paragraph:
            ``(6) Registered vendors permitted to administer certain 
        claims for refund of diesel fuel and kerosene sold to 
        farmers.--
                    ``(A) In general.--In the case of diesel fuel or 
                kerosene used on a farm for farming purposes (within 
                the meaning of section 6420(c)), paragraph (1) shall 
                not apply to the aggregate amount of such diesel fuel 
                or kerosene if such amount does not exceed 500 gallons 
                (as determined under subsection (i)(5)(A)(iii)).
                    ``(B) Payment to ultimate vendor.--The amount which 
                would (but for subparagraph (A)) have been paid under 
                paragraph (1) with respect to any fuel shall be paid to 
                the ultimate vendor of such fuel, if such vendor--
                            ``(i) is registered under section 4101, and
                            ``(ii) meets the requirements of 
                        subparagraph (A), (B), or (D) of section 
                        6416(a)(1).''.
            (2) Filing of claims.--Section 6427(i) is amended by 
        inserting at the end the following new paragraph:
            ``(5) Special rule for vendor refunds with respect to 
        farmers.--
                    ``(A) In general.--A claim may be filed under 
                subsection (l)(6) by any person with respect to fuel 
                sold by such person for any period--
                            ``(i) for which $200 or more ($100 or more 
                        in the case of kerosene) is payable under 
                        subsection (l)(6),
                            ``(ii) which is not less than 1 week, and
                            ``(iii) which is for not more than 500 
                        gallons for each farmer for which there is a 
                        claim.
                Notwithstanding subsection (l)(1), paragraph (3)(B) 
                shall apply to claims filed under the preceding 
                sentence.
                    ``(B) Time for filing claim.--No claim filed under 
                this paragraph shall be allowed unless filed on or 
                before the last day of the first quarter following the 
                earliest quarter included in the claim.''.
            (3) Conforming amendments.--
                    (A) Section 6427(l)(5)(A) is amended to read as 
                follows:
                    ``(A) In general.--Paragraph (1) shall not apply to 
                diesel fuel or kerosene used by a State or local 
                government.''.
                    (B) The heading for section 6427(l)(5) is amended 
                by striking ``farmers and''.
    (b) Effective Date.--The amendment made by this section shall apply 
to fuels sold for nontaxable use after the date of the enactment of 
this Act.

SEC. 5263. TAXABLE FUEL REFUNDS FOR CERTAIN ULTIMATE VENDORS.

    (a) In General.--Paragraph (4) of section 6416(a) (relating to 
abatements, credits, and refunds) is amended to read as follows:
            ``(4) Registered ultimate vendor to administer credits and 
        refunds of gasoline tax.--
                    ``(A) In general.--For purposes of this subsection, 
                if an ultimate vendor purchases any gasoline on which 
                tax imposed by section 4081 has been paid and sells 
                such gasoline to an ultimate purchaser described in 
                subparagraph (C) or (D) of subsection (b)(2) (and such 
                gasoline is for a use described in such subparagraph), 
                such ultimate vendor shall be treated as the person 
                (and the only person) who paid such tax, but only if 
                such ultimate vendor is registered under section 4101. 
                For purposes of this subparagraph, if the sale of 
                gasoline is made by means of a credit card, the person 
                extending the credit to the ultimate purchaser shall be 
                deemed to be the ultimate vendor.
                    ``(B) Timing of claims.--The procedure and timing 
                of any claim under subparagraph (A) shall be the same 
                as for claims under section 6427(i)(4), except that the 
                rules of section 6427(i)(3)(B) regarding electronic 
                claims shall not apply unless the ultimate vendor has 
                certified to the Secretary for the most recent quarter 
                of the taxable year that all ultimate purchasers of the 
                vendor are certified and entitled to a refund under 
                subparagraph (C) or (D) of subsection (b)(2).''.
    (b) Credit Card Purchases of Diesel Fuel or Kerosene by State and 
Local Governments.--Section 6427(l)(5)(C) (relating to nontaxable uses 
of diesel fuel, kerosene, and aviation fuel), as amended by section 
5252 of this Act, is amended by adding at the end the following new 
sentence: ``For purposes of this subparagraph, if the sale of diesel 
fuel or kerosene is made by means of a credit card, the person 
extending the credit to the ultimate purchaser shall be deemed to be 
the ultimate vendor.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

SEC. 5264. TWO-PARTY EXCHANGES.

    (a) In General.--Subpart C of part III of subchapter A of chapter 
32, as amended by section 5251 of this Act, is amended by adding at the 
end the following new section:

``SEC. 4106. TWO-PARTY EXCHANGES.

    ``(a) In General.--In a two-party exchange, the delivering person 
shall not be liable for the tax imposed under of section 
4081(a)(1)(A)(ii).
    ``(b) Two-Party Exchange.--The term `two-party exchange' means a 
transaction, other than a sale, in which taxable fuel is transferred 
from a delivering person registered under section 4101 as a taxable 
fuel registrant to a receiving person who is so registered where all of 
the following occur:
            ``(1) The transaction includes a transfer from the 
        delivering person, who holds the inventory position for taxable 
        fuel in the terminal as reflected in the records of the 
        terminal operator.
            ``(2) The exchange transaction occurs before or 
        contemporaneous with completion of removal across the rack from 
        the terminal by the receiving person.
            ``(3) The terminal operator in its books and records treats 
        the receiving person as the person that removes the product 
        across the terminal rack for purposes of reporting the 
        transaction to the Secretary.
            ``(4) The transaction is the subject of a written 
        contract.''.
    (b) Conforming Amendment.--The table of sections for subpart C of 
part III of subchapter A of chapter 32, as amended by section 5251 of 
this Act, is amended by adding after the last item the following new 
item:

``Sec. 4106. Two-party exchanges.''.
    (c) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5265. MODIFICATIONS OF TAX ON USE OF CERTAIN VEHICLES.

    (a) No Proration of Tax Unless Vehicle Is Destroyed or Stolen.--
            (1) In general.--Section 4481(c) (relating to proration of 
        tax) is amended to read as follows:
    ``(c) Proration of Tax Where Vehicle Sold, Destroyed, or Stolen.--
            ``(1) In general.--If in any taxable period a highway motor 
        vehicle is sold, destroyed, or stolen before the first day of 
        the last month in such period and not subsequently used during 
        such taxable period, the tax shall be reckoned proportionately 
        from the first day of the month in such period in which the 
        first use of such highway motor vehicle occurs to and including 
        the last day of the month in which such highway motor vehicle 
        was sold, destroyed, or stolen.
            ``(2) Destroyed.--For purposes of paragraph (1), a highway 
        motor vehicle is destroyed if such vehicle is damaged by reason 
        of an accident or other casualty to such an extent that it is 
        not economic to rebuild.''.
            (2) Conforming amendments.--
                    (A) Section 6156 (relating to installment payment 
                of tax on use of highway motor vehicles) is repealed.
                    (B) The table of sections for subchapter A of 
                chapter 62 is amended by striking the item relating to 
                section 6156.
    (b) Display of Tax Certificate.--Paragraph (2) of section 4481(d) 
(relating to one tax liability for period) is amended to read as 
follows:
            ``(2) Display of tax certificate.--Every taxpayer which 
        pays the tax imposed under this section with respect to a 
        highway motor vehicle shall, not later than 1 month after the 
        due date of the return of tax with respect to each taxable 
        period, receive and display on such vehicle an electronic 
        identification device prescribed by the Secretary.''.
    (c) Electronic filing.--Section 4481, as amended by section 5001 of 
this Act, is amended by redesignating subsection (e) as subsection (f) 
and by inserting after subsection (d) the following new subsection:
    ``(e) Electronic filing.--Any taxpayer who files a return under 
this section with respect to 25 or more vehicles for any taxable period 
shall file such return electronically.''.
    (d) Repeal of reduction in tax for certain trucks.--Section 4483 of 
the Internal Revenue Code of 1986 is amended by striking subsection 
(f).
    (e) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable periods 
        beginning after the date of the enactment of this Act.
            (2) Subsection (b).--The amendment made by subsection (b) 
        shall take effect on October 1, 2005.

SEC. 5266. DEDICATION OF REVENUES FROM CERTAIN PENALTIES TO THE HIGHWAY 
              TRUST FUND.

    (a) In General.--Subsection (b) of section 9503 (relating to 
transfer to Highway Trust Fund of amounts equivalent to certain taxes), 
as amended by section 5001 of this Act, is amended by redesignating 
paragraph (5) as paragraph (6) and inserting after paragraph (4) the 
following new paragraph:
            ``(5) Certain penalties.--There are hereby appropriated to 
        the Highway Trust Fund amounts equivalent to the penalties 
        assessed under sections 6715, 6715A, 6717, 6718, 6719, 6720, 
        6725, 7232, and 7272 (but only with regard to penalties under 
        such section related to failure to register under section 
        4101).''.
    (b) Conforming Amendments.--
            (1) The heading of subsection (b) of section 9503 is 
        amended by inserting ``and Penalties'' after ``Taxes''.
            (2) The heading of paragraph (1) of section 9503(b) is 
        amended by striking ``In general'' and inserting ``Certain 
        taxes''.
    (c) Effective Date.--The amendments made by this section shall 
apply to penalties assessed after October 1, 2004.

SEC. 5267. NONAPPLICATION OF EXPORT EXEMPTION TO DELIVERY OF FUEL TO 
              MOTOR VEHICLES REMOVED FROM UNITED STATES.

    (a) In General.--Section 4221(d)(2) (defining export) is amended by 
adding at the end the following new sentence: ``Such term does not 
include the delivery of a taxable fuel (as defined in section 
4083(a)(1)) into a fuel tank of a motor vehicle which is shipped or 
driven out of the United States.''.
    (b) Conforming Amendments.--
            (1) Section 4041(g) (relating to other exemptions) is 
        amended by adding at the end the following new sentence: 
        ``Paragraph (3) shall not apply to the sale for delivery of a 
        liquid into a fuel tank of a motor vehicle which is shipped or 
        driven out of the United States.''.
            (2) Clause (iv) of section 4081(a)(1)(A) (relating to tax 
        on removal, entry, or sale) is amended by inserting ``or at a 
        duty-free sales enterprise (as defined in section 555(b)(8) of 
        the Tariff Act of 1930)'' after ``section 4101''.
    (c) Effective Date.--The amendments made by this section shall 
apply to sales or deliveries made after the date of the enactment of 
this Act.

                     PART VII--TOTAL ACCOUNTABILITY

SEC. 5271. TOTAL ACCOUNTABILITY.

    (a) Taxation of Reportable Liquids.--
            (1) In general.--Section 4081(a), as amended by this Act, 
        is amended--
                    (A) by inserting ``or reportable liquid'' after 
                ``taxable fuel'' each place it appears, and
                    (B) by inserting ``such liquid'' after ``such 
                fuel'' in paragraph (1)(A)(iv).
            (2) Rate of tax.--Subparagraph (A) of section 4081(a)(2), 
        as amended by section 5211 of this Act, is amended by striking 
        ``and'' at the end of clause (iii), by striking the period at 
        the end of clause (iv) and inserting ``, and'', and by adding 
        at the end the following new clause:
                            ``(v) in the case of reportable liquids, 
                        the rate determined under section 
                        4083(c)(2).''.
            (3) Exemption.--Section 4081(a)(1) is amended by adding at 
        the end the following new subparagraph:
                    ``(C) Exemption for registered transfers of 
                reportable liquids.--The tax imposed by this paragraph 
                shall not apply to any removal, entry, or sale of a 
                reportable liquid if--
                            ``(i) such removal, entry, or sale is to a 
                        registered person who certifies that such 
                        liquid will not be used as a fuel or in the 
                        production of a fuel, or
                            ``(ii) the sale is to the ultimate 
                        purchaser of such liquid.''.
            (4) Reportable liquids.--Section 4083, as amended by this 
        Act, is amended by redesignating subsections (c) and (d) (as 
        redesignated by section 5211 of this Act) as subsections (d) 
        and (e), respectively, and by inserting after subsection (b) 
        the following new section:
    ``(c) Reportable liquid.--For purposes of this subpart--
            ``(1) In general.--The term `reportable liquid' means any 
        petroleum-based liquid other than a taxable fuel.
            ``(2) Taxation.--
                    ``(A) Gasoline blend stocks and additives.--
                Gasoline blend stocks and additives which are 
                reportable liquids (as defined in paragraph (1)) shall 
                be subject to the rate of tax under clause (i) of 
                section 4081(a)(2)(A).
                    ``(B) Other reportable liquids.--Any reportable 
                liquid (as defined in paragraph (1)) not described in 
                subparagraph (A) shall be subject to the rate of tax 
                under clause (iii) of section 4081(a)(2)(A).''.
            (5) Conforming amendments.--
                    (A) Section 4081(e) is amended by inserting ``or 
                reportable liquid'' after ``taxable fuel''.
                    (B) Section 4083(d) (relating to certain use 
                defined as removal), as redesignated by paragraph (4), 
                is amended by inserting ``or reportable liquid'' after 
                ``taxable fuel''.
                    (C) Section 4083(e)(1) (relating to administrative 
                authority), as redesignated by paragraph (4), is 
                amended--
                            (i) in subparagraph (A)--
                                    (I) by inserting ``or reportable 
                                liquid'' after ``taxable fuel'', and
                                    (II) by inserting ``or such 
                                liquid'' after ``such fuel'' each place 
                                it appears, and
                            (ii) in subparagraph (B), by inserting ``or 
                        any reportable liquid'' after ``any taxable 
                        fuel''.
                    (D) Section 4101(a)(2), as added by section 5243 of 
                this Act, is amended by inserting ``or a reportable 
                liquid'' after ``taxable fuel''.
                    (E) Section 4101(a)(3), as added by section 5242 of 
                this Act and redesignated by section 5243 of this Act, 
                is amended by inserting ``or any reportable liquid'' 
                before the period at the end.
                    (F) Section 4102 is amended by inserting ``or any 
                reportable liquid'' before the period at the end.
                    (G)(i) Section 6718, as added by section 5241 of 
                this Act, is amended--
                            (I) in subsection (a), by inserting ``or 
                        any reportable liquid (as defined in section 
                        4083(c)(1))'' after `` section 4083(a)(1))'', 
                        and
                            (II) in the heading, by inserting ``or 
                        reportable liquids'' after ``taxable fuel''.
                    (ii) The item relating to section 6718 in table of 
                sections for part I of subchapter B of chapter 68, as 
                added by section 5241 of this Act, is amended by 
                inserting ``or reportable liquids'' after ``taxable 
                fuels''.
                    (H) Section 6427(h) is amended to read as follows:
    ``(h) Gasoline Blend Stocks or Additives and Reportable Liquids.--
Except as provided in subsection (k)--
            ``(1) if any gasoline blend stock or additive (within the 
        meaning of section 4083(a)(2)) is not used by any person to 
        produce gasoline and such person establishes that the ultimate 
        use of such gasoline blend stock or additive is not to produce 
        gasoline, or
            ``(2) if any reportable liquid (within the meaning of 
        section 4083(c)(1)) is not used by any person to produce a 
        taxable fuel and such person establishes that the ultimate use 
        of such reportable liquid is not to produce a taxable fuel,
then the Secretary shall pay (without interest) to such person an 
amount equal to the aggregate amount of the tax imposed on such person 
with respect to such gasoline blend stock or additive or such 
reportable fuel.''.
                    (I) Section 7232, as amended by this Act, is 
                amended by inserting ``or reportable liquid (within the 
                meaning of section 4083(c)(1))'' after ``section 
                4083)''.
                    (J) Section 343 of the Trade Act of 2002, as 
                amended by section 5252 of this Act, is amended by 
                inserting ``and reportable liquids (as defined in 
                section 4083(c)(1) of such Code)'' after ``Internal 
                Revenue Code of 1986)''.
    (b) Dyed Diesel.--Section 4082(a) is amended by striking ``and'' at 
the end of paragraph (2), by striking the period at the end of 
paragraph (3) and inserting ``and'', and by inserting after paragraph 
(3) the following new paragraph:
            ``(4) which is removed, entered, or sold by a person 
        registered under section 4101.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to reportable liquids (as defined in section 4083(c) of the 
Internal Revenue Code) and fuel sold or used after September 30, 2004.

SEC. 5272. EXCISE TAX REPORTING.

    (a) In General.--Part II of subchapter A of chapter 61 is amended 
by adding at the end the following new subpart:

                   ``Subpart E--Excise Tax Reporting

``SEC. 6025. RETURNS RELATING TO FUEL TAXES.

    ``(a) In General.--The Secretary shall require any person liable 
for the tax imposed under Part III of subchapter A of chapter 32 to 
file a return of such tax on a monthly basis.
    ``(b) Information Included with Return.--The Secretary shall 
require any person filing a return under subsection (a) to provide 
information regarding any refined product (whether or not such product 
is taxable under this title) removed from a terminal during the period 
for which such return applies.''.
    (b) Conforming Amendment.--The table of parts for subchapter A of 
chapter 61 is amended by adding at the end the following new item:

``Subpart E--Excise Tax Reporting''.
    (c) Effective Date.--The amendments made by this section shall 
apply to fuel sold or used after September 30, 2004.

SEC. 5273. INFORMATION REPORTING.

    (a) In General.--Section 4101(d) is amended by adding at the end 
the following new flush sentence:
``The Secretary shall require reporting under the previous sentence 
with respect to taxable fuels removed, entered, or transferred from any 
refinery, pipeline, or vessel which is registered under this 
section.''.
    (b) Effective Date.--The amendment made by this section shall apply 
on October 1, 2004.

               Subtitle D--Definition of Highway Vehicle

SEC. 5301. EXEMPTION FROM CERTAIN EXCISE TAXES FOR MOBILE MACHINERY.

    (a) Exemption From Tax on Heavy Trucks and Trailers Sold at 
Retail.--
            (1) In general.--Section 4053 (relating to exemptions) is 
        amended by adding at the end the following new paragraph:
            ``(8) Mobile machinery.--Any vehicle which consists of a 
        chassis--
                    ``(A) to which there has been permanently mounted 
                (by welding, bolting, riveting, or other means) 
                machinery or equipment to perform a construction, 
                manufacturing, processing, farming, mining, drilling, 
                timbering, or similar operation if the operation of the 
                machinery or equipment is unrelated to transportation 
                on or off the public highways,
                    ``(B) which has been specially designed to serve 
                only as a mobile carriage and mount (and a power 
                source, where applicable) for the particular machinery 
                or equipment involved, whether or not such machinery or 
                equipment is in operation, and
                    ``(C) which, by reason of such special design, 
                could not, without substantial structural modification, 
                be used as a component of a vehicle designed to perform 
                a function of transporting any load other than that 
                particular machinery or equipment or similar machinery 
                or equipment requiring such a specially designed 
                chassis.''.
            (2) Effective date.--The amendment made by this subsection 
        shall take effect on the day after the date of the enactment of 
        this Act.
    (b) Exemption From Tax on Use of Certain Vehicles.--
            (1) In general.--Section 4483 (relating to exemptions) is 
        amended by redesignating subsection (g) as subsection (h) and 
        by inserting after subsection (f) the following new subsection:
    ``(g) Exemption for Mobile Machinery.--No tax shall be imposed by 
section 4481 on the use of any vehicle described in section 4053(8).''.
            (2) Effective date.--The amendments made by this subsection 
        shall take effect on the day after the date of the enactment of 
        this Act.
    (d) Exemption From Fuel Taxes.--
            (1) In general.--Section 6421(e)(2) (defining off-highway 
        business use) is amended by adding at the end the following new 
        subparagraph:
                    ``(C) Uses in mobile machinery.--
                            ``(i) In general.--The term `off-highway 
                        business use' shall include any use in a 
                        vehicle which meets the requirements described 
                        in clause (ii).
                            ``(ii) Requirements for mobile machinery.--
                        The requirements described in this clause are--
                                    ``(I) the design-based test, and
                                    ``(II) the use-based test.
                            ``(iii) Design-based test.--For purposes of 
                        clause (ii)(I), the design-based test is met if 
                        the vehicle consists of a chassis--
                                    ``(I) to which there has been 
                                permanently mounted (by welding, 
                                bolting, riveting, or other means) 
                                machinery or equipment to perform a 
                                construction, manufacturing, 
                                processing, farming, mining, drilling, 
                                timbering, or similar operation if the 
                                operation of the machinery or equipment 
                                is unrelated to transportation on or 
                                off the public highways,
                                    ``(II) which has been specially 
                                designed to serve only as a mobile 
                                carriage and mount (and a power source, 
                                where applicable) for the particular 
                                machinery or equipment involved, 
                                whether or not such machinery or 
                                equipment is in operation, and
                                    ``(III) which, by reason of such 
                                special design, could not, without 
                                substantial structural modification, be 
                                used as a component of a vehicle 
                                designed to perform a function of 
                                transporting any load other than that 
                                particular machinery or equipment or 
                                similar machinery or equipment 
                                requiring such a specially designed 
                                chassis.
                            ``(iv) Use-based test.--For purposes of 
                        clause (ii)(II), the use-based test is met if 
                        the use of the vehicle on public highways was 
                        less than 5,000 miles during the taxpayer's 
                        taxable year.
                            ``(v) Special rule for use by certain tax-
                        exempt organizations.--In the case of any use 
                        in a vehicle by an organization which is 
                        described in section 501(c) and exempt from tax 
                        under section 501(a), clause (ii) shall be 
                        applied without regard to subclause (II) 
                        thereof.''.
            (2) Annual refund of tax paid.--Section 6427(i)(2) 
        (relating to exceptions) is amended by adding at the end the 
        following new subparagraph:
                    ``(C) Nonapplication of paragraph.--This paragraph 
                shall not apply to any fuel used in any off-highway 
                business use described in section 6421(e)(2)(C).''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to taxable years beginning after the date of the 
        enactment of this Act.

SEC. 5302. MODIFICATION OF DEFINITION OF OFF-HIGHWAY VEHICLE.

    (a) In General.--Section 7701(a) (relating to definitions) is 
amended by adding at the end the following new paragraph:
            ``(48) Off-highway vehicles.--
                    ``(A) Off-highway transportation vehicles.--
                            ``(i) In general.--A vehicle shall not be 
                        treated as a highway vehicle if such vehicle is 
                        specially designed for the primary function of 
                        transporting a particular type of load other 
                        than over the public highway and because of 
                        this special design such vehicle's capability 
                        to transport a load over the public highway is 
                        substantially limited or impaired.
                            ``(ii) Determination of vehicle's design.--
                        For purposes of clause (i), a vehicle's design 
                        is determined solely on the basis of its 
                        physical characteristics.
                            ``(iii) Determination of substantial 
                        limitation or impairment.--For purposes of 
                        clause (i), in determining whether substantial 
                        limitation or impairment exists, account may be 
                        taken of factors such as the size of the 
                        vehicle, whether such vehicle is subject to the 
                        licensing, safety, and other requirements 
                        applicable to highway vehicles, and whether 
                        such vehicle can transport a load at a 
                        sustained speed of at least 25 miles per hour. 
                        It is immaterial that a vehicle can transport a 
                        greater load off the public highway than such 
                        vehicle is permitted to transport over the 
                        public highway.
                    ``(B) Nontransportation trailers and 
                semitrailers.--A trailer or semitrailer shall not be 
                treated as a highway vehicle if it is specially 
                designed to function only as an enclosed stationary 
                shelter for the carrying on of an off-highway function 
                at an off-highway site.''.
    (c) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendment made by this section shall take effect on the date of 
        the enactment of this Act.
            (2) Fuel taxes.--With respect to taxes imposed under 
        subchapter B of chapter 31 and part III of subchapter A of 
        chapter 32, the amendment made by this section shall apply to 
        taxable periods beginning after the date of the enactment of 
        this Act.

            Subtitle E--Excise Tax Reform and Simplification

                      PART I--HIGHWAY EXCISE TAXES

SEC. 5401. DEDICATION OF GAS GUZZLER TAX TO HIGHWAY TRUST FUND.

    (a) In General.--Section 9503(b)(1) (relating to transfer to 
Highway Trust Fund of amounts equivalent to certain taxes), as amended 
by section 5101 of this Act, is amended by redesignating subparagraphs 
(C), (D), and (E) as subparagraphs (D), (E), and (F), respectively, and 
by inserting after subparagraph (B) the following new subparagraph:
                    ``(C) section 4064 (relating to gas guzzler 
                tax),''.
    (b) Uniform Application of Tax.--Subparagraph (A) of section 
4064(b)(1) (defining automobile) is amended by striking the second 
sentence.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5402. REPEAL CERTAIN EXCISE TAXES ON RAIL DIESEL FUEL AND INLAND 
              WATERWAY BARGE FUELS.

    (a) Taxes on Trains.--
            (1) In general.--Subparagraph (A) of section 4041(a)(1) is 
        amended by striking ``or a diesel-powered train'' each place it 
        appears and by striking ``or train''.
            (2) Conforming amendments.--
                    (A) Subparagraph (C) of section 4041(a)(1), as 
                amended by section 5001 of this Act, is amended by 
                striking clause (ii) and by redesignating clause (iii) 
                as clause (ii).
                    (B) Subparagraph (C) of section 4041(b)(1) is 
                amended by striking all that follows ``section 
                6421(e)(2)'' and inserting a period.
                    (C) Subsection (d) of section 4041 is amended by 
                redesignating paragraph (3) as paragraph (4) and by 
                inserting after paragraph (2) the following new 
                paragraph:
            ``(3) Diesel fuel used in trains.--There is hereby imposed 
        a tax of 0.1 cent per gallon on any liquid other than gasoline 
        (as defined in section 4083)--
                    ``(A) sold by any person to an owner, lessee, or 
                other operator of a diesel-powered train for use as a 
                fuel in such train, or
                    ``(B) used by any person as a fuel in a diesel-
                powered train unless there was a taxable sale of such 
                fuel under subparagraph (A).
        No tax shall be imposed by this paragraph on the sale or use of 
        any liquid if tax was imposed on such liquid under section 
        4081.''.
                    (D) Subsection (f) of section 4082 is amended by 
                striking ``section 4041(a)(1)'' and inserting 
                ``subsections (d)(3) and (a)(1) of section 4041, 
                respectively''.
                    (E) Subparagraphs (A) and (B) of section 
                4083(a)(3), as amended by section 5261 of this Act, are 
                amended by striking ``or a diesel-powered train''.
                    (F) Paragraph (3) of section 6421(f) is amended to 
                read as follows:
            ``(3) Gasoline used in trains.--In the case of gasoline 
        used as a fuel in a train, this section shall not apply with 
        respect to the Leaking Underground Storage Tank Trust Fund 
        financing rate under section 4081.''.
                    (G) Paragraph (3) of section 6427(l) is amended to 
                read as follows:
            ``(3) Refund of certain taxes on fuel used in diesel-
        powered trains.--For purposes of this subsection, the term 
        `nontaxable use' includes fuel used in a diesel-powered train. 
        The preceding sentence shall not apply to the tax imposed by 
        section 4041(d) and the Leaking Underground Storage Tank Trust 
        Fund financing rate under section 4081 except with respect to 
        fuel sold for exclusive use by a State or any political 
        subdivision thereof.''.
    (b) Fuel Used on Inland Waterways.--
            (1) In general.--Paragraph (1) of section 4042(b) is 
        amended by adding ``and'' at the end of subparagraph (A), by 
        striking ``, and'' at the end of subparagraph (B) and inserting 
        a period, and by striking subparagraph (C).
            (2) Conforming amendment.--Paragraph (2) of section 4042(b) 
        is amended by striking subparagraph (C).
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

                     PART II--AQUATIC EXCISE TAXES

SEC. 5411. ELIMINATION OF AQUATIC RESOURCES TRUST FUND AND 
              TRANSFORMATION OF SPORT FISH RESTORATION ACCOUNT.

    (a) Simplification of Funding for Boat Safety Account.--
            (1) In general.--Section 9503(c)(3) (relating to transfers 
        from Trust Fund for motorboat fuel taxes), as redesignated by 
        section 5002 of this Act, is amended--
                    (A) by striking ``Fund--'' and all that follows 
                through ``shall be transferred'' in subparagraph (B) 
                and inserting ``Fund which is attributable to motorboat 
                fuel taxes shall be transferred'', and
                    (B) by striking subparagraph (A), and
                    (C) by redesignating subparagraphs (B) through (E) 
                as subparagraphs (A) through (D), respectively.
            (2) Conforming amendments.--
                    (A) Section 9503(b)(4), as amended by section 5102 
                of this Act, is amended--
                            (i) by adding ``or'' at the end of 
                        subparagraph (B),
                            (ii) by striking the comma at the end of 
                        subparagraph (C) and inserting a period, and
                            (iii) by striking subparagraph (D).
                    (B) Subparagraph (B) of section 9503(c)(3), as 
                redesignated by section 5002 of this Act and subsection 
                (a)(3), is amended--
                            (i) by striking ``account'' in the heading 
                        and inserting ``trust fund'',
                            (ii) by striking ``or (B)'' in clause (ii), 
                        and
                            (iii) by striking ``Account in the Aquatic 
                        Resources''.
                    (C) Subparagraph (C) of section 9503(c)(3), as 
                redesignated by section 5002 of this Act and subsection 
                (a)(3), is amended by striking ``, but only to the 
                extent such taxes are deposited into the Highway Trust 
                Fund''.
                    (D) Paragraph (4) of section 9503(c), as 
                redesignated by section 5002 of this Act, is amended--
                            (i) by striking ``Account in the Aquatic 
                        Resources'' in subparagraph (A), and
                            (ii) by striking ``, but only to the extent 
                        such taxes are deposited into the Highway Trust 
                        Fund'' in subparagraph (B).
    (b) Merging of Accounts.--
            (1) In general.--Subsection (a) of section 9504 is amended 
        to read as follows:
    ``(a) Creation of Trust Fund.--There is hereby established in the 
Treasury of the United States a trust fund to be known as the `Sport 
Fish Restoration Trust Fund'. Such Trust Fund shall consist of such 
amounts as may be appropriated, credited, or paid to it as provided in 
this section, section 9503(c)(3), section 9503(c)(4), or section 
9602(b).''.
            (2) Conforming amendments.--
                    (A) Subsection (b) of section 9504 is amended--
                            (i) by striking ``Account'' in the heading 
                        and inserting ``Trust Fund'',
                            (ii) by striking ``Account'' both places it 
                        appears in paragraphs (1) and (2) and inserting 
                        ``Trust Fund'', and
                            (iii) by striking ``account'' both places 
                        it appears in the headings for paragraphs (1) 
                        and (2) and inserting ``trust fund''.
                    (B) Subsection (d) of section 9504, as amended by 
                section 5001 of this Act, is amended--
                            (i) by striking ``Aquatic Resources'' in 
                        the heading,
                            (ii) by striking ``any Account in the 
                        Aquatic Resources'' in paragraph (1) and 
                        inserting ``the Sports Fish Restoration'', and
                            (iii) by striking ``any such Account'' in 
                        paragraph (1) and inserting ``such Trust 
                        Fund''.
                    (C) Subsection (e) of section 9504, as amended by 
                section 5002 of this Act, is amended by striking ``Boat 
                Safety Account and Sport Fish Restoration Account'' and 
                inserting ``Sport Fish Restoration Trust Fund''.
                    (D) Section 9504 is amended by striking ``aquatic 
                resources'' in the heading and inserting ``sport fish 
                restoration''.
                    (E) The item relating to section 9504 in the table 
                of sections for subchapter A of chapter 98 is amended 
                by striking ``aquatic resources'' and inserting ``sport 
                fish restoration''.
    (c) Phaseout of Boat Safety Account.--Subsection (c) of section 
9504 is amended to read as follows:
    ``(c) Expenditures From Boat Safety Account.--Amounts remaining in 
the Boat Safety Account on October 1, 2004, and amounts thereafter 
credited to the Account under section 9602(b), shall be available, as 
provided by appropriation Acts, for making expenditures before October 
1, 2009, to carry out the purposes of section 13106 of title 46, United 
States Code (as in effect on the date of the enactment of the Safe, 
Accountable, Flexible, and Efficient Transportation Equity Act of 
2004).''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2004.

SEC. 5412. EXEMPTION OF LED DEVICES FROM SONAR DEVICES SUITABLE FOR 
              FINDING FISH.

    (a) In General.--Section 4162(b) (defining sonar device suitable 
for finding fish) is amended by striking ``or'' at the end of paragraph 
(3), by striking the period at the end of paragraph (4) and inserting 
``, or'', and by adding at the end the following new paragraph:
            ``(5) an LED display.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to articles sold by the manufacturer, producer, or importer after 
September 30, 2004.

SEC. 5413. REPEAL OF HARBOR MAINTENANCE TAX ON EXPORTS.

    (a) In General.--Subsection (d) of section 4462 (relating to 
definitions and special rules) is amended to read as follows:
    ``(d) Nonapplicability of Tax to Exports.--The tax imposed by 
section 4461(a) shall not apply to any port use with respect to any 
commercial cargo to be exported from the United States.''.
    (b) Conforming Amendments.--
            (1) Section 4461(c)(1) is amended by adding ``or'' at the 
        end of subparagraph (A), by striking subparagraph (B), and by 
        redesignating subparagraph (C) as subparagraph (B).
            (2) Section 4461(c)(2) is amended by striking ``imposed--'' 
        and all that follows through ``in any other case,'' and 
        inserting ``imposed''.
    (c) Effective Date.--The amendments made by this section shall take 
effect before, on, and after the date of the enactment of this Act.

SEC. 5414. CAP ON EXCISE TAX ON CERTAIN FISHING EQUIPMENT.

    (a) In General.--Paragraph (1) of section 4161(a) (relating to 
sport fishing equipment) is amended to read as follows:
            ``(1) Imposition of tax.--
                    ``(A) In general.--There is hereby imposed on the 
                sale of any article of sport fishing equipment by the 
                manufacturer, producer, or importer a tax equal to 10 
                percent of the price for which so sold.
                    ``(B) Limitation on tax imposed on fishing rods and 
                poles.--The tax imposed by subparagraph (A) on any 
                fishing rod or pole shall not exceed $10.''.
    (b) Conforming Amendments.--Section 4161(a)(2) is amended by 
striking ``paragraph (1)'' both places it appears and inserting 
``paragraph (1)(A)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to articles sold by the manufacturer, producer, or importer after 
September 30, 2004.

SEC. 5415. REDUCTION IN RATE OF TAX ON PORTABLE AERATED BAIT 
              CONTAINERS.

    (a) In General.--Section 4161(a)(2)(A) (relating to 3 percent rate 
of tax for electric outboard motors and sonar devices suitable for 
finding fish) is amended by inserting ``or a portable aerated bait 
container'' after ``fish''.
    (b) Conforming Amendment.--The heading of section 4161(a)(2) is 
amended by striking ``electric outboard motors and sonar devices 
suitable for finding fish'' and inserting ``certain sport fishing 
equipment''.
    (c) Effective Date.--The amendments made by this section shall 
apply to articles sold by the manufacturer, producer, or importer after 
September 30, 2004.

                     PART III--AERIAL EXCISE TAXES

SEC. 5421. CLARIFICATION OF EXCISE TAX EXEMPTIONS FOR AGRICULTURAL 
              AERIAL APPLICATORS AND EXEMPTION FOR FIXED-WING AIRCRAFT 
              ENGAGED IN FORESTRY OPERATIONS.

    (a) No Waiver by Farm Owner, Tenant, or Operator Necessary.--
Subparagraph (B) of section 6420(c)(4) (relating to certain farming use 
other than by owner, etc.) is amended to read as follows:
                    ``(B) if the person so using the gasoline is an 
                aerial or other applicator of fertilizers or other 
                substances and is the ultimate purchaser of the 
                gasoline, then subparagraph (A) of this paragraph shall 
                not apply and the aerial or other applicator shall be 
                treated as having used such gasoline on a farm for 
                farming purposes.''.
    (b) Exemption Includes Fuel Used Between Airfield and Farm.--
Section 6420(c)(4), as amended by subsection (a), is amended by adding 
at the end the following new flush sentence:
        ``For purposes of this paragraph, in the case of an aerial 
        applicator, gasoline shall be treated as used on a farm for 
        farming purposes if the gasoline is used for the direct flight 
        between the airfield and 1 or more farms.''.
    (c) Exemption from Tax on Air Transportation of Persons for 
Forestry Purposes Extended to Fixed-Wing Aircraft.--Subsection (f) of 
section 4261 (relating to tax on air transportation of persons) is 
amended to read as follows:
    ``(f) Exemption for Certain Uses.--No tax shall be imposed under 
subsection (a) or (b) on air transportation--
            ``(1) by helicopter for the purpose of transporting 
        individuals, equipment, or supplies in the exploration for, or 
        the development or removal of, hard minerals, oil, or gas, or
            ``(2) by helicopter or by fixed-wing aircraft for the 
        purpose of the planting, cultivation, cutting, or 
        transportation of, or caring for, trees (including logging 
        operations),
but only if the helicopter or fixed-wing aircraft does not take off 
from, or land at, a facility eligible for assistance under the Airport 
and Airway Development Act of 1970, or otherwise use services provided 
pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of 
title 49, United States Code, during such use. In the case of 
helicopter transportation described in paragraph (1), this subsection 
shall be applied by treating each flight segment as a distinct 
flight.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to fuel use or air transportation after the date of the enactment 
of this Act.

SEC. 5422. MODIFICATION OF RURAL AIRPORT DEFINITION.

    (a) In General.--Section 4261(e)(1)(B) (defining rural airport) is 
amended--
            (1) by inserting ``(in the case of any airport described in 
        clause (ii)(III), on flight segments of at least 100 miles)'' 
        after ``by air'' in clause (i), and
            (2) by striking the period at the end of subclause (II) of 
        clause (ii) and inserting ``, or'', and by adding at the end of 
        clause (ii) the following new subclause:
                                    ``(III) is not connected by paved 
                                roads to another airport.''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on April 1, 2004.

SEC. 5423. EXEMPTION FROM TICKET TAXES FOR TRANSPORTATION PROVIDED BY 
              SEAPLANES.

    (a) In General.--Section 4261 (relating to imposition of tax) is 
amended by redesignating subsection (i) as subsection (j) and by 
inserting after subsection (h) the following new subsection:
    ``(i) Exemption for Seaplanes.--No tax shall be imposed by this 
section or section 4271 on any air transportation by a seaplane with 
respect to any segment consisting of a takeoff from, and a landing on, 
water, but only if the places at which such takeoff and landing occur 
have not received and are not receiving financial assistance from the 
Airport and Airways Trust Fund.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to transportation beginning after March 31, 2004.

SEC. 5424. CERTAIN SIGHTSEEING FLIGHTS EXEMPT FROM TAXES ON AIR 
              TRANSPORTATION.

    (a) In General.--Section 4281 (relating to small aircraft on 
nonestablished lines) is amended by adding at the end the following new 
sentence: ``For purposes of this section, an aircraft shall not be 
considered as operated on an established line if such aircraft is 
operated on a flight the sole purpose of which is sightseeing.''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to transportation beginning on or after the date of the 
enactment of this Act, but shall not apply to any amount paid before 
such date for such transportation.

                PART IV--ALCOHOLIC BEVERAGE EXCISE TAXES

SEC. 5431. REPEAL OF SPECIAL OCCUPATIONAL TAXES ON PRODUCERS AND 
              MARKETERS OF ALCOHOLIC BEVERAGES.

    (a) Repeal of Occupational Taxes.--
            (1) In general.--The following provisions of part II of 
        subchapter A of chapter 51 (relating to occupational taxes) are 
        hereby repealed:
                    (A) Subpart A (relating to proprietors of distilled 
                spirits plants, bonded wine cellars, etc.).
                    (B) Subpart B (relating to brewer).
                    (C) Subpart D (relating to wholesale dealers) 
                (other than sections 5114 and 5116).
                    (D) Subpart E (relating to retail dealers) (other 
                than section 5124).
                    (E) Subpart G (relating to general provisions) 
                (other than sections 5142, 5143, 5145, and 5146).
            (2) Nonbeverage domestic drawback.--Section 5131 is amended 
        by striking ``, on payment of a special tax per annum,''.
            (3) Industrial use of distilled spirits.--Section 5276 is 
        hereby repealed.
    (b) Conforming Amendments.--
            (1)(A) The heading for part II of subchapter A of chapter 
        51 and the table of subparts for such part are amended to read 
        as follows:

                  ``PART II--MISCELLANEOUS PROVISIONS

``Subpart A. Manufacturers of stills.
``Subpart B. Nonbeverage domestic drawback claimants.
``Subpart C. Recordkeeping by dealers.
``Subpart D. Other provisions.''.
            (B) The table of parts for such subchapter A is amended by 
        striking the item relating to part II and inserting the 
        following new item:

``Part II. Miscellaneous provisions.''.
            (2) Subpart C of part II of such subchapter (relating to 
        manufacturers of stills) is redesignated as subpart A.
            (3)(A) Subpart F of such part II (relating to nonbeverage 
        domestic drawback claimants) is redesignated as subpart B and 
        sections 5131 through 5134 are redesignated as sections 5111 
        through 5114, respectively.
            (B) The table of sections for such subpart B, as so 
        redesignated, is amended--
                    (i) by redesignating the items relating to sections 
                5131 through 5134 as relating to sections 5111 through 
                5114, respectively, and
                    (ii) by striking ``and rate of tax'' in the item 
                relating to section 5111, as so redesignated.
            (C) Section 5111, as redesignated by subparagraph (A), is 
        amended--
                    (i) by striking ``and rate of tax'' in the section 
                heading,
                    (ii) by striking the subsection heading for 
                subsection (a), and
                    (iii) by striking subsection (b).
            (4) Part II of subchapter A of chapter 51 is amended by 
        adding after subpart B, as redesignated by paragraph (3), the 
        following new subpart:

                 ``Subpart C--Recordkeeping by Dealers

``Sec. 5121. Recordkeeping by wholesale dealers.
``Sec. 5122. Recordkeeping by retail dealers.
``Sec. 5123. Preservation and inspection of records, and entry of 
                            premises for inspection.''.
            (5)(A) Section 5114 (relating to records) is moved to 
        subpart C of such part II and inserted after the table of 
        sections for such subpart.
            (B) Section 5114 is amended--
                    (i) by striking the section heading and inserting 
                the following new heading:

``SEC. 5121. RECORDKEEPING BY WHOLESALE DEALERS.'',

                and
                    (ii) by redesignating subsection (c) as subsection 
                (d) and by inserting after subsection (b) the following 
                new subsection:
    ``(c) Wholesale Dealers.--For purposes of this part--
            ``(1) Wholesale dealer in liquors.--The term `wholesale 
        dealer in liquors' means any dealer (other than a wholesale 
        dealer in beer) who sells, or offers for sale, distilled 
        spirits, wines, or beer, to another dealer.
            ``(2) Wholesale dealer in beer.--The term `wholesale dealer 
        in beer' means any dealer who sells, or offers for sale, beer, 
        but not distilled spirits or wines, to another dealer.
            ``(3) Dealer.--The term `dealer' means any person who 
        sells, or offers for sale, any distilled spirits, wines, or 
        beer.
            ``(4) Presumption in case of sale of 20 wine gallons or 
        more.--The sale, or offer for sale, of distilled spirits, 
        wines, or beer, in quantities of 20 wine gallons or more to the 
        same person at the same time, shall be presumptive evidence 
        that the person making such sale, or offer for sale, is engaged 
        in or carrying on the business of a wholesale dealer in liquors 
        or a wholesale dealer in beer, as the case may be. Such 
        presumption may be overcome by evidence satisfactorily showing 
        that such sale, or offer for sale, was made to a person other 
        than a dealer.''.
            (C) Paragraph (3) of section 5121(d), as so redesignated, 
        is amended by striking ``section 5146'' and inserting ``section 
        5123''.
            (6)(A) Section 5124 (relating to records) is moved to 
        subpart C of part II of subchapter A of chapter 51 and inserted 
        after section 5121.
            (B) Section 5124 is amended--
                    (i) by striking the section heading and inserting 
                the following new heading:

``SEC. 5122. RECORDKEEPING BY RETAIL DEALERS.'',

                    (ii) by striking ``section 5146'' in subsection (c) 
                and inserting ``section 5123'', and
                    (iii) by redesignating subsection (c) as subsection 
                (d) and inserting after subsection (b) the following 
                new subsection:
    ``(c) Retail Dealers.--For purposes of this section--
            ``(1) Retail dealer in liquors.--The term `retail dealer in 
        liquors' means any dealer (other than a retail dealer in beer 
        or a limited retail dealer) who sells, or offers for sale, 
        distilled spirits, wines, or beer, to any person other than a 
        dealer.
            ``(2) Retail dealer in beer.--The term `retail dealer in 
        beer' means any dealer (other than a limited retail dealer) who 
        sells, or offers for sale, beer, but not distilled spirits or 
        wines, to any person other than a dealer.
            ``(3) Limited retail dealer.--The term `limited retail 
        dealer' means any fraternal, civic, church, labor, charitable, 
        benevolent, or ex-servicemen's organization making sales of 
        distilled spirits, wine or beer on the occasion of any kind of 
        entertainment, dance, picnic, bazaar, or festival held by it, 
        or any person making sales of distilled spirits, wine or beer 
        to the members, guests, or patrons of bona fide fairs, 
        reunions, picnics, carnivals, or other similar outings, if such 
        organization or person is not otherwise engaged in business as 
        a dealer.
            ``(4) Dealer.--The term `dealer' has the meaning given such 
        term by section 5121(c)(3).''.
            (7) Section 5146 is moved to subpart C of part II of 
        subchapter A of chapter 51, inserted after section 5122, and 
        redesignated as section 5123.
            (8) Part II of subchapter A of chapter 51 is amended by 
        inserting after subpart C the following new subpart:

                     ``Subpart D--Other Provisions

``Sec. 5131. Packaging distilled spirits for industrial uses.
``Sec. 5132. Prohibited purchases by dealers.''.
            (9) Section 5116 is moved to subpart D of part II of 
        subchapter A of chapter 51, inserted after the table of 
        sections, redesignated as section 5131, and amended by 
        inserting ``(as defined in section 5121(c))'' after ``dealer'' 
        in subsection (a).
            (10) Subpart D of part II of subchapter A of chapter 51 is 
        amended by adding at the end thereof the following new section:

``SEC. 5132. PROHIBITED PURCHASES BY DEALERS.

    ``(a) In General.--Except as provided in regulations prescribed by 
the Secretary, it shall be unlawful for a dealer to purchase distilled 
spirits for resale from any person other than a wholesale dealer in 
liquors who is required to keep the records prescribed by section 5121.
    ``(b) Limited Retail Dealers.--A limited retail dealer may lawfully 
purchase distilled spirits for resale from a retail dealer in liquors.
    ``(c) Penalty and Forfeiture.--

                                ``For penalty and forfeiture provisions 
applicable to violations of subsection (a), see sections 5687 and 
7302.''.
            (11) Subsection (b) of section 5002 is amended--
                    (A) by striking ``section 5112(a)'' and inserting 
                ``section 5121(c)(3)'',
                    (B) by striking ``section 5112'' and inserting 
                ``section 5121(c)'',
                    (C) by striking ``section 5122'' and inserting 
                ``section 5122(c)''.
            (12) Subparagraph (A) of section 5010(c)(2) is amended by 
        striking ``section 5134'' and inserting ``section 5114''.
            (13) Subsection (d) of section 5052 is amended to read as 
        follows:
    ``(d) Brewer.--For purposes of this chapter, the term `brewer' 
means any person who brews beer or produces beer for sale. Such term 
shall not include any person who produces only beer exempt from tax 
under section 5053(e).''.
            (14) The text of section 5182 is amended to read as 
        follows:
            ``For provisions requiring recordkeeping by wholesale 
        liquor dealers, see section 5121, and by retail liquor dealers, 
        see section 5122.''.
            (15) Subsection (b) of section 5402 is amended by striking 
        ``section 5092'' and inserting ``section 5052(d)''.
            (16) Section 5671 is amended by striking ``or 5091''.
            (17)(A) Part V of subchapter J of chapter 51 is hereby 
        repealed.
            (B) The table of parts for such subchapter J is amended by 
        striking the item relating to part V.
            (18)(A) Sections 5142, 5143, and 5145 are moved to 
        subchapter D of chapter 52, inserted after section 5731, 
        redesignated as sections 5732, 5733, and 5734, respectively, 
        and amended by striking ``this part'' each place it appears and 
        inserting ``this subchapter''.
            (B) Section 5732, as redesignated by subparagraph (A), is 
        amended by striking ``(except the tax imposed by section 
        5131)'' each place it appears.
            (C) Paragraph (2) of section 5733(c), as redesignated by 
        subparagraph (A), is amended by striking ``liquors'' both 
        places it appears and inserting ``tobacco products and 
        cigarette papers and tubes''.
            (D) The table of sections for subchapter D of chapter 52 is 
        amended by adding at the end thereof the following:

``Sec. 5732. Payment of tax.
``Sec. 5733. Provisions relating to liability for occupational taxes.
``Sec. 5734. Application of State laws.''.
            (E) Section 5731 is amended by striking subsection (c) and 
        by redesignating subsection (d) as subsection (c).
            (19) Subsection (c) of section 6071 is amended by striking 
        ``section 5142'' and inserting ``section 5732''.
            (20) Paragraph (1) of section 7652(g) is amended--
                    (A) by striking ``subpart F'' and inserting 
                ``subpart B'', and
                    (B) by striking ``section 5131(a)'' and inserting 
                ``section 5111''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on July 1, 2004, but shall not apply to taxes imposed for 
periods before such date.

SEC. 5432. SUSPENSION OF LIMITATION ON RATE OF RUM EXCISE TAX COVER 
              OVER TO PUERTO RICO AND VIRGIN ISLANDS.

    (a) In General.--Section 7652(f)(1) (relating to limitation on 
cover over of tax on distilled spirits) is amended by striking 
``January 1, 2004'' and inserting ``October 1, 2004, and $13.50 in the 
case of distilled spirits brought into the United States after 
September 30, 2004, and before January 1, 2006''.
    (b) Effective Date.--
            (1) In general.--The amendment made by subsection (a) shall 
        apply to articles containing distilled spirits brought into the 
        United States after December 31, 2003.
            (2) Special rule.--
                    (A) In general.--After September 30, 2004, the 
                treasury of Puerto Rico shall make a Conservation Trust 
                Fund transfer within 30 days from the date of each 
                cover over payment to such treasury under section 
                7652(e) of the Internal Revenue Code of 1986.
                    (B) Conservation trust fund transfer.--
                            (i) In general.--For purposes of this 
                        paragraph, the term ``Conservation Trust Fund 
                        transfer'' means a transfer to the Puerto Rico 
                        Conservation Trust Fund of an amount equal to 
                        50 cents per proof gallon of the taxes imposed 
                        under section 5001 or section 7652 of such Code 
                        on distilled spirits that are covered over to 
                        the treasury of Puerto Rico under section 
                        7652(e) of such Code.
                            (ii) Treatment of transfer.--Each 
                        Conservation Trust Fund transfer shall be 
                        treated as principal for an endowment, the 
                        income from which to be available for use by 
                        the Puerto Rico Conservation Trust Fund for the 
                        purposes for which the Trust Fund was 
                        established.
                            (iii) Result of nontransfer.--
                                    (I) In general.--Upon notification 
                                by the Secretary of the Interior that a 
                                Conservation Trust Fund transfer has 
                                not been made by the treasury of Puerto 
                                Rico, the Secretary of the Treasury 
                                shall, except as provided in subclause 
                                (II), deduct and withhold from the next 
                                cover over payment to be made to the 
                                treasury of Puerto Rico under section 
                                7652(e) of such Code an amount equal to 
                                the appropriate Conservation Trust Fund 
                                transfer and interest thereon at the 
                                underpayment rate established under 
                                section 6621 of such Code as of the due 
                                date of such transfer. The Secretary of 
                                the Treasury shall transfer such amount 
                                deducted and withheld, and the interest 
                                thereon, directly to the Puerto Rico 
                                Conservation Trust Fund.
                                    (II) Good cause exception.--If the 
                                Secretary of the Interior finds, after 
                                consultation with the Governor of 
                                Puerto Rico, that the failure by the 
                                treasury of Puerto Rico to make a 
                                required transfer was for good cause, 
                                and notifies the Secretary of the 
                                Treasury of the finding of such good 
                                cause before the due date of the next 
                                cover over payment following the 
                                notification of nontransfer, then the 
                                Secretary of the Treasury shall not 
                                deduct the amount of such nontransfer 
                                from any cover over payment.
                    (C) Puerto rico conservation trust fund.--For 
                purposes of this paragraph, the term ``Puerto Rico 
                Conservation Trust Fund'' means the fund established 
                pursuant to a Memorandum of Understanding between the 
                United States Department of the Interior and the 
                Commonwealth of Puerto Rico, dated December 24, 1968.

                       PART V--SPORT EXCISE TAXES

SEC. 5441. CUSTOM GUNSMITHS.

    (a) Small Manufacturers Exempt From Firearms Excise Tax.--Section 
4182 (relating to exemptions) is amended by redesignating subsection 
(c) as subsection (d) and by inserting after subsection (b) the 
following new subsection:
    ``(c) Small Manufacturers, Etc.--
            ``(1) In general.--The tax imposed by section 4181 shall 
        not apply to any article described in such section if 
        manufactured, produced, or imported by a person who 
        manufactures, produces, and imports less than 50 of such 
        articles during the calendar year.
            ``(2) Controlled groups.--All persons treated as a single 
        employer for purposes of subsection (a) or (b) of section 52 
        shall be treated as one person for purposes of paragraph 
        (1).''.
    (b) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to articles sold by the manufacturer, producer, or 
        importer on or after the date which is the first day of the 
        month beginning at least 2 weeks after the date of the 
        enactment of this Act.
            (2) No inference.--Nothing in the amendments made by this 
        section shall be construed to create any inference with respect 
        to the proper tax treatment of any sales before the effective 
        date of such amendments.

SEC. 5442. MODIFIED TAXATION OF IMPORTED ARCHERY PRODUCTS.

    (a) Bows.--Paragraph (1) of section 4161(b) (relating to bows) is 
amended to read as follows:
            ``(1) Bows.--
                    ``(A) In general.--There is hereby imposed on the 
                sale by the manufacturer, producer, or importer of any 
                bow which has a peak draw weight of 30 pounds or more, 
                a tax equal to 11 percent of the price for which so 
                sold.
                    ``(B) Archery equipment.--There is hereby imposed 
                on the sale by the manufacturer, producer, or 
                importer--
                            ``(i) of any part or accessory suitable for 
                        inclusion in or attachment to a bow described 
                        in subparagraph (A), and
                            ``(ii) of any quiver or broadhead suitable 
                        for use with an arrow described in paragraph 
                        (2),
                a tax equal to 11 percent of the price for which so 
                sold.''.
    (b) Arrows.--Subsection (b) of section 4161 (relating to bows and 
arrows, etc.) is amended by redesignating paragraph (3) as paragraph 
(4) and inserting after paragraph (2) the following:
            ``(3) Arrows.--
                    ``(A) In general.--There is hereby imposed on the 
                sale by the manufacturer, producer, or importer of any 
                arrow, a tax equal to 12 percent of the price for which 
                so sold.
                    ``(B) Exception.--In the case of any arrow of which 
                the shaft or any other component has been previously 
                taxed under paragraph (1) or (2)--
                            ``(i) section 6416(b)(3) shall not apply, 
                        and
                            ``(ii) the tax imposed by subparagraph (A) 
                        shall be an amount equal to the excess (if any) 
                        of--
                                    ``(I) the amount of tax imposed by 
                                this paragraph (determined without 
                                regard to this subparagraph), over
                                    ``(II) the amount of tax paid with 
                                respect to the tax imposed under 
                                paragraph (1) or (2) on such shaft or 
                                component.
                    ``(C) Arrow.--For purposes of this paragraph, the 
                term `arrow' means any shaft described in paragraph (2) 
                to which additional components are attached.''.
    (c) Conforming Amendments.--Section 4161(b)(2) is amended--
            (1) by inserting ``(other than broadheads)'' after 
        ``point'', and
            (2) by striking ``Arrows.--'' in the heading and inserting 
        ``Arrow components.--''.
    (d) Effective Date.--The amendments made by this section shall 
apply to articles sold by the manufacturer, producer, or importer after 
the date of the enactment of this Act.

SEC. 5443. TREATMENT OF TRIBAL GOVERNMENTS FOR PURPOSES OF FEDERAL 
              WAGERING EXCISE AND OCCUPATIONAL TAXES.

    (a) In General.--Subsection (a) of section 7871 (relating to Indian 
tribal governments treated as States for certain purposes) is amended 
by striking ``and'' at the end of paragraph (6), by striking the period 
at the end of paragraph (7) and inserting ``; and'', and by adding at 
the end the following new paragraph:
            ``(8) for purposes of chapter 35 (relating to taxes on 
        wagering).''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on July 1, 2004, but shall not apply to taxes imposed for 
periods before such date.

                       PART VI--OTHER PROVISIONS

SEC. 5451. INCOME TAX CREDIT FOR DISTILLED SPIRITS WHOLESALERS AND FOR 
              DISTILLED SPIRITS IN CONTROL STATE BAILMENT WAREHOUSES 
              FOR COSTS OF CARRYING FEDERAL EXCISE TAXES ON BOTTLED 
              DISTILLED SPIRITS.

    (a) In General.--Subpart A of part I of subchapter A of chapter 51 
(relating to gallonage and occupational taxes) is amended by adding at 
the end the following new section:

``SEC. 5011. INCOME TAX CREDIT FOR AVERAGE COST OF CARRYING EXCISE TAX.

    ``(a) In General.--For purposes of section 38, the amount of the 
distilled spirits credit for any taxable year is the amount equal to 
the product of--
            ``(1) in the case of--
                    ``(A) any eligible wholesaler--
                            ``(i) the number of cases of bottled 
                        distilled spirits--
                                    ``(I) which were bottled in the 
                                United States, and
                                    ``(II) which are purchased by such 
                                wholesaler during the taxable year 
                                directly from the bottler of such 
                                spirits, or
                    ``(B) any person which is subject to section 5005 
                and which is not an eligible wholesaler, the number of 
                cases of bottled distilled spirits which are stored in 
                a warehouse operated by, or on behalf of, a State, or 
                agency or political subdivision thereof, on which title 
                has not passed on an unconditional sale basis, and
            ``(2) the average tax-financing cost per case for the most 
        recent calendar year ending before the beginning of such 
        taxable year.
    ``(b) Eligible Wholesaler.--For purposes of this section, the term 
`eligible wholesaler' means any person which holds a permit under the 
Federal Alcohol Administration Act as a wholesaler of distilled spirits 
which is not a State, or agency or political subdivision thereof.
    ``(c) Average Tax-Financing Cost.--
            ``(1) In general.--For purposes of this section, the 
        average tax-financing cost per case for any calendar year is 
        the amount of interest which would accrue at the deemed 
        financing rate during a 60-day period on an amount equal to the 
        deemed Federal excise tax per case.
            ``(2) Deemed financing rate.--For purposes of paragraph 
        (1), the deemed financing rate for any calendar year is the 
        average of the corporate overpayment rates under paragraph (1) 
        of section 6621(a) (determined without regard to the last 
        sentence of such paragraph) for calendar quarters of such year.
            ``(3) Deemed federal excise tax per case.--For purposes of 
        paragraph (1), the deemed Federal excise tax per case is 
        $25.68.
    ``(d) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Case.--The term `case' means 12 80-proof 750 
        milliliter bottles.
            ``(2) Number of cases in lot.--The number of cases in any 
        lot of distilled spirits shall be determined by dividing the 
        number of liters in such lot by 9.''.
    (b) Credit Treated as Part of General Business Credit.--Section 
38(b) (relating to current year business credit), as amended by section 
5103 of this Act, is amended by striking ``plus'' at the end of 
paragraph (15), by striking the period at the end of paragraph (16) and 
inserting ``, plus'', and by adding at the end the following new 
paragraph:
            ``(17) the distilled spirits credit determined under 
        section 5011(a).''.
    (c) Conforming Amendments.--
            (1) Section 39(d), as amended by section 5103 of this Act, 
        is amended by adding at the end the following new paragraph:
            ``(12) No carryback of section 5011 credit before effective 
        date.--No portion of the unused business credit for any taxable 
        year which is attributable to the credit determined under 
        section 5011(a) may be carried back to a taxable year beginning 
        before the date of the enactment of section 5011.''.
            (2) The table of sections for subpart A of part I of 
        subchapter A of chapter 51 is amended by adding at the end the 
        following new item:

``Sec. 5011. Income tax credit for average cost of carrying excise 
                            tax.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5452. CREDIT FOR TAXPAYERS OWNING COMMERCIAL POWER TAKEOFF 
              VEHICLES.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
(relating to business-related credits) is amended by adding at the end 
the following new section:

``SEC. 45G. COMMERCIAL POWER TAKEOFF VEHICLES CREDIT.

    ``(a) General Rule.--For purposes of section 38, the amount of the 
commercial power takeoff vehicles credit determined under this section 
for the taxable year is $250 for each qualified commercial power 
takeoff vehicle owned by the taxpayer as of the close of the calendar 
year in which or with which the taxable year of the taxpayer ends.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Qualified commercial power takeoff vehicle.--The term 
        `qualified commercial power takeoff vehicle' means any highway 
        vehicle described in paragraph (2) which is propelled by any 
        fuel subject to tax under section 4041 or 4081 if such vehicle 
        is used in a trade or business or for the production of income 
        (and is licensed and insured for such use).
            ``(2) Highway vehicle described.--A highway vehicle is 
        described in this paragraph if such vehicle is--
                    ``(A) designed to engage in the daily collection of 
                refuse or recyclables from homes or businesses and is 
                equipped with a mechanism under which the vehicle's 
                propulsion engine provides the power to operate a load 
                compactor, or
                    ``(B) designed to deliver ready mixed concrete on a 
                daily basis and is equipped with a mechanism under 
                which the vehicle's propulsion engine provides the 
                power to operate a mixer drum to agitate and mix the 
                product en route to the delivery site.
    ``(c) Exception for Vehicles Used by Governments, Etc.--No credit 
shall be allowed under this section for any vehicle owned by any person 
at the close of a calendar year if such vehicle is used at any time 
during such year by--
            ``(1) the United States or an agency or instrumentality 
        thereof, a State, a political subdivision of a State, or an 
        agency or instrumentality of one or more States or political 
        subdivisions, or
            ``(2) an organization exempt from tax under section 501(a).
    ``(d) Termination.--This section shall not apply with respect to 
any calendar year after 2006.''.
    (b) Credit Treated as Part of General Business Credit.--Section 
38(b) (relating to current year business credit), as amended by section 
5451 of this Act, is amended by striking ``plus'' at the end of 
paragraph (16), by striking the period at the end of paragraph (17) and 
inserting ``, plus'', and by adding at the end the following new 
paragraph:
            ``(18) the commercial power takeoff vehicles credit under 
        section 45G(a).''.
    (c) Conforming Amendments.--
            (1) Section 39(d), as amended by section 5451 of this Act, 
        is amended by adding at the end the following new paragraph:
            ``(13) No carryback of section 45g credit before effective 
        date.--No portion of the unused business credit for any taxable 
        year which is attributable to the credit determined under 
        section 45G(a) may be carried back to a taxable year beginning 
        on or before the date of the enactment of section 45G.''.
            (2) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 is amended by adding at the end the 
        following new item:

``Sec. 45G. Commercial power takeoff vehicles credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5453. CREDIT FOR AUXILIARY POWER UNITS INSTALLED ON DIESEL-POWERED 
              TRUCKS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
(relating to business-related credits), as amended by section 5452 of 
this Act, is amended by adding at the end the following new section:

``SEC. 45H. AUXILIARY POWER UNIT CREDIT.

    ``(a) General Rule.--For purposes of section 38, the amount of the 
auxiliary power unit credit determined under this section for the 
taxable year is $250 for each qualified auxiliary power unit--
            ``(1) purchased by the taxpayer, and
            ``(2) installed or caused to be installed by the taxpayer 
        on a qualified heavy-duty highway vehicle during such taxable 
        year.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Qualified auxiliary power unit.--The term `qualified 
        auxiliary power unit' means any integrated system which--
                    ``(A) provides heat, air conditioning, engine 
                warming, and electricity to the factory installed 
                components on a qualified heavy-duty highway vehicle as 
                if the main drive engine of such vehicle was in 
                operation,
                    ``(B) is employed to reduce long-term idling of the 
                diesel engine on such a vehicle, and
                    ``(C) is certified by the Environmental Protection 
                Agency as meeting emission standards in regulations in 
                effect on the date of the enactment of this section.
            ``(2) Qualified heavy-duty highway vehicle.--The term 
        `qualified heavy-duty highway vehicle' means any highway 
        vehicle weighing more than 12,500 pounds and powered by a 
        diesel engine.
    ``(c) Termination.--This section shall not apply with respect to 
any installation occurring after December 31, 2006.''.
    (b) Credit Treated as Part of General Business Credit.--Section 
38(b) (relating to current year business credit), as amended by section 
5452 of this Act, is amended by striking ``plus'' at the end of 
paragraph (17), by striking the period at the end of paragraph (18) and 
inserting ``, plus'', and by adding at the end the following new 
paragraph:
            ``(19) the auxiliary power unit credit under section 
        45H(a).''.
    (c) Conforming Amendments.--
            (1) Section 39(d), as amended by section 5452 of this Act, 
        is amended by adding at the end the following new paragraph:
            ``(14) No carryback of section 45h credit before effective 
        date.--No portion of the unused business credit for any taxable 
        year which is attributable to the credit determined under 
        section 45H(a) may be carried back to a taxable year beginning 
        on or before the date of the enactment of section 45H.''.
            (2) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1, as amended by section 5452 of this 
        Act, is amended by adding at the end the following new item:

``Sec. 45H. Auxiliary power unit credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to auxiliary power units purchased and installed for taxable 
years beginning after the date of the enactment of this Act.

                  Subtitle F--Miscellaneous Provisions

SEC. 5501. MOTOR FUEL TAX ENFORCEMENT ADVISORY COMMISSION.

    (a) Establishment.--There is established a Motor Fuel Tax 
Enforcement Advisory Commission (in this section referred to as the 
``Commission'').
    (b) Function.--The Commission shall--
            (1) review motor fuel revenue collections, historical and 
        current;
            (2) review the progress of investigations;
            (3) develop and review legislative proposals with respect 
        to motor fuel taxes;
            (4) monitor the progress of administrative regulation 
        projects relating to motor fuel taxes;
            (5) review the results of Federal and State agency 
        cooperative efforts regarding motor fuel taxes;
            (6) review the results of Federal interagency cooperative 
        efforts regarding motor fuel taxes; and
            (7) evaluate and make recommendations regarding--
                    (A) the effectiveness of existing Federal 
                enforcement programs regarding motor fuel taxes,
                    (B) enforcement personnel allocation, and
                    (C) proposals for regulatory projects, legislation, 
                and funding.
    (c) Membership.--
            (1) Appointment.--The Commission shall be composed of the 
        following representatives appointed by the Chairmen and the 
        Ranking Members of the Committee on Finance of the Senate and 
        the Committee on Ways and Means of the House of 
        Representatives:
                    (A) At least 1 representative from each of the 
                following Federal entities: the Department of Homeland 
                Security, the Department of Transportation--Office of 
                Inspector General, the Federal Highway Administration, 
                the Department of Defense, and the Department of 
                Justice.
                    (B) At least 1 representative from the Federation 
                of State Tax Administrators.
                    (C) At least 1 representative from any State 
                department of transportation.
                    (D) 2 representatives from the highway construction 
                industry.
                    (E) 5 representatives from industries relating to 
                fuel distribution -- refiners (2 representatives), 
                distributors (1 representative), pipelines (1 
                representative), and terminal operators (2 
                representatives).
                    (F) 1 representative from the retail fuel industry.
                    (G) 2 representatives from the staff of the 
                Committee on Finance of the Senate and 2 
                representatives from the staff of the Committee on Ways 
                and Means of the House of Representatives.
            (2) Terms.--Members shall be appointed for the life of the 
        Commission.
            (3) Vacancies.--A vacancy in the Commission shall be filled 
        in the manner in which the original appointment was made.
            (4) Travel expenses.--Members shall serve without pay but 
        shall receive travel expenses, including per diem in lieu of 
        subsistence, in accordance with sections 5702 and 5703 of title 
        5, United States Code.
            (5) Chairman.--The Chairman of the Commission shall be 
        elected by the members.
    (d) Funding.--Such sums as are necessary shall be available from 
the Highway Trust fund for the expenses of the Commission.
    (e) Consultation.--Upon request of the Commission, representatives 
of the Department of the Treasury and the Internal Revenue Service 
shall be available for consultation to assist the Commission in 
carrying out its duties under this section.
    (f) Obtaining Data.--The Commission may secure directly from any 
department or agency of the United States, information (other than 
information required by any law to be kept confidential by such 
department or agency) necessary for the Commission to carry out its 
duties under this section. Upon request of the Commission, the head of 
that department or agency shall furnish such nonconfidential 
information to the Commission. The Commission shall also gather 
evidence through such means as it may deem appropriate, including 
through holding hearings and soliciting comments by means of Federal 
Register notices.
    (g) Termination.--The Commission shall terminate after September 
30, 2009.

SEC. 5502. NATIONAL SURFACE TRANSPORTATION INFRASTRUCTURE FINANCING 
              COMMISSION.

    (a) Establishment.--There is established a National Surface 
Transportation Infrastructure Financing Commission (in this section 
referred to as the ``Commission''). The Commission shall hold its first 
meeting within 90 days of the appointment of the eighth individual to 
be named to the Commission.
    (b) Function.--
            (1) In general.--The Commission shall--
                    (A) make a thorough investigation and study of 
                revenues flowing into the Highway Trust Fund under 
                current law, including the individual components of the 
                overall flow of such revenues;
                    (B) consider whether the amount of such revenues is 
                likely to increase, decline, or remain unchanged, 
                absent changes in the law, particularly by taking into 
                account the impact of possible changes in public 
                vehicular choice, fuel use, or travel alternatives that 
                could be expected to reduce or increase revenues into 
                the Highway Trust Fund;
                    (C) consider alternative approaches to generating 
                revenues for the Highway Trust Fund, and the level of 
                revenues that such alternatives would yield;
                    (D) consider highway and transit needs and whether 
                additional revenues into the Highway Trust Fund, or 
                other Federal revenues dedicated to highway and transit 
                infrastructure, would be required in order to meet such 
                needs; and
                    (E) study such other matters closely related to the 
                subjects described in the preceding subparagraphs as it 
                may deem appropriate.
            (2) Time frame of investigation and study.--The time frame 
        to be considered by the Commission shall extend through the 
        year 2015.
            (3) Preparation of report.--Based on such investigation and 
        study, the Commission shall develop a final report, with 
        recommendations and the bases for those recommendations, 
        indicating policies that should be adopted, or not adopted, to 
        achieve various levels of annual revenue for the Highway Trust 
        Fund and to enable the Highway Trust Fund to receive revenues 
        sufficient to meet highway and transit needs. Such 
        recommendations shall address, among other matters as the 
        Commission may deem appropriate--
                    (A) what levels of revenue are required by the 
                Federal Highway Trust Fund in order for it to meet 
                needs to--
                            (i) maintain, and
                            (ii) improve the condition and performance 
                        of the Nation's highway and transit systems;
                    (B) what levels of revenue are required by the 
                Federal Highway Trust Fund in order to ensure that 
                Federal levels of investment in highways and transit do 
                not decline in real terms; and
                    (C) the extent, if any, to which the Highway Trust 
                Fund should be augmented by other mechanisms or funds 
                as a Federal means of financing highway and transit 
                infrastructure investments.
    (c) Membership.--
            (1) Appointment.--The Commission shall be composed of 15 
        members, appointed as follows:
                    (A) 7 members appointed by the Secretary of 
                Transportation, in consultation with the Secretary of 
                the Treasury.
                    (B) 2 members appointed by the Chairman of the 
                Committee on Ways and Means of the House of 
                Representatives.
                    (C) 2 members appointed by the Ranking Minority 
                Member of the Committee on Ways and Means of the House 
                of Representatives.
                    (D) 2 members appointed by the Chairman of the 
                Committee on Finance of the Senate.
                    (E) 2 members appointed by the Ranking Minority 
                Member of the Committee on Finance of the Senate.
            (2) Qualifications.--Members appointed pursuant to 
        paragraph (1) shall be appointed from among individuals 
        knowledgeable in the fields of public transportation finance or 
        highway and transit programs, policy, and needs, and may 
        include representatives of interested parties, such as State 
        and local governments or other public transportation 
        authorities or agencies, representatives of the transportation 
        construction industry (including suppliers of technology, 
        machinery and materials), transportation labor (including 
        construction and providers), transportation providers, the 
        financial community, and users of highway and transit systems.
            (3) Terms.--Members shall be appointed for the life of the 
        Commission.
            (4) Vacancies.--A vacancy in the Commission shall be filled 
        in the manner in which the original appointment was made.
            (5) Travel expenses.--Members shall serve without pay but 
        shall receive travel expenses, including per diem in lieu of 
        subsistence, in accordance with sections 5702 and 5703 of title 
        5, United States Code.
            (6) Chairman.--The Chairman of the Commission shall be 
        elected by the members.
    (d) Staff.--The Commission may appoint and fix the pay of such 
personnel as it considers appropriate.
    (e) Funding.--Funding for the Commission shall be provided by the 
Secretary of the Treasury and by the Secretary of Transportation, out 
of funds available to those agencies for administrative and policy 
functions.
    (f) Staff of Federal Agencies.--Upon request of the Commission, the 
head of any department or agency of the United States may detail any of 
the personnel of that department or agency to the Commission to assist 
in carrying out its duties under this section.
    (g) Obtaining Data.--The Commission may secure directly from any 
department or agency of the United States, information (other than 
information required by any law to be kept confidential by such 
department or agency) necessary for the Commission to carry out its 
duties under this section. Upon request of the Commission, the head of 
that department or agency shall furnish such nonconfidential 
information to the Commission. The Commission shall also gather 
evidence through such means as it may deem appropriate, including 
through holding hearings and soliciting comments by means of Federal 
Register notices.
    (h) Report.--Not later than 2 years after the date of its first 
meeting, the Commission shall transmit its final report, including 
recommendations, to the Secretary of Transportation, the Secretary of 
the Treasury, and the Committee on Ways and Means of the House of 
Representatives, the Committee on Finance of the Senate, the Committee 
on Transportation and Infrastructure of the House of Representatives, 
the Committee on Environment and Public Works of the Senate, and the 
Committee on Banking, Housing, and Urban Affairs of the Senate.
    (i) Termination.--The Commission shall terminate on the 180th day 
following the date of transmittal of the report under subsection (h). 
All records and papers of the Commission shall thereupon be delivered 
to the Administrator of General Services for deposit in the National 
Archives.

SEC. 5503. TREASURY STUDY OF FUEL TAX COMPLIANCE AND INTERAGENCY 
              COOPERATION.

    (a) In General.--Not later than January 31, 2006, the Secretary of 
the Treasury shall submit to the Committee on Finance of the Senate and 
the Committee on Ways and Means of the House of Representatives a 
report regarding fuel tax enforcement which shall include the 
information and analysis specified in subsections (b) and (c) and any 
other information and recommendations the Secretary of the Treasury may 
deem appropriate.
    (b) Audits.--With respect to audits conducted by the Internal 
Revenue Service, the report required under subsection (a) shall 
include--
            (1) the number and geographic distribution of audits 
        conducted annually, by fiscal year, between October 1, 2001, 
        and September 30, 2005;
            (2) the total volume involved for each of the taxable fuels 
        covered by such audits and a comparison to the annual 
        production of such fuels;
            (3) the staff hours and number of personnel devoted to the 
        audits per year; and
            (4) the results of such audits by year, including total tax 
        collected, total penalties collected, and number of referrals 
        for criminal prosecution.
    (c) Enforcement Activities.--With respect to enforcement 
activities, the report required under subsection (a) shall include--
            (1) the number and geographic distribution of criminal 
        investigations and prosecutions annually, by fiscal year, 
        between October 1, 2001, and September 30, 2005, and the 
        results of such investigations and prosecutions;
            (2) to the extent such investigations and prosecutions 
        involved other agencies, State or Federal, a breakdown by 
        agency of the number of joint investigations involved;
            (3) an assessment of the effectiveness of joint action and 
        cooperation between the Department of the Treasury and other 
        Federal and State agencies, including a discussion of the 
        ability and need to share information across agencies for both 
        civil and criminal Federal tax enforcement and enforcement of 
        State or Federal laws relating to fuels;
            (4) the staff hours and number of personnel devoted to 
        criminal investigations and prosecutions per year;
            (5) the staff hours and number of personnel devoted to 
        administrative collection of fuel taxes; and
            (6) the results of administrative collection efforts 
        annually, by fiscal year, between October 1, 2001, and 
        September 30, 2005.

SEC. 5504. EXPANSION OF HIGHWAY TRUST FUND EXPENDITURE PURPOSES TO 
              INCLUDE FUNDING FOR STUDIES OF SUPPLEMENTAL OR 
              ALTERNATIVE FINANCING FOR THE HIGHWAY TRUST FUND.

    (a) In General.--From amounts available in the Highway Trust Fund, 
there is authorized to be expended for 2 comprehensive studies of 
supplemental or alternative funding sources for the Highway Trust 
Fund--
            (1) $1,000,000 to the Western Transportation Institute of 
        the College of Engineering at Montana State University for the 
        study and report described in subsection (b), and
            (2) $16,500,000 to the Public Policy Center of the 
        University of Iowa for the study and report described in 
        subsection (c).
    (b) Study of Funding Mechanisms.--Not later than December 31, 2006, 
the Western Transportation Institute of the College of Engineering at 
Montana State University shall report to the Secretary of the Treasury 
and the Secretary of Transportation on a study of highway funding 
mechanisms of other industrialized nations, an examination of the 
viability of alternative funding proposals, including congestion 
pricing, greater reliance on tolls, privatization of facilities, and 
bonding for construction of added capacity, and an examination of 
increasing the rates of motor fuels taxes in effect on the date of the 
enactment of this Act, including the indexation of such rates.
    (c) Study on Field Test of On-Board Computer Assessment of Highway 
Use Taxes.--Not later than December 31, 2011, the Public Policy Center 
of the University of Iowa shall direct, analyze, and report to the 
Secretary of the Treasury and the Secretary of Transportation on a 
long-term field test of an approach to assessing highway use taxes 
based upon actual mileage driven by a specific vehicle on specific 
types of highways by use of an on-board computer--
            (1) which is linked to satellites to calculate highway 
        mileage traversed,
            (2) which computes the appropriate highway use tax for each 
        of the Federal, State, and local governments as the vehicle 
        makes use of the highways, and
            (3) the data from which is periodically downloaded by the 
        vehicle owner to a collection center for an assessment of 
        highway use taxes due in each jurisdiction traversed.The 
        components of the field test shall include 2 years for 
        preparation, including selection of vendors and test 
        participants, and 3-year testing period.

SEC. 5505. TREASURY STUDY OF HIGHWAY FUELS USED BY TRUCKS FOR NON-
              TRANSPORTATION PURPOSES.

    (a) Study.--The Secretary of the Treasury shall conduct a study 
regarding the use of highway motor fuel by trucks that is not used for 
the propulsion of the vehicle. As part of such study--
            (1) in the case of vehicles carrying equipment that is 
        unrelated to the transportation function of the vehicle--
                    (A) the Secretary of the Treasury, in consultation 
                with the Secretary of Transportation, and with public 
                notice and comment, shall determine the average annual 
                amount of tax paid fuel consumed per vehicle, by type 
                of vehicle, used by the propulsion engine to provide 
                the power to operate the equipment attached to the 
                highway vehicle, and
                    (B) the Secretary of the Treasury shall review the 
                technical and administrative feasibility of exempting 
                such nonpropulsive use of highway fuels for the highway 
                motor fuels excise taxes,
            (2) in the case where non-transportation equipment is run 
        by a separate motor--
                    (A) the Secretary of the Treasury shall determine 
                the annual average amount of fuel exempted from tax in 
                the use of such equipment by equipment type, and
                    (B) the Secretary of the Treasury shall review 
                issues of administration and compliance related to the 
                present-law exemption provided for such fuel use, and
            (3) the Secretary of the Treasury shall--
                    (A) estimate the amount of taxable fuel consumed by 
                trucks and the emissions of various pollutants due to 
                the long-term idling of diesel engines, and
                    (B) determine the cost of reducing such long-term 
                idling through the use of plug-ins at truck stops, 
                auxiliary power units, or other technologies.
    (b) Report.--Not later than January 1, 2006, the Secretary of the 
Treasury shall report the findings of the study required under 
subsection (a) to the Committee on Finance of the Senate and the 
Committee on Ways and Means of the House of Representatives.

SEC. 5506. DELTA REGIONAL TRANSPORTATION PLAN.

    (a) Study.--The Delta Regional Authority shall conduct a study of 
the transportation assets and needs in the States of Alabama, Arkansas, 
Illinois, Kentucky, Louisiana, Mississippi, Missouri, and Tennessee 
which comprise the Delta region.
    (b) Regional Strategic Transportation Plan.--Upon completion of the 
study required under subsection (a), the Delta Regional Authority shall 
establish a regional strategic transportation plan to achieve efficient 
transportation systems in the Delta region. In developing the regional 
strategic transportation plan, the Delta Regional Authority shall 
consult with local planning and development districts, local and 
regional governments, metropolitan planning organizations, State 
transportation entities, and Federal transportation agencies.
    (c) Elements of Study and Plan.--The study and plan under this 
section shall include the following transportation modes and systems: 
transit, rail, highway, interstate, bridges, air, airports, waterways 
and ports.
    (d) Authorization of Appropriations.--There is authorized to be 
appropriated to the Delta Regional Authority $1,000,000 to carry out 
the purposes of this section, to remain available until expended.

SEC. 5507. TREATMENT OF EMPLOYER-PROVIDED TRANSIT AND VAN POOLING 
              BENEFITS.

    (a) In General.--Subparagraph (A) of section 132(f)(2) (relating to 
limitation on exclusion) is amended by striking ``$100'' and inserting 
``$120''.
    (b) Inflation Adjustment Conforming Amendments.--The last sentence 
of section 132(f)(6)(A) (relating to inflation adjustment) is amended--
            (1) by striking ``2002'' and inserting ``2005'', and
            (2) by striking ``2001'' and inserting ``2004''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2004.

SEC. 5508. STUDY OF INCENTIVES FOR PRODUCTION OF BIODIESEL.

    (a) Study.--The General Comptroller of the United States shall 
conduct a study related to biodiesel fuels and the tax credit for 
biodiesel fuels established under this Act. Such study shall include--
            (1) an assessment on whether such credit provides 
        sufficient assistance to the producers of biodiesel fuel to 
        establish the fuel as a viable energy alternative in the 
        current market place,
            (2) an assessment on how long such credit or similar 
        subsidy would have to remain in effect before biodiesel fuel 
        can compete in the market place without such assistance,
            (3) a cost-benefit analysis of such credit, comparing the 
        cost of the credit in forgone revenue to the benefits of lower 
        fuel costs for consumers, increased profitability for the 
        biodiesel industry, increased farm income, reduced program 
        outlays from the Department of Agriculture, and the improved 
        environmental conditions through the use of biodiesel fuel, and
            (4) an assessment on whether such credit results in any 
        unintended consequences for unrelated industries, including the 
        impact, if any, on the glycerin market.
    (b) Report.--Not later than 2 years after the date of the enactment 
of this Act, the Comptroller General of the United States shall report 
the findings of the study required under subsection (a) to the 
Committee on Finance of the Senate and the Committee on Ways and Means 
of the House of Representatives.

                      Subtitle G--Revenue Offsets

     PART I--LIMITATION ON EXPENSING CERTAIN PASSENGER AUTOMOBILES

SEC. 5601. EXPANSION OF LIMITATION ON DEPRECIATION OF CERTAIN PASSENGER 
              AUTOMOBILES.

    (a) In General.--Section 179(b) (relating to limitations) is 
amended by adding at the end the following new paragraph:
            ``(6) Limitation on cost taken into account for certain 
        passenger vehicles.--
                    ``(A) In general.--The cost of any sport utility 
                vehicle for any taxable year which may be taken into 
                account under this section shall not exceed $25,000.
                    ``(B) Sport utility vehicle.--For purposes of 
                subparagraph (A)--
                            ``(i) In general.--The term `sport utility 
                        vehicle' means any 4-wheeled vehicle which--
                                    ``(I) is manufactured primarily for 
                                use on public streets, roads, and 
                                highways,
                                    ``(II) is not subject to section 
                                280F, and
                                    ``(III) is rated at not more than 
                                14,000 pounds gross vehicle weight.
                            ``(ii) Certain vehicles excluded.--Such 
                        term does not include any vehicle which--
                                    ``(I) does not have the primary 
                                load carrying device or container 
                                attached,
                                    ``(II) has a seating capacity of 
                                more than 12 individuals,
                                    ``(III) is designed for more than 9 
                                individuals in seating rearward of the 
                                driver's seat,
                                    ``(IV) is equipped with an open 
                                cargo area, or a covered box not 
                                readily accessible from the passenger 
                                compartment, of at least 72.0 inches in 
                                interior length, or
                                    ``(V) has an integral enclosure, 
                                fully enclosing the driver compartment 
                                and load carrying device, does not have 
                                seating rearward of the driver's seat, 
                                and has no body section protruding more 
                                than 30 inches ahead of the leading 
                                edge of the windshield.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after February 2, 2004.

          PART II--PROVISIONS DESIGNED TO CURTAIL TAX SHELTERS

SEC. 5611. CLARIFICATION OF ECONOMIC SUBSTANCE DOCTRINE.

    (a) In General.--Section 7701 is amended by redesignating 
subsection (n) as subsection (o) and by inserting after subsection (m) 
the following new subsection:
    ``(n) Clarification of Economic Substance Doctrine; Etc.--
            ``(1) General rules.--
                    ``(A) In general.--In any case in which a court 
                determines that the economic substance doctrine is 
                relevant for purposes of this title to a transaction 
                (or series of transactions), such transaction (or 
                series of transactions) shall have economic substance 
                only if the requirements of this paragraph are met.
                    ``(B) Definition of economic substance.--For 
                purposes of subparagraph (A)--
                            ``(i) In general.--A transaction has 
                        economic substance only if--
                                    ``(I) the transaction changes in a 
                                meaningful way (apart from Federal tax 
                                effects) the taxpayer's economic 
                                position, and
                                    ``(II) the taxpayer has a 
                                substantial nontax purpose for entering 
                                into such transaction and the 
                                transaction is a reasonable means of 
                                accomplishing such purpose.
                        In applying subclause (II), a purpose of 
                        achieving a financial accounting benefit shall 
                        not be taken into account in determining 
                        whether a transaction has a substantial nontax 
                        purpose if the origin of such financial 
                        accounting benefit is a reduction of income 
                        tax.
                            ``(ii) Special rule where taxpayer relies 
                        on profit potential.--A transaction shall not 
                        be treated as having economic substance by 
                        reason of having a potential for profit 
                        unless--
                                    ``(I) the present value of the 
                                reasonably expected pre-tax profit from 
                                the transaction is substantial in 
                                relation to the present value of the 
                                expected net tax benefits that would be 
                                allowed if the transaction were 
                                respected, and
                                    ``(II) the reasonably expected pre-
                                tax profit from the transaction exceeds 
                                a risk-free rate of return.
                    ``(C) Treatment of fees and foreign taxes.--Fees 
                and other transaction expenses and foreign taxes shall 
                be taken into account as expenses in determining pre-
                tax profit under subparagraph (B)(ii).
            ``(2) Special rules for transactions with tax-indifferent 
        parties.--
                    ``(A) Special rules for financing transactions.--
                The form of a transaction which is in substance the 
                borrowing of money or the acquisition of financial 
                capital directly or indirectly from a tax-indifferent 
                party shall not be respected if the present value of 
                the deductions to be claimed with respect to the 
                transaction is substantially in excess of the present 
                value of the anticipated economic returns of the person 
                lending the money or providing the financial capital. A 
                public offering shall be treated as a borrowing, or an 
                acquisition of financial capital, from a tax-
                indifferent party if it is reasonably expected that at 
                least 50 percent of the offering will be placed with 
                tax-indifferent parties.
                    ``(B) Artificial income shifting and basis 
                adjustments.--The form of a transaction with a tax-
                indifferent party shall not be respected if--
                            ``(i) it results in an allocation of income 
                        or gain to the tax-indifferent party in excess 
                        of such party's economic income or gain, or
                            ``(ii) it results in a basis adjustment or 
                        shifting of basis on account of overstating the 
                        income or gain of the tax-indifferent party.
            ``(3) Definitions and special rules.--For purposes of this 
        subsection--
                    ``(A) Economic substance doctrine.--The term 
                `economic substance doctrine' means the common law 
                doctrine under which tax benefits under subtitle A with 
                respect to a transaction are not allowable if the 
                transaction does not have economic substance or lacks a 
                business purpose.
                    ``(B) Tax-indifferent party.--The term `tax-
                indifferent party' means any person or entity not 
                subject to tax imposed by subtitle A. A person shall be 
                treated as a tax-indifferent party with respect to a 
                transaction if the items taken into account with 
                respect to the transaction have no substantial impact 
                on such person's liability under subtitle A.
                    ``(C) Exception for personal transactions of 
                individuals.--In the case of an individual, this 
                subsection shall apply only to transactions entered 
                into in connection with a trade or business or an 
                activity engaged in for the production of income.
                    ``(D) Treatment of lessors.--In applying paragraph 
                (1)(B)(ii) to the lessor of tangible property subject 
                to a lease--
                            ``(i) the expected net tax benefits with 
                        respect to the leased property shall not 
                        include the benefits of--
                                    ``(I) depreciation,
                                    ``(II) any tax credit, or
                                    ``(III) any other deduction as 
                                provided in guidance by the Secretary, 
                                and
                            ``(ii) subclause (II) of paragraph 
                        (1)(B)(ii) shall be disregarded in determining 
                        whether any of such benefits are allowable.
            ``(4) Other common law doctrines not affected.--Except as 
        specifically provided in this subsection, the provisions of 
        this subsection shall not be construed as altering or 
        supplanting any other rule of law, and the requirements of this 
        subsection shall be construed as being in addition to any such 
        other rule of law.
            ``(5) Regulations.--The Secretary shall prescribe such 
        regulations as may be necessary or appropriate to carry out the 
        purposes of this subsection. Such regulations may include 
        exemptions from the application of this subsection.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to transactions entered into after February 2, 2004.

SEC. 5612. PENALTY FOR FAILING TO DISCLOSE REPORTABLE TRANSACTION.

    (a) In General.--Part I of subchapter B of chapter 68 (relating to 
assessable penalties) is amended by inserting after section 6707 the 
following new section:

``SEC. 6707A. PENALTY FOR FAILURE TO INCLUDE REPORTABLE TRANSACTION 
              INFORMATION WITH RETURN OR STATEMENT.

    ``(a) Imposition of Penalty.--Any person who fails to include on 
any return or statement any information with respect to a reportable 
transaction which is required under section 6011 to be included with 
such return or statement shall pay a penalty in the amount determined 
under subsection (b).
    ``(b) Amount of Penalty.--
            ``(1) In general.--Except as provided in paragraphs (2) and 
        (3), the amount of the penalty under subsection (a) shall be 
        $50,000.
            ``(2) Listed transaction.--The amount of the penalty under 
        subsection (a) with respect to a listed transaction shall be 
        $100,000.
            ``(3) Increase in penalty for large entities and high net 
        worth individuals.--
                    ``(A) In general.--In the case of a failure under 
                subsection (a) by--
                            ``(i) a large entity, or
                            ``(ii) a high net worth individual,
                the penalty under paragraph (1) or (2) shall be twice 
                the amount determined without regard to this paragraph.
                    ``(B) Large entity.--For purposes of subparagraph 
                (A), the term `large entity' means, with respect to any 
                taxable year, a person (other than a natural person) 
                with gross receipts in excess of $10,000,000 for the 
                taxable year in which the reportable transaction occurs 
                or the preceding taxable year. Rules similar to the 
                rules of paragraph (2) and subparagraphs (B), (C), and 
                (D) of paragraph (3) of section 448(c) shall apply for 
                purposes of this subparagraph.
                    ``(C) High net worth individual.--For purposes of 
                subparagraph (A), the term `high net worth individual' 
                means, with respect to a reportable transaction, a 
                natural person whose net worth exceeds $2,000,000 
                immediately before the transaction.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Reportable transaction.--The term `reportable 
        transaction' means any transaction with respect to which 
        information is required to be included with a return or 
        statement because, as determined under regulations prescribed 
        under section 6011, such transaction is of a type which the 
        Secretary determines as having a potential for tax avoidance or 
        evasion.
            ``(2) Listed transaction.--Except as provided in 
        regulations, the term `listed transaction' means a reportable 
        transaction which is the same as, or substantially similar to, 
        a transaction specifically identified by the Secretary as a tax 
        avoidance transaction for purposes of section 6011.
    ``(d) Authority To Rescind Penalty.--
            ``(1) In general.--The Commissioner of Internal Revenue may 
        rescind all or any portion of any penalty imposed by this 
        section with respect to any violation if--
                    ``(A) the violation is with respect to a reportable 
                transaction other than a listed transaction,
                    ``(B) the person on whom the penalty is imposed has 
                a history of complying with the requirements of this 
                title,
                    ``(C) it is shown that the violation is due to an 
                unintentional mistake of fact;
                    ``(D) imposing the penalty would be against equity 
                and good conscience, and
                    ``(E) rescinding the penalty would promote 
                compliance with the requirements of this title and 
                effective tax administration.
            ``(2) Discretion.--The exercise of authority under 
        paragraph (1) shall be at the sole discretion of the 
        Commissioner and may be delegated only to the head of the 
        Office of Tax Shelter Analysis. The Commissioner, in the 
        Commissioner's sole discretion, may establish a procedure to 
        determine if a penalty should be referred to the Commissioner 
        or the head of such Office for a determination under paragraph 
        (1).
            ``(3) No appeal.--Notwithstanding any other provision of 
        law, any determination under this subsection may not be 
        reviewed in any administrative or judicial proceeding.
            ``(4) Records.--If a penalty is rescinded under paragraph 
        (1), the Commissioner shall place in the file in the Office of 
        the Commissioner the opinion of the Commissioner or the head of 
        the Office of Tax Shelter Analysis with respect to the 
        determination, including--
                    ``(A) the facts and circumstances of the 
                transaction,
                    ``(B) the reasons for the rescission, and
                    ``(C) the amount of the penalty rescinded.
            ``(5) Report.--The Commissioner shall each year report to 
        the Committee on Ways and Means of the House of Representatives 
        and the Committee on Finance of the Senate--
                    ``(A) a summary of the total number and aggregate 
                amount of penalties imposed, and rescinded, under this 
                section, and
                    ``(B) a description of each penalty rescinded under 
                this subsection and the reasons therefor.
    ``(e) Penalty Reported to SEC.--In the case of a person--
            ``(1) which is required to file periodic reports under 
        section 13 or 15(d) of the Securities Exchange Act of 1934 or 
        is required to be consolidated with another person for purposes 
        of such reports, and
            ``(2) which--
                    ``(A) is required to pay a penalty under this 
                section with respect to a listed transaction,
                    ``(B) is required to pay a penalty under section 
                6662A with respect to any reportable transaction at a 
                rate prescribed under section 6662A(c), or
                    ``(C) is required to pay a penalty under section 
                6662B with respect to any noneconomic substance 
                transaction,
the requirement to pay such penalty shall be disclosed in such reports 
filed by such person for such periods as the Secretary shall specify. 
Failure to make a disclosure in accordance with the preceding sentence 
shall be treated as a failure to which the penalty under subsection 
(b)(2) applies.
    ``(f) Coordination With Other Penalties.--The penalty imposed by 
this section is in addition to any penalty imposed under this title.''.
    (b) Conforming Amendment.--The table of sections for part I of 
subchapter B of chapter 68 is amended by inserting after the item 
relating to section 6707 the following:

``Sec. 6707A. Penalty for failure to include reportable transaction 
                            information with return or statement.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to returns and statements the due date for which is after the 
date of the enactment of this Act.

SEC. 5613. ACCURACY-RELATED PENALTY FOR LISTED TRANSACTIONS AND OTHER 
              REPORTABLE TRANSACTIONS HAVING A SIGNIFICANT TAX 
              AVOIDANCE PURPOSE.

    (a) In General.--Subchapter A of chapter 68 is amended by inserting 
after section 6662 the following new section:

``SEC. 6662A. IMPOSITION OF ACCURACY-RELATED PENALTY ON UNDERSTATEMENTS 
              WITH RESPECT TO REPORTABLE TRANSACTIONS.

    ``(a) Imposition of Penalty.--If a taxpayer has a reportable 
transaction understatement for any taxable year, there shall be added 
to the tax an amount equal to 20 percent of the amount of such 
understatement.
    ``(b) Reportable Transaction Understatement.--For purposes of this 
section--
            ``(1) In general.--The term `reportable transaction 
        understatement' means the sum of--
                    ``(A) the product of--
                            ``(i) the amount of the increase (if any) 
                        in taxable income which results from a 
                        difference between the proper tax treatment of 
                        an item to which this section applies and the 
                        taxpayer's treatment of such item (as shown on 
                        the taxpayer's return of tax), and
                            ``(ii) the highest rate of tax imposed by 
                        section 1 (section 11 in the case of a taxpayer 
                        which is a corporation), and
                    ``(B) the amount of the decrease (if any) in the 
                aggregate amount of credits determined under subtitle A 
                which results from a difference between the taxpayer's 
                treatment of an item to which this section applies (as 
                shown on the taxpayer's return of tax) and the proper 
                tax treatment of such item.
        For purposes of subparagraph (A), any reduction of the excess 
        of deductions allowed for the taxable year over gross income 
        for such year, and any reduction in the amount of capital 
        losses which would (without regard to section 1211) be allowed 
        for such year, shall be treated as an increase in taxable 
        income.
            ``(2) Items to which section applies.--This section shall 
        apply to any item which is attributable to--
                    ``(A) any listed transaction, and
                    ``(B) any reportable transaction (other than a 
                listed transaction) if a significant purpose of such 
                transaction is the avoidance or evasion of Federal 
                income tax.
    ``(c) Higher Penalty for Nondisclosed Listed and Other Avoidance 
Transactions.--
            ``(1) In general.--Subsection (a) shall be applied by 
        substituting `30 percent' for `20 percent' with respect to the 
        portion of any reportable transaction understatement with 
        respect to which the requirement of section 6664(d)(2)(A) is 
        not met.
            ``(2) Rules applicable to assertion and compromise of 
        penalty.--
                    ``(A) In general.--Only upon the approval by the 
                Chief Counsel for the Internal Revenue Service or the 
                Chief Counsel's delegate at the national office of the 
                Internal Revenue Service may a penalty to which 
                paragraph (1) applies be included in a 1st letter of 
                proposed deficiency which allows the taxpayer an 
                opportunity for administrative review in the Internal 
                Revenue Service Office of Appeals. If such a letter is 
                provided to the taxpayer, only the Commissioner of 
                Internal Revenue may compromise all or any portion of 
                such penalty.
                    ``(B) Applicable rules.--The rules of paragraphs 
                (2), (3), (4), and (5) of section 6707A(d) shall apply 
                for purposes of subparagraph (A).
    ``(d) Definitions of Reportable and Listed Transactions.--For 
purposes of this section, the terms `reportable transaction' and 
`listed transaction' have the respective meanings given to such terms 
by section 6707A(c).
    ``(e) Special Rules.--
            ``(1) Coordination with penalties, etc., on other 
        understatements.--In the case of an understatement (as defined 
        in section 6662(d)(2))--
                    ``(A) the amount of such understatement (determined 
                without regard to this paragraph) shall be increased by 
                the aggregate amount of reportable transaction 
                understatements and noneconomic substance transaction 
                understatements for purposes of determining whether 
                such understatement is a substantial understatement 
                under section 6662(d)(1), and
                    ``(B) the addition to tax under section 6662(a) 
                shall apply only to the excess of the amount of the 
                substantial understatement (if any) after the 
                application of subparagraph (A) over the aggregate 
                amount of reportable transaction understatements and 
                noneconomic substance transaction understatements.
            ``(2) Coordination with other penalties.--
                    ``(A) Application of fraud penalty.--References to 
                an underpayment in section 6663 shall be treated as 
                including references to a reportable transaction 
                understatement and a noneconomic substance transaction 
                understatement.
                    ``(B) No double penalty.--This section shall not 
                apply to any portion of an understatement on which a 
                penalty is imposed under section 6662B or 6663.
            ``(3) Special rule for amended returns.--Except as provided 
        in regulations, in no event shall any tax treatment included 
        with an amendment or supplement to a return of tax be taken 
        into account in determining the amount of any reportable 
        transaction understatement or noneconomic substance transaction 
        understatement if the amendment or supplement is filed after 
        the earlier of the date the taxpayer is first contacted by the 
        Secretary regarding the examination of the return or such other 
        date as is specified by the Secretary.
                    ``(4) Noneconomic substance transaction 
                understatement.--For purposes of this subsection, the 
                term `noneconomic substance transaction understatement' 
                has the meaning given such term by section 6662B(c).
                    ``(5) Cross reference.--

                                ``For reporting of section 6662A(c) 
penalty to the Securities and Exchange Commission, see section 
6707A(e).''.
    (b) Determination of Other Understatements.--Subparagraph (A) of 
section 6662(d)(2) is amended by adding at the end the following flush 
sentence:
                ``The excess under the preceding sentence shall be 
                determined without regard to items to which section 
                6662A applies and without regard to items with respect 
                to which a penalty is imposed by section 6662B.''.
    (c) Reasonable Cause Exception.--
            (1) In general.--Section 6664 is amended by adding at the 
        end the following new subsection:
    ``(d) Reasonable Cause Exception for Reportable Transaction 
Understatements.--
            ``(1) In general.--No penalty shall be imposed under 
        section 6662A with respect to any portion of a reportable 
        transaction understatement if it is shown that there was a 
        reasonable cause for such portion and that the taxpayer acted 
        in good faith with respect to such portion.
            ``(2) Special rules.--Paragraph (1) shall not apply to any 
        reportable transaction understatement unless--
                    ``(A) the relevant facts affecting the tax 
                treatment of the item are adequately disclosed in 
                accordance with the regulations prescribed under 
                section 6011,
                    ``(B) there is or was substantial authority for 
                such treatment, and
                    ``(C) the taxpayer reasonably believed that such 
                treatment was more likely than not the proper 
                treatment.
        A taxpayer failing to adequately disclose in accordance with 
        section 6011 shall be treated as meeting the requirements of 
        subparagraph (A) if the penalty for such failure was rescinded 
        under section 6707A(d).
            ``(3) Rules relating to reasonable belief.--For purposes of 
        paragraph (2)(C)--
                    ``(A) In general.--A taxpayer shall be treated as 
                having a reasonable belief with respect to the tax 
                treatment of an item only if such belief--
                            ``(i) is based on the facts and law that 
                        exist at the time the return of tax which 
                        includes such tax treatment is filed, and
                            ``(ii) relates solely to the taxpayer's 
                        chances of success on the merits of such 
                        treatment and does not take into account the 
                        possibility that a return will not be audited, 
                        such treatment will not be raised on audit, or 
                        such treatment will be resolved through 
                        settlement if it is raised.
                    ``(B) Certain opinions may not be relied upon.--
                            ``(i) In general.--An opinion of a tax 
                        advisor may not be relied upon to establish the 
                        reasonable belief of a taxpayer if--
                                    ``(I) the tax advisor is described 
                                in clause (ii), or
                                    ``(II) the opinion is described in 
                                clause (iii).
                            ``(ii) Disqualified tax advisors.--A tax 
                        advisor is described in this clause if the tax 
                        advisor--
                                    ``(I) is a material advisor (within 
                                the meaning of section 6111(b)(1)) who 
                                participates in the organization, 
                                management, promotion, or sale of the 
                                transaction or who is related (within 
                                the meaning of section 267(b) or 
                                707(b)(1)) to any person who so 
                                participates,
                                    ``(II) is compensated directly or 
                                indirectly by a material advisor with 
                                respect to the transaction,
                                    ``(III) has a fee arrangement with 
                                respect to the transaction which is 
                                contingent on all or part of the 
                                intended tax benefits from the 
                                transaction being sustained, or
                                    ``(IV) as determined under 
                                regulations prescribed by the 
                                Secretary, has a disqualifying 
                                financial interest with respect to the 
                                transaction.
                            ``(iii) Disqualified opinions.--For 
                        purposes of clause (i), an opinion is 
                        disqualified if the opinion--
                                    ``(I) is based on unreasonable 
                                factual or legal assumptions (including 
                                assumptions as to future events),
                                    ``(II) unreasonably relies on 
                                representations, statements, findings, 
                                or agreements of the taxpayer or any 
                                other person,
                                    ``(III) does not identify and 
                                consider all relevant facts, or
                                    ``(IV) fails to meet any other 
                                requirement as the Secretary may 
                                prescribe.''.
            (2) Conforming amendment.--The heading for subsection (c) 
        of section 6664 is amended by inserting ``for Underpayments'' 
        after ``Exception''.
    (d) Conforming Amendments.--
            (1) Subparagraph (C) of section 461(i)(3) is amended by 
        striking ``section 6662(d)(2)(C)(iii)'' and inserting ``section 
        1274(b)(3)(C)''.
            (2) Paragraph (3) of section 1274(b) is amended--
                    (A) by striking ``(as defined in section 
                6662(d)(2)(C)(iii))'' in subparagraph (B)(i), and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(C) Tax shelter.--For purposes of subparagraph 
                (B), the term `tax shelter' means--
                            ``(i) a partnership or other entity,
                            ``(ii) any investment plan or arrangement, 
                        or
                            ``(iii) any other plan or arrangement,
                if a significant purpose of such partnership, entity, 
                plan, or arrangement is the avoidance or evasion of 
                Federal income tax.''.
            (3) Section 6662(d)(2) is amended by striking subparagraphs 
        (C) and (D).
            (4) Section 6664(c)(1) is amended by striking ``this part'' 
        and inserting ``section 6662 or 6663''.
            (5) Subsection (b) of section 7525 is amended by striking 
        ``section 6662(d)(2)(C)(iii)'' and inserting ``section 
        1274(b)(3)(C)''.
            (6)(A) The heading for section 6662 is amended to read as 
        follows:

``SEC. 6662. IMPOSITION OF ACCURACY-RELATED PENALTY ON 
              UNDERPAYMENTS.''.

            (B) The table of sections for part II of subchapter A of 
        chapter 68 is amended by striking the item relating to section 
        6662 and inserting the following new items:

``Sec. 6662. Imposition of accuracy-related penalty on underpayments.
``Sec. 6662A. Imposition of accuracy-related penalty on understatements 
                            with respect to reportable transactions.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 5614. PENALTY FOR UNDERSTATEMENTS ATTRIBUTABLE TO TRANSACTIONS 
              LACKING ECONOMIC SUBSTANCE, ETC.

    (a) In General.--Subchapter A of chapter 68 is amended by inserting 
after section 6662A the following new section:

``SEC. 6662B. PENALTY FOR UNDERSTATEMENTS ATTRIBUTABLE TO TRANSACTIONS 
              LACKING ECONOMIC SUBSTANCE, ETC.

    ``(a) Imposition of Penalty.--If a taxpayer has an noneconomic 
substance transaction understatement for any taxable year, there shall 
be added to the tax an amount equal to 40 percent of the amount of such 
understatement.
    ``(b) Reduction of Penalty for Disclosed Transactions.--Subsection 
(a) shall be applied by substituting `20 percent' for `40 percent' with 
respect to the portion of any noneconomic substance transaction 
understatement with respect to which the relevant facts affecting the 
tax treatment of the item are adequately disclosed in the return or a 
statement attached to the return.
    ``(c) Noneconomic Substance Transaction Understatement.--For 
purposes of this section--
            ``(1) In general.--The term `noneconomic substance 
        transaction understatement' means any amount which would be an 
        understatement under section 6662A(b)(1) if section 6662A were 
        applied by taking into account items attributable to 
        noneconomic substance transactions rather than items to which 
        section 6662A would apply without regard to this paragraph.
            ``(2) Noneconomic substance transaction.--The term 
        `noneconomic substance transaction' means any transaction if--
                    ``(A) there is a lack of economic substance (within 
                the meaning of section 7701(n)(1)) for the transaction 
                giving rise to the claimed benefit or the transaction 
                was not respected under section 7701(n)(2), or
                    ``(B) the transaction fails to meet the 
                requirements of any similar rule of law.
    ``(d) Rules Applicable To Compromise of Penalty.--
            ``(1) In general.--If the 1st letter of proposed deficiency 
        which allows the taxpayer an opportunity for administrative 
        review in the Internal Revenue Service Office of Appeals has 
        been sent with respect to a penalty to which this section 
        applies, only the Commissioner of Internal Revenue may 
        compromise all or any portion of such penalty.
            ``(2) Applicable rules.--The rules of paragraphs (2), (3), 
        (4), and (5) of section 6707A(d) shall apply for purposes of 
        paragraph (1).
    ``(e) Coordination With Other Penalties.--Except as otherwise 
provided in this part, the penalty imposed by this section shall be in 
addition to any other penalty imposed by this title.
    ``(f) Cross References.--

                                ``(1) For coordination of penalty with 
understatements under section 6662 and other special rules, see section 
6662A(e).
                                ``(2) For reporting of penalty imposed 
under this section to the Securities and Exchange Commission, see 
section 6707A(e).''.
    (b) Clerical Amendment.--The table of sections for part II of 
subchapter A of chapter 68 is amended by inserting after the item 
relating to section 6662A the following new item:

``Sec. 6662B. Penalty for understatements attributable to transactions 
                            lacking economic substance, etc.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to transactions entered into after February 2, 2004.

SEC. 5615. MODIFICATIONS OF SUBSTANTIAL UNDERSTATEMENT PENALTY FOR 
              NONREPORTABLE TRANSACTIONS.

    (a) Substantial Understatement of Corporations.--Section 
6662(d)(1)(B) (relating to special rule for corporations) is amended to 
read as follows:
                    ``(B) Special rule for corporations.--In the case 
                of a corporation other than an S corporation or a 
                personal holding company (as defined in section 542), 
                there is a substantial understatement of income tax for 
                any taxable year if the amount of the understatement 
                for the taxable year exceeds the lesser of--
                            ``(i) 10 percent of the tax required to be 
                        shown on the return for the taxable year (or, 
                        if greater, $10,000), or
                            ``(ii) $10,000,000.''.
    (b) Reduction for Understatement of Taxpayer Due to Position of 
Taxpayer or Disclosed Item.--
            (1) In general.--Section 6662(d)(2)(B)(i) (relating to 
        substantial authority) is amended to read as follows:
                            ``(i) the tax treatment of any item by the 
                        taxpayer if the taxpayer had reasonable belief 
                        that the tax treatment was more likely than not 
                        the proper treatment, or''.
            (2) Conforming amendment.--Section 6662(d) is amended by 
        adding at the end the following new paragraph:
            ``(3) Secretarial list.--For purposes of this subsection, 
        section 6664(d)(2), and section 6694(a)(1), the Secretary may 
        prescribe a list of positions for which the Secretary believes 
        there is not substantial authority or there is no reasonable 
        belief that the tax treatment is more likely than not the 
        proper tax treatment. Such list (and any revisions thereof) 
        shall be published in the Federal Register or the Internal 
        Revenue Bulletin.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5616. TAX SHELTER EXCEPTION TO CONFIDENTIALITY PRIVILEGES RELATING 
              TO TAXPAYER COMMUNICATIONS.

    (a) In General.--Section 7525(b) (relating to section not to apply 
to communications regarding corporate tax shelters) is amended to read 
as follows:
    ``(b) Section Not To Apply to Communications Regarding Tax 
Shelters.--The privilege under subsection (a) shall not apply to any 
written communication which is--
            ``(1) between a federally authorized tax practitioner and--
                    ``(A) any person,
                    ``(B) any director, officer, employee, agent, or 
                representative of the person, or
                    ``(C) any other person holding a capital or profits 
                interest in the person, and
            ``(2) in connection with the promotion of the direct or 
        indirect participation of the person in any tax shelter (as 
        defined in section 1274(b)(3)(C)).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to communications made on or after the date of the enactment of this 
Act.

SEC. 5617. DISCLOSURE OF REPORTABLE TRANSACTIONS.

    (a) In General.--Section 6111 (relating to registration of tax 
shelters) is amended to read as follows:

``SEC. 6111. DISCLOSURE OF REPORTABLE TRANSACTIONS.

    ``(a) In General.--Each material advisor with respect to any 
reportable transaction shall make a return (in such form as the 
Secretary may prescribe) setting forth--
            ``(1) information identifying and describing the 
        transaction,
            ``(2) information describing any potential tax benefits 
        expected to result from the transaction, and
            ``(3) such other information as the Secretary may 
        prescribe.
Such return shall be filed not later than the date specified by the 
Secretary.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Material advisor.--
                    ``(A) In general.--The term `material advisor' 
                means any person--
                            ``(i) who provides any material aid, 
                        assistance, or advice with respect to 
                        organizing, managing, promoting, selling, 
                        implementing, or carrying out any reportable 
                        transaction, and
                            ``(ii) who directly or indirectly derives 
                        gross income in excess of the threshold amount 
                        for such aid, assistance, or advice.
                    ``(B) Threshold amount.--For purposes of 
                subparagraph (A), the threshold amount is--
                            ``(i) $50,000 in the case of a reportable 
                        transaction substantially all of the tax 
                        benefits from which are provided to natural 
                        persons, and
                            ``(ii) $250,000 in any other case.
            ``(2) Reportable transaction.--The term `reportable 
        transaction' has the meaning given to such term by section 
        6707A(c).
    ``(c) Regulations.--The Secretary may prescribe regulations which 
provide--
            ``(1) that only 1 person shall be required to meet the 
        requirements of subsection (a) in cases in which 2 or more 
        persons would otherwise be required to meet such requirements,
            ``(2) exemptions from the requirements of this section, and
            ``(3) such rules as may be necessary or appropriate to 
        carry out the purposes of this section.''.
    (b) Conforming Amendments.--
            (1) The item relating to section 6111 in the table of 
        sections for subchapter B of chapter 61 is amended to read as 
        follows:

``Sec. 6111. Disclosure of reportable transactions.''.
            (2)(A) So much of section 6112 as precedes subsection (c) 
        thereof is amended to read as follows:

``SEC. 6112. MATERIAL ADVISORS OF REPORTABLE TRANSACTIONS MUST KEEP 
              LISTS OF ADVISEES.

    ``(a) In General.--Each material advisor (as defined in section 
6111) with respect to any reportable transaction (as defined in section 
6707A(c)) shall maintain, in such manner as the Secretary may by 
regulations prescribe, a list--
            ``(1) identifying each person with respect to whom such 
        advisor acted as such a material advisor with respect to such 
        transaction, and
            ``(2) containing such other information as the Secretary 
        may by regulations require.
This section shall apply without regard to whether a material advisor 
is required to file a return under section 6111 with respect to such 
transaction.''.
            (B) Section 6112 is amended by redesignating subsection (c) 
        as subsection (b).
            (C) Section 6112(b), as redesignated by subparagraph (B), 
        is amended--
                    (i) by inserting ``written'' before ``request'' in 
                paragraph (1)(A), and
                    (ii) by striking ``shall prescribe'' in paragraph 
                (2) and inserting ``may prescribe''.
            (D) The item relating to section 6112 in the table of 
        sections for subchapter B of chapter 61 is amended to read as 
        follows:

``Sec. 6112. Material advisors of reportable transactions must keep 
                            lists of advisees.''.
            (3)(A) The heading for section 6708 is amended to read as 
        follows:

``SEC. 6708. FAILURE TO MAINTAIN LISTS OF ADVISEES WITH RESPECT TO 
              REPORTABLE TRANSACTIONS.''.

            (B) The item relating to section 6708 in the table of 
        sections for part I of subchapter B of chapter 68 is amended to 
        read as follows:

``Sec. 6708. Failure to maintain lists of advisees with respect to 
                            reportable transactions.''.
    (c) Required Disclosure Not Subject to Claim of Confidentiality.--
Subparagraph (A) of section 6112(b)(1), as redesignated by subsection 
(b)(2)(B), is amended by adding at the end the following new flush 
sentence:
        ``For purposes of this section, the identity of any person on 
        such list shall not be privileged.''.
    (d) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to transactions 
        with respect to which material aid, assistance, or advice 
        referred to in section 6111(b)(1)(A)(i) of the Internal Revenue 
        Code of 1986 (as added by this section) is provided after the 
        date of the enactment of this Act.
            (2) No claim of confidentiality against disclosure.--The 
        amendment made by subsection (c) shall take effect as if 
        included in the amendments made by section 142 of the Deficit 
        Reduction Act of 1984.

SEC. 5618. MODIFICATIONS TO PENALTY FOR FAILURE TO REGISTER TAX 
              SHELTERS.

    (a) In General.--Section 6707 (relating to failure to furnish 
information regarding tax shelters) is amended to read as follows:

``SEC. 6707. FAILURE TO FURNISH INFORMATION REGARDING REPORTABLE 
              TRANSACTIONS.

    ``(a) In General.--If a person who is required to file a return 
under section 6111(a) with respect to any reportable transaction--
            ``(1) fails to file such return on or before the date 
        prescribed therefor, or
            ``(2) files false or incomplete information with the 
        Secretary with respect to such transaction,
such person shall pay a penalty with respect to such return in the 
amount determined under subsection (b).
    ``(b) Amount of Penalty.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        penalty imposed under subsection (a) with respect to any 
        failure shall be $50,000.
            ``(2) Listed transactions.--The penalty imposed under 
        subsection (a) with respect to any listed transaction shall be 
        an amount equal to the greater of--
                    ``(A) $200,000, or
                    ``(B) 50 percent of the gross income derived by 
                such person with respect to aid, assistance, or advice 
                which is provided with respect to the listed 
                transaction before the date the return including the 
                transaction is filed under section 6111.
        Subparagraph (B) shall be applied by substituting `75 percent' 
        for `50 percent' in the case of an intentional failure or act 
        described in subsection (a).
    ``(c) Certain Rules To Apply.--The provisions of section 6707A(d) 
shall apply to any penalty imposed under this section.
    ``(d) Reportable and Listed Transactions.--The terms `reportable 
transaction' and `listed transaction' have the respective meanings 
given to such terms by section 6707A(c).''.
    (b) Clerical Amendment.--The item relating to section 6707 in the 
table of sections for part I of subchapter B of chapter 68 is amended 
by striking ``tax shelters'' and inserting ``reportable transactions''.
    (c) Effective Date.--The amendments made by this section shall 
apply to returns the due date for which is after the date of the 
enactment of this Act.

SEC. 5619. MODIFICATION OF PENALTY FOR FAILURE TO MAINTAIN LISTS OF 
              INVESTORS.

    (a) In General.--Subsection (a) of section 6708 is amended to read 
as follows:
    ``(a) Imposition of Penalty.--
            ``(1) In general.--If any person who is required to 
        maintain a list under section 6112(a) fails to make such list 
        available upon written request to the Secretary in accordance 
        with section 6112(b)(1)(A) within 20 business days after the 
        date of the Secretary's request, such person shall pay a 
        penalty of $10,000 for each day of such failure after such 20th 
        day.
            ``(2) Reasonable cause exception.--No penalty shall be 
        imposed by paragraph (1) with respect to the failure on any day 
        if such failure is due to reasonable cause.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to requests made after the date of the enactment of this Act.

SEC. 5620. MODIFICATION OF ACTIONS TO ENJOIN CERTAIN CONDUCT RELATED TO 
              TAX SHELTERS AND REPORTABLE TRANSACTIONS.

    (a) In General.--Section 7408 (relating to action to enjoin 
promoters of abusive tax shelters, etc.) is amended by redesignating 
subsection (c) as subsection (d) and by striking subsections (a) and 
(b) and inserting the following new subsections:
    ``(a) Authority To Seek Injunction.--A civil action in the name of 
the United States to enjoin any person from further engaging in 
specified conduct may be commenced at the request of the Secretary. Any 
action under this section shall be brought in the district court of the 
United States for the district in which such person resides, has his 
principal place of business, or has engaged in specified conduct. The 
court may exercise its jurisdiction over such action (as provided in 
section 7402(a)) separate and apart from any other action brought by 
the United States against such person.
    ``(b) Adjudication and Decree.--In any action under subsection (a), 
if the court finds--
            ``(1) that the person has engaged in any specified conduct, 
        and
            ``(2) that injunctive relief is appropriate to prevent 
        recurrence of such conduct,
the court may enjoin such person from engaging in such conduct or in 
any other activity subject to penalty under this title.
    ``(c) Specified Conduct.--For purposes of this section, the term 
`specified conduct' means any action, or failure to take action, 
subject to penalty under section 6700, 6701, 6707, or 6708.''.
    (b) Conforming Amendments.--
            (1) The heading for section 7408 is amended to read as 
        follows:

``SEC. 7408. ACTIONS TO ENJOIN SPECIFIED CONDUCT RELATED TO TAX 
              SHELTERS AND REPORTABLE TRANSACTIONS.''.

            (2) The table of sections for subchapter A of chapter 67 is 
        amended by striking the item relating to section 7408 and 
        inserting the following new item:

``Sec. 7408. Actions to enjoin specified conduct related to tax 
                            shelters and reportable transactions.''.
    (c) Effective Date.--The amendment made by this section shall take 
effect on the day after the date of the enactment of this Act.

SEC. 5621. UNDERSTATEMENT OF TAXPAYER'S LIABILITY BY INCOME TAX RETURN 
              PREPARER.

    (a) Standards Conformed to Taxpayer Standards.--Section 6694(a) 
(relating to understatements due to unrealistic positions) is amended--
            (1) by striking ``realistic possibility of being sustained 
        on its merits'' in paragraph (1) and inserting ``reasonable 
        belief that the tax treatment in such position was more likely 
        than not the proper treatment'',
            (2) by striking ``or was frivolous'' in paragraph (3) and 
        inserting ``or there was no reasonable basis for the tax 
        treatment of such position'', and
            (3) by striking ``Unrealistic'' in the heading and 
        inserting ``Improper''.
    (b) Amount of Penalty.--Section 6694 is amended--
            (1) by striking ``$250'' in subsection (a) and inserting 
        ``$1,000'', and
            (2) by striking ``$1,000'' in subsection (b) and inserting 
        ``$5,000''.
    (c) Effective Date.--The amendments made by this section shall 
apply to documents prepared after the date of the enactment of this 
Act.

SEC. 5622. PENALTY ON FAILURE TO REPORT INTERESTS IN FOREIGN FINANCIAL 
              ACCOUNTS.

    (a) In General.--Section 5321(a)(5) of title 31, United States 
Code, is amended to read as follows:
            ``(5) Foreign financial agency transaction violation.--
                    ``(A) Penalty authorized.--The Secretary of the 
                Treasury may impose a civil money penalty on any person 
                who violates, or causes any violation of, any provision 
                of section 5314.
                    ``(B) Amount of penalty.--
                            ``(i) In general.--Except as provided in 
                        subparagraph (C), the amount of any civil 
                        penalty imposed under subparagraph (A) shall 
                        not exceed $5,000.
                            ``(ii) Reasonable cause exception.--No 
                        penalty shall be imposed under subparagraph (A) 
                        with respect to any violation if--
                                    ``(I) such violation was due to 
                                reasonable cause, and
                                    ``(II) the amount of the 
                                transaction or the balance in the 
                                account at the time of the transaction 
                                was properly reported.
                    ``(C) Willful violations.--In the case of any 
                person willfully violating, or willfully causing any 
                violation of, any provision of section 5314--
                            ``(i) the maximum penalty under 
                        subparagraph (B)(i) shall be increased to the 
                        greater of--
                                    ``(I) $25,000, or
                                    ``(II) the amount (not exceeding 
                                $100,000) determined under subparagraph 
                                (D), and
                            ``(ii) subparagraph (B)(ii) shall not 
                        apply.
                    ``(D) Amount.--The amount determined under this 
                subparagraph is--
                            ``(i) in the case of a violation involving 
                        a transaction, the amount of the transaction, 
                        or
                            ``(ii) in the case of a violation involving 
                        a failure to report the existence of an account 
                        or any identifying information required to be 
                        provided with respect to an account, the 
                        balance in the account at the time of the 
                        violation.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to violations occurring after the date of the enactment of this Act.

SEC. 5623. FRIVOLOUS TAX SUBMISSIONS.

    (a) Civil Penalties.--Section 6702 is amended to read as follows:

``SEC. 6702. FRIVOLOUS TAX SUBMISSIONS.

    ``(a) Civil Penalty for Frivolous Tax Returns.--A person shall pay 
a penalty of $5,000 if--
            ``(1) such person files what purports to be a return of a 
        tax imposed by this title but which--
                    ``(A) does not contain information on which the 
                substantial correctness of the self-assessment may be 
                judged, or
                    ``(B) contains information that on its face 
                indicates that the self-assessment is substantially 
                incorrect; and
            ``(2) the conduct referred to in paragraph (1)--
                    ``(A) is based on a position which the Secretary 
                has identified as frivolous under subsection (c), or
                    ``(B) reflects a desire to delay or impede the 
                administration of Federal tax laws.
    ``(b) Civil Penalty for Specified Frivolous Submissions.--
            ``(1) Imposition of penalty.--Except as provided in 
        paragraph (3), any person who submits a specified frivolous 
        submission shall pay a penalty of $5,000.
            ``(2) Specified frivolous submission.--For purposes of this 
        section--
                    ``(A) Specified frivolous submission.--The term 
                `specified frivolous submission' means a specified 
                submission if any portion of such submission--
                            ``(i) is based on a position which the 
                        Secretary has identified as frivolous under 
                        subsection (c), or
                            ``(ii) reflects a desire to delay or impede 
                        the administration of Federal tax laws.
                    ``(B) Specified submission.--The term `specified 
                submission' means--
                            ``(i) a request for a hearing under--
                                    ``(I) section 6320 (relating to 
                                notice and opportunity for hearing upon 
                                filing of notice of lien), or
                                    ``(II) section 6330 (relating to 
                                notice and opportunity for hearing 
                                before levy), and
                            ``(ii) an application under--
                                    ``(I) section 6159 (relating to 
                                agreements for payment of tax liability 
                                in installments),
                                    ``(II) section 7122 (relating to 
                                compromises), or
                                    ``(III) section 7811 (relating to 
                                taxpayer assistance orders).
            ``(3) Opportunity to withdraw submission.--If the Secretary 
        provides a person with notice that a submission is a specified 
        frivolous submission and such person withdraws such submission 
        within 30 days after such notice, the penalty imposed under 
        paragraph (1) shall not apply with respect to such submission.
    ``(c) Listing of Frivolous Positions.--The Secretary shall 
prescribe (and periodically revise) a list of positions which the 
Secretary has identified as being frivolous for purposes of this 
subsection. The Secretary shall not include in such list any position 
that the Secretary determines meets the requirement of section 
6662(d)(2)(B)(ii)(II).
    ``(d) Reduction of Penalty.--The Secretary may reduce the amount of 
any penalty imposed under this section if the Secretary determines that 
such reduction would promote compliance with and administration of the 
Federal tax laws.
    ``(e) Penalties in Addition to Other Penalties.--The penalties 
imposed by this section shall be in addition to any other penalty 
provided by law.''.
    (b) Treatment of Frivolous Requests for Hearings Before Levy.--
            (1) Frivolous requests disregarded.--Section 6330 (relating 
        to notice and opportunity for hearing before levy) is amended 
        by adding at the end the following new subsection:
    ``(g) Frivolous Requests for Hearing, Etc.--Notwithstanding any 
other provision of this section, if the Secretary determines that any 
portion of a request for a hearing under this section or section 6320 
meets the requirement of clause (i) or (ii) of section 6702(b)(2)(A), 
then the Secretary may treat such portion as if it were never submitted 
and such portion shall not be subject to any further administrative or 
judicial review.''.
            (2) Preclusion from raising frivolous issues at hearing.--
        Section 6330(c)(4) is amended--
                    (A) by striking ``(A)'' and inserting ``(A)(i)'';
                    (B) by striking ``(B)'' and inserting ``(ii)'';
                    (C) by striking the period at the end of the first 
                sentence and inserting ``; or''; and
                    (D) by inserting after subparagraph (A)(ii) (as so 
                redesignated) the following:
                    ``(B) the issue meets the requirement of clause (i) 
                or (ii) of section 6702(b)(2)(A).''.
            (3) Statement of grounds.--Section 6330(b)(1) is amended by 
        striking ``under subsection (a)(3)(B)'' and inserting ``in 
        writing under subsection (a)(3)(B) and states the grounds for 
        the requested hearing''.
    (c) Treatment of Frivolous Requests for Hearings Upon Filing of 
Notice of Lien.--Section 6320 is amended--
            (1) in subsection (b)(1), by striking ``under subsection 
        (a)(3)(B)'' and inserting ``in writing under subsection 
        (a)(3)(B) and states the grounds for the requested hearing'', 
        and
            (2) in subsection (c), by striking ``and (e)'' and 
        inserting ``(e), and (g)''.
    (d) Treatment of Frivolous Applications for Offers-in-Compromise 
and Installment Agreements.--Section 7122 is amended by adding at the 
end the following new subsection:
    ``(e) Frivolous Submissions, Etc.--Notwithstanding any other 
provision of this section, if the Secretary determines that any portion 
of an application for an offer-in-compromise or installment agreement 
submitted under this section or section 6159 meets the requirement of 
clause (i) or (ii) of section 6702(b)(2)(A), then the Secretary may 
treat such portion as if it were never submitted and such portion shall 
not be subject to any further administrative or judicial review.''.
    (e) Clerical Amendment.--The table of sections for part I of 
subchapter B of chapter 68 is amended by striking the item relating to 
section 6702 and inserting the following new item:

``Sec. 6702. Frivolous tax submissions.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to submissions made and issues raised after the date on which the 
Secretary first prescribes a list under section 6702(c) of the Internal 
Revenue Code of 1986, as amended by subsection (a).

SEC. 5624. REGULATION OF INDIVIDUALS PRACTICING BEFORE THE DEPARTMENT 
              OF TREASURY.

    (a) Censure; Imposition of Penalty.--
            (1) In general.--Section 330(b) of title 31, United States 
        Code, is amended--
                    (A) by inserting ``, or censure,'' after 
                ``Department'', and
                    (B) by adding at the end the following new flush 
                sentence:
``The Secretary may impose a monetary penalty on any representative 
described in the preceding sentence. If the representative was acting 
on behalf of an employer or any firm or other entity in connection with 
the conduct giving rise to such penalty, the Secretary may impose a 
monetary penalty on such employer, firm, or entity if it knew, or 
reasonably should have known, of such conduct. Such penalty shall not 
exceed the gross income derived (or to be derived) from the conduct 
giving rise to the penalty and may be in addition to, or in lieu of, 
any suspension, disbarment, or censure of the representative.''.
            (2) Effective date.--The amendments made by this subsection 
        shall apply to actions taken after the date of the enactment of 
        this Act.
    (b) Tax Shelter Opinions, Etc.--Section 330 of such title 31 is 
amended by adding at the end the following new subsection:
    ``(d) Nothing in this section or in any other provision of law 
shall be construed to limit the authority of the Secretary of the 
Treasury to impose standards applicable to the rendering of written 
advice with respect to any entity, transaction plan or arrangement, or 
other plan or arrangement, which is of a type which the Secretary 
determines as having a potential for tax avoidance or evasion.''.

SEC. 5625. PENALTY ON PROMOTERS OF TAX SHELTERS.

    (a) Penalty on Promoting Abusive Tax Shelters.--Section 6700(a) is 
amended by adding at the end the following new sentence: 
``Notwithstanding the first sentence, if an activity with respect to 
which a penalty imposed under this subsection involves a statement 
described in paragraph (2)(A), the amount of the penalty shall be equal 
to 50 percent of the gross income derived (or to be derived) from such 
activity by the person on which the penalty is imposed.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to activities after the date of the enactment of this Act.

SEC. 5626. STATUTE OF LIMITATIONS FOR TAXABLE YEARS FOR WHICH REQUIRED 
              LISTED TRANSACTIONS NOT REPORTED.

    (a) In General.--Section 6501(c) (relating to exceptions) is 
amended by adding at the end the following new paragraph:
            ``(10) Listed transactions.--If a taxpayer fails to include 
        on any return or statement for any taxable year any information 
        with respect to a listed transaction (as defined in section 
        6707A(c)(2)) which is required under section 6011 to be 
        included with such return or statement, the time for assessment 
        of any tax imposed by this title with respect to such 
        transaction shall not expire before the date which is 1 year 
        after the earlier of--
                    ``(A) the date on which the Secretary is furnished 
                the information so required; or
                    ``(B) the date that a material advisor (as defined 
                in section 6111) meets the requirements of section 6112 
                with respect to a request by the Secretary under 
                section 6112(b) relating to such transaction with 
                respect to such taxpayer.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years with respect to which the period for assessing a 
deficiency did not expire before the date of the enactment of this Act.

SEC. 5627. DENIAL OF DEDUCTION FOR INTEREST ON UNDERPAYMENTS 
              ATTRIBUTABLE TO NONDISCLOSED REPORTABLE AND NONECONOMIC 
              SUBSTANCE TRANSACTIONS.

    (a) In General.--Section 163 (relating to deduction for interest) 
is amended by redesignating subsection (m) as subsection (n) and by 
inserting after subsection (l) the following new subsection:
    ``(m) Interest on Unpaid Taxes Attributable To Nondisclosed 
Reportable Transactions and Noneconomic Substance Transactions.--No 
deduction shall be allowed under this chapter for any interest paid or 
accrued under section 6601 on any underpayment of tax which is 
attributable to--
            ``(1) the portion of any reportable transaction 
        understatement (as defined in section 6662A(b)) with respect to 
        which the requirement of section 6664(d)(2)(A) is not met, or
            ``(2) any noneconomic substance transaction understatement 
        (as defined in section 6662B(c)).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to transactions in taxable years beginning after the date of the 
enactment of this Act.

SEC. 5628. AUTHORIZATION OF APPROPRIATIONS FOR TAX LAW ENFORCEMENT.

    There is authorized to be appropriated $300,000,000 for each fiscal 
year beginning after September 30, 2003, for the purpose of carrying 
out tax law enforcement to combat tax avoidance transactions and other 
tax shelters, including the use of offshore financial accounts to 
conceal taxable income.

            PART III--OTHER CORPORATE GOVERNANCE PROVISIONS

SEC. 5631. AFFIRMATION OF CONSOLIDATED RETURN REGULATION AUTHORITY.

    (a) In General.--Section 1502 (relating to consolidated return 
regulations) is amended by adding at the end the following new 
sentence: ``In prescribing such regulations, the Secretary may 
prescribe rules applicable to corporations filing consolidated returns 
under section 1501 that are different from other provisions of this 
title that would apply if such corporations filed separate returns.''.
    (b) Result Not Overturned.--Notwithstanding subsection (a), the 
Internal Revenue Code of 1986 shall be construed by treating Treasury 
regulation Sec. 1.1502-20(c)(1)(iii) (as in effect on January 1, 2001) 
as being inapplicable to the type of factual situation in 255 F.3d 1357 
(Fed. Cir. 2001).
    (c) Effective Date.--The provisions of this section shall apply to 
taxable years beginning before, on, or after the date of the enactment 
of this Act.

SEC. 5632. DECLARATION BY CHIEF EXECUTIVE OFFICER RELATING TO FEDERAL 
              ANNUAL CORPORATE INCOME TAX RETURN.

    (a) In General.--The Federal tax return of a corporation with 
respect to income shall also include a declaration signed by the chief 
executive officer of such corporation (or other such officer of the 
corporation as the Secretary of the Treasury may designate if the 
corporation does not have a chief executive officer), under penalties 
of perjury, that the chief executive officer has established processes 
and procedures that ensure that such return complies with the Internal 
Revenue Code of 1986 and that the chief executive officer was provided 
reasonable assurance of the accuracy of all material aspects of such 
return. The preceding sentence shall not apply to any return of a 
regulated investment company (within the meaning of section 851 of such 
Code).
    (b) Effective Date.--This section shall apply to Federal tax 
returns filed after the date of the enactment of this Act.

SEC. 5633. DENIAL OF DEDUCTION FOR CERTAIN FINES, PENALTIES, AND OTHER 
              AMOUNTS.

    (a) In General.--Subsection (f) of section 162 (relating to trade 
or business expenses) is amended to read as follows:
    ``(f) Fines, Penalties, and Other Amounts.--
            ``(1) In general.--Except as provided in paragraph (2), no 
        deduction otherwise allowable shall be allowed under this 
        chapter for any amount paid or incurred (whether by suit, 
        agreement, or otherwise) to, or at the direction of, a 
        government or entity described in paragraph (4) in relation to 
        the violation of any law or the investigation or inquiry by 
        such government or entity into the potential violation of any 
        law.
            ``(2) Exception for amounts constituting restitution.--
        Paragraph (1) shall not apply to any amount which the taxpayer 
        establishes constitutes restitution for damage or harm caused 
        by the violation of any law or the potential violation of any 
        law. This paragraph shall not apply to any amount paid or 
        incurred as reimbursement to the government or entity for the 
        costs of any investigation or litigation.
            ``(3) Exception for amounts paid or incurred as the result 
        of certain court orders.--Paragraph (1) shall not apply to any 
        amount paid or incurred by order of a court in a suit in which 
        no government or entity described in paragraph (4) is a party.
            ``(4) Certain nongovernmental regulatory entities.--An 
        entity is described in this paragraph if it is--
                    ``(A) a nongovernmental entity which exercises 
                self-regulatory powers (including imposing sanctions) 
                in connection with a qualified board or exchange (as 
                defined in section 1256(g)(7)), or
                    ``(B) to the extent provided in regulations, a 
                nongovernmental entity which exercises self-regulatory 
                powers (including imposing sanctions) as part of 
                performing an essential governmental function.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to amounts paid or incurred after April 27, 2003, except that such 
amendment shall not apply to amounts paid or incurred under any binding 
order or agreement entered into on or before April 27, 2003. Such 
exception shall not apply to an order or agreement requiring court 
approval unless the approval was obtained on or before April 27, 2003.

SEC. 5634. DISALLOWANCE OF DEDUCTION FOR PUNITIVE DAMAGES.

    (a) Disallowance of Deduction.--
            (1) In general.--Section 162(g) (relating to treble damage 
        payments under the antitrust laws) is amended by adding at the 
        end the following new paragraph:
            ``(2) Punitive damages.--No deduction shall be allowed 
        under this chapter for any amount paid or incurred for punitive 
        damages in connection with any judgment in, or settlement of, 
        any action. This paragraph shall not apply to punitive damages 
        described in section 104(c).''.
            (2) Conforming amendments.--
                    (A) Section 162(g) is amended--
                            (i) by striking ``If'' and inserting:
            ``(1) Treble damages.--If'', and
                            (ii) by redesignating paragraphs (1) and 
                        (2) as subparagraphs (A) and (B), respectively.
                    (B) The heading for section 162(g) is amended by 
                inserting ``or Punitive Damages'' after ``Laws''.
    (b) Inclusion in Income of Punitive Damages Paid by Insurer or 
Otherwise.--
            (1) In general.--Part II of subchapter B of chapter 1 
        (relating to items specifically included in gross income) is 
        amended by adding at the end the following new section:

``SEC. 91. PUNITIVE DAMAGES COMPENSATED BY INSURANCE OR OTHERWISE.

    ``Gross income shall include any amount paid to or on behalf of a 
taxpayer as insurance or otherwise by reason of the taxpayer's 
liability (or agreement) to pay punitive damages.''.
            (2) Reporting requirements.--Section 6041 (relating to 
        information at source) is amended by adding at the end the 
        following new subsection:
    ``(f) Section To Apply to Punitive Damages Compensation.--This 
section shall apply to payments by a person to or on behalf of another 
person as insurance or otherwise by reason of the other person's 
liability (or agreement) to pay punitive damages.''.
            (3) Conforming amendment.--The table of sections for part 
        II of subchapter B of chapter 1 is amended by adding at the end 
        the following new item:

``Sec. 91. Punitive damages compensated by insurance or otherwise.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to damages paid or incurred on or after the date of the enactment 
of this Act.

SEC. 5635. INCREASE IN CRIMINAL MONETARY PENALTY LIMITATION FOR THE 
              UNDERPAYMENT OR OVERPAYMENT OF TAX DUE TO FRAUD.

    (a) In General.--Section 7206 (relating to fraud and false 
statements) is amended--
            (1) by striking ``Any person who--'' and inserting ``(a) In 
        General.--Any person who--'', and
            (2) by adding at the end the following new subsection:
    ``(b) Increase in Monetary Limitation for Underpayment or 
Overpayment of Tax Due To Fraud.--If any portion of any underpayment 
(as defined in section 6664(a)) or overpayment (as defined in section 
6401(a)) of tax required to be shown on a return is attributable to 
fraudulent action described in subsection (a), the applicable dollar 
amount under subsection (a) shall in no event be less than an amount 
equal to such portion. A rule similar to the rule under section 6663(b) 
shall apply for purposes of determining the portion so attributable.''.
    (b) Increase in Penalties.--
            (1) Attempt to evade or defeat tax.--Section 7201 is 
        amended--
                    (A) by striking ``$100,000'' and inserting 
                ``$250,000'',
                    (B) by striking ``$500,000'' and inserting 
                ``$1,000,000'', and
                    (C) by striking ``5 years'' and inserting ``10 
                years''.
            (2) Willful failure to file return, supply information, or 
        pay tax.--Section 7203 is amended--
                    (A) in the first sentence--
                            (i) by striking ``misdemeanor'' and 
                        inserting ``felony'', and
                            (ii) by striking ``1 year'' and inserting 
                        ``10 years'', and
                    (B) by striking the third sentence.
            (3) Fraud and false statements.--Section 7206(a) (as 
        redesignated by subsection (a)) is amended--
                    (A) by striking ``$100,000'' and inserting 
                ``$250,000'',
                    (B) by striking ``$500,000'' and inserting 
                ``$1,000,000'', and
                    (C) by striking ``3 years'' and inserting ``5 
                years''.
    (c) Effective Date.--The amendments made by this section shall 
apply to underpayments and overpayments attributable to actions 
occurring after the date of the enactment of this Act.

SEC. 5636. DOUBLING OF CERTAIN PENALTIES, FINES, AND INTEREST ON 
              UNDERPAYMENTS RELATED TO CERTAIN OFFSHORE FINANCIAL 
              ARRANGEMENTS.

    (a) General Rule.--If--
            (1) a taxpayer eligible to participate in--
                    (A) the Department of the Treasury's Offshore 
                Voluntary Compliance Initiative, or
                    (B) the Department of the Treasury's voluntary 
                disclosure initiative which applies to the taxpayer by 
                reason of the taxpayer's underreporting of United 
                States income tax liability through financial 
                arrangements which rely on the use of offshore 
                arrangements which were the subject of the initiative 
                described in subparagraph (A), and
            (2) any interest or applicable penalty is imposed with 
        respect to any arrangement to which any initiative described in 
        paragraph (1) applied or to any underpayment of Federal income 
        tax attributable to items arising in connection with any 
        arrangement described in paragraph (1),
then, notwithstanding any other provision of law, the amount of such 
interest or penalty shall be equal to twice that determined without 
regard to this section.
    (b) Definitions and Rules.--For purposes of this section--
            (1) Applicable penalty.--The term ``applicable penalty'' 
        means any penalty, addition to tax, or fine imposed under 
        chapter 68 of the Internal Revenue Code of 1986.
            (2) Voluntary offshore compliance initiative.--The term 
        ``Voluntary Offshore Compliance Initiative'' means the program 
        established by the Department of the Treasury in January of 
        2003 under which any taxpayer was eligible to voluntarily 
        disclose previously undisclosed income on assets placed in 
        offshore accounts and accessed through credit card and other 
        financial arrangements.
            (3) Participation.--A taxpayer shall be treated as having 
        participated in the Voluntary Offshore Compliance Initiative if 
        the taxpayer submitted the request in a timely manner and all 
        information requested by the Secretary of the Treasury or his 
        delegate within a reasonable period of time following the 
        request.
    (c) Effective Date.--The provisions of this section shall apply to 
interest, penalties, additions to tax, and fines with respect to any 
taxable year if as of the date of the enactment of this Act, the 
assessment of any tax, penalty, or interest with respect to such 
taxable year is not prevented by the operation of any law or rule of 
law.

             PART IV--ENRON-RELATED TAX SHELTER PROVISIONS

SEC. 5641. LIMITATION ON TRANSFER OR IMPORTATION OF BUILT-IN LOSSES.

    (a) In General.--Section 362 (relating to basis to corporations) is 
amended by adding at the end the following new subsection:
    ``(e) Limitations on Built-In Losses.--
            ``(1) Limitation on importation of built-in losses.--
                    ``(A) In general.--If in any transaction described 
                in subsection (a) or (b) there would (but for this 
                subsection) be an importation of a net built-in loss, 
                the basis of each property described in subparagraph 
                (B) which is acquired in such transaction shall 
                (notwithstanding subsections (a) and (b)) be its fair 
                market value immediately after such transaction.
                    ``(B) Property described.--For purposes of 
                subparagraph (A), property is described in this 
                subparagraph if--
                            ``(i) gain or loss with respect to such 
                        property is not subject to tax under this 
                        subtitle in the hands of the transferor 
                        immediately before the transfer, and
                            ``(ii) gain or loss with respect to such 
                        property is subject to such tax in the hands of 
                        the transferee immediately after such transfer.
                In any case in which the transferor is a partnership, 
                the preceding sentence shall be applied by treating 
                each partner in such partnership as holding such 
                partner's proportionate share of the property of such 
                partnership.
                    ``(C) Importation of net built-in loss.--For 
                purposes of subparagraph (A), there is an importation 
                of a net built-in loss in a transaction if the 
                transferee's aggregate adjusted bases of property 
                described in subparagraph (B) which is transferred in 
                such transaction would (but for this paragraph) exceed 
                the fair market value of such property immediately 
                after such transaction.''.
            ``(2) Limitation on transfer of built-in losses in section 
        351 transactions.--
                    ``(A) In general.--If--
                            ``(i) property is transferred by a 
                        transferor in any transaction which is 
                        described in subsection (a) and which is not 
                        described in paragraph (1) of this subsection, 
                        and
                            ``(ii) the transferee's aggregate adjusted 
                        bases of such property so transferred would 
                        (but for this paragraph) exceed the fair market 
                        value of such property immediately after such 
                        transaction,
                then, notwithstanding subsection (a), the transferee's 
                aggregate adjusted bases of the property so transferred 
                shall not exceed the fair market value of such property 
                immediately after such transaction.
                    ``(B) Allocation of basis reduction.--The aggregate 
                reduction in basis by reason of subparagraph (A) shall 
                be allocated among the property so transferred in 
                proportion to their respective built-in losses 
                immediately before the transaction.
                    ``(C) Exception for transfers within affiliated 
                group.--Subparagraph (A) shall not apply to any 
                transaction if the transferor owns stock in the 
                transferee meeting the requirements of section 
                1504(a)(2). In the case of property to which 
                subparagraph (A) does not apply by reason of the 
                preceding sentence, the transferor's basis in the stock 
                received for such property shall not exceed its fair 
                market value immediately after the transfer.''.
    (b) Comparable Treatment Where Liquidation.--Paragraph (1) of 
section 334(b) (relating to liquidation of subsidiary) is amended to 
read as follows:
            ``(1) In general.--If property is received by a corporate 
        distributee in a distribution in a complete liquidation to 
        which section 332 applies (or in a transfer described in 
        section 337(b)(1)), the basis of such property in the hands of 
        such distributee shall be the same as it would be in the hands 
        of the transferor; except that the basis of such property in 
        the hands of such distributee shall be the fair market value of 
        the property at the time of the distribution--
                    ``(A) in any case in which gain or loss is 
                recognized by the liquidating corporation with respect 
                to such property, or
                    ``(B) in any case in which the liquidating 
                corporation is a foreign corporation, the corporate 
                distributee is a domestic corporation, and the 
                corporate distributee's aggregate adjusted bases of 
                property described in section 362(e)(1)(B) which is 
                distributed in such liquidation would (but for this 
                subparagraph) exceed the fair market value of such 
                property immediately after such liquidation.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to transactions after February 13, 2003.

SEC. 5642. NO REDUCTION OF BASIS UNDER SECTION 734 IN STOCK HELD BY 
              PARTNERSHIP IN CORPORATE PARTNER.

    (a) In General.--Section 755 is amended by adding at the end the 
following new subsection:
    ``(c) No Allocation of Basis Decrease to Stock of Corporate 
Partner.--In making an allocation under subsection (a) of any decrease 
in the adjusted basis of partnership property under section 734(b)--
            ``(1) no allocation may be made to stock in a corporation 
        (or any person which is related (within the meaning of section 
        267(b) or 707(b)(1)) to such corporation) which is a partner in 
        the partnership, and
            ``(2) any amount not allocable to stock by reason of 
        paragraph (1) shall be allocated under subsection (a) to other 
        partnership property in such manner as the Secretary may 
        prescribe.
Gain shall be recognized to the partnership to the extent that the 
amount required to be allocated under paragraph (2) to other 
partnership property exceeds the aggregate adjusted basis of such other 
property immediately before the allocation required by paragraph 
(2).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to distributions after February 13, 2003.

SEC. 5643. REPEAL OF SPECIAL RULES FOR FASITS.

    (a) In General.--Part V of subchapter M of chapter 1 (relating to 
financial asset securitization investment trusts) is hereby repealed.
    (b) Conforming Amendments.--
            (1) Paragraph (6) of section 56(g) is amended by striking 
        ``REMIC, or FASIT'' and inserting ``or REMIC''.
            (2) Clause (ii) of section 382(l)(4)(B) is amended by 
        striking ``a REMIC to which part IV of subchapter M applies, or 
        a FASIT to which part V of subchapter M applies,'' and 
        inserting ``or a REMIC to which part IV of subchapter M 
        applies,''.
            (3) Paragraph (1) of section 582(c) is amended by striking 
        ``, and any regular interest in a FASIT,''.
            (4) Subparagraph (E) of section 856(c)(5) is amended by 
        striking the last sentence.
            (5)(A) Section 860G(a)(1) is amended by adding at the end 
        the following new sentence: ``An interest shall not fail to 
        qualify as a regular interest solely because the specified 
        principal amount of the regular interest (or the amount of 
        interest accrued on the regular interest) can be reduced as a 
        result of the nonoccurrence of 1 or more contingent payments 
        with respect to any reverse mortgage loan held by the REMIC if, 
        on the startup day for the REMIC, the sponsor reasonably 
        believes that all principal and interest due under the regular 
        interest will be paid at or prior to the liquidation of the 
        REMIC.''.
            (B) The last sentence of section 860G(a)(3) is amended by 
        inserting ``, and any reverse mortgage loan (and each balance 
        increase on such loan meeting the requirements of subparagraph 
        (A)(iii)) shall be treated as an obligation secured by an 
        interest in real property'' before the period at the end.
            (6) Paragraph (3) of section 860G(a) is amended by adding 
        ``and'' at the end of subparagraph (B), by striking ``, and'' 
        at the end of subparagraph (C) and inserting a period, and by 
        striking subparagraph (D).
            (7) Section 860G(a)(3), as amended by paragraph (6), is 
        amended by adding at the end the following new sentence: ``For 
        purposes of subparagraph (A), if more than 50 percent of the 
        obligations transferred to, or purchased by, the REMIC are 
        originated by the United States or any State (or any political 
        subdivision, agency, or instrumentality of the United States or 
        any State) and are principally secured by an interest in real 
        property, then each obligation transferred to, or purchased by, 
        the REMIC shall be treated as secured by an interest in real 
        property.''.
            (8)(A) Section 860G(a)(3)(A) is amended by striking ``or'' 
        at the end of clause (i), by inserting ``or'' at the end of 
        clause (ii), and by inserting after clause (ii) the following 
        new clause:
                            ``(iii) represents an increase in the 
                        principal amount under the original terms of an 
                        obligation described in clause (i) or (ii) if 
                        such increase--
                                    ``(I) is attributable to an advance 
                                made to the obligor pursuant to the 
                                original terms of the obligation,
                                    ``(II) occurs after the startup 
                                day, and
                                    ``(III) is purchased by the REMIC 
                                pursuant to a fixed price contract in 
                                effect on the startup day.''.
            (B) Section 860G(a)(7)(B) is amended to read as follows:
                    ``(B) Qualified reserve fund.--For purposes of 
                subparagraph (A), the term `qualified reserve fund' 
                means any reasonably required reserve to--
                            ``(i) provide for full payment of expenses 
                        of the REMIC or amounts due on regular 
                        interests in the event of defaults on qualified 
                        mortgages or lower than expected returns on 
                        cash flow investments, or
                            ``(ii) provide a source of funds for the 
                        purchase of obligations described in clause 
                        (ii) or (iii) of paragraph (3)(A).
                The aggregate fair market value of the assets held in 
                any such reserve shall not exceed 50 percent of the 
                aggregate fair market value of all of the assets of the 
                REMIC on the startup day, and the amount of any such 
                reserve shall be promptly and appropriately reduced to 
                the extent the amount held in such reserve is no longer 
                reasonably required for purposes specified in clause 
                (i) or (ii) of paragraph (3)(A).''.
            (9) Subparagraph (C) of section 1202(e)(4) is amended by 
        striking ``REMIC, or FASIT'' and inserting ``or REMIC''.
            (10) Clause (xi) of section 7701(a)(19)(C) is amended--
                    (A) by striking ``and any regular interest in a 
                FASIT,'', and
                    (B) by striking ``or FASIT'' each place it appears.
            (11) The table of parts for subchapter M of chapter 1 is 
        amended by striking the item relating to part V.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect on February 
        14, 2003.
            (2) Exception for existing fasits.--Paragraph (1) shall not 
        apply to any FASIT in existence on the date of the enactment of 
        this Act to the extent that regular interests issued by the 
        FASIT before such date continue to remain outstanding in 
        accordance with the original terms of issuance.

SEC. 5644. EXPANDED DISALLOWANCE OF DEDUCTION FOR INTEREST ON 
              CONVERTIBLE DEBT.

    (a) In General.--Paragraph (2) of section 163(l) is amended by 
striking ``or a related party'' and inserting ``or equity held by the 
issuer (or any related party) in any other person''.
    (b) Capitalization Allowed With Respect to Equity of Persons Other 
Than Issuer and Related Parties.--Section 163(l) is amended by 
redesignating paragraphs (4) and (5) as paragraphs (5) and (6) and by 
inserting after paragraph (3) the following new paragraph:
            ``(4) Capitalization allowed with respect to equity of 
        persons other than issuer and related parties.--If the 
        disqualified debt instrument of a corporation is payable in 
        equity held by the issuer (or any related party) in any other 
        person (other than a related party), the basis of such equity 
        shall be increased by the amount not allowed as a deduction by 
        reason of paragraph (1) with respect to the instrument.''.
    (c) Exception for Certain Instruments Issued By Dealers In 
Securities.--Section 163(l), as amended by subsection (b), is amended 
by redesignating paragraphs (5) and (6) as paragraphs (6) and (7) and 
by inserting after paragraph (4) the following new paragraph:
            ``(5) Exception for certain instruments issued by dealers 
        in securities.--For purposes of this subsection, the term 
        `disqualified debt instrument' does not include indebtedness 
        issued by a dealer in securities (or a related party) which is 
        payable in, or by reference to, equity (other than equity of 
        the issuer or a related party) held by such dealer in its 
        capacity as a dealer in securities. For purposes of this 
        paragraph, the term `dealer in securities' has the meaning 
        given such term by section 475.''.
    (c) Conforming Amendments.--Paragraph (3) of section 163(l) is 
amended--
            (1) by striking ``or a related party'' in the material 
        preceding subparagraph (A) and inserting ``or any other 
        person'', and
            (2) by striking ``or interest'' each place it appears.
    (d) Effective Date.--The amendments made by this section shall 
apply to debt instruments issued after February 13, 2003.

SEC. 5645. EXPANDED AUTHORITY TO DISALLOW TAX BENEFITS UNDER SECTION 
              269.

    (a) In General.--Subsection (a) of section 269 (relating to 
acquisitions made to evade or avoid income tax) is amended to read as 
follows:
    ``(a) In General.--If--
            ``(1)(A) any person or persons acquire, directly or 
        indirectly, control of a corporation, or
            ``(B) any corporation acquires, directly or indirectly, 
        property of another corporation and the basis of such property, 
        in the hands of the acquiring corporation, is determined by 
        reference to the basis in the hands of the transferor 
        corporation, and
            ``(2) the principal purpose for which such acquisition was 
        made is evasion or avoidance of Federal income tax,
then the Secretary may disallow such deduction, credit, or other 
allowance. For purposes of paragraph (1)(A), control means the 
ownership of stock possessing at least 50 percent of the total combined 
voting power of all classes of stock entitled to vote or at least 50 
percent of the total value of all shares of all classes of stock of the 
corporation.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to stock and property acquired after February 13, 2003.

SEC. 5646. MODIFICATION OF INTERACTION BETWEEN SUBPART F AND PASSIVE 
              FOREIGN INVESTMENT COMPANY RULES.

    (a) Limitation on Exception From PFIC Rules for United States 
Shareholders of Controlled Foreign Corporations.--Paragraph (2) of 
section 1297(e) (relating to passive foreign investment company) is 
amended by adding at the end the following flush sentence:
                ``Such term shall not include any period if the earning 
                of subpart F income by such corporation during such 
                period would result in only a remote likelihood of an 
                inclusion in gross income under section 
                951(a)(1)(A)(i).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years of controlled foreign corporations beginning after 
February 13, 2003, and to taxable years of United States shareholders 
with or within which such taxable years of controlled foreign 
corporations end.

             PART V--PROVISIONS TO DISCOURAGE EXPATRIATION

SEC. 5651. TAX TREATMENT OF INVERTED CORPORATE ENTITIES.

    (a) In General.--Subchapter C of chapter 80 (relating to provisions 
affecting more than one subtitle) is amended by adding at the end the 
following new section:

``SEC. 7874. RULES RELATING TO INVERTED CORPORATE ENTITIES.

    ``(a) Inverted Corporations Treated as Domestic Corporations.--
            ``(1) In general.--If a foreign incorporated entity is 
        treated as an inverted domestic corporation, then, 
        notwithstanding section 7701(a)(4), such entity shall be 
        treated for purposes of this title as a domestic corporation.
            ``(2) Inverted domestic corporation.--For purposes of this 
        section, a foreign incorporated entity shall be treated as an 
        inverted domestic corporation if, pursuant to a plan (or a 
        series of related transactions)--
                    ``(A) the entity completes after March 20, 2002, 
                the direct or indirect acquisition of substantially all 
                of the properties held directly or indirectly by a 
                domestic corporation or substantially all of the 
                properties constituting a trade or business of a 
                domestic partnership,
                    ``(B) after the acquisition at least 80 percent of 
                the stock (by vote or value) of the entity is held--
                            ``(i) in the case of an acquisition with 
                        respect to a domestic corporation, by former 
                        shareholders of the domestic corporation by 
                        reason of holding stock in the domestic 
                        corporation, or
                            ``(ii) in the case of an acquisition with 
                        respect to a domestic partnership, by former 
                        partners of the domestic partnership by reason 
                        of holding a capital or profits interest in the 
                        domestic partnership, and
                    ``(C) the expanded affiliated group which after the 
                acquisition includes the entity does not have 
                substantial business activities in the foreign country 
                in which or under the law of which the entity is 
                created or organized when compared to the total 
                business activities of such expanded affiliated group.
        Except as provided in regulations, an acquisition of properties 
        of a domestic corporation shall not be treated as described in 
        subparagraph (A) if none of the corporation's stock was readily 
        tradeable on an established securities market at any time 
        during the 4-year period ending on the date of the acquisition.
    ``(b) Preservation of Domestic Tax Base in Certain Inversion 
Transactions to Which Subsection (a) Does Not Apply.--
            ``(1) In general.--If a foreign incorporated entity would 
        be treated as an inverted domestic corporation with respect to 
        an acquired entity if either--
                    ``(A) subsection (a)(2)(A) were applied by 
                substituting `after December 31, 1996, and on or before 
                March 20, 2002' for `after March 20, 2002' and 
                subsection (a)(2)(B) were applied by substituting `more 
                than 50 percent' for `at least 80 percent', or
                    ``(B) subsection (a)(2)(B) were applied by 
                substituting `more than 50 percent' for `at least 80 
                percent',
        then the rules of subsection (c) shall apply to any inversion 
        gain of the acquired entity during the applicable period and 
        the rules of subsection (d) shall apply to any related party 
        transaction of the acquired entity during the applicable 
        period. This subsection shall not apply for any taxable year if 
        subsection (a) applies to such foreign incorporated entity for 
        such taxable year.
            ``(2) Acquired entity.--For purposes of this section--
                    ``(A) In general.--The term `acquired entity' means 
                the domestic corporation or partnership substantially 
                all of the properties of which are directly or 
                indirectly acquired in an acquisition described in 
                subsection (a)(2)(A) to which this subsection applies.
                    ``(B) Aggregation rules.--Any domestic person 
                bearing a relationship described in section 267(b) or 
                707(b) to an acquired entity shall be treated as an 
                acquired entity with respect to the acquisition 
                described in subparagraph (A).
            ``(3) Applicable period.--For purposes of this section--
                    ``(A) In general.--The term `applicable period' 
                means the period--
                            ``(i) beginning on the first date 
                        properties are acquired as part of the 
                        acquisition described in subsection (a)(2)(A) 
                        to which this subsection applies, and
                            ``(ii) ending on the date which is 10 years 
                        after the last date properties are acquired as 
                        part of such acquisition.
                    ``(B) Special rule for inversions occurring before 
                march 21, 2002.--In the case of any acquired entity to 
                which paragraph (1)(A) applies, the applicable period 
                shall be the 10-year period beginning on January 1, 
                2003.
    ``(c) Tax on Inversion Gains May Not Be Offset.--If subsection (b) 
applies--
            ``(1) In general.--The taxable income of an acquired entity 
        (or any expanded affiliated group which includes such entity) 
        for any taxable year which includes any portion of the 
        applicable period shall in no event be less than the inversion 
        gain of the entity for the taxable year.
            ``(2) Credits not allowed against tax on inversion gain.--
        Credits shall be allowed against the tax imposed by this 
        chapter on an acquired entity for any taxable year described in 
        paragraph (1) only to the extent such tax exceeds the product 
        of--
                    ``(A) the amount of the inversion gain for the 
                taxable year, and
                    ``(B) the highest rate of tax specified in section 
                11(b)(1).
        For purposes of determining the credit allowed by section 901 
        inversion gain shall be treated as from sources within the 
        United States.
            ``(3) Special rules for partnerships.--In the case of an 
        acquired entity which is a partnership--
                    ``(A) the limitations of this subsection shall 
                apply at the partner rather than the partnership level,
                    ``(B) the inversion gain of any partner for any 
                taxable year shall be equal to the sum of--
                            ``(i) the partner's distributive share of 
                        inversion gain of the partnership for such 
                        taxable year, plus
                            ``(ii) income or gain required to be 
                        recognized for the taxable year by the partner 
                        under section 367(a), 741, or 1001, or under 
                        any other provision of chapter 1, by reason of 
                        the transfer during the applicable period of 
                        any partnership interest of the partner in such 
                        partnership to the foreign incorporated entity, 
                        and
                    ``(C) the highest rate of tax specified in the rate 
                schedule applicable to the partner under chapter 1 
                shall be substituted for the rate of tax under 
                paragraph (2)(B).
            ``(4) Inversion gain.--For purposes of this section, the 
        term `inversion gain' means any income or gain required to be 
        recognized under section 304, 311(b), 367, 1001, or 1248, or 
        under any other provision of chapter 1, by reason of the 
        transfer during the applicable period of stock or other 
        properties by an acquired entity--
                    ``(A) as part of the acquisition described in 
                subsection (a)(2)(A) to which subsection (b) applies, 
                or
                    ``(B) after such acquisition to a foreign related 
                person.
        The Secretary may provide that income or gain from the sale of 
        inventories or other transactions in the ordinary course of a 
        trade or business shall not be treated as inversion gain under 
        subparagraph (B) to the extent the Secretary determines such 
        treatment would not be inconsistent with the purposes of this 
        section.
            ``(5) Coordination with section 172 and minimum tax.--Rules 
        similar to the rules of paragraphs (3) and (4) of section 
        860E(a) shall apply for purposes of this section.
            ``(6) Statute of limitations.--
                    ``(A) In general.--The statutory period for the 
                assessment of any deficiency attributable to the 
                inversion gain of any taxpayer for any pre-inversion 
                year shall not expire before the expiration of 3 years 
                from the date the Secretary is notified by the taxpayer 
                (in such manner as the Secretary may prescribe) of the 
                acquisition described in subsection (a)(2)(A) to which 
                such gain relates and such deficiency may be assessed 
                before the expiration of such 3-year period 
                notwithstanding the provisions of any other law or rule 
                of law which would otherwise prevent such assessment.
                    ``(B) Pre-inversion year.--For purposes of 
                subparagraph (A), the term `pre-inversion year' means 
                any taxable year if--
                            ``(i) any portion of the applicable period 
                        is included in such taxable year, and
                            ``(ii) such year ends before the taxable 
                        year in which the acquisition described in 
                        subsection (a)(2)(A) is completed.
    ``(d) Special Rules Applicable to Acquired Entities to Which 
Subsection (b) Applies.--
            ``(1) Increases in accuracy-related penalties.--In the case 
        of any underpayment of tax of an acquired entity to which 
        subsection (b) applies--
                    ``(A) section 6662(a) shall be applied with respect 
                to such underpayment by substituting `30 percent' for 
                `20 percent', and
                    ``(B) if such underpayment is attributable to one 
                or more gross valuation understatements, the increase 
                in the rate of penalty under section 6662(h) shall be 
                to 50 percent rather than 40 percent.
            ``(2) Modifications of limitation on interest deduction.--
        In the case of an acquired entity to which subsection (b) 
        applies, section 163(j) shall be applied--
                    ``(A) without regard to paragraph (2)(A)(ii) 
                thereof, and
                    ``(B) by substituting `25 percent' for `50 percent' 
                each place it appears in paragraph (2)(B) thereof.
    ``(e) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Rules for application of subsection (a)(2).--In 
        applying subsection (a)(2) for purposes of subsections (a) and 
        (b), the following rules shall apply:
                    ``(A) Certain stock disregarded.--There shall not 
                be taken into account in determining ownership for 
                purposes of subsection (a)(2)(B)--
                            ``(i) stock held by members of the expanded 
                        affiliated group which includes the foreign 
                        incorporated entity, or
                            ``(ii) stock of such entity which is sold 
                        in a public offering or private placement 
                        related to the acquisition described in 
                        subsection (a)(2)(A).
                    ``(B) Plan deemed in certain cases.--If a foreign 
                incorporated entity acquires directly or indirectly 
                substantially all of the properties of a domestic 
                corporation or partnership during the 4-year period 
                beginning on the date which is 2 years before the 
                ownership requirements of subsection (a)(2)(B) are met 
                with respect to such domestic corporation or 
                partnership, such actions shall be treated as pursuant 
                to a plan.
                    ``(C) Certain transfers disregarded.--The transfer 
                of properties or liabilities (including by contribution 
                or distribution) shall be disregarded if such transfers 
                are part of a plan a principal purpose of which is to 
                avoid the purposes of this section.
                    ``(D) Special rule for related partnerships.--For 
                purposes of applying subsection (a)(2) to the 
                acquisition of a domestic partnership, except as 
                provided in regulations, all partnerships which are 
                under common control (within the meaning of section 
                482) shall be treated as 1 partnership.
                    ``(E) Treatment of certain rights.--The Secretary 
                shall prescribe such regulations as may be necessary--
                            ``(i) to treat warrants, options, contracts 
                        to acquire stock, convertible debt instruments, 
                        and other similar interests as stock, and
                            ``(ii) to treat stock as not stock.
            ``(2) Expanded affiliated group.--The term `expanded 
        affiliated group' means an affiliated group as defined in 
        section 1504(a) but without regard to section 1504(b)(3), 
        except that section 1504(a) shall be applied by substituting 
        `more than 50 percent' for `at least 80 percent' each place it 
        appears.
            ``(3) Foreign incorporated entity.--The term `foreign 
        incorporated entity' means any entity which is, or but for 
        subsection (a)(1) would be, treated as a foreign corporation 
        for purposes of this title.
            ``(4) Foreign related person.--The term `foreign related 
        person' means, with respect to any acquired entity, a foreign 
        person which--
                    ``(A) bears a relationship to such entity described 
                in section 267(b) or 707(b), or
                    ``(B) is under the same common control (within the 
                meaning of section 482) as such entity.
            ``(5) Subsequent acquisitions by unrelated domestic 
        corporations.--
                    ``(A) In general.--Subject to such conditions, 
                limitations, and exceptions as the Secretary may 
                prescribe, if, after an acquisition described in 
                subsection (a)(2)(A) to which subsection (b) applies, a 
                domestic corporation stock of which is traded on an 
                established securities market acquires directly or 
                indirectly any properties of one or more acquired 
                entities in a transaction with respect to which the 
                requirements of subparagraph (B) are met, this section 
                shall cease to apply to any such acquired entity with 
                respect to which such requirements are met.
                    ``(B) Requirements.--The requirements of the 
                subparagraph are met with respect to a transaction 
                involving any acquisition described in subparagraph (A) 
                if--
                            ``(i) before such transaction the domestic 
                        corporation did not have a relationship 
                        described in section 267(b) or 707(b), and was 
                        not under common control (within the meaning of 
                        section 482), with the acquired entity, or any 
                        member of an expanded affiliated group 
                        including such entity, and
                            ``(ii) after such transaction, such 
                        acquired entity--
                                    ``(I) is a member of the same 
                                expanded affiliated group which 
                                includes the domestic corporation or 
                                has such a relationship or is under 
                                such common control with any member of 
                                such group, and
                                    ``(II) is not a member of, and does 
                                not have such a relationship and is not 
                                under such common control with any 
                                member of, the expanded affiliated 
                                group which before such acquisition 
                                included such entity.
    ``(f) Regulations.--The Secretary shall provide such regulations as 
are necessary to carry out this section, including regulations 
providing for such adjustments to the application of this section as 
are necessary to prevent the avoidance of the purposes of this section, 
including the avoidance of such purposes through--
            ``(1) the use of related persons, pass-thru or other 
        noncorporate entities, or other intermediaries, or
            ``(2) transactions designed to have persons cease to be (or 
        not become) members of expanded affiliated groups or related 
        persons.''.
    (b) Information Reporting.--The Secretary of the Treasury shall 
exercise the Secretary's authority under the Internal Revenue Code of 
1986 to require entities involved in transactions to which section 7874 
of such Code (as added by subsection (a)) applies to report to the 
Secretary, shareholders, partners, and such other persons as the 
Secretary may prescribe such information as is necessary to ensure the 
proper tax treatment of such transactions.
    (c) Conforming Amendment.--The table of sections for subchapter C 
of chapter 80 is amended by adding at the end the following new item:

``Sec. 7874. Rules relating to inverted corporate entities.''.
    (d) Transition Rule for Certain Regulated Investment Companies and 
Unit Investment Trusts.--Notwithstanding section 7874 of the Internal 
Revenue Code of 1986 (as added by subsection (a)), a regulated 
investment company, or other pooled fund or trust specified by the 
Secretary of the Treasury, may elect to recognize gain by reason of 
section 367(a) of such Code with respect to a transaction under which a 
foreign incorporated entity is treated as an inverted domestic 
corporation under section 7874(a) of such Code by reason of an 
acquisition completed after March 20, 2002, and before January 1, 2004.

SEC. 5652. IMPOSITION OF MARK-TO-MARKET TAX ON INDIVIDUALS WHO 
              EXPATRIATE.

    (a) In General.--Subpart A of part II of subchapter N of chapter 1 
is amended by inserting after section 877 the following new section:

``SEC. 877A. TAX RESPONSIBILITIES OF EXPATRIATION.

    ``(a) General Rules.--For purposes of this subtitle--
            ``(1) Mark to market.--Except as provided in subsections 
        (d) and (f), all property of a covered expatriate to whom this 
        section applies shall be treated as sold on the day before the 
        expatriation date for its fair market value.
            ``(2) Recognition of gain or loss.--In the case of any sale 
        under paragraph (1)--
                    ``(A) notwithstanding any other provision of this 
                title, any gain arising from such sale shall be taken 
                into account for the taxable year of the sale, and
                    ``(B) any loss arising from such sale shall be 
                taken into account for the taxable year of the sale to 
                the extent otherwise provided by this title, except 
                that section 1091 shall not apply to any such loss.
        Proper adjustment shall be made in the amount of any gain or 
        loss subsequently realized for gain or loss taken into account 
        under the preceding sentence.
            ``(3) Exclusion for certain gain.--
                    ``(A) In general.--The amount which, but for this 
                paragraph, would be includible in the gross income of 
                any individual by reason of this section shall be 
                reduced (but not below zero) by $600,000. For purposes 
                of this paragraph, allocable expatriation gain taken 
                into account under subsection (f)(2) shall be treated 
                in the same manner as an amount required to be 
                includible in gross income.
                    ``(B) Cost-of-living adjustment.--
                            ``(i) In general.--In the case of an 
                        expatriation date occurring in any calendar 
                        year after 2004, the $600,000 amount under 
                        subparagraph (A) shall be increased by an 
                        amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(II) the cost-of-living 
                                adjustment determined under section 
                                1(f)(3) for such calendar year, 
                                determined by substituting `calendar 
                                year 2003' for `calendar year 1992' in 
                                subparagraph (B) thereof.
                            ``(ii) Rounding rules.--If any amount after 
                        adjustment under clause (i) is not a multiple 
                        of $1,000, such amount shall be rounded to the 
                        next lower multiple of $1,000.
            ``(4) Election to continue to be taxed as united states 
        citizen.--
                    ``(A) In general.--If a covered expatriate elects 
                the application of this paragraph--
                            ``(i) this section (other than this 
                        paragraph and subsection (i)) shall not apply 
                        to the expatriate, but
                            ``(ii) in the case of property to which 
                        this section would apply but for such election, 
                        the expatriate shall be subject to tax under 
                        this title in the same manner as if the 
                        individual were a United States citizen.
                    ``(B) Requirements.--Subparagraph (A) shall not 
                apply to an individual unless the individual--
                            ``(i) provides security for payment of tax 
                        in such form and manner, and in such amount, as 
                        the Secretary may require,
                            ``(ii) consents to the waiver of any right 
                        of the individual under any treaty of the 
                        United States which would preclude assessment 
                        or collection of any tax which may be imposed 
                        by reason of this paragraph, and
                            ``(iii) complies with such other 
                        requirements as the Secretary may prescribe.
                    ``(C) Election.--An election under subparagraph (A) 
                shall apply to all property to which this section would 
                apply but for the election and, once made, shall be 
                irrevocable. Such election shall also apply to property 
                the basis of which is determined in whole or in part by 
                reference to the property with respect to which the 
                election was made.
    ``(b) Election To Defer Tax.--
            ``(1) In general.--If the taxpayer elects the application 
        of this subsection with respect to any property treated as sold 
        by reason of subsection (a), the payment of the additional tax 
        attributable to such property shall be postponed until the due 
        date of the return for the taxable year in which such property 
        is disposed of (or, in the case of property disposed of in a 
        transaction in which gain is not recognized in whole or in 
        part, until such other date as the Secretary may prescribe).
            ``(2) Determination of tax with respect to property.--For 
        purposes of paragraph (1), the additional tax attributable to 
        any property is an amount which bears the same ratio to the 
        additional tax imposed by this chapter for the taxable year 
        solely by reason of subsection (a) as the gain taken into 
        account under subsection (a) with respect to such property 
        bears to the total gain taken into account under subsection (a) 
        with respect to all property to which subsection (a) applies.
            ``(3) Termination of postponement.--No tax may be postponed 
        under this subsection later than the due date for the return of 
        tax imposed by this chapter for the taxable year which includes 
        the date of death of the expatriate (or, if earlier, the time 
        that the security provided with respect to the property fails 
        to meet the requirements of paragraph (4), unless the taxpayer 
        corrects such failure within the time specified by the 
        Secretary).
            ``(4) Security.--
                    ``(A) In general.--No election may be made under 
                paragraph (1) with respect to any property unless 
                adequate security is provided to the Secretary with 
                respect to such property.
                    ``(B) Adequate security.--For purposes of 
                subparagraph (A), security with respect to any property 
                shall be treated as adequate security if--
                            ``(i) it is a bond in an amount equal to 
                        the deferred tax amount under paragraph (2) for 
                        the property, or
                            ``(ii) the taxpayer otherwise establishes 
                        to the satisfaction of the Secretary that the 
                        security is adequate.
            ``(5) Waiver of certain rights.--No election may be made 
        under paragraph (1) unless the taxpayer consents to the waiver 
        of any right under any treaty of the United States which would 
        preclude assessment or collection of any tax imposed by reason 
        of this section.
            ``(6) Elections.--An election under paragraph (1) shall 
        only apply to property described in the election and, once 
        made, is irrevocable. An election may be made under paragraph 
        (1) with respect to an interest in a trust with respect to 
        which gain is required to be recognized under subsection 
        (f)(1).
            ``(7) Interest.--For purposes of section 6601--
                    ``(A) the last date for the payment of tax shall be 
                determined without regard to the election under this 
                subsection, and
                    ``(B) section 6621(a)(2) shall be applied by 
                substituting `5 percentage points' for `3 percentage 
                points' in subparagraph (B) thereof.
    ``(c) Covered Expatriate.--For purposes of this section--
            ``(1) In general.--Except as provided in paragraph (2), the 
        term `covered expatriate' means an expatriate.
            ``(2) Exceptions.--An individual shall not be treated as a 
        covered expatriate if--
                    ``(A) the individual--
                            ``(i) became at birth a citizen of the 
                        United States and a citizen of another country 
                        and, as of the expatriation date, continues to 
                        be a citizen of, and is taxed as a resident of, 
                        such other country, and
                            ``(ii) has not been a resident of the 
                        United States (as defined in section 
                        7701(b)(1)(A)(ii)) during the 5 taxable years 
                        ending with the taxable year during which the 
                        expatriation date occurs, or
                    ``(B)(i) the individual's relinquishment of United 
                States citizenship occurs before such individual 
                attains age 18\1/2\, and
                    ``(ii) the individual has been a resident of the 
                United States (as so defined) for not more than 5 
                taxable years before the date of relinquishment.
    ``(d) Exempt Property; Special Rules for Pension Plans.--
            ``(1) Exempt property.--This section shall not apply to the 
        following:
                    ``(A) United states real property interests.--Any 
                United States real property interest (as defined in 
                section 897(c)(1)), other than stock of a United States 
                real property holding corporation which does not, on 
                the day before the expatriation date, meet the 
                requirements of section 897(c)(2).
                    ``(B) Specified property.--Any property or interest 
                in property not described in subparagraph (A) which the 
                Secretary specifies in regulations.
            ``(2) Special rules for certain retirement plans.--
                    ``(A) In general.--If a covered expatriate holds on 
                the day before the expatriation date any interest in a 
                retirement plan to which this paragraph applies--
                            ``(i) such interest shall not be treated as 
                        sold for purposes of subsection (a)(1), but
                            ``(ii) an amount equal to the present value 
                        of the expatriate's nonforfeitable accrued 
                        benefit shall be treated as having been 
                        received by such individual on such date as a 
                        distribution under the plan.
                    ``(B) Treatment of subsequent distributions.--In 
                the case of any distribution on or after the 
                expatriation date to or on behalf of the covered 
                expatriate from a plan from which the expatriate was 
                treated as receiving a distribution under subparagraph 
                (A), the amount otherwise includible in gross income by 
                reason of the subsequent distribution shall be reduced 
                by the excess of the amount includible in gross income 
                under subparagraph (A) over any portion of such amount 
                to which this subparagraph previously applied.
                    ``(C) Treatment of subsequent distributions by 
                plan.--For purposes of this title, a retirement plan to 
                which this paragraph applies, and any person acting on 
                the plan's behalf, shall treat any subsequent 
                distribution described in subparagraph (B) in the same 
                manner as such distribution would be treated without 
                regard to this paragraph.
                    ``(D) Applicable plans.--This paragraph shall apply 
                to--
                            ``(i) any qualified retirement plan (as 
                        defined in section 4974(c)),
                            ``(ii) an eligible deferred compensation 
                        plan (as defined in section 457(b)) of an 
                        eligible employer described in section 
                        457(e)(1)(A), and
                            ``(iii) to the extent provided in 
                        regulations, any foreign pension plan or 
                        similar retirement arrangements or programs.
    ``(e) Definitions.--For purposes of this section--
            ``(1) Expatriate.--The term `expatriate' means--
                    ``(A) any United States citizen who relinquishes 
                citizenship, and
                    ``(B) any long-term resident of the United States 
                who--
                            ``(i) ceases to be a lawful permanent 
                        resident of the United States (within the 
                        meaning of section 7701(b)(6)), or
                            ``(ii) commences to be treated as a 
                        resident of a foreign country under the 
                        provisions of a tax treaty between the United 
                        States and the foreign country and who does not 
                        waive the benefits of such treaty applicable to 
                        residents of the foreign country.
            ``(2) Expatriation date.--The term `expatriation date' 
        means--
                    ``(A) the date an individual relinquishes United 
                States citizenship, or
                    ``(B) in the case of a long-term resident of the 
                United States, the date of the event described in 
                clause (i) or (ii) of paragraph (1)(B).
            ``(3) Relinquishment of citizenship.--A citizen shall be 
        treated as relinquishing United States citizenship on the 
        earliest of--
                    ``(A) the date the individual renounces such 
                individual's United States nationality before a 
                diplomatic or consular officer of the United States 
                pursuant to paragraph (5) of section 349(a) of the 
                Immigration and Nationality Act (8 U.S.C. 1481(a)(5)),
                    ``(B) the date the individual furnishes to the 
                United States Department of State a signed statement of 
                voluntary relinquishment of United States nationality 
                confirming the performance of an act of expatriation 
                specified in paragraph (1), (2), (3), or (4) of section 
                349(a) of the Immigration and Nationality Act (8 U.S.C. 
                1481(a)(1)-(4)),
                    ``(C) the date the United States Department of 
                State issues to the individual a certificate of loss of 
                nationality, or
                    ``(D) the date a court of the United States cancels 
                a naturalized citizen's certificate of naturalization.
        Subparagraph (A) or (B) shall not apply to any individual 
        unless the renunciation or voluntary relinquishment is 
        subsequently approved by the issuance to the individual of a 
        certificate of loss of nationality by the United States 
        Department of State.
            ``(4) Long-term resident.--The term `long-term resident' 
        has the meaning given to such term by section 877(e)(2).
    ``(f) Special Rules Applicable to Beneficiaries' Interests in 
Trust.--
            ``(1) In general.--Except as provided in paragraph (2), if 
        an individual is determined under paragraph (3) to hold an 
        interest in a trust on the day before the expatriation date--
                    ``(A) the individual shall not be treated as having 
                sold such interest,
                    ``(B) such interest shall be treated as a separate 
                share in the trust, and
                    ``(C)(i) such separate share shall be treated as a 
                separate trust consisting of the assets allocable to 
                such share,
                    ``(ii) the separate trust shall be treated as 
                having sold its assets on the day before the 
                expatriation date for their fair market value and as 
                having distributed all of its assets to the individual 
                as of such time, and
                    ``(iii) the individual shall be treated as having 
                recontributed the assets to the separate trust.
        Subsection (a)(2) shall apply to any income, gain, or loss of 
        the individual arising from a distribution described in 
        subparagraph (C)(ii). In determining the amount of such 
        distribution, proper adjustments shall be made for liabilities 
        of the trust allocable to an individual's share in the trust.
            ``(2) Special rules for interests in qualified trusts.--
                    ``(A) In general.--If the trust interest described 
                in paragraph (1) is an interest in a qualified trust--
                            ``(i) paragraph (1) and subsection (a) 
                        shall not apply, and
                            ``(ii) in addition to any other tax imposed 
                        by this title, there is hereby imposed on each 
                        distribution with respect to such interest a 
                        tax in the amount determined under subparagraph 
                        (B).
                    ``(B) Amount of tax.--The amount of tax under 
                subparagraph (A)(ii) shall be equal to the lesser of--
                            ``(i) the highest rate of tax imposed by 
                        section 1(e) for the taxable year which 
                        includes the day before the expatriation date, 
                        multiplied by the amount of the distribution, 
                        or
                            ``(ii) the balance in the deferred tax 
                        account immediately before the distribution 
                        determined without regard to any increases 
                        under subparagraph (C)(ii) after the 30th day 
                        preceding the distribution.
                    ``(C) Deferred tax account.--For purposes of 
                subparagraph (B)(ii)--
                            ``(i) Opening balance.--The opening balance 
                        in a deferred tax account with respect to any 
                        trust interest is an amount equal to the tax 
                        which would have been imposed on the allocable 
                        expatriation gain with respect to the trust 
                        interest if such gain had been included in 
                        gross income under subsection (a).
                            ``(ii) Increase for interest.--The balance 
                        in the deferred tax account shall be increased 
                        by the amount of interest determined (on the 
                        balance in the account at the time the interest 
                        accrues), for periods after the 90th day after 
                        the expatriation date, by using the rates and 
                        method applicable under section 6621 for 
                        underpayments of tax for such periods, except 
                        that section 6621(a)(2) shall be applied by 
                        substituting `5 percentage points' for `3 
                        percentage points' in subparagraph (B) thereof.
                            ``(iii) Decrease for taxes previously 
                        paid.--The balance in the tax deferred account 
                        shall be reduced--
                                    ``(I) by the amount of taxes 
                                imposed by subparagraph (A) on any 
                                distribution to the person holding the 
                                trust interest, and
                                    ``(II) in the case of a person 
                                holding a nonvested interest, to the 
                                extent provided in regulations, by the 
                                amount of taxes imposed by subparagraph 
                                (A) on distributions from the trust 
                                with respect to nonvested interests not 
                                held by such person.
                    ``(D) Allocable expatriation gain.--For purposes of 
                this paragraph, the allocable expatriation gain with 
                respect to any beneficiary's interest in a trust is the 
                amount of gain which would be allocable to such 
                beneficiary's vested and nonvested interests in the 
                trust if the beneficiary held directly all assets 
                allocable to such interests.
                    ``(E) Tax deducted and withheld.--
                            ``(i) In general.--The tax imposed by 
                        subparagraph (A)(ii) shall be deducted and 
                        withheld by the trustees from the distribution 
                        to which it relates.
                            ``(ii) Exception where failure to waive 
                        treaty rights.--If an amount may not be 
                        deducted and withheld under clause (i) by 
                        reason of the distributee failing to waive any 
                        treaty right with respect to such 
                        distribution--
                                    ``(I) the tax imposed by 
                                subparagraph (A)(ii) shall be imposed 
                                on the trust and each trustee shall be 
                                personally liable for the amount of 
                                such tax, and
                                    ``(II) any other beneficiary of the 
                                trust shall be entitled to recover from 
                                the distributee the amount of such tax 
                                imposed on the other beneficiary.
                    ``(F) Disposition.--If a trust ceases to be a 
                qualified trust at any time, a covered expatriate 
                disposes of an interest in a qualified trust, or a 
                covered expatriate holding an interest in a qualified 
                trust dies, then, in lieu of the tax imposed by 
                subparagraph (A)(ii), there is hereby imposed a tax 
                equal to the lesser of--
                            ``(i) the tax determined under paragraph 
                        (1) as if the day before the expatriation date 
                        were the date of such cessation, disposition, 
                        or death, whichever is applicable, or
                            ``(ii) the balance in the tax deferred 
                        account immediately before such date.
                Such tax shall be imposed on the trust and each trustee 
                shall be personally liable for the amount of such tax 
                and any other beneficiary of the trust shall be 
                entitled to recover from the covered expatriate or the 
                estate the amount of such tax imposed on the other 
                beneficiary.
                    ``(G) Definitions and special rules.--For purposes 
                of this paragraph--
                            ``(i) Qualified trust.--The term `qualified 
                        trust' means a trust which is described in 
                        section 7701(a)(30)(E).
                            ``(ii) Vested interest.--The term `vested 
                        interest' means any interest which, as of the 
                        day before the expatriation date, is vested in 
                        the beneficiary.
                            ``(iii) Nonvested interest.--The term 
                        `nonvested interest' means, with respect to any 
                        beneficiary, any interest in a trust which is 
                        not a vested interest. Such interest shall be 
                        determined by assuming the maximum exercise of 
                        discretion in favor of the beneficiary and the 
                        occurrence of all contingencies in favor of the 
                        beneficiary.
                            ``(iv) Adjustments.--The Secretary may 
                        provide for such adjustments to the bases of 
                        assets in a trust or a deferred tax account, 
                        and the timing of such adjustments, in order to 
                        ensure that gain is taxed only once.
                            ``(v) Coordination with retirement plan 
                        rules.--This subsection shall not apply to an 
                        interest in a trust which is part of a 
                        retirement plan to which subsection (d)(2) 
                        applies.
            ``(3) Determination of beneficiaries' interest in trust.--
                    ``(A) Determinations under paragraph (1).--For 
                purposes of paragraph (1), a beneficiary's interest in 
                a trust shall be based upon all relevant facts and 
                circumstances, including the terms of the trust 
                instrument and any letter of wishes or similar 
                document, historical patterns of trust distributions, 
                and the existence of and functions performed by a trust 
                protector or any similar adviser.
                    ``(B) Other determinations.--For purposes of this 
                section--
                            ``(i) Constructive ownership.--If a 
                        beneficiary of a trust is a corporation, 
                        partnership, trust, or estate, the 
                        shareholders, partners, or beneficiaries shall 
                        be deemed to be the trust beneficiaries for 
                        purposes of this section.
                            ``(ii) Taxpayer return position.--A 
                        taxpayer shall clearly indicate on its income 
                        tax return--
                                    ``(I) the methodology used to 
                                determine that taxpayer's trust 
                                interest under this section, and
                                    ``(II) if the taxpayer knows (or 
                                has reason to know) that any other 
                                beneficiary of such trust is using a 
                                different methodology to determine such 
                                beneficiary's trust interest under this 
                                section.
    ``(g) Termination of Deferrals, etc.--In the case of any covered 
expatriate, notwithstanding any other provision of this title--
            ``(1) any period during which recognition of income or gain 
        is deferred shall terminate on the day before the expatriation 
        date, and
            ``(2) any extension of time for payment of tax shall cease 
        to apply on the day before the expatriation date and the unpaid 
        portion of such tax shall be due and payable at the time and in 
        the manner prescribed by the Secretary.
    ``(h) Imposition of Tentative Tax.--
            ``(1) In general.--If an individual is required to include 
        any amount in gross income under subsection (a) for any taxable 
        year, there is hereby imposed, immediately before the 
        expatriation date, a tax in an amount equal to the amount of 
        tax which would be imposed if the taxable year were a short 
        taxable year ending on the expatriation date.
            ``(2) Due date.--The due date for any tax imposed by 
        paragraph (1) shall be the 90th day after the expatriation 
        date.
            ``(3) Treatment of tax.--Any tax paid under paragraph (1) 
        shall be treated as a payment of the tax imposed by this 
        chapter for the taxable year to which subsection (a) applies.
            ``(4) Deferral of tax.--The provisions of subsection (b) 
        shall apply to the tax imposed by this subsection to the extent 
        attributable to gain includible in gross income by reason of 
        this section.
    ``(i) Special Liens for Deferred Tax Amounts.--
            ``(1) Imposition of lien.--
                    ``(A) In general.--If a covered expatriate makes an 
                election under subsection (a)(4) or (b) which results 
                in the deferral of any tax imposed by reason of 
                subsection (a), the deferred amount (including any 
                interest, additional amount, addition to tax, 
                assessable penalty, and costs attributable to the 
                deferred amount) shall be a lien in favor of the United 
                States on all property of the expatriate located in the 
                United States (without regard to whether this section 
                applies to the property).
                    ``(B) Deferred amount.--For purposes of this 
                subsection, the deferred amount is the amount of the 
                increase in the covered expatriate's income tax which, 
                but for the election under subsection (a)(4) or (b), 
                would have occurred by reason of this section for the 
                taxable year including the expatriation date.
            ``(2) Period of lien.--The lien imposed by this subsection 
        shall arise on the expatriation date and continue until--
                    ``(A) the liability for tax by reason of this 
                section is satisfied or has become unenforceable by 
                reason of lapse of time, or
                    ``(B) it is established to the satisfaction of the 
                Secretary that no further tax liability may arise by 
                reason of this section.
            ``(3) Certain rules apply.--The rules set forth in 
        paragraphs (1), (3), and (4) of section 6324A(d) shall apply 
        with respect to the lien imposed by this subsection as if it 
        were a lien imposed by section 6324A.
    ``(j) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary or appropriate to carry out the purposes of this 
section.''.
    (b) Inclusion in Income of Gifts and Bequests Received by United 
States Citizens and Residents From Expatriates.--Section 102 (relating 
to gifts, etc. not included in gross income) is amended by adding at 
the end the following new subsection:
    ``(d) Gifts and Inheritances From Covered Expatriates.--
            ``(1) In general.--Subsection (a) shall not exclude from 
        gross income the value of any property acquired by gift, 
        bequest, devise, or inheritance from a covered expatriate after 
        the expatriation date. For purposes of this subsection, any 
        term used in this subsection which is also used in section 877A 
        shall have the same meaning as when used in section 877A.
            ``(2) Exceptions for transfers otherwise subject to estate 
        or gift tax.--Paragraph (1) shall not apply to any property if 
        either--
                    ``(A) the gift, bequest, devise, or inheritance 
                is--
                            ``(i) shown on a timely filed return of tax 
                        imposed by chapter 12 as a taxable gift by the 
                        covered expatriate, or
                            ``(ii) included in the gross estate of the 
                        covered expatriate for purposes of chapter 11 
                        and shown on a timely filed return of tax 
                        imposed by chapter 11 of the estate of the 
                        covered expatriate, or
                    ``(B) no such return was timely filed but no such 
                return would have been required to be filed even if the 
                covered expatriate were a citizen or long-term resident 
                of the United States.''.
    (c) Definition of Termination of United States Citizenship.--
Section 7701(a) is amended by adding at the end the following new 
paragraph:
            ``(48) Termination of united states citizenship.--
                    ``(A) In general.--An individual shall not cease to 
                be treated as a United States citizen before the date 
                on which the individual's citizenship is treated as 
                relinquished under section 877A(e)(3).
                    ``(B) Dual citizens.--Under regulations prescribed 
                by the Secretary, subparagraph (A) shall not apply to 
                an individual who became at birth a citizen of the 
                United States and a citizen of another country.''.
    (d) Ineligibility for Visa or Admission to United States.--
            (1) In general.--Section 212(a)(10)(E) of the Immigration 
        and Nationality Act (8 U.S.C. 1182(a)(10)(E)) is amended to 
        read as follows:
                    ``(E) Former citizens not in compliance with 
                expatriation revenue provisions.--Any alien who is a 
                former citizen of the United States who relinquishes 
                United States citizenship (within the meaning of 
                section 877A(e)(3) of the Internal Revenue Code of 
                1986) and who is not in compliance with section 877A of 
                such Code (relating to expatriation).''.
            (2) Availability of information.--
                    (A) In general.--Section 6103(l) (relating to 
                disclosure of returns and return information for 
                purposes other than tax administration) is amended by 
                adding at the end the following new paragraph:
            ``(19) Disclosure to deny visa or admission to certain 
        expatriates.--Upon written request of the Attorney General or 
        the Attorney General's delegate, the Secretary shall disclose 
        whether an individual is in compliance with section 877A (and 
        if not in compliance, any items of noncompliance) to officers 
        and employees of the Federal agency responsible for 
        administering section 212(a)(10)(E) of the Immigration and 
        Nationality Act solely for the purpose of, and to the extent 
        necessary in, administering such section 212(a)(10)(E).''.
                    (B) Safeguards.--
                            (i) Technical amendments.--Paragraph (4) of 
                        section 6103(p) of the Internal Revenue Code of 
                        1986, as amended by section 202(b)(2)(B) of the 
                        Trade Act of 2002 (Public Law 107-210; 116 
                        Stat. 961), is amended by striking ``or (17)'' 
                        after ``any other person described in 
                        subsection (l)(16)'' each place it appears and 
                        inserting ``or (18)''.
                            (ii) Conforming amendments.--Section 
                        6103(p)(4) (relating to safeguards), as amended 
                        by clause (i), is amended by striking ``or 
                        (18)'' after ``any other person described in 
                        subsection (l)(16)'' each place it appears and 
                        inserting ``(18), or (19)''.
            (3) Effective dates.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the amendments made by this subsection shall apply 
                to individuals who relinquish United States citizenship 
                on or after the date of the enactment of this Act.
                    (B) Technical amendments.--The amendments made by 
                paragraph (2)(B)(i) shall take effect as if included in 
                the amendments made by section 202(b)(2)(B) of the 
                Trade Act of 2002 (Public Law 107-210; 116 Stat. 961).
    (e) Conforming Amendments.--
            (1) Section 877 is amended by adding at the end the 
        following new subsection:
    ``(g) Application.--This section shall not apply to an expatriate 
(as defined in section 877A(e)) whose expatriation date (as so defined) 
occurs on or after February 2, 2004.''.
            (2) Section 2107 is amended by adding at the end the 
        following new subsection:
    ``(f) Application.--This section shall not apply to any expatriate 
subject to section 877A.''.
            (3) Section 2501(a)(3) is amended by adding at the end the 
        following new subparagraph:
                    ``(F) Application.--This paragraph shall not apply 
                to any expatriate subject to section 877A.''.
            (4)(A) Paragraph (1) of section 6039G(d) is amended by 
        inserting ``or 877A'' after ``section 877''.
            (B) The second sentence of section 6039G(e) is amended by 
        inserting ``or who relinquishes United States citizenship 
        (within the meaning of section 877A(e)(3))'' after ``877(a))''.
            (C) Section 6039G(f) is amended by inserting ``or 
        877A(e)(2)(B)'' after ``877(e)(1)''.
    (f) Clerical Amendment.--The table of sections for subpart A of 
part II of subchapter N of chapter 1 is amended by inserting after the 
item relating to section 877 the following new item:

``Sec. 877A. Tax responsibilities of expatriation.''.
    (g) Effective Date.--
            (1) In general.--Except as provided in this subsection, the 
        amendments made by this section shall apply to expatriates 
        (within the meaning of section 877A(e) of the Internal Revenue 
        Code of 1986, as added by this section) whose expatriation date 
        (as so defined) occurs on or after February 2, 2004.
            (2) Gifts and bequests.--Section 102(d) of the Internal 
        Revenue Code of 1986 (as added by subsection (b)) shall apply 
        to gifts and bequests received on or after February 2, 2004, 
        from an individual or the estate of an individual whose 
        expatriation date (as so defined) occurs after such date.
            (3) Due date for tentative tax.--The due date under section 
        877A(h)(2) of the Internal Revenue Code of 1986, as added by 
        this section, shall in no event occur before the 90th day after 
        the date of the enactment of this Act.

SEC. 5653. EXCISE TAX ON STOCK COMPENSATION OF INSIDERS IN INVERTED 
              CORPORATIONS.

    (a) In General.--Subtitle D is amended by adding at the end the 
following new chapter:

 ``CHAPTER 48--STOCK COMPENSATION OF INSIDERS IN INVERTED CORPORATIONS

``Sec. 5000A. Stock compensation of insiders in inverted corporations 
                            entities.

``SEC. 5000A. STOCK COMPENSATION OF INSIDERS IN INVERTED CORPORATIONS.

    ``(a) Imposition of Tax.--In the case of an individual who is a 
disqualified individual with respect to any inverted corporation, there 
is hereby imposed on such person a tax equal to 20 percent of the value 
(determined under subsection (b)) of the specified stock compensation 
held (directly or indirectly) by or for the benefit of such individual 
or a member of such individual's family (as defined in section 267) at 
any time during the 12-month period beginning on the date which is 6 
months before the inversion date.
    ``(b) Value.--For purposes of subsection (a)--
            ``(1) In general.--The value of specified stock 
        compensation shall be--
                    ``(A) in the case of a stock option (or other 
                similar right) or any stock appreciation right, the 
                fair value of such option or right, and
                    ``(B) in any other case, the fair market value of 
                such compensation.
            ``(2) Date for determining value.--The determination of 
        value shall be made--
                    ``(A) in the case of specified stock compensation 
                held on the inversion date, on such date,
                    ``(B) in the case of such compensation which is 
                canceled during the 6 months before the inversion date, 
                on the day before such cancellation, and
                    ``(C) in the case of such compensation which is 
                granted after the inversion date, on the date such 
                compensation is granted.
    ``(c) Tax To Apply Only If Shareholder Gain Recognized.--Subsection 
(a) shall apply to any disqualified individual with respect to an 
inverted corporation only if gain (if any) on any stock in such 
corporation is recognized in whole or part by any shareholder by reason 
of the acquisition referred to in section 7874(a)(2)(A) (determined by 
substituting `July 10, 2002' for `March 20, 2002') with respect to such 
corporation.
    ``(d) Exception Where Gain Recognized on Compensation.--Subsection 
(a) shall not apply to--
            ``(1) any stock option which is exercised on the inversion 
        date or during the 6-month period before such date and to the 
        stock acquired in such exercise, if income is recognized under 
        section 83 on or before the inversion date with respect to the 
        stock acquired pursuant to such exercise, and
            ``(2) any specified stock compensation which is exercised, 
        sold, exchanged, distributed, cashed out, or otherwise paid 
        during such period in a transaction in which gain or loss is 
        recognized in full.
    ``(e) Definitions.--For purposes of this section--
            ``(1) Disqualified individual.--The term `disqualified 
        individual' means, with respect to a corporation, any 
        individual who, at any time during the 12-month period 
        beginning on the date which is 6 months before the inversion 
        date--
                    ``(A) is subject to the requirements of section 
                16(a) of the Securities Exchange Act of 1934 with 
                respect to such corporation, or
                    ``(B) would be subject to such requirements if such 
                corporation were an issuer of equity securities 
                referred to in such section.
            ``(2) Inverted corporation; inversion date.--
                    ``(A) Inverted corporation.--The term `inverted 
                corporation' means any corporation to which subsection 
                (a) or (b) of section 7874 applies determined--
                            ``(i) by substituting `July 10, 2002' for 
                        `March 20, 2002' in section 7874(a)(2)(A), and
                            ``(ii) without regard to subsection 
                        (b)(1)(A).
                Such term includes any predecessor or successor of such 
                a corporation.
                    ``(B) Inversion date.--The term `inversion date' 
                means, with respect to a corporation, the date on which 
                the corporation first becomes an inverted corporation.
            ``(3) Specified stock compensation.--
                    ``(A) In general.--The term `specified stock 
                compensation' means payment (or right to payment) 
                granted by the inverted corporation (or by any member 
                of the expanded affiliated group which includes such 
                corporation) to any person in connection with the 
                performance of services by a disqualified individual 
                for such corporation or member if the value of such 
                payment or right is based on (or determined by 
                reference to) the value (or change in value) of stock 
                in such corporation (or any such member).
                    ``(B) Exceptions.--Such term shall not include--
                            ``(i) any option to which part II of 
                        subchapter D of chapter 1 applies, or
                            ``(ii) any payment or right to payment from 
                        a plan referred to in section 280G(b)(6).
            ``(4) Expanded affiliated group.--The term `expanded 
        affiliated group' means an affiliated group (as defined in 
        section 1504(a) without regard to section 1504(b)(3)); except 
        that section 1504(a) shall be applied by substituting `more 
        than 50 percent' for `at least 80 percent' each place it 
        appears.
    ``(f) Special Rules.--For purposes of this section--
            ``(1) Cancellation of restriction.--The cancellation of a 
        restriction which by its terms will never lapse shall be 
        treated as a grant.
            ``(2) Payment or reimbursement of tax by corporation 
        treated as specified stock compensation.--Any payment of the 
        tax imposed by this section directly or indirectly by the 
        inverted corporation or by any member of the expanded 
        affiliated group which includes such corporation--
                    ``(A) shall be treated as specified stock 
                compensation, and
                    ``(B) shall not be allowed as a deduction under any 
                provision of chapter 1.
            ``(3) Certain restrictions ignored.--Whether there is 
        specified stock compensation, and the value thereof, shall be 
        determined without regard to any restriction other than a 
        restriction which by its terms will never lapse.
            ``(4) Property transfers.--Any transfer of property shall 
        be treated as a payment and any right to a transfer of property 
        shall be treated as a right to a payment.
            ``(5) Other administrative provisions.--For purposes of 
        subtitle F, any tax imposed by this section shall be treated as 
        a tax imposed by subtitle A.
    ``(g) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary or appropriate to carry out the purposes of this 
section.''.
    (b) Denial of Deduction.--
            (1) In general.--Paragraph (6) of section 275(a) is amended 
        by inserting ``48,'' after ``46,''.
            (2) $1,000,000 limit on deductible compensation reduced by 
        payment of excise tax on specified stock compensation.--
        Paragraph (4) of section 162(m) is amended by adding at the end 
        the following new subparagraph:
                    ``(G) Coordination with excise tax on specified 
                stock compensation.--The dollar limitation contained in 
                paragraph (1) with respect to any covered employee 
                shall be reduced (but not below zero) by the amount of 
                any payment (with respect to such employee) of the tax 
                imposed by section 5000A directly or indirectly by the 
                inverted corporation (as defined in such section) or by 
                any member of the expanded affiliated group (as defined 
                in such section) which includes such corporation.''.
    (c) Conforming Amendments.--
            (1) The last sentence of section 3121(v)(2)(A) is amended 
        by inserting before the period ``or to any specified stock 
        compensation (as defined in section 5000A) on which tax is 
        imposed by section 5000A''.
            (2) The table of chapters for subtitle D is amended by 
        adding at the end the following new item:

``Chapter 48. Stock compensation of insiders in inverted 
                            corporations.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on July 11, 2002; except that periods before such date shall not 
be taken into account in applying the periods in subsections (a) and 
(e)(1) of section 5000A of the Internal Revenue Code of 1986, as added 
by this section.

SEC. 5654. REINSURANCE OF UNITED STATES RISKS IN FOREIGN JURISDICTIONS.

    (a) In General.--Section 845(a) (relating to allocation in case of 
reinsurance agreement involving tax avoidance or evasion) is amended by 
striking ``source and character'' and inserting ``amount, source, or 
character''.
    (b) Effective Date.--The amendments made by this section shall 
apply to any risk reinsured after April 11, 2002.

               Subtitle H--Additional Revenue Provisions

                   PART I--ADMINISTRATIVE PROVISIONS

SEC. 5671. EXTENSION OF IRS USER FEES.

    (a) In General.--Section 7528(c) (relating to termination) is 
amended by striking ``December 31, 2004'' and inserting ``September 30, 
2013''.
    (b) Effective Date.--The amendment made by this section shall apply 
to requests after the date of the enactment of this Act.

SEC. 5672. CLARIFICATION OF RULES FOR PAYMENT OF ESTIMATED TAX FOR 
              CERTAIN DEEMED ASSET SALES.

    (a) In General.--Paragraph (13) of section 338(h) (relating to tax 
on deemed sale not taken into account for estimated tax purposes) is 
amended by adding at the end the following: ``The preceding sentence 
shall not apply with respect to a qualified stock purchase for which an 
election is made under paragraph (10).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to transactions occurring after the date of the enactment of this 
Act.

SEC. 5673. PARTIAL PAYMENT OF TAX LIABILITY IN INSTALLMENT AGREEMENTS.

    (a) In General.--
            (1) Section 6159(a) (relating to authorization of 
        agreements) is amended--
                    (A) by striking ``satisfy liability for payment 
                of'' and inserting ``make payment on'', and
                    (B) by inserting ``full or partial'' after 
                ``facilitate''.
            (2) Section 6159(c) (relating to Secretary required to 
        enter into installment agreements in certain cases) is amended 
        in the matter preceding paragraph (1) by inserting ``full'' 
        before ``payment''.
    (b) Requirement To Review Partial Payment Agreements Every Two 
Years.--Section 6159, as amended by this Act, is amended by 
redesignating subsections (d), (e), and (f) as subsections (e), (f), 
and (g), respectively, and inserting after subsection (c) the following 
new subsection:
    ``(d) Secretary Required To Review Installment Agreements for 
Partial Collection Every Two Years.--In the case of an agreement 
entered into by the Secretary under subsection (a) for partial 
collection of a tax liability, the Secretary shall review the agreement 
at least once every 2 years.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to agreements entered into on or after the date of the enactment 
of this Act.

                     PART II--FINANCIAL INSTRUMENTS

SEC. 5675. TREATMENT OF STRIPPED INTERESTS IN BOND AND PREFERRED STOCK 
              FUNDS, ETC.

    (a) In General.--Section 1286 (relating to tax treatment of 
stripped bonds) is amended by redesignating subsection (f) as 
subsection (g) and by inserting after subsection (e) the following new 
subsection:
    ``(f) Treatment of Stripped Interests in Bond and Preferred Stock 
Funds, Etc.--In the case of an account or entity substantially all of 
the assets of which consist of bonds, preferred stock, or a combination 
thereof, the Secretary may by regulations provide that rules similar to 
the rules of this section and 305(e), as appropriate, shall apply to 
interests in such account or entity to which (but for this subsection) 
this section or section 305(e), as the case may be, would not apply.''.
    (b) Cross Reference.--Subsection (e) of section 305 is amended by 
adding at the end the following new paragraph:
            ``(7) Cross reference.--

                                ``For treatment of stripped interests 
in certain accounts or entities holding preferred stock, see section 
1286(f).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to purchases and dispositions after the date of the enactment of 
this Act.

SEC. 5676. APPLICATION OF EARNINGS STRIPPING RULES TO PARTNERSHIPS AND 
              S CORPORATIONS.

    (a) In General.--Section 168(j) (relating to limitation on 
deduction for interest on certain indebtedness) is amended by 
redesignating paragraph (8) as paragraph (9) and by inserting after 
paragraph (7) the following new paragraph:
            ``(8) Application to partnerships and s corporations.--
                    ``(A) In general.--This subsection shall apply to 
                partnerships and S corporations in the same manner as 
                it applies to C corporations.
                    ``(B) Allocations to certain corporate partners.--
                If a C corporation is a partner in a partnership--
                            ``(i) the corporation's allocable share of 
                        indebtedness and interest income of the 
                        partnership shall be taken into account in 
                        applying this subsection to the corporation, 
                        and
                            ``(ii) if a deduction is not disallowed 
                        under this subsection with respect to any 
                        interest expense of the partnership, this 
                        subsection shall be applied separately in 
                        determining whether a deduction is allowable to 
                        the corporation with respect to the 
                        corporation's allocable share of such interest 
                        expense.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5677. RECOGNITION OF CANCELLATION OF INDEBTEDNESS INCOME REALIZED 
              ON SATISFACTION OF DEBT WITH PARTNERSHIP INTEREST.

    (a) In General.--Paragraph (8) of section 108(e) (relating to 
general rules for discharge of indebtedness (including discharges not 
in title 11 cases or insolvency)) is amended to read as follows:
            ``(8) Indebtedness satisfied by corporate stock or 
        partnership interest.--For purposes of determining income of a 
        debtor from discharge of indebtedness, if--
                    ``(A) a debtor corporation transfers stock, or
                    ``(B) a debtor partnership transfers a capital or 
                profits interest in such partnership,
        to a creditor in satisfaction of its recourse or nonrecourse 
        indebtedness, such corporation or partnership shall be treated 
        as having satisfied the indebtedness with an amount of money 
        equal to the fair market value of the stock or interest. In the 
        case of any partnership, any discharge of indebtedness income 
        recognized under this paragraph shall be included in the 
        distributive shares of taxpayers which were the partners in the 
        partnership immediately before such discharge.''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to cancellations of indebtedness occurring on or after the 
date of the enactment of this Act.

SEC. 5678. MODIFICATION OF STRADDLE RULES.

    (a) Rules Relating to Identified Straddles.--
            (1) In general.--Subparagraph (A) of section 1092(a)(2) 
        (relating to special rule for identified straddles) is amended 
        to read as follows:
                    ``(A) In general.--In the case of any straddle 
                which is an identified straddle--
                            ``(i) paragraph (1) shall not apply with 
                        respect to identified positions comprising the 
                        identified straddle,
                            ``(ii) if there is any loss with respect to 
                        any identified position of the identified 
                        straddle, the basis of each of the identified 
                        offsetting positions in the identified straddle 
                        shall be increased by an amount which bears the 
                        same ratio to the loss as the unrecognized gain 
                        with respect to such offsetting position bears 
                        to the aggregate unrecognized gain with respect 
                        to all such offsetting positions, and
                            ``(iii) any loss described in clause (ii) 
                        shall not otherwise be taken into account for 
                        purposes of this title.''.
            (2) Identified straddle.--Section 1092(a)(2)(B) (defining 
        identified straddle) is amended--
                    (A) by striking clause (ii) and inserting the 
                following:
                            ``(ii) to the extent provided by 
                        regulations, the value of each position of 
                        which (in the hands of the taxpayer immediately 
                        before the creation of the straddle) is not 
                        less than the basis of such position in the 
                        hands of the taxpayer at the time the straddle 
                        is created, and'', and
                    (B) by adding at the end the following new flush 
                sentence:
                ``The Secretary shall prescribe regulations which 
                specify the proper methods for clearly identifying a 
                straddle as an identified straddle (and the positions 
                comprising such straddle), which specify the rules for 
                the application of this section for a taxpayer which 
                fails to properly identify the positions of an 
                identified straddle, and which specify the ordering 
                rules in cases where a taxpayer disposes of less than 
                an entire position which is part of an identified 
                straddle.''.
            (3) Unrecognized gain.--Section 1092(a)(3) (defining 
        unrecognized gain) is amended by redesignating subparagraph (B) 
        as subparagraph (C) and by inserting after subparagraph (A) the 
        following new subparagraph:
                    ``(B) Special rule for identified straddles.--For 
                purposes of paragraph (2)(A)(ii), the unrecognized gain 
                with respect to any identified offsetting position 
                shall be the excess of the fair market value of the 
                position at the time of the determination over the fair 
                market value of the position at the time the taxpayer 
                identified the position as a position in an identified 
                straddle.''
            (4) Conforming amendment.--Section 1092(c)(2) is amended by 
        striking subparagraph (B) and by redesignating subparagraph (C) 
        as subparagraph (B).
    (b) Physically Settled Positions.--Section 1092(d) (relating to 
definitions and special rules) is amended by adding at the end the 
following new paragraph:
            ``(8) Special rules for physically settled positions.--For 
        purposes of subsection (a), if a taxpayer settles a position 
        which is part of a straddle by delivering property to which the 
        position relates (and such position, if terminated, would 
        result in a realization of a loss), then such taxpayer shall be 
        treated as if such taxpayer--
                    ``(A) terminated the position for its fair market 
                value immediately before the settlement, and
                    ``(B) sold the property so delivered by the 
                taxpayer at its fair market value.''.
    (c) Repeal of Stock Exception.--
            (1) In general.--Section 1092(d)(3) is repealed.
            (2) Conforming amendment.--Section 1258(d)(1) is amended by 
        striking ``; except that the term `personal property' shall 
        include stock''.
    (d) Repeal of Qualified Covered Call Exception.--Section 1092(c)(4) 
is amended by adding at the end the following new subparagraph:
                    ``(I) Termination.--This paragraph shall not apply 
                to any position established on or after the date of the 
                enactment of this subparagraph.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to positions established on or after the date of the enactment of 
this Act.

SEC. 5679. DENIAL OF INSTALLMENT SALE TREATMENT FOR ALL READILY 
              TRADEABLE DEBT.

    (a) In General.--Section 453(f)(4)(B) (relating to purchaser 
evidences of indebtedness payable on demand or readily tradeable) is 
amended by striking ``is issued by a corporation or a government or 
political subdivision thereof and''.
    (b) Effective Date.--The amendment made by this section shall apply 
to sales occurring on or after the date of the enactment of this Act.

                PART III--CORPORATIONS AND PARTNERSHIPS

SEC. 5680. MODIFICATION OF TREATMENT OF TRANSFERS TO CREDITORS IN 
              DIVISIVE REORGANIZATIONS.

    (a) In General.--Section 361(b)(3) (relating to treatment of 
transfers to creditors) is amended by adding at the end the following 
new sentence: ``In the case of a reorganization described in section 
368(a)(1)(D) with respect to which stock or securities of the 
corporation to which the assets are transferred are distributed in a 
transaction which qualifies under section 355, this paragraph shall 
apply only to the extent that the sum of the money and the fair market 
value of other property transferred to such creditors does not exceed 
the adjusted bases of such assets transferred.''.
    (b) Liabilities in Excess of Basis.--Section 357(c)(1)(B) is 
amended by inserting ``with respect to which stock or securities of the 
corporation to which the assets are transferred are distributed in a 
transaction which qualifies under section 355'' after ``section 
368(a)(1)(D)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to transfers of money or other property, or liabilities assumed, 
in connection with a reorganization occurring on or after the date of 
the enactment of this Act.

SEC. 5681. CLARIFICATION OF DEFINITION OF NONQUALIFIED PREFERRED STOCK.

    (a) In General.--Section 351(g)(3)(A) is amended by adding at the 
end the following: ``Stock shall not be treated as participating in 
corporate growth to any significant extent unless there is a real and 
meaningful likelihood of the shareholder actually participating in the 
earnings and growth of the corporation.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to transactions after May 14, 2003.

SEC. 5682. MODIFICATION OF DEFINITION OF CONTROLLED GROUP OF 
              CORPORATIONS.

    (a) In General.--Section 1563(a)(2) (relating to brother-sister 
controlled group) is amended by striking ``possessing--'' and all that 
follows through ``(B)'' and inserting ``possessing''.
    (b) Application of Existing Rules to Other Code Provisions.--
Section 1563(f) (relating to other definitions and rules) is amended by 
adding at the end the following new paragraph:
            ``(5) Brother-sister controlled group definition for 
        provisions other than this part.--
                    ``(A) In general.--Except as specifically provided 
                in an applicable provision, subsection (a)(2) shall be 
                applied to an applicable provision as if it read as 
                follows:
            `(2) Brother-sister controlled group.--Two or more 
        corporations if 5 or fewer persons who are individuals, 
        estates, or trusts own (within the meaning of subsection (d)(2) 
        stock possessing--
                    `(A) at least 80 percent of the total combined 
                voting power of all classes of stock entitled to vote, 
                or at least 80 percent of the total value of shares of 
                all classes of stock, of each corporation, and
                    `(B) more than 50 percent of the total combined 
                voting power of all classes of stock entitled to vote 
                or more than 50 percent of the total value of shares of 
                all classes of stock of each corporation, taking into 
                account the stock ownership of each such person only to 
                the extent such stock ownership is identical with 
                respect to each such corporation.'
                    ``(B) Applicable provision.--For purposes of this 
                paragraph, an applicable provision is any provision of 
                law (other than this part) which incorporates the 
                definition of controlled group of corporations under 
                subsection (a).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 5683. MANDATORY BASIS ADJUSTMENTS IN CONNECTION WITH PARTNERSHIP 
              DISTRIBUTIONS AND TRANSFERS OF PARTNERSHIP INTERESTS.

    (a) In General.--Section 754 is repealed.
    (b) Adjustment to Basis of Undistributed Partnership Property.--
Section 734 is amended--
            (1) by striking ``, with respect to which the election 
        provided in section 754 is in effect,'' in the matter preceding 
        paragraph (1) of subsection (b),
            (2) by striking ``(as adjusted by section 732(d))'' both 
        places it appears in subsection (b),
            (3) by striking the last sentence of subsection (b),
            (4) by striking subsection (a) and by redesignating 
        subsections (b) and (c) as subsections (a) and (b), 
        respectively, and
            (5) by striking ``optional'' in the heading.
    (c) Adjustment to Basis of Partnership Property.--Section 743 is 
amended--
            (1) by striking ``with respect to which the election 
        provided in section 754 is in effect'' in the matter preceding 
        paragraph (1) of subsection (b),
            (2) by striking subsection (a) and by redesignating 
        subsections (b) and (c) as subsections (a) and (b), 
        respectively,
            (3) by adding at the end the following new subsection:
    ``(c) Election to Adjust Basis for Transfers Upon Death of 
Partner.--Subsection (a) shall not apply and no adjustments shall be 
made in the case of any transfer of an interest in a partnership upon 
the death of a partner unless an election to do so is made by the 
partnership. Such an election shall apply with respect to all such 
transfers of interests in the partnership. Any election under section 
754 in effect on the date of the enactment of this subsection shall 
constitute an election made under this subsection. Such election may be 
revoked by the partnership, subject to such limitations as may be 
provided by regulations prescribed by the Secretary.'', and
            (4) by striking ``optional'' in the heading.
    (d) Conforming Amendments.--
            (1) Subsection (d) of section 732 is repealed.
            (2) Section 755(a) is amended--
                    (A) by striking ``section 734(b) (relating to the 
                optional adjustment'' and inserting ``section 734(a) 
                (relating to the adjustment'', and
                    (B) by striking ``section 743(b) (relating to the 
                optional adjustment'' and inserting ``section 743(a) 
                (relating to the adjustment''.
            (3) Section 761(e)(2) is amended by striking ``optional''.
            (4) Section 774(a) is amended by striking ``743(b)'' both 
        places it appears and inserting ``743(a)''.
            (5) The item relating to section 734 in the table of 
        sections for subpart B of part II of subchapter K of chapter 1 
        is amended by striking ``Optional''.
            (6) The item relating to section 743 in the table of 
        sections for subpart C of part II of subchapter K of chapter 1 
        is amended by striking ``Optional''.
    (e) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to transfers and 
        distributions made after the date of the enactment of this Act.
            (2) Repeal of section 732(d).--The amendments made by 
        subsections (b)(2) and (d)(1) shall apply to--
                    (A) except as provided in subparagraph (B), 
                transfers made after the date of the enactment of this 
                Act, and
                    (B) in the case of any transfer made on or before 
                such date to which section 732(d) applies, 
                distributions made after the date which is 2 years 
                after such date of enactment.

SEC. 5684. CLASS LIVES FOR UTILITY GRADING COSTS.

    (a) Gas Utility Property.--Section 168(e)(3)(E) (defining 15-year 
property) is amended by striking ``and'' at the end of clause (ii), by 
striking the period at the end of clause (iii) and inserting ``, and'', 
and by adding at the end the following new clause:
                            ``(iv) initial clearing and grading land 
                        improvements with respect to gas utility 
                        property.''.
    (b) Electric Utility Property.--Section 168(e)(3) is amended by 
adding at the end the following new subparagraph:
                    ``(F) 20-year property.--The term `20-year 
                property' means initial clearing and grading land 
                improvements with respect to any electric utility 
                transmission and distribution plant.''.
    (c) Conforming Amendments.--The table contained in section 
168(g)(3)(B) is amended--
            (1) by inserting ``or (E)(iv)'' after ``(E)(iii)'', and
            (2) by adding at the end the following new item:

    ``(F).........................................                25''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 5685. CONSISTENT AMORTIZATION OF PERIODS FOR INTANGIBLES.

    (a) Start-Up Expenditures.--
            (1) Allowance of deduction.--Paragraph (1) of section 
        195(b) (relating to start-up expenditures) is amended to read 
        as follows:
            ``(1) Allowance of deduction.--If a taxpayer elects the 
        application of this subsection with respect to any start-up 
        expenditures--
                    ``(A) the taxpayer shall be allowed a deduction for 
                the taxable year in which the active trade or business 
                begins in an amount equal to the lesser of--
                            ``(i) the amount of start-up expenditures 
                        with respect to the active trade or business, 
                        or
                            ``(ii) $5,000, reduced (but not below zero) 
                        by the amount by which such start-up 
                        expenditures exceed $50,000, and
                    ``(B) the remainder of such start-up expenditures 
                shall be allowed as a deduction ratably over the 180-
                month period beginning with the month in which the 
                active trade or business begins.''.
            (2) Conforming amendment.--Subsection (b) of section 195 is 
        amended by striking ``Amortize'' and inserting ``Deduct'' in 
        the heading.
    (b) Organizational Expenditures.--Subsection (a) of section 248 
(relating to organizational expenditures) is amended to read as 
follows:
    ``(a) Election to Deduct.--If a corporation elects the application 
of this subsection (in accordance with regulations prescribed by the 
Secretary) with respect to any organizational expenditures--
            ``(1) the corporation shall be allowed a deduction for the 
        taxable year in which the corporation begins business in an 
        amount equal to the lesser of--
                    ``(A) the amount of organizational expenditures 
                with respect to the taxpayer, or
                    ``(B) $5,000, reduced (but not below zero) by the 
                amount by which such organizational expenditures exceed 
                $50,000, and
            ``(2) the remainder of such organizational expenditures 
        shall be allowed as a deduction ratably over the 180-month 
        period beginning with the month in which the corporation begins 
        business.''.
    (c) Treatment of Organizational and Syndication Fees or 
Partnerships.--
            (1) In general.--Section 709(b) (relating to amortization 
        of organization fees) is amended by redesignating paragraph (2) 
        as paragraph (3) and by amending paragraph (1) to read as 
        follows:
            ``(1) Allowance of deduction.--If a taxpayer elects the 
        application of this subsection (in accordance with regulations 
        prescribed by the Secretary) with respect to any organizational 
        expenses--
                    ``(A) the taxpayer shall be allowed a deduction for 
                the taxable year in which the partnership begins 
                business in an amount equal to the lesser of--
                            ``(i) the amount of organizational expenses 
                        with respect to the partnership, or
                            ``(ii) $5,000, reduced (but not below zero) 
                        by the amount by which such organizational 
                        expenses exceed $50,000, and
                    ``(B) the remainder of such organizational expenses 
                shall be allowed as a deduction ratably over the 180-
                month period beginning with the month in which the 
                partnership begins business.
            ``(2) Dispositions before close of amortization period.--In 
        any case in which a partnership is liquidated before the end of 
        the period to which paragraph (1)(B) applies, any deferred 
        expenses attributable to the partnership which were not allowed 
        as a deduction by reason of this section may be deducted to the 
        extent allowable under section 165.''.
            (2) Conforming amendment.--Subsection (b) of section 709 is 
        amended by striking ``Amortization'' and inserting 
        ``Deduction'' in the heading.
    (d) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act.

  Subtitle I--Tax-Exempt Financing of Highway Projects and Rail-Truck 
                          Transfer Facilities

SEC. 5691. TAX-EXEMPT FINANCING OF HIGHWAY PROJECTS AND RAIL-TRUCK 
              TRANSFER FACILITIES.

    (a) Treatment as Exempt Facility Bond.--Subsection (a) of section 
142 (relating to exempt facility bond) is amended by striking ``or'' at 
the end of paragraph (12), by striking the period at the end of 
paragraph (13), and by adding at the end the following:
            ``(14) qualified highway facilities, or
            ``(15) qualified surface freight transfer facilities.''.
    (b) Qualified Highway Facilities and Qualified Surface Freight 
Transfer Facilities.--Section 142 is amended by adding at the end the 
following:
    ``(l) Qualified Highway and Surface Freight Transfer Facilities.--
            ``(1) Qualified highway facilities.--For purposes of 
        subsection (a)(14), the term `qualified highway facilities' 
        means--
                    ``(A) any surface transportation project which 
                receives Federal assistance under title 23, United 
                States Code (as in effect on the date of the enactment 
                of this subsection), or
                    ``(B) any project for an international bridge or 
                tunnel for which an international entity authorized 
                under Federal or State law is responsible and which 
                receives Federal assistance under such title 23.
            ``(2) Qualified Surface Freight Transfer Facilities.--For 
        purposes of subsection (a)(15), the term `qualified surface 
        freight transfer facilities' means facilities for the transfer 
        of freight from truck to rail or rail to truck (including any 
        temporary storage facilities directly related to such 
        transfers) which receives Federal assistance under either title 
        23 or title 49, United States Code (as in effect on the date of 
        the enactment of this subsection).
            ``(3) Aggregate face amount of tax-exempt financing for 
        facilities.--
                    ``(A) In general.--An issue shall not be treated as 
                an issue described in subsection (a)(14) or (a)(15) if 
                the aggregate face amount of bonds issued by any State 
                pursuant thereto (when added to the aggregate face 
                amount of bonds previously so issued) exceeds 
                $15,000,000,000.
                    ``(B) Allocation by secretary of transportation.--
                The Secretary of Transportation shall allocate the 
                amount described in subparagraph (A) among eligible 
                projects described in subsections (a)(14) and (a)(15) 
                in such manner as the Secretary determines 
                appropriate.''.
    (c) Exemption From General State Volume Caps.--Paragraph (3) of 
section 146(g) of the Internal Revenue Code of 1986 (relating to 
exception for certain bonds) is amended by striking ``or (13)'' and all 
that follows through the end of the paragraph and inserting ``(13), 
(14), or (15) of section 142(a), and''.
    (d) Effective Date.--The amendments made by this section apply to 
bonds issued after the date of the enactment of this Act.

SEC. 5692. ADDITION OF VACCINES AGAINST HEPATITIS A TO LIST OF TAXABLE 
              VACCINES.

    (a) In General.--Section 4132(a)(1) (defining taxable vaccine) is 
amended by redesignating subparagraphs (I), (J), (K), and (L) as 
subparagraphs (J), (K), (L), and (M), respectively, and by inserting 
after subparagraph (H) the following new subparagraph:
                    ``(I) Any vaccine against hepatitis A.''.
    (b) Conforming Amendment.--Section 9510(c)(1)(A) is amended by 
striking ``October 18, 2000'' and inserting ``the date of the enactment 
of the Safe, Accountable, Flexible, and Efficient Transportation Equity 
Act of 2004''.
    (c) Effective Date.--
            (1) Sales, etc.--The amendments made by this section shall 
        apply to sales and uses on or after the first day of the first 
        month which begins more than 4 weeks after the date of the 
        enactment of this Act.
            (2) Deliveries.--For purposes of paragraph (1) and section 
        4131 of the Internal Revenue Code of 1986, in the case of sales 
        on or before the effective date described in such paragraph for 
        which delivery is made after such date, the delivery date shall 
        be considered the sale date.

SEC. 5693. ADDITION OF VACCINES AGAINST INFLUENZA TO LIST OF TAXABLE 
              VACCINES.

    (a) In General.--Section 4132(a)(1) (defining taxable vaccine), as 
amended by section 5692 of this Act, is amended by adding at the end 
the following new subparagraph:
                    ``(N) Any trivalent vaccine against influenza.''.
    (b) Effective Date.--
            (1) Sales, etc.--The amendment made by this section shall 
        apply to sales and uses on or after the later of--
                    (A) the first day of the first month which begins 
                more than 4 weeks after the date of the enactment of 
                this Act, or
                    (B) the date on which the Secretary of Health and 
                Human Services lists any vaccine against influenza for 
                purposes of compensation for any vaccine-related injury 
                or death through the Vaccine Injury Compensation Trust 
                Fund.
            (2) Deliveries.--For purposes of paragraph (1) and section 
        4131 of the Internal Revenue Code of 1986, in the case of sales 
        on or before the effective date described in such paragraph for 
        which delivery is made after such date, the delivery date shall 
        be considered the sale date.

SEC. 5694. EXTENSION OF AMORTIZATION OF INTANGIBLES TO SPORTS 
              FRANCHISES.

    (a) In General.--Section 197(e) (relating to exceptions to 
definition of section 197 intangible) is amended by striking paragraph 
(6) and by redesignating paragraphs (7) and (8) as paragraphs (6) and 
(7), respectively.
    (b) Conforming Amendments.--
            (1)(A) Section 1056 (relating to basis limitation for 
        player contracts transferred in connection with the sale of a 
        franchise) is repealed.
            (B) The table of sections for part IV of subchapter O of 
        chapter 1 is amended by striking the item relating to section 
        1056.
            (2) Section 1245(a) (relating to gain from disposition of 
        certain depreciable property) is amended by striking paragraph 
        (4).
            (3) Section 1253 (relating to transfers of franchises, 
        trademarks, and trade names) is amended by striking subsection 
        (e).
    (c) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to property 
        acquired after the date of the enactment of this Act.
            (2) Section 1245.--The amendment made by subsection (b)(2) 
        shall apply to franchises acquired after the date of the 
        enactment of this Act.

 TITLE VI--TRANSPORTATION DISCRETIONARY SPENDING GUARANTEE AND BUDGET 
                                OFFSETS

SEC. 6101. SENSE OF THE SENATE ON OVERALL FEDERAL BUDGET.

    It is the sense of the Senate that--
            (1) comprehensive statutory budget enforcement measures, 
        the jurisdiction of which lies with the Senate Budget Committee 
        and Senate Governmental Affairs Committee, should--
                    (A) be enacted this year; and
                    (B) address all areas of the Federal budget, 
                including discretionary spending, direct spending, and 
                revenues; and
            (2) special allocations for transportation or any other 
        categories of spending should be considered in that context and 
        be consistent with the rest of the Federal budget.

SEC. 6102. DISCRETIONARY SPENDING CATEGORIES.

    (a) Definitions.--
            (1) Highway category.--Section 250(c)(4)(B) of the Balanced 
        Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 
        900(c)(4)(B)) is amended--
                    (A) by striking ``Transportation Equity Act for the 
                21st Century'' and inserting ``Safe, Accountable, 
                Flexible, and Efficient Transportation Equity Act of 
                2004''; and
                    (B) by adding at the end the following:
                            ``(v) 69-8158-0-7-401 (Motor Carrier Safety 
                        Grants).
                            ``(vi) 69-8159-0-7-401 (Motor Carrier 
                        Safety Operations and Programs).''.
            (2) Mass transit category.--Section 250(c)(4) of the 
        Balanced Budget and Emergency Deficit Control Act of 1985 (2 
        U.S.C. 900(c)(4)) is amended by striking subparagraph (C) and 
        inserting the following:
                    ``(C) Mass transit category.--The term `mass 
                transit category' means the following budget accounts, 
                or portions of the accounts, that are subject to the 
                obligation limitations on contract authority provided 
                in the Safe, Accountable, Flexible, and Efficient 
                Transportation Equity Act of 2004 or for which 
                appropriations are provided in accordance with 
                authorizations contained in that Act:
                            ``(i) 69-1120-0-1-401 (Administrative 
                        Expenses).
                            ``(ii) 69-1134-0-1-401 (Capital Investment 
                        Grants).
                            ``(iii) 69-8191-0-7-401 (Discretionary 
                        Grants).
                            ``(iv) 69-1129-0-1-401 (Formula Grants).
                            ``(v) 69-8303-0-7-401 (Formula Grants and 
                        Research).
                            ``(vi) 69-1127-0-1-401 (Interstate Transfer 
                        Grants--Transit).
                            ``(vii) 69-1125-0-1-401 (Job Access and 
                        Reverse Commute).
                            ``(viii) 69-1122-0-1-401 (Miscellaneous 
                        Expired Accounts).
                            ``(ix) 69-1139-0-1-401 (Major Capital 
                        Investment Grants).
                            ``(x) 69-1121-0-1-401 (Research, Training 
                        and Human Resources).
                            ``(xi) 69-8350-0-7-401 (Trust Fund Share of 
                        Expenses).
                            ``(xii) 69-1137-0-1-401 (Transit Planning 
                        and Research).
                            ``(xiii) 69-1136-0-1-401 (University 
                        Transportation Research).
                            ``(xiv) 69-1128-0-1-401 (Washington 
                        Metropolitan Area Transit Authority).''.
    (b) Highway Funding Revenue Alignment.--Section 251(b)(1)(B) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 
901(b)(1)(B)) is amended--
            (1) in clause (i)--
                    (A) by inserting ``for each of fiscal years 2006 
                through 2009'' after ``submits the budget'';
                    (B) by inserting ``the obligation limitation and 
                outlay limit for'' after ``adjustments to''; and
                    (C) by striking ``provided in clause (ii)(I)(cc).'' 
                and inserting the following: ``follows:
                                    ``(I) OMB shall take the actual 
                                level of highway receipts for the year 
                                before the current year and subtract 
                                the sum of the estimated level of 
                                highway receipts in clause (iii), plus 
                                any amount previously calculated under 
                                clauses (i)(II) and (ii) for that year.
                                    ``(II) OMB shall take the current 
                                estimate of highway receipts for the 
                                current year and subtract the estimated 
                                level of highway receipts in clause 
                                (iii) for that year.
                                    ``(III) OMB shall--
                                            ``(aa) take the sum of the 
                                        amounts calculated under 
                                        subclauses (I) and (II) and add 
                                        that amount to the obligation 
                                        limitation set forth in section 
                                        6103 of the Safe, Accountable, 
                                        Flexible, and Efficient 
                                        Transportation Equity Act of 
                                        2004 for the highway category 
                                        for the budget year, and 
                                        calculate the outlay change 
                                        resulting from that change in 
                                        obligations relative to that 
                                        amount for the budget year and 
                                        each outyear using current 
                                        estimates; and
                                            ``(bb) after making the 
                                        calculation under item (aa), 
                                        adjust the obligation 
                                        limitation set forth in section 
                                        6103 of the Safe, Accountable, 
                                        Flexible, and Efficient 
                                        Transportation Equity Act of 
                                        2004 for the budget year by 
                                        adding the amount calculated 
                                        under subclauses (I) and 
                                        (II).'';
            (2) by striking clause (ii) and inserting the following:
                            ``(ii) When the President submits the 
                        supplementary budget estimates for each of 
                        fiscal years 2006 through 2009 under section 
                        1106 of title 31, United States Code, OMB's 
                        Mid-Session Review shall include adjustments to 
                        the obligation limitation and outlay limit for 
                        the highway category for the budget year and 
                        each outyear as follows:
                                    ``(I) OMB shall take the most 
                                recent estimate of highway receipts for 
                                the current year (based on OMB's Mid-
                                Session Review) and subtract the 
                                estimated level of highway receipts in 
                                clause (iii) plus any amount previously 
                                calculated and included in the 
                                President's Budget under clause (i)(II) 
                                for that year.
                                    ``(II) OMB shall--
                                            ``(aa) take the amount 
                                        calculated under subclause (I) 
                                        and add that amount to the 
                                        amount of obligations set forth 
                                        in section 6103 of the Safe, 
                                        Accountable, Flexible, and 
                                        Efficient Transportation Equity 
                                        Act of 2004 for the highway 
                                        category for the budget year, 
                                        and calculate the outlay change 
                                        resulting from that change in 
                                        obligations relative to that 
                                        amount for the budget year and 
                                        each outyear using current 
                                        estimates; and
                                            ``(bb) after making the 
                                        calculation under item (aa), 
                                        adjust the amount of 
                                        obligations set forth in 
                                        section 6103 of the Safe, 
                                        Accountable, Flexible, and 
                                        Efficient Transportation Equity 
                                        Act of 2004 for the budget year 
                                        by adding the amount calculated 
                                        under subclause (I).''; and
            (3) by adding at the end the following:
                            ``(iii) The estimated level of highway 
                        receipts for the purpose of this subparagraph 
                        are--
                                    ``(I) for fiscal year 2004, 
                                $29,945,938,902;
                                    ``(II) for fiscal year 2005, 
                                $36,294,778,392;
                                    ``(III) for fiscal year 2006, 
                                $37,766,517,123;
                                    ``(IV) for fiscal year 2007, 
                                $38,795,061,111;
                                    ``(V) for fiscal year 2008, 
                                $39,832,795,606; and
                                    ``(VI) for fiscal year 2009, 
                                $40,964,722,457.
                            ``(iv) In this subparagraph, the term 
                        ``highway receipts'' means the governmental 
                        receipts and interest credited to the highway 
                        account of the Highway Trust Fund.''.
    (c) Continuation of Separate Spending Categories.--For the purpose 
of section 251(c) of the Balanced Budget and Emergency Deficit Control 
Act of 1985 (2 U.S.C. 901(c)), the discretionary spending limits for 
the highway category and the mass transit category shall be--
            (1) for fiscal year 2004--
                    (A) $28,876,732,956 for the highway category; and
                    (B) $6,262,000,000 for the mass transit category;
            (2) for fiscal year 2005--
                    (A) $31,991,246,160 for the highway category; and
                    (B) $6,903,000,000 for the mass transit category;
            (3) for fiscal year 2006--
                    (A) $35,598,640,776 for the highway category; and
                    (B) $7,974,000,000 for the mass transit category;
            (4) for fiscal year 2007--
                    (A) $37,871,760,938 for the highway category; and
                    (B) $8,658,000,000 for the mass transit category;
            (5) for fiscal year 2008--
                    (A) $38,722,907,474 for the highway category; and
                    (B) $9,222,000,000 for the mass transit category; 
                and
            (6) for fiscal year 2009--
                    (A) $40,537,563,667 for the highway category; and
                    (B) $9,897,000,000 for the mass transit category.
    (d) Additional Adjustments.--Section 251(b)(1) of the Balanced 
Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 901(b)(1)) 
is amended--
            (1) in subparagraph (C)--
                    (A) in clause (i), by striking ``fiscal years 2000, 
                2001, 2002, or 2003,'' and inserting ``each of fiscal 
                years 2006, 2007, 2008, and 2009,''; and
                    (B) in clause (ii), by striking ``2002 and 2003'' 
                and inserting ``2008 and 2009''; and
            (2) in subparagraph (D)--
                    (A) in clause (i)--
                            (i) by striking ``1999'' and inserting 
                        ``2005'';
                            (ii) by striking ``2000 through 2003'' and 
                        inserting ``2006 through 2009''; and
                            (iii) by striking ``section 8103 of the 
                        Transportation Equity Act for the 21st 
                        Century'' and inserting ``section 6102 of the 
                        Safe, Accountable, Flexible, and Efficient 
                        Transportation Equity Act of 2004''; and
                    (B) in clause (ii), by striking ``2000, 2001, 2002, 
                or 2003'' and inserting ``2006, 2007, 2008, and 2009''.

SEC. 6103. LEVEL OF OBLIGATION LIMITATIONS.

    (a) Highway Category.--For the purpose of section 251(b) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 
901(b)), the level of obligation limitations for the highway category 
is--
            (1) for fiscal year 2004, $34,651,000,000;
            (2) for fiscal year 2005, $38,927,000,000;
            (3) for fiscal year 2006, $40,186,000,000;
            (4) for fiscal year 2007, $40,229,000,000;
            (5) for fiscal year 2008, $40,563,000,000; and
            (6) for fiscal year 2009, $45,622,000,000.
    (b) Mass Transit Category.--For the purpose of section 251(b) of 
the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 
901(b)), the level of obligation limitations for the mass transit 
category is--
            (1) for fiscal year 2004, $7,265,877,000;
            (2) for fiscal year 2005, $8,650,000,000;
            (3) for fiscal year 2006, $9,085,123,000;
            (4) for fiscal year 2007, $9,600,000,000;
            (5) for fiscal year 2008, $10,490,000,000; and
            (6) for fiscal year 2009, $11,430,000,000.
For the purpose of this subsection, the term ``obligation limitations'' 
means the sum of budget authority and obligation limitations.

                  TITLE VII--MISCELLANEOUS PROVISIONS

SEC. 7001. REIMBURSEMENT OF CERTAIN TRANSPORTATION COSTS INCURRED BY 
              MEMBERS OF THE UNITED STATES ARMED FORCES ON REST AND 
              RECUPERATION LEAVE.

    The Secretary of Defense shall reimburse a member of the United 
States Armed Forces (out of funds available for the Armed Forces for 
operation and maintenance for the relevant fiscal year) for 
transportation expenses incurred by such member for 1 round trip by 
such member between 2 locations within the United States in connection 
with leave taken under the Central Command Rest and Recuperation Leave 
Program during the period beginning on September 25, 2003, and ending 
on December 18, 2003.

                    TITLE VIII--SOLID WASTE DISPOSAL

SEC. 8001. INCREASED USE OF RECOVERED MINERAL COMPONENT IN FEDERALLY 
              FUNDED PROJECTS INVOLVING PROCUREMENT OF CEMENT OR 
              CONCRETE.

    (a) In General.--Subtitle F of the Solid Waste Disposal Act (42 
U.S.C. 6961 et seq.) is amended by adding at the end the following:

``SEC. 6005. INCREASED USE OF RECOVERED MINERAL COMPONENT IN FEDERALLY 
              FUNDED PROJECTS INVOLVING PROCUREMENT OF CEMENT OR 
              CONCRETE.

    ``(a) Definitions.--In this section:
            ``(1) Agency head.--The term `agency head' means--
                    ``(A) the Secretary of Transportation; and
                    ``(B) the head of each other Federal agency that on 
                a regular basis procures, or provides Federal funds to 
                pay or assist in paying the cost of procuring, material 
                for cement or concrete projects.
            ``(2) Cement or concrete project.--The term `cement or 
        concrete project' means a project for the construction or 
        maintenance of a highway or other transportation facility or a 
        Federal, State, or local government building or other public 
        facility that--
                    ``(A) involves the procurement of cement or 
                concrete; and
                    ``(B) is carried out in whole or in part using 
                Federal funds.
            ``(3) Recovered mineral component.--The term `recovered 
        mineral component' means--
                    ``(A) ground granulated blast furnace slag;
                    ``(B) coal combustion fly ash; and
                    ``(C) any other waste material or byproduct 
                recovered or diverted from solid waste that the 
                Administrator, in consultation with an agency head, 
                determines should be treated as recovered mineral 
                component under this section for use in cement or 
                concrete projects paid for, in whole or in part, by the 
                agency head.
    ``(b) Implementation of Requirements.--
            ``(1) In general.--Not later than 1 year after the date of 
        enactment of this section, the Administrator and each agency 
        head shall take such actions as are necessary to implement 
        fully all procurement requirements and incentives in effect as 
        of the date of enactment of this section (including guidelines 
        under section 6002) that provide for the use of cement and 
        concrete incorporating recovered mineral component in cement or 
        concrete projects.
            ``(2) Priority.--In carrying out paragraph (1) an agency 
        head shall give priority to achieving greater use of recovered 
        mineral component in cement or concrete projects for which 
        recovered mineral components historically have not been used or 
        have been used only minimally.
            ``(3) Conformance.--The Administrator and each agency head 
        shall carry out this subsection in accordance with section 
        6002.
    ``(c) Full Implementation Study.--
            ``(1) In general.--The Administrator, in cooperation with 
        the Secretary of Transportation and the Secretary of Energy, 
        shall conduct a study to determine the extent to which current 
        procurement requirements, when fully implemented in accordance 
        with subsection (b), may realize energy savings and 
        environmental benefits attainable with substitution of 
        recovered mineral component in cement used in cement or 
        concrete projects.
            ``(2) Matters to be addressed.--The study shall--
                    ``(A) quantify the extent to which recovered 
                mineral components are being substituted for Portland 
                cement, particularly as a result of current procurement 
                requirements, and the energy savings and environmental 
                benefits associated with that substitution;
                    ``(B) identify all barriers in procurement 
                requirements to greater realization of energy savings 
                and environmental benefits, including barriers 
                resulting from exceptions from current law; and
                    ``(C)(i) identify potential mechanisms to achieve 
                greater substitution of recovered mineral component in 
                types of cement or concrete projects for which 
                recovered mineral components historically have not been 
                used or have been used only minimally;
                    ``(ii) evaluate the feasibility of establishing 
                guidelines or standards for optimized substitution 
                rates of recovered mineral component in those cement or 
                concrete projects; and
                    ``(iii) identify any potential environmental or 
                economic effects that may result from greater 
                substitution of recovered mineral component in those 
                cement or concrete projects.
            ``(3) Report.--Not later than 30 months after the date of 
        enactment of this section, the Administrator shall submit to 
        Congress a report on the study.
    ``(d) Additional Procurement Requirements.--Unless the study 
conducted under subsection (c) identifies any effects or other problems 
described in subsection (c)(2)(C)(iii) that warrant further review or 
delay, the Administrator and each agency head shall, not later than 1 
year after the release of the report in accordance with subsection 
(c)(3), take additional actions authorized under this Act to establish 
procurement requirements and incentives that provide for the use of 
cement and concrete with increased substitution of recovered mineral 
component in the construction and maintenance of cement or concrete 
projects, so as to--
            ``(1) realize more fully the energy savings and 
        environmental benefits associated with increased substitution; 
        and
            ``(2) eliminate barriers identified under subsection (c).
    ``(e) Effect of Section.--Nothing in this section affects the 
requirements of section 6002 (including the guidelines and 
specifications for implementing those requirements).''.
    (b) Table of Contents Amendment.--The table of contents in section 
1001 of the Solid Waste Disposal Act (42 U.S.C. prec. 6901) is amended 
by adding after the item relating to section 6004 the following:

``Sec. 6005. Increased use of recovered mineral component in federally 
                            funded projects involving procurement of 
                            cement or concrete.''.

SEC. 8002. USE OF GRANULAR MINE TAILINGS.

    (a) In General.--Subtitle F of the Solid Waste Disposal Act (42 
U.S.C. 6961 et seq.) (as amended by section 8001(a)) is amended by 
adding at the end the following:

``SEC. 6006. USE OF GRANULAR MINE TAILINGS.

    ``(a) Mine Tailings.--
            ``(1) In general.--Not later than 180 days after the date 
        of enactment of this section, the Administrator, in 
        consultation with the Secretary of Transportation and heads of 
        other Federal agencies, shall establish criteria (including an 
        evaluation of whether to establish a numerical standard for 
        concentration of lead and other hazardous substances) for the 
        safe and environmentally protective use of granular mine 
        tailings from the Tar Creek, Oklahoma Mining District, known as 
        `chat', for--
                    ``(A) cement or concrete projects; and
                    ``(B) transportation construction projects 
                (including transportation construction projects 
                involving the use of asphalt) that are carried out, in 
                whole or in part, using Federal funds.
            ``(2) Requirements.--In establishing criteria under 
        paragraph (1), the Administrator shall consider--
                    ``(A) the current and previous uses of granular 
                mine tailings as an aggregate for asphalt; and
                    ``(B) any environmental and public health risks and 
                benefits derived from the removal, transportation, and 
                use in transportation projects of granular mine 
                tailings.
            ``(3) Public participation.--In establishing the criteria 
        under paragraph (1), the Administrator shall solicit and 
        consider comments from the public.
            ``(4) Applicability of criteria.--On the establishment of 
        the criteria under paragraph (1), any use of the granular mine 
        tailings described in paragraph (1) in a transportation project 
        that is carried out, in whole or in part, using Federal funds, 
        shall meet the criteria established under paragraph (1).
    ``(b) Effect of Sections.--Nothing in this section or section 6005 
affects any requirement of any law (including a regulation) in effect 
on the date of enactment of this section.''.
    (b) Conforming Amendment.--The table of contents in section 1001 of 
the Solid Waste Disposal Act (42 U.S.C. prec. 6901) (as amended by 
section 8001(b)) is amended by adding after the item relating to 
section 6005 the following:

``Sec. 6006. Use of granular mine tailings.''.

            Passed the Senate February 12, 2004.

            Attest:

                                                             Secretary.
108th CONGRESS

  2d Session

                                S. 1072

_______________________________________________________________________

                                 AN ACT

 To authorize funds for Federal-aid highways, highway safety programs, 
             and transit programs, and for other purposes.