[Congressional Record Volume 140, Number 33 (Tuesday, March 22, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]
[Congressional Record: March 22, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. LOTT (for himself, Mr. Shelby, Mr. Hatch, Mr. Brown, Mr.
Burns, Mr. Coats, Mr. Coverdell, Mr. Dole, Mr. Grassley, Mr.
Gregg, Mr. Helms, Mrs. Kassebaum, Mr. Mack, Mr. McCain, Mr.
Nickles, Mr. Simpson, and Mr. Smith):
S. 1955. A bill to amend the Congressional Budget and Impoundment
Control Act of 1974 to reform the budget process, and for other
purposes; to the Committee on the Budget and the Committee on
Governmental Affairs, jointly, pursuant to the order of August 4, 1977,
with instructions that if one committee reports, the other committee
has 30 days to report or be discharged.
budget process reform act
Mr. LOTT. Mr. President, today as we begin debate on the budget
resolution for the next fiscal year, I think it is appropriate that we
also think at this time about the need for budget process reform.
Twenty years ago, we passed the Congressional Budget and Impoundment
Control Act of 1974. I supported it at that time because I thought we
needed some process to take a look at how much we were spending, what
it was going for, and just basically adding up what we were doing. Up
until that time, there was no budget. We had authorization bills and
appropriations bills out of the various subcommittees of Appropriations
Committee, and nobody ever added them up to see what we were spending
really, in total, and what it was doing to the deficit.
So we passed the Budget and Impoundment Control Act, and I thought it
was a good idea at the time. This bill established our basic budget
process as we know it today. Twenty years has been long enough to see
what has worked and what has not worked. Some of it has been fine; some
of it has not accomplished all we would like for it to have
accomplished. So, as the old adage says, ``Hindsight is 20/20.'' It is
time for us to take advantage of what we can see behind us, learn from
it, and make some changes.
As we consider this fiscal year 1995 budget, we should also make
significant changes in the budget process that the Budget Act, the
Budget and Impoundment Control Act, established in 1974.
That is why I am introducing a bill today to overhaul the Federal
budget process, along with a number of our colleagues, including
Democrats and Republicans. Process reform may not seem very glamorous.
Indeed, it is not. But it is the foundation upon which all of our
annual spending and taxing decisions are made. Without a strong
foundation, a house will not stand.
There are two fundamental components of the budget which must be
addressed to achieve effectiveness and efficiency in budgeting, as well
as deficit reduction. After all, that should be our goal.
As we debate the budget, we will see this week that as a matter of
fact we continue to have deficits every year, and the debt continues to
go up every year. In fact, it will go up, some estimate, to $5 trillion
over the next 5 years unless we find some way to better address the
problem.
But the two components of the budget go hand in hand. The first is
the process for development and implementation of a budget, and the
second is the actual determination of the taxing and spending levels
within that budget.
This bill addresses the first component, process reform, as its
title, ``The Budget Process Reform Act,'' indicates. I am introducing
this bill with my friend Senator Shelby and 15 other original Senate
cosponsors. This bill would radically change the way Congress does
business.
With budget reform in place, we could then effectively administer the
second component of budgeting, the resource allocation process: where
and how much do we spend of the taxpayers money. We will have a
structure designed to permit clear, rational, and accountable choices
among competing priorities.
That is the difficult part. If we would just basically says we have
this much coming in, and that is all we are going to spend, there would
be a ferocious debate about what our priorities would be and how we
would spend that money.
But that is what we are here for, and in the end we could make, I
think, rational decisions about our priorities for spending and keep
the budget deficits and eventually the debt under control.
I do think deficits matter, and as far as pointing fingers, I am not
doing that. I think we all have contributed to this problem. But I
think instead of looking back at the past, and how we got here, we need
to be looking forward to how we stop this problem.
I believe the momentum behind the balanced budget amendment, which we
have debated and which got a very strong vote--it came within four
votes in the Senate, and I believe five votes in the House of
Representatives--is an indication of a continuing and, I believe,
growing concern about this problem.
Our Nation is facing a fiscal crisis. Our deficit for fiscal year
1993 was $255 billion. Our debt for fiscal year 1994 is projected to be
$4.734 trillion. That is $13,345 for every man, woman, and child in
America. We must do something about this.
Why are we debating these types of changes? Because Congress needs
handcuffs. Unfortunately, Congress has not been willing to make the
tough choices and cut spending enough.
There have been some starts and fits and stops, back and forth, and
we have accomplished some things. I remember in 1981 and 1982, we
actually cut the deficit some. Last year, the process I think actually
did contribute to cutting the deficit some. I objected because I
thought too much of it was done in the tax area. But the net result was
that we still have not made enough tough choices to deal with the
problem.
I can understand why each one of us were sent here by constituencies
to protect the interests of our various States. In my own State, we
have a lot of poverty; we have a lot of needs. We need better roads. We
need better schools. Naturally, I am interested in trying to help my
State with those needs.
Putting procedural changes in place such as the balanced budget
amendment and some of the provisions of this bill would force Congress
to be more responsible stewards of our constituents' hard-earned money.
I do want to point out that even if we had a budget surplus, I would
still believe the changes in this bill are necessary. The system needs
to be tweaked. As it stands currently, it does not allow the budget to
reflect the current priorities of our Nation.
This bill was also introduced in the House by my friend Congressman
Chris Cox. He and Congressman Charles Stenholm have worked very hard on
this and there are now over 160 cosponsors in the House.
The bill will achieve the following objectives: simplification of the
process, a shift from its current bias toward higher spending, and
compliance with current law.
The Budget Process Reform Act would accomplish these goals through
the following specific provisions:
First, it requires the budget resolution to be a joint one, voted on
by April 15. Making it legally binding by requiring the President's
signature will involve the President in the process at an early stage
and ensure a shared effort.
I think that would be very important. You may say: Well, this
President is not involved. But maybe he is more than others. I think
until we get this requirement for a joint resolution, the President
will not be as involved. We really need him.
The bill espouses a wise concept: Budget first, spend second. No
spending bills--either authorizations or appropriations--could be
considered prior to passage of the budget resolution. This will allow
spending bills to move through the appropriations process in a logical
and timely manner.
Second, the bill forces overall spending decisions to be made at a
macro level. This year's budget is 4 volumes, 2,013 pages, and weighs 6
pounds.
How many of us are actually going to read it?
It takes a budget guru just to figure out what we're spending on a
specific program. Our system seems designed to keep us all confused.
This bill would simplify the budget process by first requiring a 1-
page budget document reflecting the total spending levels in the 19
summary categories currently used.
This would facilitate an easier decisionmaking process and the
ability to prioritize--and see--where we are spending the American
taxpayers' money.
We should not get bogged down in the details. That job belongs to the
authorizers and appropriators.
The budget would also set ceilings on all Federal spending for the
coming fiscal year, except for Social Security and interest on the
debt. The bill does not say what those ceilings would be, but merely
that Congress would set them and then live by them.
The President would be required to submit the detailed support 2
weeks later, after the overall spending decisions had been addressed.
The bill would eliminate baseline budgeting as we know it. This
concept of budgeting allows automatic spending increases every year.
This is the only place I know in the world where you allow for an
increase and then you begin deciding how much you are going to add to
that from that particular point.
I believe there are two fundamental problems with this: First, this
means spending automatically goes up every year. Period. Second, this
does not allow Congress to make decisions about where we should spend
more or less.
I think anyone who considers this issue in terms of their own
financial position would agree that this is poor policy and it is not
even honest. For instance, how many of you automatically plan to spend
3 or 4 percent--or whatever the annual inflation rate is--more each
year than you did the year before?
I was very encouraged by the vote on this issue in the Senate Budget
Committee markup last Thursday. The Budget Committee voted 15 to 5 for
a sense-of-the-Congress to eliminate baseline budgeting. This provision
was also included in the House passed budget resolution. This is a
change whose time has come. I urge that we adopt this provision.
The bill also contains a bias in favor of spending constraint which
is in sharp contrast to our current situation. Any spending which
exceeds the caps set in the budget resolution would be subject a three-
fifth's vote of the Senate. Thus, the only way to adopt spending
proposals by simple majority would be to authorize and appropriate
within the ceilings of a duly enacted budget law.
Additionally, the ceilings on spending would also apply to
entitlements. Again, this merely means that Congress would decide on
specific spending totals for these programs. Congress has abdicated
their control over the largest Government programs. As a result, these
programs have grown uncontrollably. We must reign them in and make
conscious decisions about the Government spending instead of just
signing the blank check year after year.
The head of each executive agency that administers any entitlement
program would be authorized to adjust benefit levels and eligibility
requirements, so that the program costs exactly what Congress has
appropriated and no more.
To maintain the integrity of congressional control over the
legislative process, the CBO--rather than the OMB--would be the
scorekeeper for determining whether particular authorization and
appropriations measures were consistent with the budget ceilings. In
his State of the Union speech last year, President Clinton said that
the CBO should be the official scorekeeper. I do not have any bias for
CBO. In fact, I have a lot of reservations about it. But, we need to
decide who it is going to be, so we will have consistent numbers.
President Clinton has also repeatedly stated his support for the line
item veto. This bill would give it to him. Why shouldn't the President
of the United States have the same ability as 43 Governors to reduce
targeted, pork-barrel projects?
This bill gives the President the authority to rescind over-budget
spending unless Congress were to enact legislation expressly
overturning it. This gives the President the power to selectively
reduce individual programs by a percentage, leaving intact some
portions of programs budgeted by Congress if he chooses. This would
help control spending.
The bill also precludes the need for continuing resolutions by
automatically reverting any unfinished appropriations bills to the
prior year's spending level. It amazes me, by law, Congress is to
finish all appropriations bills by June 30. Yet, every year we miss
this legal deadline and are forced to pass continuing resolutions
because we can't get our work done in a timely manner. Various
Government agencies and programs do not know whether they are going to
be able to continue or not. We always talk about shutting down the
Washington Monument. It is time to stop that insanity.
This provision of the bill will prevent actual or threatened annual
shut-downs of the Federal Government.
In addition, this reversion would encourage spending restraint--if no
action were taken on the appropriations bills, spending would not
increase from year to year.
In conclusion, through the Budget Process Reform Act we will enforce
the law. We will require cooperation between the President and
Congress. We will bring entitlement programs under budget control.
Above all, we will make the system clear and understandable to the
people whose money we are spending.
As we annualy translate our Nation's priorities into a Federal
budget, we can use this new process to both plan and discipline our
spending while still achieving our goals. The final result will be a
meaningful budget which allows Congress to focus on the effects of the
bottom line on the economy and on the tradeoffs which must be made
among priorities to control overall levels of spending.
This is a bipartisan plan. In preparing this legislation, we drew
upon the experience and ideas of Democratic and Republican
administration officials, congressional leaders, and academic experts
across the past seven decades. This bill is a good starting point for
real deficit reduction.
It sets the mechanisms in place to facilitate a more efficient and
effective budget system.
I am hopeful that the grounds swell of support for reform will enable
us to get this bill through this Congress. We need to put aside old
ways of thinking and doing things. I believe Congress can do what it
must do. We can win back the people's trust.
Our fiscal problems are not unsurmountable. A child must learn to
step before he walks, and walk before he runs.
I remind my colleagues of a quote by St. Francis of Assisi:
Start by doing what's necessary; then do what is possible;
and suddenly you are doing the impossible.
So I urge my colleagues to join me and the cosponsors of this bill in
taking this step towards restoring fiscal responsibility, discipline,
and accountability.
Mr. President, I ask unanimous consent that the Budget Process Reform
Act be printed in it's entirety at the conclusion of my remarks.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1955
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 ``Budget
Process Reform Act''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I--STATEMENT OF CONGRESSIONAL PURPOSE
Sec. 101. Improvement in decisionmaking process.
Sec. 102. Reform of fiscal management.
Sec. 103. Safeguards against delay and inaction.
TITLE II--BINDING BUDGET LAW
Sec. 201. Joint resolution establishing binding budget law.
Sec. 202. Budget required before spending bills may be considered.
Sec. 203. ``baseline'' budgeting prohibited; unadjusted year-to-year
comparisons required in budget law.
Sec. 204. President's budget submissions.
TITLE III--ENFORCEMENT MECHANICS
Subtitle A--Supermajority Required to Break Budget Law
Sec. 301. Three-fifths requirement for all spending bills in absence of
budget law.
Sec. 302. Three-fifths requirement for over-budget spending bills.
Sec. 303. Three-fifths requirement for waiver of this Act.
Subtitle B--Limited Enhanced Rescission Authority
Sec. 304. Rescission authority limited to spending above limits of
congressional budget law.
Sec. 305. Application.
Subtitle C--``Blank Check'' Appropriations Prohibited
Sec. 306. Intent of Senate.
Sec. 307. Fixed-dollar appropriations required.
Sec. 308. Agency-adjusted benefits.
Sec. 309. Budget authority and entitlement authority may cover only a
single fiscal period.
Subtitle D--``Pay As You Go'' Requirement for New Spending
Sec. 310. Spending offsets required.
Sec. 311. Three-fifths vote required to waive point of order.
TITLE IV--SUSTAINING MECHANISM
Sec. 401. Automatic continuing resolution.
Sec. 402. Contingency regulations.
Sec. 403. Unauthorized appropriations prohibited.
TITLE V--PROTECTION OF SOCIAL SECURITY
Sec. 501. Benefits protected against deficit reduction.
Sec. 502. Conforming amendment.
TITLE VI--TIMETABLE
Sec. 601. Revision of timetable.
TITLE VII--CONFORMING AMENDMENTS
Sec. 701. Conforming and technical amendments changing ``concurrent''
to ``joint'' resolutions.
Sec. 702. Further conforming and technical amendments.
Sec. 703. Conforming amendments to the Impoundment Control Act of 1974.
Sec. 704. Conforming amendment to title 31, United States Code.
TITLE VIII--DEFINITIONS AND RULES OF INTERPRETATION
Sec. 801. Definitions.
Sec. 802. Amendments to Congressional Budget and Impoundment Control
Act of 1974.
Sec. 803. Use of terms.
TITLE IX--EFFECTIVE DATE
Sec. 901. General provision.
Sec. 902. Fiscal year 1993.
TITLE I--STATEMENT OF CONGRESSIONAL PURPOSE
SEC. 101. IMPROVEMENT IN DECISIONMAKING PROCESS.
Because the Federal budget process is the principal vehicle
by which many of the most fundamental policy choices in
Government are made, the purpose of this Act is to facilitate
rational, informed, and timely decisions by the Congress in
the course of that process.
SEC. 102. REFORM OF FISCAL MANAGEMENT.
It is the sense of the Congress that a properly functioning
Federal budget process should focus the attention of
policymakers and the public on the aggregate impact of
Federal spending on the economy, and on the tradeoffs that
must be made among priorities in order to control overall
levels of spending. To this end, the Act is intended to
establish a budget process that, in each fiscal period--
(1) requires the adoption of a budget before, not after,
any spending begins;
(2) produces decisions on that budget early in the
budgeting cycle;
(3) encourages cooperation between Congress and the
President in adopting the budget;
(4) ties each subsequent spending decision to an overall,
binding budget total;
(5) requires regular, periodic decisions on appropriate
spending levels for all Federal programs, not just those
arbitrarily deemed ``controllable''; and
(6) produces a bias in favor of fiscal responsibility that
can be overcome only if the Congress expressly determines to
do so.
SEC. 103. SAFEGUARDS AGAINST DELAY AND INACTION.
The Congress further finds that a properly functioning
budget process should contain safeguards against delay and
inaction, so that temporary shut-downs of the Federal
Government may be avoided when the President and the Congress
fail to complete work on the budget prior to the beginning of
a fiscal period. Accordingly, this Act is intended to provide
an enforcement mechanism that gives meaning and importance to
the timely adoption of a budget, and a sustaining mechanism
that ensures a continuation of the Government should the
political process produce deadlock or a failure to act in a
timely fashion.
TITLE II--BINDING BUDGET LAW
SEC. 201. JOINT RESOLUTION ESTABLISHING BINDING BUDGET LAW.
To encourage early consultation and cooperation between the
Congress and the President on decisions concerning overall
spending levels for all Federal programs, the Congress shall
enact a binding budget law, in the form of a joint
resolution, by April 15 of the calendar year before that in
which the fiscal period commences. The technical amendments
contained in title VI and section 701 of this Act are
intended to assist in the establishment of this requirement.
The budget law itself shall fit on a single page, which sets
forth specific budget ceilings in the following 19 major
functional categories, which together comprise the entire
Federal budget.
Function 050: National Defense
Function 150: International Affairs
Function 250: General Science, Space and Technology
Function 270: Energy
Function 300: Natural Resources and Environment
Function 350: Agriculture
Function 400: Transportation
Function 450: Community and Regional Development
Function 500: Education, Training, Employment and Social
Services
Function 550: Health
Function 570: Medicare
Function 600: Income Security
Function 650: Social Security
Function 700: Veterans Benefits and Services
Function 750: Administration of Justice
Function 800: General Government
Function 900: Net Interest
Function 920: Allowances
Function 950: Undistributed Offsetting Receipts.
By thus requiring that the budget process begin with highly
generalized macroeconomic decisions about spending in 19
overall categories, this section is intended to facilitate
agreement within Congress itself, and between Congress and
the President, on how much the Federal Government should
spend in the ensuing fiscal period.
SEC. 202. BUDGET REQUIRED BEFORE SPENDING BILLS MAY BE
CONSIDERED.
Unless and until a joint resolution on the budget is
enacted with respect to any major functional category for a
fiscal period, it shall not be in order in either the House
of Representatives or the Senate, or any committee or
subcommittee thereof, to consider any spending bill affecting
spending in that category, except as provided in Title III of
this Act. The purpose of this provision is to ensure that
until the budget is signed into law, no authorization or
appropriations bill shall be considered in the Congress.
SEC. 203. ``BASELINE'' BUDGETING PROHIBITED; UNADJUSTED YEAR-
TO-YEAR COMPARISONS REQUIRED IN BUDGET LAW.
Section 301(e) of the Congressional Budget Act of 1974 is
amended by--
(1) inserting after the second sentence the following:
``The starting point for any deliberations in the Committee
on the Budget of each House on the joint resolution on the
budget for the next fiscal period shall be the estimated
level of outlays for the current period in each function and
subfunction. Any increases or decreases in the Congressional
budget for the next fiscal period shall be from such
estimated levels.'';
(2) striking paragraphs (2) and (3) and inserting the
following:
``(2) a comparison of levels for the current fiscal period
with proposed spending for the subsequent fiscal periods
along with the proposed increase or decrease of spending in
percentage terms for each function and subfunction;
``(3) information, data, and comparisons indicating the
manner in which, and the basis on which, the committee
determined each of the matters set forth in the joint
resolution, including information on outlays for the current
fiscal period and the decisions reached to set funding for
the subsequent fiscal years;'';
(3) inserting ``and'' after the semicolon in paragraph (7);
(4) striking paragraph (8); and
(5) redesignating paragraph (9) as paragraph (8).
The technical amendments contained in sections 702(g) and
704(b) of this Act are intended to apply the same prohibition
against ``baseline'' budgeting to the budgets prepared by the
President and the Congressional Budget Office reports to the
Budget Committees.
SEC. 204. PRESIDENT'S BUDGET SUBMISSIONS.
On or before the fifteenth day after a joint resolution on
the budget is enacted, the President shall submit to the
Congress a detailed budget for the fiscal period beginning on
October 1 of the current calendar year, including all
summaries and explanations required under section 1105(a) of
title 31, United States Code.
TITLE III--ENFORCEMENT MECHANICS
Subtitle A--Supermajority Required to Break Budget Law
SEC. 301. THREE-FIFTHS REQUIREMENT FOR ALL SPENDING BILLS IN
ABSENCE OF BUDGET LAW.
Unless and until a joint resolution on the budget is
enacted with respect to any major functional category for a
fiscal period, it shall not be in order in the Senate or any
committee or subcommittee thereof, to consider any spending
bill affecting spending in that category unless it is
approved by the affirmative vote of three-fifths of the
Members voting, a quorum being present.
SEC. 302. THREE-FIFTHS REQUIREMENT FOR OVER-BUDGET SPENDING
BILLS.
(a) Determination of Budget Effect of All Proposed Spending
Bills.--The Congressional Budget Office shall provide to the
Senate (or the appropriate committee, subcommittee, or
conference thereof) as soon as practicable after the
introduction of any spending bill, its estimate of the costs
in each major functional category attributable to that bill
during the fiscal period in which it is to become effective
and in each of the next 4 fiscal years, together with the
basis for such estimate. The Congressional Budget Office
report shall not be required, however, if the Congressional
Budget Office certifies that a spending bill will likely
result in applicable costs of less than $10,000,000. For
purposes of estimating the costs attributable to any spending
bill that includes new credit authority, the report shall
deem the market value of any loan (if it were sold by the
Federal Government) or the assumption cost of any guarantee
(if it were assumed at market rates) to be the costs
attributable to such loan or guarantee in the fiscal period
in which it is made.
(b) CBO Report Required Before Consideration of Spending
Bills.--It shall not be in order in the Senate, or in any
committee thereof, to consider any spending bill, unless and
until the report referred to in subsection (a) has been made
available to the Senate or the appropriate committee or
subcommittee thereof.
(c) Three-Fifths Requirement for All Over-Budget Spending
Bills.--It shall not be in order in the Senate (or in any
committee, subcommittee, or conference) to consider any
spending bill for a fiscal period that the report referred to
in subsection (a) indicates would in such fiscal period
exceed a budget ceiling, unless such bill is approved by the
affirmative vote of three-fifths of the Members voting, a
quorum being present.
(d) Determination of Spending in a Category.--A spending
bill shall be deemed to break a budget ceiling if--
(1) its cost in any major functional category as estimated
in the report referred to in subsection (a); and
(2) all other budget authority, budget outlays, and
entitlement authority, if any, in that major functional
category for the relevant fiscal period contained in any
previously enacted legislation for the fiscal period; and
(3) to the extent that new budget authority or entitlement
authority for the relevant fiscal period has not been granted
(or modified from the level of the previous fiscal period) in
any other enacted legislation for any program within such
major functional category, the amounts of budget authority
and entitlement authority for such major functional category
(or part thereof) for the previous fiscal period;
exceed the budget ceiling for such major functional category.
SEC. 303. THREE-FIFTHS REQUIREMENT FOR WAIVER OF THIS ACT.
No waiver of any provision of this Act, including the
calendar deadlines for completion of Congressional action and
the provisions concerning over-budget spending, shall be
effective unless approved by the affirmative vote of three-
fifths of the Members of the Senate, a quorum being present.
No committee of the Senate shall have jurisdiction to report
a rule governing procedures for consideration of spending
bills covered by this Act, if such rule would violate the
provisions of this section. Nothing in this provision shall
be deemed to require a supermajority vote to amend this Act.
Subtitle B--Limited Enhanced Rescission Authority
SEC. 304. RESCISSION AUTHORITY LIMITED TO SPENDING ABOVE
LIMITS OF CONGRESSIONAL BUDGET LAW.
The Impoundment Control Act of 1974 (2 U.S.C. 681 et seq.)
is amended by redesignating sections 1013 through 1017 as
sections 1014 through 1018, respectively, and inserting after
section 1012 the following new section:
``RESCISSION OF SPENDING ABOVE LIMITS OF CONGRESSIONAL BUDGET LAW
``Sec. 1013. (a) Transmittal of Special Message.--The
President may transmit to both Houses of Congress for
consideration in accordance with this section one or more
special messages to rescind (in whole or in part) items of
budget authority or entitlement authority sufficient to
ensure that the levels of budget authority, entitlement
authority, and outlays in a functional category do not exceed
the levels stated in the budget law for the applicable fiscal
period (or, in the absence of a budget law, do not exceed
such levels in the previous fiscal period).
``(b) Limitations.--For purposes of this section--
``(1) continuing appropriations made pursuant to section
1311 of title 31, United States Code, shall be treated as
continuing appropriations for an entire fiscal period; and
``(2) the levels of budget authority, entitlement
authority, and outlays shall be determined on the basis of
the reports made by the Congressional Budget Office pursuant
to section 202 of the Budget Process Reform Act of 1990.
``(c) Contents of Special Message.--Each special message
transmitted under subsection (a) shall specify, with respect
to each item of budget authority to be rescinded, the matters
referred to in paragraphs (1) through (5) of section 1012(a).
``(d) Requirement Not To Make Available for Obligation.--
Any item of budget authority to be rescinded as set forth in
such special message shall not be made available for
obligation unless, within the prescribed 45-day period,
Congress completes action on a rescission bill disapproving
the rescission of the amount to be rescinded. Funds made
available for obligation under this procedure may not be
included in a special message again.
``(e) Procedures.--
``(1)(A) Before the close of the third day beginning after
the day on which a special message to rescind an item of
budget authority is transmitted to the House of
Representatives and the Senate under subsection (a), a bill
may be introduced (by request) by the majority leader or
minority leader of the House of the Congress in which the
appropriation Act providing the budget authority originated
to disapprove the rescission set forth in the special
message. If such House is not in session on the day on which
a special message is transmitted, the bill may be introduced
in such House, as provided in the preceding sentence, on the
first day thereafter on which such House is in session.
``(B) A bill introduced in the House of Representatives or
the Senate pursuant to subparagraph (A) shall be referred to
the Committee on Appropriations of such House. The Committee
shall report the bill without substantive revision (and with
or without recommendation) not later than 15 calendar days of
continuous session of the Congress after the date on which
the bill is introduced. A committee failing to report a bill
within the 15-day period referred to in the preceding
sentence shall be automatically discharged from consideration
of the bill and the bill shall be placed on the appropriate
calendar.
``(C) A vote on final passage of a bill introduced in a
House of the Congress pursuant to subparagraph (A) shall be
taken on or before the close of the 25th calendar day of
continuous session of the Congress after the date of the
introduction of the bill in such House. If the bill is agreed
to, the Clerk of the House of Representatives (in the case of
a bill agreed to in the House of Representatives) or the
Secretary of the Senate (in the case of a bill agreed to in
the Senate) shall cause the bill to be engrossed, certified,
and transmitted to the other House of the Congress on the
same calendar day on which the bill is agreed to.
``(2)(A) A bill transmitted to the House of Representatives
or the Senate pursuant to paragraph (1)(C) shall be referred
to the Committee on Appropriations of such House. The
committee shall report the bill without substantive revision
(and with or without recommendation) not later than 10
calendar days of continuous session of the Congress after the
bill is transmitted to such House. A committee failing to
report the bill within the 10-day period referred to in the
preceding sentence shall be automatically discharged from
consideration of the bill and the bill shall be placed upon
the appropriate calendar.
``(B) A vote on the final passage of a bill transmitted to
a House of the Congress pursuant to paragraph (1)(C) shall be
taken on or before the close of the 10th calendar day of
continuous session of the Congress after the date on which
the bill is transmitted to such House. If the bill is agreed
to in such House, the Clerk of the House of Representatives
(in the case of a bill agreed to in the House of
Representatives) or the Secretary of the Senate (in the case
of a bill agreed to in the Senate) shall cause the engrossed
bill to be returned to the House in which the bill
originated, together with a statement of the action taken by
the House acting under this paragraph.
``(3)(A) A motion in the House of Representatives to
proceed to the consideration of a bill under this section
shall be highly privileged and not debatable. An amendment to
the motion shall not be in order, nor shall it be in order to
move to reconsider the vote by which the motion is agreed to
or disagreed to.
``(B) Debate in the House of Representatives on a bill
under this section shall be limited to not more than 2 hours,
which shall be divided equally between those favoring and
those opposing the bill. A motion further to limit debate
shall not be debatable and shall require an affirmative vote
of two-thirds of the Members voting, a quorum being present.
It shall not be in order to move to recommit a bill under
this section or to move to reconsider the vote by which the
bill is agreed to or disagreed to.
``(C) All appeals from the decisions of the Chair relating
to the application of the Rules of the House of
Representatives to the procedure relating to a bill under
this section shall be decided without debate.
``(D) Except to the extent specifically provided in the
preceding provisions of this subsection, consideration of a
bill under this section shall be governed by the Rules of the
House of Representatives applicable to other bills in similar
circumstances.
``(4)(A) A motion in the Senate to proceed to the
consideration of a bill under this section shall be
privileged and not debatable. An amendment to the motion
shall not be in order, nor shall it be in order to move to
reconsider the vote by which the motion is agreed to or
disagreed to.
``(B) Debate in the Senate on a bill under this section,
and all debatable motions and appeals in connection
therewith, shall be limited to not more than 2 hours. The
time shall be equally divided between, and controlled by, the
majority leader and the minority leader or their designees.
``(C) Debate in the Senate on any debatable motion or
appeal in connection with a bill under this section shall be
limited to not more than 1 hour, to be equally divided
between, and controlled by, the mover and the manager of the
bill except that in the event the manager of the bill is in
favor of any such motion or appeal, the time in opposition
thereto shall be controlled by the minority leader or his
designee. Such leaders, or either of them, may, from time
under their control on the passage of a bill, allot
additional time to any Senator during the consideration of
any debatable motion or appeal.
``(D) A motion in the Senate to further limit debate on a
bill under this section is not debatable. A motion to
recommit a bill under this section is not in order.
``(f) Amendments Prohibited.--No amendment to a bill
considered under this section shall be in order in either the
House of Representatives or the Senate. No motion to suspend
the application of this subsection shall be in order in
either House, not shall it be in order in either House for
the presiding officer to entertain a request to suspend the
application of this subsection by unanimous consent.''.
SEC. 305. APPLICATION.
The amendments made by section 304 shall apply to items of
budget authority (as defined in subsection (g)(1) of section
1013, as added by section 103(b) of this Act) provided by
appropriation Acts (as defined in subsection (g)(3) of such
section) that become law after the date of enactment of this
Act.
Subtitle C--``Blank Check'' Appropriations Prohibited
SEC. 306. INTENT OF SENATE.
It is the intent of the Senate, by this provision, to put
an end to open-ended, ``blank check'' appropriations, which
typically authorize the spending of ``such sums as may be
necessary.'' By requiring explicit decisions concerning the
desired level of spending for each federal program (except
social security and interest on the debt), it is intended
that currently uncontrolled programs will be brought within
the discipline of an overall budget.
SEC. 307. FIXED-DOLLAR APPROPRIATIONS REQUIRED.
(a) Fixed-Dollar Appropriations.--For every account except
social security and interest on the debt, every appropriation
for a fiscal period for any program, project, or activity
shall be for a specific, fixed dollar amount. Any
appropriations of ``such sums as may be necessary'' (except
with respect to the automatic continuing resolution provided
for by section 401 of this Act) are hereby prohibited.
(b) Point of Order.--It shall not be in order in the Senate
(or in any committee, subcommittee, or conference) to
consider any appropriation that is in violation of subsection
(a).
SEC. 308. AGENCY-ADJUSTED BENEFITS.
The head of each Executive agency that administers any
entitlement program is authorized to adjust benefit levels
and eligibility requirements, or both, with respect to the
program such that aggregate outlays for a fiscal period do
not exceed the fixed-dollar appropriation proved pursuant to
this title such fiscal period. Such adjustment shall be made
by rule or, pending adoption of appropriate rules, informal
guideline. The purpose of any such rule or guideline shall be
to ensure that the fixed-dollar appropriations for the
program authorized by Congress are not exceeded.
SEC. 309. BUDGET AUTHORITY AND ENTITLEMENT AUTHORITY MAY
COVER ONLY A SINGLE FISCAL PERIOD.
Chapter 13 of title 31, United States Code, is amended by
inserting after section 1312 the following new section:
``Sec. 1313. Budget authority and entitlement authority must
cover single fiscal period
``(a) Notwithstanding any other provision of law and except
as provided by subsection (b), no budget authority or
entitlement authority--
``(1) enacted on or after the date of enactment of this
section shall be effective for more than one fiscal period;
or
``(2) enacted before the date of enactment of this section
shall continue in effect beyond the end of the first fiscal
period beginning after the date of enactment of this section.
``(b) Subsection (a) does not apply with respect to
appropriations for the repayment of indebtedness incurred
under chapter 31 or benefits payable under the old-age,
survivors, and disability insurance program established under
title II of the Social Security Act.''.
Subtitle D--``Pay As You Go'' Requirement for New Spending
SEC. 310. SPENDING OFFSETS REQUIRED.
It shall not be in order in the Senate to consider any
supplemental appropriation measure, or any other bill,
resolution, or amendment which authorizes, requires, or
provides new entitlements/mandatory spending as defined in
section 3 (12)(A) of the Congressional Budget and Impoundment
Control Act of 1974, or which authorizes spending for a
fiscal period that the report referred to in section 302(a)
of this Act indicates would in such fiscal period exceed a
budget ceiling, unless any such increased spending called for
therein is offset fully in each such fiscal period in such
measure, bill, resolution or amendment by an equal amount of
reductions in existing spending.
SEC. 311. THREE-FIFTHS VOTE REQUIRED TO WAIVE POINT OF ORDER.
The point of order established by this subtitle may be
waived or suspended in the Senate, and an appeal of the
ruling of the Chair on a point of order raised under this
section may be sustained, only by the affirmative vote of
three-fifths of the Members voting, a quorum being present.
TITLE IV--SUSTAINING MECHANISM
SEC. 401. AUTOMATIC CONTINUING RESOLUTION.
Chapter 13 of title 31, United States Code, is amended by
inserting after section 1310 the following new section:
``Sec. 1311. Continuing appropriation
``(a) If for any account an appropriation for a fiscal
period does not become law before the beginning of such
fiscal period, there are hereby appropriated, out of any
moneys in the Treasury not otherwise appropriated, and out of
applicable corporate or other revenues, receipts, and funds,
such sums as may be necessary to continue any program,
project, or activity provide for in the most recent
appropriation Act at a rate of operations not in excess of
the rate of operations provided for such program, project, or
activity in such Act. In no case shall the total dollar
amount of appropriations for any program, project or activity
pursuant to this section exceed the appropriation for such
program, project, or activity in the most recent
appropriation Act, determined on a fiscal-period basis.
``(b) Amounts appropriated pursuant to subsection (a) for a
program, project, or activity shall be available during a
fiscal period until the earlier of--
``(1) the day on which the appropriation bill for such
fiscal period which would include the program, project, or
activity takes effect; or
``(2) the last day of such fiscal period.''.
SEC. 402. CONTINGENCY REGULATIONS.
Chapter 13 of title 31, United States Code, is amended by
inserting after section 1311 the following new section:
``Sec. 1312. Contingency regulations
``(a) Notwithstanding any other provisions of law and
except as provided by subsection (b), the head of each
Executive agency that administers any entitlement program
shall, by rule, (or informal guideline, pending adoption of
appropriate rules), provide for the adjustments of benefit
levels or eligibility requirements, or both, with respect to
the program such that aggregate outlays for a fiscal period
do not exceed the fixed-dollar appropriation provided
pursuant to section 314 (requiring fixed-dollar
appropriations) or section 401 (providing for an Automatic
Continuing Resolution) of this Act for such fiscal period.
``(b) In the case of social safety net programs, the rules
shall provide each State the option of receiving an aggregate
amount for the fiscal period for such programs equal to the
amount it received for the preceding fiscal period for such
programs (in which case such State could, in its discretion,
allocate the benefits among such programs to best meet the
needs of recipients in its State) or the amounts it received
for each such program for such preceding fiscal period.
``(c) As used in this section--
``(1) the term `Executive agency' has the meaning given
such term in section 105 of title 5, United States Code;
``(2) the term `entitlement program' means any spending
authority as defined in section 401(c)(2)(C) of the
Congressional Budget Act of 1974; and
``(3) the term `social safety net programs' means the
following programs: family support payments, adoption
assistance, child support enforcement, food stamps, foster
care, medicaid, child nutrition programs, social services
block grant, and supplemental security income (SSI).''.
SEC. 403. UNAUTHORIZED APPROPRIATIONS PROHIBITED.
Section 401(b) is amended to read as follows:
``(b) Controls on Legislation Providing Funding.--(1) It
shall not be in order in either the House of Representatives
or the Senate to consider any bill, resolution, or conference
report that provides budget authority or spending authority
described in subsection (c)(2)(C) except a bill or resolution
reported by the Committee on Appropriations of that House or
a conference report made by a committee or conference all of
whose conferees are member of the Committee on
Appropriations.
``(2) Paragraph (1) shall not apply to benefits payable
under the old-age, survivors, and disability insurance
program established under title II of the Social Security
Act.''.
TITLE V--PROTECTION OF SOCIAL SECURITY
SEC. 501. BENEFITS PROTECTED AGAINST DEFICIT REDUCTION.
Nothing in this Act shall be construed to require or permit
reductions in Social Security benefits otherwise payable
pursuant to applicable law or regulations.
SEC. 502. CONFORMING AMENDMENT.
Chapter 13 of title 31, United States Code, is amended by
inserting after section 1313 the following new section:
``Sec. 1314. Protection of social security from budget
deficit reduction measures
``No reductions in benefits payable under the old-age,
survivors, and disability insurance program established under
title II of the Social Security Act shall be made as a
consequence of the Budget Process Reform Act''.
TITLE VI--TIMETABLE
SEC. 601. REVISION OF TIMETABLE.
Section 300 (2 U.S.C. 631) is amended to read as follows:
``timetable
``Sec. 300. The timetable with respect to the Congressional
budget process for any Congress (beginning with the One
Hundred Third Congress) is as follows:
Action to be completed:
President submits short-form budget recommendations....................
Congressional Budget Office submits report to Budget Committees........
Committees submit views and estimates to Budget Committees.............
Budget Committees report joint resolution on the budget................
Congress completes action on joint resolution on the budget and .......
transmits it to the President for signature or veto.
Authorization and appropriations bills may be considered in the .......
Congress.
President submits complete budget and support documents................
Appropriations Committees report last of annual appropriation bills....
Congress completes action on reconciliation legislation and annual ....
appropriation bills.
Fiscal period begins. Congress completes all necessary action on ......
budget, authorizations and appropriations, or automatic continuing
resolution takes effect.''.
TITLE VII--CONFORMING AMENDMENTS
SEC. 701. CONFORMING AND TECHNICAL AMENDMENTS CHANGING
``CONCURRENT'' TO ``JOINT'' RESOLUTIONS.
(a) Sections 300, 301, 302, 303, 304, 305, 308, 310, and
311 (2 U.S.C. 631 et seq.) are amended by striking
``concurrent resolutions'' each place it appears and by
inserting ``joint resolution''.
(b) The table of contents set forth in section 1(b) is
amended by striking ``Concurrent'' in the items relating to
sections 301, 303, and 304 and inserting ``Joint''.
(c) Clauses 4(a)(2), 4(b)(2), 4(g), and 4(h) of rule X,
clause 8 of rule XXIII, and rule XLIX of the Rules of the
House of Representatives are amended by striking
``concurrent'' and by inserting in its place ``joint''.
(d) Section 258C(b)(1) of the Deficit Control Action of
1985 is amended by striking ``concurrent'' and by inserting
``joint''.
SEC. 702. FURTHER CONFORMING AND TECHNICAL AMENDMENTS.
(a) Section 302(f) (2 U.S.C. 633(f)) is amended--
(1) in paragraph (1) by striking ``(1) In the House of
Representatives.--'', by striking ``new budget authority for
such fiscal year, new entitlement authority effective during
such fiscal year, or'' and by striking ``new discretionary
budget authority, new entitlement authority, or''; and
(2) by striking paragraph (2).
(b) Section 303 is amended--
(1) in its heading by striking ``new budget authority, new
spending authority,'' and the comma before ``or changes'';
(2) in subsection (a) by striking paragraphs (1), (4) and
(5) and by redesignating paragraphs (2), (3), and (6) as
paragraphs (1), (2), and (3), respectively; and
(3) in subsection (b) by striking paragraph (1)(A), by
striking ``(B)'', by striking the dash after ``resolution'',
and by striking the last sentence.
(c) The table of contents set forth in section 1(b) is
amended by striking ``new budget authority, new spending
authority,'' and the comma before ``or changes'' in the item
relating to section 303.
(d) Section 311 is amended--
(1) in its heading by striking ``new budget authority, new
spending authority, and'';
(2) in subsection (a)(1) by striking ``providing new budget
authority for such fiscal year, providing new entitlement
authority effective during such fiscal year, or''; by
striking ``the appropriate level of total new budget
authority or total budget outlays set forth in the most
recently agreed to concurrent resolution on the budget to be
exceeded, or'';
(3) by repealing subsection (b); and
(4) by redesignating subsection (c) as subsection (b), and
by striking ``new budget authority, budget outlays, new
entitlement authority, and'' in subsection (c) (as
redesignated).
(e) The table of contents set forth in section 1(b) is
amended by striking ``new budget authority, new spending
authority, and'' in the item relating to section 311.
(f) The last sentence of clause 4(b) of rule XI of the
Rules of the House of Representatives is amended by inserting
before the period at the end of the following: ``; nor shall
it report any rule or order which would waive any point of
order set forth in title III of the Budget Process Reform
Act''.
(g) The first sentence of section 202(f)(1) of the
Congressional Budget Act of 1974 is amended to read as
follows: ``On or before February 15 of each year, the
Director shall submit to the Committees on the Budget of the
House of Representatives and the Senate a report, for the
fiscal year commencing on October 1 of that year, with
respect to fiscal policy, including (A) estimated budget
outlays in all functions and subfunctions for appropriated
accounts for the current fiscal year and estimated budget
outlays under current law for all entitlement programs for
the next fiscal year, (B) alternative levels of total
revenues, total new budget authority, and total outlays
(including related surpluses and deficits), and (C) the
levels of tax expenditures under existing law, taking into
account projected economic factors and any changes in such
levels based on proposals in the budget submitted by the
President for such fiscal year.''.
SEC. 703. CONFORMING AMENDMENTS TO THE IMPOUNDMENT CONTROL
ACT OF 1974.
(a) Section 1011(5) (2 U.S.C. 682(5)) is amended--
(1) by striking ``1012, and'' and inserting ``1012, the 20-
day periods referred to in paragraphs (1)(b) and (2)(A) of
section 1013(c), the 45-day period referred to in section
1013(b), and'';
(2) by striking ``1012 during'' and inserting ``1012 or
1013 during'';
(3) by striking ``of 45'' and inserting ``of the applicable
number of''; and
(4) by striking ``45-day period referred to in paragraph
(3) of this section and in section 1012'' and inserting
``period or periods of time applicable under such section''.
(b) Section 1011 is further amended--
(1) in paragraph (4) by striking ``1013'' and inserting
``1014''; and
(2) in paragraph (5)--
(A) by striking ``1016'' and inserting ``1017''; and
(B) by striking ``1017(b)(1)'' and inserting
``1018(b)(1)''.
(c) Section 1015 (as redesignated) is amended--
(1) by striking ``1012 or 1013'' each place it appears and
inserting ``1012, 1013, or 1014'';
(2) in subsection (b)(1) by striking ``1012'' and inserting
``1012 or 1013'';
(3) in subsection (b)(2) by striking ``1013'' and inserting
``1014''; and
(4) in subsection (e)(1)--
(A) by striking ``and'' at the end of subparagraph (A),
(B) by redesignating subparagraph (B) as subparagraph (C),
(C) by striking ``1013'' in subparagraph (C) (as
redesignated), and
(D) by inserting after subparagraph (A) the following new
subparagraph:
``(B) he has transmitted a special message under section
1013 with respect to a proposed rescission; and''.
(d) Section 1016 (as redesignated) is amended by striking
``1012 or 1013'' each place it appears and inserting ``1012,
1013, or 1014''.
(e) Section 1012(b) is amended by inserting before the last
sentence the following new sentence: ``The preceding sentence
shall not apply to any item of budget authority proposed by
the President to be rescinded under this section that the
President has also proposed to rescind under section 1013 and
with respect to which the 45-day period referred to in
subsection (e) of such section has not expired.''.
(f) The table of sections set forth in section 1(b) is
amended--
(1) by redesignating the items relating to sections 1013
through 1017 as items relating to sections through 1018,
respectively; and
(2) by inserting after the item relating to section 1012
the following new item:
``Sec. 1013. Rescission of spending above limits of congressional
budget law.''.
SEC. 704. CONFORMING AMENDMENT TO TITLE 31, UNITED STATES
CODE.
(a) The analysis of chapter 13 of title 31, United States
Code, is amended by inserting after the item relating to
section 1310 the following new items:
``Sec. 1311. Continuing appropriation.
``Sec. 1312. Contingency regulations.
``Sec. 1313. Budget authority and entitlement authority must cover
single fiscal period.
``Sec. 1314. Protection of Social Security from budget deficit
reduction measures.''.
(b) Paragraph (5) of section 1105(a) of title 31, United
States Code, is amended to read as follows:
``(5) except as provided in subsection (b) of this
section--
``(A) estimated expenditures and proposed appropriations
for each function and subfunction in the current fiscal year;
``(B) estimated expenditures and proposed appropriations
the President decides are necessary to support the Government
for each function and subfunction in the fiscal year for
which the budget is submitted; and
``(C) a comparison of levels of estimated expenditures and
proposed appropriations for each function and subfunction in
the current fiscal year and the fiscal year for which the
budget is submitted, along with the proposed increase or
decrease of spending in percentage terms for each function
and subfunction;''.
(b) Section 1105(a) of title 31, United States Code, is
amended--
(1) in the first sentence, by inserting ``on a single page,
which sets forth specific budget ceilings for that fiscal
period in the nineteen major functional categories described
in section 201 of the Budget Process Reform Act'' before the
period; and
(2) by repealing the second sentence and all of the third
sentence preceding the colon and inserting the following:
``On or before the fifteenth day after a joint resolution on
the budget for that budget period is enacted, the President
shall submit a detailed budget for that fiscal period,
including a budget message and summary and supporting
information, as follows''.
TITLE VIII--DEFINITIONS AND RULES OF INTERPRETATION
SEC. 801. DEFINITIONS.
(a) Definition of Budget Law.--Section 3(4) (2 U.S.C.
622(4)), containing general definitions under the Budget Act
is amended to read as follows:
``(4) The term `budget law' or `joint resolution on the
budget' means--
``(A) a joint resolution setting forth the simplified
budget for the United States Government for a fiscal period
as provided in section 301; and
``(B) any other joint resolution revising the budget for
the United States Government for a fiscal period as described
in section 304.''.
(b) Other Definitions.--Section 3 (2 U.S.C. 622) is further
amended by adding at the end the following new paragraphs:
``(11) The term `major functional category' refers to the
groupings of budget authority, budget outlays, and credit
authority (including continuing appropriations pursuant to
section 1331 of title 31, United States Code) into any one of
the following:
``Function 050: National Defense
``Function 150: International Affairs
``Function 250: General Science, Space and Technology
``Function 270: Energy
``Function 300: Natural Resources and Environment
``Function 350: Agriculture
``Function 400: Transportation
``Function 450: Community and Regional Development
``Function 500: Education, Training, Employment and Social
Services
``Function 550: Health
``Function 570: Medicare
``Function 600: Income Security
``Function 650: Social Security
``Function 700: Veterans Benefits and Services
``Function 750: Administration of Justice
``Function 800: General Government
``Function 900: Net Interest
``Function 920: Allowances
``Function 950: Undistributed Offsetting Receipts.''.
``(12) The term `budget ceiling' means the dollar amount
set forth in a budget law for a major functional category.
``(13) The term `spending bill' means any bill or
resolution, or amendment thereto or conference report
thereon, which provides budget authority, spending authority,
credit authority, or outlays.
``(14) The term `fiscal period' means the twelve-month
fiscal year beginning October 1 currently in use, or any
other fiscal period (such as a biennial period) that may
subsequently be adopted for the management of the budget of
the United States.''.
SEC. 802. AMENDMENTS TO CONGRESSIONAL BUDGET AND IMPOUNDMENT
CONTROL ACT OF 1974.
Except as otherwise expressly provided, whenever any
provision of this Act is expressed as an amendment to a
section or other provision, the reference shall be deemed to
be made to a section or other provision of the Congressional
Budget and Impoundment Control Act of 1974.
SEC. 803. USE OF TERMS.
Whenever any term is used in this Act which is defined in
section 3 of the Congressional Budget Impoundment Control Act
of 1974, the term shall have the meaning given to such term
in that Act.
TITLE IX--EFFECTIVE DATE
SEC. 901. GENERAL PROVISION.
Except as provided in section 902, this Act and the
amendments made by it shall become effective January 1, 1995,
and shall apply to fiscal periods beginning after September
30, 1995.
SEC. 902. FISCAL YEAR 1993.
Notwithstanding subsection (a), the provisions of--
(1) the Congressional Budget Impoundment Control Act of
1974,
(2) title 31, United States Code, and
(3) the Balanced Budget and Emergency Deficit Control Act
of 1985, (as such provisions were in effect on the day before
the effective date of this Act) shall apply to the fiscal
year beginning on October 1, 1994.
Mr. SHELBY. Mr. President, next year, we will pay close to $300
billion just on interest on the national debt--$300 billion. Mr.
President. That is about one-fifth of the budget for 1995.
Because we will spend so much on our budget in 1995 on just financing
our national debt, just paying the interest alone, not paying anything
off, I remain unconvinced that we are on the right track, that we are
doing what we need to do to address our chronic deficit and national
debt problems.
While CBO's recent projection of the 1995 deficit is lower than
originally expected, it does not speak to our long-term deficit and
debt future, because we have not changed the way we spend money around
here. Our system has not changed; yet, our problems are systemic.
Indeed, Mr. President, although deficit reduction was the
justification for last year's tax bill, which raised over $230 billion
in new taxes, Federal spending continues to increase at a progressive
rate through the next 5 years. From 1994 through 1998, spending will
continue to increase from $1.5 trillion to $1.8 trillion.
So, Mr. President, in reality, at the same time Congress was raising
new taxes, it was also increasing spending.
Mr. President, I ask you: Is this fiscal restraint? Is this a sign of
a Government on a diet? It would not appear so. Rather, it looks more
like the kind of diet that ends up putting 10 pounds on you instead of
taking 10 pounds off.
Let us not forget spending cuts. The President claims over 300
specific program cuts in the fiscal 1995 budget, and several proposals
have been offered over the past few months which would have similarly
made specific program cuts in order to lower the deficit.
The fact is, however, Mr. President, that many of these proposals had
nothing to do with lowering the deficit. Instead, they would only have
authorized a shift in spending. These proposals would not only have had
no affect on shrinking the size of the Federal pie, but, in fact, even
with the proposed cuts, the Federal pie would continue to get larger
through Federal spending.
So, Mr. President, I submit that while we may be slowing the growth
of the debt, we are still accelerating toward fiscal disaster.
Mr. President, if we want to put the brakes on excess Federal
spending, we need to change how we go about spending the Federal
dollar. We need to reform our annual budget process.
What role does our budget process play today if we have to wait to
pass a 5-year budget agreement locking in spending levels before we can
address spending cut proposals? And why should it be necessary for
Congress to always promise spending cuts in the future, or as we say,
in the ``outyears,'' and deliver tax increases today or--or in the case
of the 1994 tax bill--yesterday? You will recall that it was
retroactive taxes.
The reason is because Congress is unaccountable--unaccountable by
choice as well as by nature. Congress has no real incentives and faces
no threatened penalties to encourage fiscally responsible behavior
here.
Thus far, Mr. President, Congress has sought and approved simple,
politically expedient solutions to our complex deficit and debt
problems. In fact, the rallying call for deficit reduction that started
this past summer may have proved to be more of a cloak than a standard
in combating the deficit and our national debt.
Our current budget process favors increased Federal spending, not
less spending. It is impotent in enforcing current budget ceilings and
remains hostile to cuts in Federal programs. In short, Mr. President,
the budget process that we have today itself is impervious to efforts
to cut the Federal deficit and national debt.
Indeed, Mr. President, the budget process can strengthen or weaken
Congress' ability and Congress' resolve to gain control over its
excessive spending habits.
Senator Lott and I have joined the efforts of Representatives Cox and
Stenholm in trying to create a budgetary framework that is receptive to
efforts to curb Federal spending and facilitate fiscal responsibility
here.
The Budget Process Reform Act seeks to take Federal spending off of
automatic pilot and put it under stricter fiscal controls. It proposes
to reform the process to provide greater budget discipline and stronger
budget enforcement mechanisms.
The act would require that a legally binding budget resolution be in
place prior to the consideration of any appropriations or authorization
bills. Such a budget would fit on one page, setting aggregate spending
totals for each of the 19 spending categories we deal with.
The bill would eliminate baseline budgeting and require that all
entitlements, excepting Social Security and interest on the debt, are
given fixed-sum appropriations.
In addition, in order to have effective enforcement, the bill would
require a three-fifths supermajority to spend overbudget and would
grant the President enhanced rescission authority when a budget
category exceeds its allowable spending level.
Mr. President, this is effective legislation. It contains no
gimmicks. Rather, the bill establishes a process for spending Federal
dollars that imposes discipline and order while providing the
flexibility to prioritize Federal spending without draconian measures
such as across-the-board cuts or unlimited line-item veto authority.
While many may seek solace in the fact that the annual deficit is
less than predicted for this year, it is a hollow promise for our
future and for our children's future.
Without doubt, Mr. President, Congress must reform its budget process
if it is ever to effectively address this country's sinister deficits
and heavy debt--and ensure its citizens of a bright economic future.
I ask my colleagues in the Senate to join Senator Lott and me in
cosponsoring this important piece of legislation.
______
By Mr. SHELBY (for himself, Mr. Conrad, Mr. Johnston, Mr. Breaux,
and Mr. Faircloth):
S. 1956. A bill to amend the Consumer Credit Protection Act to
improve disclosures made to consumers who enter into rental-purchase
transactions, to set standards for collection practices, and for other
purposes; to the Committee on Banking, Housing, and Urban Affairs.
rental purchase reform act of 1994
Mr. SHELBY. Mr. President, today I introduce the Rental-
Purchase Reform Act of 1994, a bill that would regulate the rental-
purchase industry. This legislation would ensure that consumers are
provided straightforward disclosures of the important terms in rental-
purchase agreements.
Under a rental-purchase transaction, consumers rent televisions,
stereos, VCR's, refrigerators, furniture, and other household items by
the week or by the month. There is no long-term obligation to rent the
property beyond the initial rental period. However, after renting the
property for a specified period of time, ownership of the item
transfers automatically to the consumer.
Consumers have found rental-purchase transactions to be an attractive
means of obtaining goods that may be out of reach through traditional
purchase transactions. It is my understanding that renters become
owners in approximately 25 percent of rental-purchase transactions.
There have been some abuses in this industry. Passage of this
legislation will help curb these abuses. While this bill is similar to
legislation enacted in 36 States, it goes farther than many of these
State statutes. This legislation requires 11 contract disclosures,
including the amount and timing of rental payments, the total number
and the total dollar amount of rental payments and other charges
necessary to acquire ownership, whether the property is new or used,
the cash price of the property, and other disclosures important to
consumers when shopping for merchandise for their homes.
This bill also requires price tags on all of the merchandise in
rental-purchase stores showing consumers the important aspects of the
transaction. The bill would ensure that consumers may terminate a
rental-purchase agreement voluntarily at any time with no penalty. This
bill also contains substantive consumer protections, including
reinstatement rights for consumers, which allow them up to 90 days to
catch up on any past-due payments.
This bill also regulates the collection practices of rental merchants
and the advertising of rental-purchase products. Specifically, the bill
will require lessors to disclose important financial information in the
advertising of rental rates or the right to acquire ownership. Finally,
this bill would allow consumers to file suit for violations of the act
with statutory damages and would preempt State laws which do not
provide the same level of protection to rental-purchase consumers as
that contained in this bill. Although 36 States have passed legislation
to regulate this industry, uniform Federal regulation is still needed.
I urge my colleagues to support this legislation and I ask unanimous
consent that the bill be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1956
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Rental-Purchase Reform Act
of 1994''.
SEC. 2. REQUIREMENTS FOR RENTAL-PURCHASE TRANSACTIONS.
The Consumer Credit Protection Act (15 U.S.C. 1601 et seq.)
is amended by adding at the end the following new title:
``TITLE X--RENTAL-PURCHASE TRANSACTIONS
``Sec. 1001. Short title
``This title may be cited as the `Rental-Purchase Reform
Act of 1994'.
``Sec. 1002. Findings and purposes
``(a) The Congress finds that a significant number of
consumers engage in rental-purchase transactions. These
transactions have taken place, in many instances, without
provision of adequate disclosures and other protections to
consumers.
``(b) The purposes of this title are the following:
``(1) To assure meaningful disclosure of the terms of
rental-purchase agreements, including disclosure of all costs
to consumers under those agreements.
``(2) To regulate the collection practices of rental-
purchase merchants.
``(3) To provide certain substantive rights to consumers
under rental purchase agreements.
``Sec. 1003. Definitions
``(a) For purposes of this title:
``(1) The term `advertisement' means a commercial message
in any medium intended to aid, promote, or assist, directly
or indirectly, a rental-purchase agreement.
``(2) The term `agricultural purpose' includes--
``(A) the production, harvest, exhibition, marketing,
transportation, processing, or manufacture of agricultural
products by a natural person who cultivates plants or
propagates or nurtures agricultural products; and
``(B) the acquisition of farmlands, real property with a
farm residence, or personal property and services used
primarily in farming.
``(3) The term `Board' means the Board of Governors of the
Federal Reserve System.
``(4) The term `consumer' means an individual that, as a
party to a rental-purchase agreement, is provided use of
personal property.
``(5) The term `date of consummation' means the date on
which a consumer becomes contractually obligated under a
rental-purchase agreement.
``(6) The term `merchant' means a person who provides the
use of property through a rental-purchase agreement and to
whom a consumer's initial obligation under the agreement is
payable.
``(7) The term `personal property' means property that is
not real property under the laws of the State where the
property is located when it is made available under a rental-
purchase agreement.
``(8) The term `rental-purchase agreement'--
``(A) means an agreement between a consumer and a
merchant--
``(i) under which the merchant agrees to provide to the
consumer the use of personal property for an initial period
of 4 months or less;
``(ii) that is automatically renewable with each payment by
the consumer; and
``(iii) that permits but does not obligate the consumer to
become the owner of the property; and
``(B) does not include any credit sale (as that term is
defined in section 103(g)).
``(9) The term `State' means any State, the District of
Columbia, the Commonwealth of Puerto Rico, and any territory
or possession of the United States.
``(b) References to Regulations.--Any reference to any
provision of this title shall be considered to include
reference to the regulations prescribed by the Board under
this title.
``Sec. 1004. Exempted transactions
``This title does not apply to rental-purchase agreements
primarily for business, commercial, or agricultural purposes,
or those made with government agencies or instrumentalities
or with organizations.
``Sec. 1005. General disclosure requirements
``(a) The merchant under a rental-purchase agreement shall
disclose to the consumer under the agreement the information
required by this title. In a transaction involving more than
one merchant, only one merchant is required to make the
disclosures.
``(b) The disclosures required under this title shall be
made--
``(1) at or before the date of consummation of the rental-
purchase agreement;
``(2) clearly and conspicuously in writing, in a form that
the consumer may keep; and
``(3) in the case of disclosures required under section
1006, segregated from all other terms, data, or information
provided to the consumer.
``(c) If a disclosure required to be made by a merchant
under this title becomes inaccurate as the result of any act,
occurrence, or agreement occurring after delivery of the
required disclosure, the resulting inaccuracy is not a
violation of this title.
``Sec. 1006. Rental-purchase disclosures
``For each rental-purchase agreement, the merchant shall
disclose to the consumer under the agreement the following,
as applicable:
``(1) The amount of the initial rental payment, including
any fees, taxes, or other charges which may be required at or
before the date of consummation of the agreement.
``(2) The amount and timing of rental renewal payments.
``(3) The total number and the total dollar amount of
rental payments and other charges necessary to acquire
ownership of the property.
``(4) A statement that the consumer will not own the
property until the consumer has made the total dollar amount
necessary to acquire ownership.
``(5) A statement that the total dollar amount of payments
does not include other charges, such as late payment or
reinstatement fees, and that the consumer should examine the
rental-purchase agreement for an explanation of these
charges, if applicable.
``(6) A statement that the consumer may be responsible for
the fair market value of the property if it is lost, stolen,
damaged, or destroyed.
``(7) A statement indicating whether the property is new or
used, except that a statement that indicates that new
property is used property is not a violation of this title.
``(8) A statement of--
``(A) the manufacturer's suggested retail price, where
applicable; or
``(B) the price for which the property is available from
the merchant in a cash sale.
``(9) A clear statement of the terms of the consumer's
option to purchase.
``(10) A statement--
``(A) identifying the party that is responsible for
maintaining or servicing the property while it is being
rented;
``(B) describing that responsibility; and
``(C) disclosing that if any part of a manufacturer's
express warranty covers the property at the time the consumer
acquires ownership of the property, the warranty will be
transferred to the consumer if allowed by the terms of the
warranty.
``(11) The date of consummation of the transaction and the
identities of the merchant and consumer.
``Sec. 1007. Point-of-sale disclosures
``Each item of property displayed or offered pursuant to a
rental-purchase agreement shall have affixed to it a point-
of-sale card, tag, or label that clearly and conspicuously
discloses only the following:
``(1) Whether the property is new or used.
``(2) The price of the property in a cash sale.
``(3) The amount of each rental payment under the
agreement.
``(4) The total number of rental payments necessary to
acquire ownership of the property under the agreement.
``(5) The total dollar amount of rental payments necessary
to acquire ownership of the property under the agreement.
``Sec. 1008. Prohibited practices
``(a) A rental-purchase agreement may not contain--
``(1) a confession of judgment;
``(2) a negotiable instrument;
``(3) a security interest or any other claim of a property
interest in any goods except those goods the use of which is
provided by the merchant pursuant to the agreement;
``(4) a wage assignment; or
``(5) a waiver by the consumer of a claim or defense.
``(b) Each rental-purchase agreement shall--
``(1) provide a statement of any obligation of the consumer
and the merchant under the agreement to repair any defect or
malfunction of the property covered by the agreement, and any
limitation of those obligations;
``(2) provide that the consumer may terminate the agreement
without penalty by voluntarily surrendering or returning the
property covered by the agreement upon expiration of any
rental term; and
``(3) contain a provision for reinstatement of the
agreement, which at a minimum--
``(A) permits a consumer who fails to make a timely rental
renewal payment to reinstate the agreement, without losing
any rights or options which exist under the agreement, by the
payment of all past due rental charges and any late fee,
within 7 days after the renewal date;
``(B) if the consumer returns or voluntarily surrenders the
property covered by the agreement, other than through
judicial process, during the applicable reinstatement period
set forth in subparagraph (A), permits the consumer to
reinstate the agreement during a period of at least 30 days
after the date of the return or surrender of the property by
the payment of all past due rental charges, and any
applicable redelivery, repair, or late fees; and
``(C) if the consumer has paid 60 percent or more of the
total dollar amount of payments necessary to acquire
ownership of the property under the agreement and returns or
voluntarily surrenders the property, other than through
judicial process, during the applicable reinstatement period
set forth in subparagraph (A), permits the consumer to
reinstate the agreement during a period of at least 90 days
after the date of the return of the property by the payment
of all past due rental charges, and any applicable
redelivery, repair, or late fees.
``(c) Subsection (b) shall not be construed to prevent a
merchant from attempting to repossess property during the
reinstatement period, but such a repossession does not affect
the consumer's right to reinstate. Upon reinstatement, the
merchant shall provide the consumer with the same property,
or substitute property of comparable quality and condition.
``Sec. 1009. Collection practices
``(a) A merchant under a rental-purchase agreement, in
communicating with any person other than the consumer for the
purpose of acquiring information as to the location of a
consumer--
``(1) shall identify himself or herself and state that he
or she is confirming or correcting location information
concerning the consumer;
``(2) shall not communicate with any person more than once,
unless--
``(A) requested to do so by the person; or
``(B) the merchant reasonably believes that the earlier
response is erroneous or incomplete and that the person now
has correct or complete location information;
``(3) shall not communicate by postcard;
``(4) shall not use any language or symbol on any envelope
or in the contents of any communication which indicates that
the communication relates to the recovery or repossession of
property; and
``(5) shall not communicate with any person other than the
consumer's attorney, after the merchant knows the consumer is
represented by an attorney with regard to the rental-purchase
agreement and has knowledge of, or can readily ascertain, the
attorney's name and address, unless the attorney fails to
respond within a reasonable period of time to communication
from the merchant or unless the attorney consents to direct
communication with the consumer.
``(b)(1) Without the prior consent of the consumer given
directly to the merchant or the express permission of a court
of competent jurisdiction, a merchant shall not communicate
with a consumer in connection with the recovery or
repossession of property--
``(A) at the consumer's place of employment;
``(B) at any unusual time or place or a time; or
``(C) at any place known or which should be known to be
inconvenient to the consumer.
``(2) In the absence of knowledge of circumstances to the
contrary, a merchant shall assume that the convenient time
for communicating with a consumer is after 8:00 a.m. and
before 9:00 p.m., local time at the consumer's location.
``(c) A merchant may not communicate, in connection with a
rental-purchase agreement, with any person other than the
consumer, the consumer's attorney, or the merchant's
attorney, except--
``(1) as reasonably necessary to acquire location
information concerning the consumer in accordance with
subsection (a);
``(2) after receiving prior consent from the consumer given
directly to the merchant;
``(3) after receiving express permission of a court of
competent jurisdiction; or
``(4) as reasonably necessary to effectuate a post-judgment
judicial remedy.
``(d) If a consumer notifies the merchant in writing that
the consumer desires the merchant to cease further
communication with the consumer, the merchant shall not
communicate further with the consumer with respect to the
rental-purchase agreement, except--
``(1) to advise the consumer that the merchant's further
efforts to communicate are being terminated;
``(2) to notify the consumer that the merchant may invoke
specified remedies allowable under law which are ordinarily
invoked by the merchant; or
``(3) as necessary to effectuate any post-judgment remedy.
``(e) A merchant shall not--
``(1) use or threaten to use violence or criminal means to
harm the physical person, reputation, or property of any
person;
``(2) use obscene, profane, or abusive language;
``(3) cause a telephone to ring, or engage any person in
telephone conversation, repeatedly or continuously with
intent to annoy, abuse, or harass any person;
``(4) place any telephone call without disclosing the
caller's identity; or
``(5) perform any other act intended to harass or abuse a
consumer.
``Sec. 1010. Receipts and accounts
``A merchant shall provide the consumer a written receipt
for each payment made by cash or money order.
``Sec. 1011. Renegotiations and extensions
``A renegotiation of a rental-purchase agreement is deemed
to be a new agreement for purposes of this title, requiring
new disclosures. A renegotiation shall be considered to occur
when an existing rental-purchase agreement is satisfied and
replaced by a new agreement undertaken by the same merchant.
Events such as the following shall not be treated as
renegotiations:
``(1) The addition or return of property in a multiple-item
agreement or the substitution of property, if in either case
the average payment allocable to a payment period is not
changed by more than 25 percent.
``(2) A deferral or extension of one or more periodic
payments, or portions of a periodic payment.
``(3) A reduction in charges in the agreement.
``(4) An agreement involving a court proceeding.
``(5) Any other event described in regulations prescribed
by the Board.
``Sec. 1012. Rental-purchase advertising
``(a) If an advertisement refers to or states the amount of
any payment or the right to acquire ownership, the merchant
that makes the advertisement shall also clearly and
conspicuously state in the advertisement the following items,
as applicable:
``(1) That the transaction advertised is to occur under a
rental-purchase agreement.
``(2) The total number and total dollar amount of rental
payments necessary to acquire ownership under the agreement.
``(3) That the consumer acquires no ownership rights in the
property if the total dollar amount of rental payments
necessary to acquire ownership is not paid.
``(b) The owner or personnel of any medium in which an
advertisement appears or through which it is disseminated
shall not be liable for a violation of this section.
``(c) Subsection (a) does not apply to an advertisement
which--
``(1) does not refer to or state the amount of any payment,
``(2) is published in the yellow pages of a telephone
directory or in any similar directory of businesses, or
``(3) is displayed in the merchant's place of business.
``Sec. 1013. Administrative enforcement
``(a) The requirements imposed by this title shall be
enforced by the Board.
``(b) All of the functions and powers of the Board under
this Act are available to the Board to enforce compliance by
any person with the requirements imposed by this title.
``Sec. 1014. Civil liability
``(a) Except as otherwise provided in this title, a
merchant who willfully violates this title with respect to a
consumer is liable to the consumer in an amount equal to the
following:
``(1) In an action by an individual consumer, the sum of--
``(A) actual damages sustained by the consumer as a result
of the violation; and
``(B) not less than $100.
``(2) In a class action, the amount the court determines to
be appropriate with no minimum recovery as to each member.
``(b)(1) An action under this section may be brought in any
United States district court of competent jurisdiction, by
not later than one year of the date of the occurrence of the
violation.
``(2) This subsection does not bar a consumer from
asserting a violation of this title in an action to collect a
debt brought more than one year after the date of the
occurrence of the violation as a matter of defense by
recoupment or set off, except as otherwise provided by State
law.
``(c)(1) A consumer may not take any action to offset any
amount for which a merchant is potentially liable under
subsection (a) against any amount owed by the consumer,
unless the amount of the merchant's liability has been
determined by judgment of a court of competent jurisdiction
in an action in which the merchant was a party.
``(2) This subsection does not bar a consumer who is in
default on the obligation from asserting a violation of this
title as an original action, or as a defense or counterclaim
to an action brought by the merchant to collect amounts owed
by the consumer.
``Sec. 1015. Defenses
``(a) A merchant is not liable under section 1014 for a
violation of the requirements of section 1006 if within 15
days after first having knowledge of the violation, and
before an action under section 1014 is filed or written
notice of the violation is received from the consumer, the
merchant notifies the consumer of the violation and makes
whatever adjustments in the account are necessary to assure
that the consumer will not be required to pay an amount in
excess of the amounts actually disclosed.
``(b)(1) A merchant is not liable under this title for any
act done or omitted in good faith in conformity with any
rule, regulation, interpretation, or approval promulgated by
the Board or by an official duly authorized by the Board.
``(2) Paragraph (1) applies even if, after the act or
omission has occurred, the rule, regulation, interpretation,
or approval is amended, rescinded, or determined by judicial
or other authority to be invalid for any reason.
``(c) A merchant is not liable under this title for a
violation if the merchant establishes, and at the time of the
violation is implementing, procedures reasonably calculated
to prevent the violation.
``Sec. 1016. Liability of assignees
``(a) For purposes of sections 1014 and 1015, the term
`merchant' includes an assignee of a merchant. However, an
action under section 1014 for a violation of this title may
be brought against an assignee only if the violation is
apparent on the face of the rental-purchase agreement to
which it relates. A violation apparent on the face of a
rental-purchase agreement includes a disclosure that can be
determined to be incomplete or inaccurate from the face of
the agreement. An assignee has no liability in a case in
which the assignment is involuntary.
``(b) In an action by or against an assignee, the
consumer's written acknowledgement of receipt of a disclosure
shall be conclusive proof that the disclosure was made, if
the assignee had no knowledge that the disclosure had not
been made when the assignee acquired the rental-purchase
agreement to which it relates.
``Sec. 1017. Regulations
``(a) The Board shall issue regulations to carry out the
purposes of this title, to prevent its circumvention, and to
facilitate compliance with its requirements. The regulations
may contain classifications and differentiations and may
provide for adjustments and exceptions for any class of
transaction.
``(b) The Board shall publish model disclosure forms and
clauses to facilitate compliance with the disclosure
requirements of this title and to aid consumers in
understanding transactions under rental-purchase agreements.
In designing forms, the Board shall consider the use by
merchants of data processing or similar automated equipment.
Use of the models shall be optional. A merchant who properly
uses the model disclosure forms shall be deemed to be in
compliance with the disclosure requirements.
``(c) Any regulation issued by the Board, or any amendment
or interpretation thereof, that requires a disclosure
different from the disclosures previously required by
regulations of the Board shall not be effective before the
October 1 that follows the date of promulgation by at least 6
months. The Board may at its discretion lengthen that period
of time to permit merchants to adjust their forms to
accommodate new requirements. The Board may also shorten that
period of time, notwithstanding the first sentence, if it
makes a specific finding that such action is necessary to
comply with the findings of a court or to prevent unfair or
deceptive practices. In any case, merchants may comply with
any newly promulgated disclosure requirement prior to its
effective date.
``Sec. 1018. Relation to state laws
``This title does not annul, alter, affect, or exempt any
person subject to this title from complying with the laws of
any State with respect to a matter covered by this title,
except to the extent that those laws--
``(1) are inconsistent with this title; and
``(2) provide a lesser degree of protection for consumers.
``Sec. 1019. Effect on government agencies
``No civil liability under this title may be imposed on the
United States or any of its departments or agencies, any
State or political subdivision, or any agency of a State or
political subdivision.''.
______
By Mr. PELL (by request):
S. 1957. A bill to provide for a United States contribution to the
Interest Subsidy Account of the successor [EASF II] to the Enhanced
Structural Adjustment Facility of the International Monetary Fund; to
the Committee on Foreign Relations.
easf legislation
Mr. PELL. Mr. President, by request, I introduce for appropriate
reference a bill to provide for a United States contribution to the
interest subsidy account of the successor [ESAF II] to the Enhanced
Structural Adjustment Facility of the International Monetary Fund.
This proposed legislation has been requested by the Department of the
Treasury, and I am introducing it in order that there may be a specific
bill to which Members of the Senate and the public may direct their
attention and comments.
I reserve my right to support or oppose this bill, as well as any
suggested amendments to it, when the matter is considered by the
Committee on Foreign Relations.
I ask unanimous consent that the bill be printed in the Record at
this point, together with the letter from the general counsel of the
Department of the Treasury, which was received on March 16, 1994.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1957
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That the
Bretton Woods Agreements Act (22 U.S.C. 286 et seq.) is
amended by adding at the end thereof the following new
section:
``SEC. 61. CONTRIBUTION TO THE INTEREST SUBSIDY ACCOUNT OF
THE SUCCESSOR (ESAF II) TO THE ENHANCED
STRUCTURAL FACILITY OF THE INTERNATIONAL
MONETARY FUND.
``(a) Contribution Authorized.--
``(1) In general.--Subject to paragraph (2), the United
States Governor of the Fund may contribute $100,000,000 to
the Interest Subsidy Account of the successor (ESAF II) to
the Enhanced Structural Adjustment Facility of the Fund on
behalf of the United States.
``(2) Contribution.--The contribution authorized in
paragraph (1) shall be effective only to such extent or in
such amounts as are provided in advance in appropriations
Acts.
``(b) Limitation on Authorization of Appropriations.--To
pay for the contribution authorized in subsection (a), there
are authorized to be appropriated $100,000,000 without fiscal
year limitation for payment by the Secretary of the
Treasury.''.
____
Department of the Treasury,
Washington, March 14, 1994.
Hon. Al Gore,
President of the Senate, Washington, DC.
Dear Mr. President: I am pleased to transmit herewith a
draft bill, ``To provide for a United States contribution to
the Interest Subsidy Account of the successor (ESAF II) to
the Enhanced Structural Adjustment Facility of the
International Monetary Fund.''
The bill would authorize the United States Governor of the
International Monetary Fund (Fund) to contribute $100,000,000
on behalf of the United States to the Interest Subsidy
Account of ESAF II. The commitment to make this contribution
is subject to obtaining the necessary appropriations.
The original ESAF was established in 1987 to enable the
Fund to provide balance of payments assistance on
concessional terms of low-income developing countries that
have protracted payments problems and that are prepared to
adopt a multi-year economic and structural reform program. On
December 15, 1993, the Fund adopted a decision to establish
ESAF II once the Executive Board determines that sufficient
contributions have been made to the facility's Interest
Subsidy Account. The establishment of ESAF II would help
assure that countries with minimum access to resources that
are willing to initiate reforms are provided with continued
access to resources on concessional terms.
It would be appreciated if you would lay the draft bill
before the Senate. An identical draft bill has been
transmitted to the Speaker of the House of Representatives.
The Office of Management and Budget has advised that there
is no objection to the transmittal of this draft bill to the
Congress, and that enactment would be in accord with the
Administration's program.
Sincerely,
Jean E. Hanson.
______
By Mr. MURKOWSKI (for himself, Mr. Stevens, and Mr. Akaka):
S. 1958. A bill to amend title 38, United States Code, to exclude
certain payments received under the Alaska Native Claims Settlement Act
from the determination of annual income for purposes of eligibility for
veterans pension; to the Committee on Veterans Affairs.
veterans pension legislation
Mr. MURKOWSKI. Mr. President, often when proposed legislation is
presented to this body by its sponsors, they state that they are
pleased to be introducing the bill in question. Usually, Mr. President,
that is the case with me. Today, however, I am not entirely happy to be
introducing a bill which, in my view, should not be necessary.
Unfortunately, the failure of one Federal agency, the Department of
Veterans Affairs [VA], to perceive accurately the clear intent of the
Congress when it enacted amendments to the Alaska Native Claims
Settlement Act [ANCSA] in 1987 makes this bill, which is purely
technical and which seeks only to put into practical affect
congressional intent as expressed in ANCSA, necessary. Before I launch
into an explanation of the legislation I propose today, however, I want
to thank my distinguished colleagues, Senators Stevens and Akaka, for
joining me as cosponsors of this bill.
As many Members of this body will recall, the Congress has labored
hard over the years to reach a series of compromises relating to the
settlement of the land claims of Alaska's Native peoples. Those
compromises are reflected in the text, and the underlying purposes of,
the Alaska Native Claims Settlement Act, codified at 43 U.S.C. section
1601 et seq., as enacted in 1971, and amended in 1988. By the
legislation that I introduce today, I do not intend to upset--or to
effect in any way whatsoever--the delicate balance of compromises
reflected in this landmark legislation; indeed, I would not amend ANCSA
at all. My only purpose is to see to it that ANCSA, as amended in 1988,
be put into full effect by requiring that the VA disregard payments
received by Alaska Natives under ANCSA--as intended by the 1988
amendments to ANCSA--when it computes Alaska Natives' eligibility for
VA's means-tested pensions programs. My amendment would amend statutes
which govern VA's pension program to accomplish that result.
To fully explain why this legislation is necessary, I need to outline
briefly the general terms of ANCSA and, in particular, a relatively
minor--but absolutely critical--provision of the statute relating to
needs-based Federal benefits. The overall purpose of ANCSA, as stated
in the legislation itself, is to provide ``a fair and just settlement
of all claims by Natives and Native groups of Alaska, based on
aboriginal land claims.'' Public Law 92-203, section 2(a), 85 Stat. 688
(1971). ANCSA was, and remains, an unusual--indeed, a landmark--piece
of legislation in resolving Native land claims. In the words of our
colleague, Senator Bingaman, ANCSA adopted ``a novel, experimental
approach in [the Federal Government's] relationship with Native
Americans. It departed from the conventional method of * * * settling
tribal land claims [by] creating * * * a framework for * * *
administering Native lands and funds through a * * * [Native]-run
corporate structure.'' S. Rept. No. 100-201 at 45, additional views.
To summarize, under ANCSA, Native Alaskans received a combination of
cash, mineral lease proceeds, and land in exchange for the
extinguishment of aboriginal land claims. Those assets, however, were
not distributed directly to individual Native Alaskans when ANCSA was
enacted in 1971. Rather, ANCSA authorized the creation of 12 Native
owned and operated regional corporations to administer those assets for
the benefit of Alaska Native shareholders. These corporations continue
to exist today, and they distribute funds received in settlement of
Native land claims, and funds generated from corporate earnings, to
Native village corporations and to Alaska Native shareholders.
When ANCSA was enacted, the question arose as to whether these
distributions should be taken into account in determining whether an
Alaska Native would be eligible to receive Federal Food Stamp
assistance. The Congress concluded--wisely, I think--that it would not
be fair to penalize Alaska Natives for settling their land claims by
causing them to lose eligibility for food stamps as a result of
receiving settlement payments. Thus, ANCSA, as originally enacted,
contained a provision, codified at 43 U.S.C. section 1626(b), which
stated that ``in determining the eligibility of any household to
participate in the Food Stamp Program, any compensation, remuneration,
revenue, or other benefit received by any member of such household * *
* shall be disregarded.'' It was only when ANCSA was amended in 1988
that this ``compensation disregard'' provision was expanded.
As was stated in the Senate report accompanying the 1988 amendments
to ANCSA,
Currently, section 29 of ANCSA directs that any
compensation, remuneration, revenue or other benefit received
pursuant to ANCSA ``shall be disregarded'' in determining
eligibility to participate in the Food Stamp Program. Natives
have been denied benefits or have received diminished
benefits in other Federal or federally-assisted programs,
because of benefits received under ANCSA. Accordingly, the
new subsection (c) in this section clarifies the present
protections as including all Federal or federally-assisted
programs. It also specifically exempts dividends up to $2,000
per individual per year and dividends and distribution of
stock from consideration in eligibility determinations.
Application of less restrictive eligibility tests are not
prohibited by this language. S. Rept. 100-201 at 39 (emphasis
added).
Based on this clear expression of intent to broaden and expand the
already-existing ``disregard'' provisions within section 29 of ANCSA,
the statute was amended to read as follows:
In determining the eligibility of a household, an
individual Native, or a descendant of a Native * * * to--
* * * * *
(3) receive financial assistance or benefits, based on
need, under any Federal program or federally-assisted
program,
none of the following received from a Native corporation,
shall be considered or taken into account as an asset or
resource:
(A) cash (including cash dividends on stock received from a
Native corporation) to the extent that it does not, in the
aggregate, exceed $2,000 per individual per annum;
(B) stock (including stock issued or distributed by a
Native corporation as a dividend or distribution on stock);
(C) a partnership interest;
(D) land or an interest in land (including land or an
interest in land received from a Native Corporation as a
dividend or distribution on stock); and
(E) an interest in a settlement trust.
43 U.S.C. section 1626(c) (emphasis added).
It seems to me, Mr. President, that the law could hardly be clearer.
By any reading of this statute, and the explanation of it contained in
the Senate Energy and Natural Resources Committee's report, one can
only conclude that ANCSA payments are to be disregarded not only for
purposes of food stamps, but for any and all Federal needs-based
benefits programs. To the extent that the words of the statute, or the
Senate's expression of purpose, might have admitted to any ambiguity--
and, frankly, I do not see how anyone could contend that they do--the
requirement that ANCSA be construed in a fashion sympathetic to Native
interests, see, e.g., Cape Fox Corp. v. U.S., 4 Cl. Ct. 223, 231
(1983), would require that any such ambiguity be resolved to require
the ``disregarding'' of ANCSA payments. When one considers that the
needs-based benefit program in question is a veterans program--a
program which embodies a longstanding tradition of resolving doubt in
the veteran's favor--the door should have been slammed, I think, on any
thought that ANCSA dividends might be used to reduce pension benefits
to which a veteran might be eligible.
Unfortunately, the VA's general counsel has taken a differing view.
In two separate legal opinions, the general counsel has stated, in
effect, that despite the foregoing, VA shall take ANCSA dividends into
account for purposes of determining eligibility for, and the amount of
benefit received under, VA's veterans pension program. This, Mr.
President, is totally indefensible in my view.
As is made clear in ANCSA, payments received under ANSCA--whether
they be cash, cash dividends, up to $2,000 per year, stock dividends,
land, whatever--are not to be ``considered'' or ``taken into account''
for purposes of determining eligibility for ``benefits, based on need,
under any Federal program.'' Equally, ANCSA payments are not to be
taken into account for purposes of diminishing needs-based Federal
benefits. See S. Rept. 100-201, supra. VA's pension program--which is
not a retirement pension program but is, rather, an ``income
maintenance'' program which assures that wartime veterans who are
permanently and totally disabled due to nonservice connected disability
will not be forced to live below subsistence income levels--is clearly
a ``benefit, based on need.'' See 38 U.S.C. chapter 15. And yet, VA
allows payments received pursuant to ANCSA to be taken into account in
determining if one is eligible to receive pension benefits. So, for
example, a veteran having an annual income of $6,000 who would
otherwise be eligible for pension would be disqualified if he or she
were to receive $2,000 per year in cash dividends under ANCSA.
Equally--and more importantly for practical purposes--VA offsets ANCSA
dividends on a dollar-for-dollar basis when it computes the amount of
pension benefits to be paid. So, for example, a VA pension recipient
who would otherwise receive $7,397 per year in pension benefits would
only receive $5,397 if he or she were also to be a recipient of $2,000
per year in ANCSA distributions. This despite the clear indication of
congressional intent to the contrary.
My colleagues might ask how VA justifies such action. I am told that
VA reasons as follows: ANCSA says that cash paid to Alaska Natives
shall not be taken into account as ``assets'' or ``resources;'' a
person's ``assets'' or ``resources'' are akin to his or her ``net
worth;'' therefore, Congress intended that ANCSA payments not be taken
into account for determining eligibility only for a certain kind of
means tested benefits programs--those that rely on ``net worth''
computations--as distinguished from ``annual income'' computations--to
determine eligibility; eligibility for VA pension programs is governed
by the applicant's ``annual income,'' not his or her ``net worth;''
therefore, ANCSA's directive that Native Corporation dividends be
disregarded does not apply to VA pension programs, even though
eligibility is based on need, since pension eligibility is determined
by reference to annual income, not net worth. I will only comment, at
this point, that this chain of reasoning stretches out of all
proportion any considered interpretation of what Congress actually
intended when it amended ANCSA in 1988.
Mr. President, the Congress had no such income versus net worth
distinction in mind when it expanded the disregard provision of ANCSA.
It had in mind something more direct: It wanted to preclude ANCSA
payments from causing Alaska Natives to be ineligible for food stamps,
and any other needs-based Federal benefits; and it wanted to assure
that such benefits would not be diminished as a result of ANCSA
receipts. My bill, Mr. President, would see to it that that clear
intent would be put into effect by forbidding VA from taking ANCSA
payments into account for purposes of its pension programs.
As I stated, Mr. President, when I opened these comments, I am not
particularly pleased to introduce this legislation. In light of VA's
interpretation of the law, this legislation is necessary. But it should
not be necessary since, to my way of thinking, the words and policy of
ANCSA clearly required the result dictated by this bill: a disregarding
of Native Corporation payments under ANCSA for purposes of both
eligibility for veterans pension payments and the amounts of those
payments. If there is a lesson to be learned here it is that whatever
words we choose in legislating we cannot rely on logic and common sense
to guide the interpretation of those words.
I ask my colleagues to support this common sense piece of
legislation. Mr. President, I ask unanimous consent that the text of my
bill be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1958
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. EXCLUSION OF PAYMENTS FROM DETERMINATION OF ANNUAL
INCOME.
Section 1503(a) of title 38, United States Code, is
amended--
(1) by striking out ``and'' at the end of paragraph (9);
(2) by striking out the period at the end of paragraph
(10)(B) and inserting in lieu thereof ``; and''; and
(3) by adding at the end the following new paragraph:
``(11) cash, stock, land, or other interest referred to in
subparagraphs (A) through (E) below paragraph (3) of section
29(c) of the Alaska Native Claims Settlement Act (43 U.S.C.
1626(c)), whether attributable to the disposition of real
property, profits from the operation of real property, or
otherwise, that is received from a Native Corporation under
such Act (43 U.S.C. 1601 et seq.).''.
______
By Mr. GRAHAM:
S. 1959. A bill to prevent delay in the completion of Federal
construction projects, and for other purposes; to the Committee on
Governmental Affairs.
federal construction project legislation
Mr. GRAHAM. Mr. President, I rise today to introduce a bill to speed
up Federal construction projects. My bill is similar to a Florida State
law which speeds up funding for State construction projects. The
purpose was to accelerate the progress of getting capital outlay
projects started. According to William Scaringe, the director of the
Florida division of building construction, the Florida law has been
very ``effective and the State likes it.'' Mr. Scaringe said that
during the first 3 to 4 years under the Florida law, projects would
bunch up that agencies wanted to get bid. Now Mr. Scaringe says the
State has no problem with the mandated deadlines. The State has the
controls in place so projects get funded and the funds don't sit
waiting for a project.
My bill is very similar to the State of Florida's law. Under my bill,
a Federal project would lose its funding unless work begins within 2
years of the Federal appropriation. The goal is to speed up
construction, to create jobs, and to use Federal dollars more
efficiently. We should not leave Federal money sitting around and
gathering dust when it could be used for worthwhile projects.
Under my bill, work on each phase of the project would have to begin
within 2 years of Federal appropriation for that phase. If a project
were funded for design, design would have to begin within 2 years. If a
project were fully funded, construction would have to begin within 2
years.
Since 1992, my staff has reviewed federally funded construction
projects in Florida. At this time we have found that more than one-
fourth of Florida's federally funded construction projects are running
behind schedule.
When we see that projects are delayed, I have written letters to the
Federal and State agencies whenever a project is behind schedule. In
these letters, I have tried to determine why the projects are lagging
and whether I can help expedite them.
The bill would provide the incentive to diminish these delays, and to
find alternatives for projects that are hopelessly behind schedule. It
would also discourage Congress from appropriating money to projects
that have not been carefully planned out and would help ensure that
construction begins on projects before their design is obsolete.
In December 1993, 30 percent of Florida's projects--or 396 million
dollars' worth--were listed as delayed.
Among the construction projects that are substantially delayed around
the country are:
IRS Complex, Chamblee, GA--Site acquisition appropriated in 1990.
Work has not begun.
Federal Building-Courthouse, Boston, MA--Construction appropriated in
1990. Construction has not begun.
Southeast Federal Center-Infrastructure, Washington, DC--Appropriated
in 1991. Construction delayed until 1996.
The bill also requires each Federal agency to report to the Director
of the Office of Management and Budget on a quarterly basis on the
status of each ongoing construction project that is under the agency's
jurisdiction. The agencies shall identify each project, which projects
are delayed and the reason for the delay. This information shall be
given to the Director of OMB who shall work with each agency to
facilitate removal of the delay on each project. The Director will then
report to the Congress on a annual basis on the construction projects.
The bill would only affect projects authorized after its enactment.
Mr. President, the bill is an important step to improve the Federal
Government's fiscal responsibility and I encourage my colleagues to
review and cosponsor this bill.
______
By Mr. McCAIN:
S. 1960. A bill to increase housing opportunities for Indians; to the
Committee on Indian Affairs.
indian housing development and reform act of 1994
Mr. McCAIN. Mr. President, I rise today to introduce the Indian
Housing Development and Reform Act of 1994.
Before I begin my remarks, I want to publicly express my appreciation
to Senator Mikulski, Senator Gramm, and their staffs for their efforts
to secure and preserve increased funding for Indian housing. I know
their efforts have given Indian people a renewed sense of hope that
their housing needs have not been forgotten.
While the majority of our Nation has been served under the public
housing program since it was first established in 1937, American
Indians and Alaska Natives were not declared eligible for Federal
housing programs until 1961. And in fact, a substantial number of
Indian housing units were not authorized until the early 1970's. The
Office of Indian Housing at the Department of Housing and Urban
Development was not permanently established until 1978. Given the slow
evolution of the Indian housing program, it is not hard to understand
why there continues to be a substantial number of Indian families in
need of safe, decent, and sanitary housing.
I want to briefly highlight a few key provisions contained in this
bill.
First, the bill increases the current Indian housing authorization
from 3,000 to 4,000 units. The primary concern of Indian tribes
continues to be the authorization level for the development of new
housing units. While appropriations for Indian housing have been near
the presently authorized level for the past several years, I believe we
can do better.
Second, my bill would reform Federal Indian housing programs by
taking the Housing Improvement Program now administered by the Bureau
of Indian Affairs at the Department of the Interior and consolidating
it with the primary Federal Indian housing programs now administered by
the Office of Native American Programs at the Department of Housing and
Urban Development.
The objective of this consolidation is not--repeat--not to eliminate
the Housing Improvement Program [HIP]. No one disputes the fact that
HIP is a valuable source of housing assistance. Unfortunately,
according to five separate audits by the Department of the Interior's
inspector general, HIP has been seriously mismanaged and abused. In
response to these audit findings, the former Assistant Secretary for
Indian Affairs wrote the following memorandum chastising bureau
personnel for failing to do their job:
Department of the Interior,
Washington, DC, April 12, 1993.
To: All Area Directors, Director, Office of Self-Governance.
Through: Acting Deputy Commissioner of Indian Affairs.
From: Assistant Secretary-Indian Affairs.
Subject: Program Management.
The Housing Improvement Program (HIP) started informally in
1964 as an outgrowth of disaster relief efforts in California
and Montana. Regulations were developed in 1975 and
contracting pursuant to P.L. 93-638 began in late 1978. In
1983, Congress removed HIP funding from what was then known
as the ``Band'' placing it in a construction account and
directing that: ``HIP be more cost effective and better meet
housing need.'' The result was the redirected HIP which,
among other things, included (1) inventory of housing need
and (2) use of model contract.
A General Accounting Office (GAO) report in 1987 showed
that redirected HIP internal controls needed strengthening in
three areas. The Acting Assistant Secretary--Indian Affairs
issued a five page memorandum on August 7, 1987, mandating
corrective action covering model contracting enforcement,
construction monitoring and inspection, and use of the
selection criteria.
In 1992, the Office of the Inspector General (OIG) began
HIP audits for selected Bureau of Indian Affairs (BIA)
operated programs in Albuquerque and Sacramento Areas. They
also audited one tribal P.L. 93-638 contract in Aberdeen and
one in Sacramento. All reports pointed out serious management
problems with the Housing Improvement Program. Similar
weaknesses were identified by BIA staff in those Areas who
applied A-123 reviews to HIP. It is noted that not all Areas
fulfilled their responsibility with this internal review.
The OIG has also completed a HIP audit for the Portland
Area. The pending report covers two BIA Agency HIP operations
and three tribally contracted programs. It is anticipated
that the Portland Audit will also be highly critical of HIP
management.
In the past eighteen months we have been embarrassed by GAO
and OIG reports on Social Services, Credit and Financing, and
now HIP. A common thread which runs through these audits is
that we are not being responsible program managers. We are
not insuring compliance to regulations as to client
eligibility and requirements. We are not verifying,
documenting, and enforcing.
It doesn't seem to matter whether the program is BIA
operated or the services provided pursuant to P.L. 93-638
contracts, we are failing to do our job. Public funds are
being wasted; clients not eligible are being served and
clients who should be served are not receiving needed
assistance. This must stop.
As to HIP, we are working towards revision of 25 CFR 256
and updating the 64 BIAM. This will take some time. We are
also developing an instrument for review of Area HIP. This
will also take time. Meanwhile, each Area Director and the
Director, Office of Self-Governance is required to do the
following:
1. Review the Albuquerque, Sacramento and Pit River OIG
Audits. Reports for Omaha and Portland will be distributed
when they become final.
2. Review the position paper on redirected HIP which was
approved by the Deputy Assistant Secretary--Indian Affairs on
April 30, 1985, and transmitted to all Area Directors on May
21, 1985, by the Deputy Director, Office of Indian Services.
3. Review the August 7, 1987, memorandum to All Area
Directors from the Acting Assistant Secretary--Indian Affairs
entitled ``General Accounting Office Audit Report on Indian
Housing.''
4. Review 25 CFR 256.
5. Certify that housing personnel are knowledgeable of
those trade crafts required by page 11 of the redirected HIP
Position Paper.
6. Certify that P.L. 93-638 contractors are using the model
contract as required by ``redirected HIP'' and specifically
mandated by the above referenced August 7, 1987, memorandum.
7. Certify that all units for which HIP funds are being
expended have been inspected pursuant to 25 CFR 256.9,
required by page 10 of the ``Redirect'' and mandated by page
2 of the August 7, 1987, memorandum.
8. Certify that all HIP recipients are eligible pursuant to
25 CFR 256.6 and selected in accord with 256.7 and page 2 of
the 1987 memorandum.
9. Certify that Contracting Officers award HIP Contracts
only after concurrence from the Housing Officers as to work
plans, eligibility of homeowners, and funding. A copy of
final inspection should become part of the contract file and
Housing office records.
I expect a personal certification from each Area Director
to the above nine (9) requirements by COB May 17, 1993. Your
certification is to be addressed to the Deputy Commissioner
of Indian Affairs. Any certification which cannot assure
total compliance shall include a specific Action Plan not to
exceed six (6) months for corrective action.
In conclusion, and perhaps waxing philosophically, a few
words need to be said about public officials. Private
citizens can do anything they so desire so long as it is not
specifically prohibited by law. Public officials can only do
those things which are specifically authorized. This is a
very significant difference. Our authorizations derive from
Public Laws, regulations, manuals, policies, court cases and
IBIA decisions. If it is not authorized, we cannot do it.
Regardless of whether the desired action is perceived as
good or bad, we do not possess the authority to act unless
specifically authorized. We do not possess authority to serve
ineligible clients, approve less than professional work (such
as shoddy work on a HIP house) or fail to verify basic
requirements.
Simply put, we have been acting outside of our authority (a
very incriminating comment against public officials in a
liberal democracy) to allow those things to occur which now
have been documented in audits going back for a decade. We
must become professional public officials.
The final report of the National Commission on American Indian,
Alaska Native, and Native Hawaiian Housing did not mince words about
the BIA's administration of HIP:
The BIA has consistently failed to fulfill its
responsibility to Native American people mandated by the
Snyder Act. In testimony before the Commission, the BIA has
admitted that it failed to meet its own goals for providing
basic housing needs. Its major housing program for Indians,
the Housing Improvement Program, has functioned for over 20
years as a self-perpetuating bureaucracy unable to bring
about any significant improvements in the Native housing
crisis. BIA has underestimated housing needs and has built
only a fraction of the new homes desperately required in
Indian country. Annual HIP appropriations have been
significantly below the BIA's own declared need.
Despite this criticism, the Commission recommended increased funding
for HIP. Apparently, the Commission concluded that the need for housing
assistance outweighed the need for HIP reform. I strongly disagree with
the Commission. I believe it is important to ensure that all levels of
government possess the integrity, accountability, and capability to
meet the needs of Indian citizens. The overriding goal should be to
strengthen and improve the capacity of the Federal and tribal
governments to effectively and efficiently provide the necessary
programs and services to the Indian people. I believe the best way to
accomplish this goal for Indian housing is to transfer HIP to HUD.
In addition, I believe the transfer of HIP to HUD is consistent with
the administration's proposals for reinventing government
which seeks to lower administrative expenses by improving productivity
and efficiency. In fact, the report of the National Performance Review
included several recommendations for the consolidation of various
Federal programs that have a common goal. The transfer would also
contribute to the President's goal of reducing Federal employment by
252,000 full-time employees by 1999.
I want to point out to my friends in Indian country that while I see
merit in transferring HIP to HUD, it does not represent a general
belief on my part that there needs to be a wholesale division and
transfer of BIA programs to other Federal agencies as some people will
argue.
Finally, section 8 of the bill authorizes $500,000 in grants to
Indian tribal governments to obtain technical assistance. In the past,
the Congress has seen fit to identify one organization for Indian
tribes to secure such assistance. After thinking carefully about this
particular approach, I believe technical assistance is best arranged
between an Indian tribe and the service provider that the tribe
believes can best meet its needs. The service provider is then made
directly accountable to the tribe and is likely to deliver a higher
quality of service in return. I do not believe any organization is
entitled to Federal assistance which establishes them as the sole
provider. Organizations should earn the trust of the constituency they
seek to serve.
Mr. President, I ask unanimous consent that a copy of the bill and
the section-by-section analysis to the bill be printed in the Record
immediately following my remarks.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1960
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Indian Housing Development
and Reform Act of 1994''.
SEC. 2. FINDINGS.
The Congress finds that--
(1) Indian tribes face an unprecedented crisis due to the
lack of shelter for a growing number of individuals and
families, including elderly persons, persons with
disabilities, and families with children;
(2) the demand for Indian housing has become more severe
and, in the absence of more effective efforts and consistent
funding, is expected to become dramatically worse,
endangering the lives and safety of Indian and Alaska Native
people;
(3) the Federal Government has a historical and special
legal relationship with, and resulting responsibility to,
Indian tribes;
(4) included within the relationship referred to in
paragraph (3) is a trust responsibility to provide decent,
safe, sanitary, and affordable housing to the members of
Indian tribes residing on reservations;
(5) the Inspector General of the Department of the Interior
has issued several audit reports on various area offices of
the Bureau of Indian Affairs and has concluded that the
Housing Improvement Program has been severely mismanaged and
abused;
(6) as a result of the mismanagement and abuse of the
Housing Improvement Program, persons who are not eligible for
the Program are receiving assistance while persons who are
eligible for the Program are not receiving needed assistance;
(7) the Secretary of Housing and Urban Development has the
primary responsibility for the delivery of Indian housing
services; and
(8) the transfer of the Housing Improvement Program to the
Department of Housing and Urban Development will eliminate
useless bureaucracy and waste while allowing the Secretary of
Housing and Urban Development to administer the Housing
Improvement Program according to the Program's intended goals
and objectives.
SEC. 3. DEFINITIONS.
For purposes of this Act, the following definitions shall
apply:
(1) Department.--The term ``Department'', unless otherwise
specified, means the Department of Housing and Urban
Development.
(2) Incorporated definitions.--The terms ``Indian'',
``Indian housing authority'', and ``Indian tribe'' have the
same meanings as in section 3 of the United States Housing
Act of 1937.
(3) Program.--The term ``Program'' means the Housing
Improvement Program of the Bureau of Indian Affairs,
Department of the Interior, as set forth in part 256 of title
25, Code of Federal Regulations.
(4) Secretary.--The term ``Secretary'', unless otherwise
specified, means the Secretary of Housing and Urban
Development.
SEC. 4. HOUSING IMPROVEMENT PROGRAM.
(a) Transfer of Program.--
(1) In general.--The Program is hereby transferred to the
Department.
(2) Effective date.--Paragraph (1) shall take effect on the
expiration of the 180-day period following the date of
enactment of this Act.
(b) Program Goals.--Notwithstanding any other provision of
law, the goals of the Program are--
(1) to benefit Indian families by providing decent, safe,
and sanitary shelter and by reducing the health and social
costs created by an unsafe and unsanitary environment; and
(2) to provide for renovations, repairs, and additions to
existing Indian houses, including repairs to houses that
remain substandard but need repairs for the health or safety
of the occupants and repairs to bring Indian houses to
standard condition.
(c) Administration of the Program.--
(1) In general.--The Secretary shall carry out the Program
in accordance with this section.
(2) Limitation on assistance.--Notwithstanding paragraph
(3) or any other provision of law, the Secretary, unless
otherwise authorized by the governing body of an Indian
tribe--
(A) shall provide assistance under the Program only to the
governing body of an Indian tribe; and
(B) shall not provide any such assistance to an Indian
housing authority.
(3) Modifications to program.--The Secretary is authorized
to modify or otherwise change the Program to meet the goals
set forth in subsection (b).
(d) Transfer and Allocations of Appropriations.--Except as
otherwise provided in this section, the assets, liabilities,
contracts, property, records, and unexpended balances of
appropriations, authorizations, allocations, and other funds
employed, used, held, arising from, available to, or to be
made available in connection with the Program, subject to
section 1531 of title 31, United States Code, shall be
transferred to the Department. Unexpended funds transferred
pursuant to this section shall be used only for the purposes
for which the funds were originally authorized and
appropriated.
(e) Transfer of Personnel.--
(1) In general.--Except as otherwise provided in this
section, the Secretary of the Interior shall transfer such
personnel to the Department to administer the Program as the
Secretary considers necessary and appropriate.
(2) No separation or reduction in grade or compensation for
1 year.--Except as otherwise provided in this section, any
transfer pursuant to this section of full-time personnel
(except special Government employees) and part-time personnel
holding permanent positions shall not cause any such employee
to be separated or reduced in grade or compensation during
the 1-year period beginning on the date on which the employee
is transferred to the Department.
(3) Executive schedule employees.--Except as otherwise
provided in this section, any person who, on the day
preceding the date on which such person is transferred to the
Department under this section, holds a position compensated
in accordance with the Executive Schedule prescribed in
chapter 53 of title 5, United States Code, and who, without a
break in service, is appointed in the Department to a
position having duties comparable to the duties performed
immediately preceding such appointment shall continue to be
compensated in such new position at not less than the rate
provided for such previous position, for the duration of the
service of such person in such new position.
(4) Presidential appointees.--Positions whose incumbents
are appointed by the President, by and with the advice and
consent of the Senate, the functions of which are transferred
pursuant to this section, shall terminate on the effective
date of this section.
(f) Incidental Transfers.--The Director of the Office of
Management and Budget, at such time or times as the Director
shall provide, is authorized to make such determinations as
may be necessary with regard to the Program, and to make such
additional incidental dispositions of personnel, assets,
liabilities, grants, contracts, property, records, and
unexpended balances of appropriations, authorizations,
allocations, and other funds held, used, arising from,
available to, or to be made available in connection with the
Program, as may be necessary to carry out this section. The
Director of the Office of Management and Budget shall provide
for the termination of the affairs of all entities terminated
by this section and for such further measures and
dispositions as may be necessary to effectuate the purposes
of this section.
(g) Continuing Effect of Legal Documents.--All orders,
determinations, rules, regulations, permits, agreements,
grants, contracts, certificates, licenses, registrations,
privileges, and other administrative actions--
(1) that have been issued, made, granted, or allowed to
become effective by the President, any Federal agency or
official, or by a court of competent jurisdiction, in the
performance of the Program which are transferred under this
section; and
(2) that are in effect on the effective date of subsection
(a)(1), or that were final before such date and are to become
effective on or after such date;
shall continue in effect according to their terms until
modified, terminated, superseded, set aside, or revoked in
accordance with law by the President, the Secretary, or other
authorized official, a court of competent jurisdiction, or by
operation of law.
(h) Proceedings Not Affected.--The provisions of this
section shall not affect any proceedings, including notices
of proposed rulemaking, or any application for any license,
permit, certificate, or financial assistance pending before
the Department of the Interior on the effective date of
subsection (a)(1), with respect to the Program, and such
proceedings and applications shall be continued. Orders shall
be issued in such proceedings, appeals shall be taken
therefrom, and payments shall be made pursuant to such
orders, as if this section had not been enacted, and orders
issued in any such proceedings shall continue in effect until
modified, terminated, superseded, or revoked by a duly
authorized official, by a court of competent jurisdiction, or
by operation of law. Nothing in this section shall be deemed
to prohibit the discontinuance or modification of any such
proceeding under the same terms and conditions and to the
same extent that such proceeding could have been discontinued
or modified if this section had not been enacted.
(i) Actions Not Affected.--The provisions of this section
shall not affect actions commenced before the effective date
of subsection (a)(1), and in all such actions, proceedings
shall be had, appeals taken, and judgments rendered in the
same manner and with the same effect as if this section had
not been enacted.
(j) Nonabatement of Actions.--No action or other proceeding
commenced by or against the Department of the Interior, or by
or against any individual in the official capacity of such
individual as an officer of the Department of the Interior,
shall abate by reason of the enactment of this section.
(k) Administrative Actions Relating to Promulgation of
Regulations.--Any administrative action relating to the
preparation or promulgation of a regulation by the Department
of the Interior relating to the Program may be continued by
the Department with the same effect as if this section had
not been enacted.
(l) Transition.--The Secretary is authorized to utilize--
(1) the services of such officers, employees, and other
personnel of the Department of the Interior with respect to
the Program; and
(2) funds appropriated to the Program for such period of
time as may reasonably be needed to facilitate the orderly
implementation of this section.
(m) References.--Reference in any other Federal law,
Executive order, rule, regulation, or delegation of
authority, or any document of or relating to--
(1) the Secretary of the Interior, with regard to the
Program, shall be deemed to refer to the Secretary; and
(2) the Department of the Interior, with regard to the
Program, shall be deemed to refer to the Department.
(n) Regulations.--The Secretary shall, by notice published
in the Federal Register, establish such requirements as may
be necessary to carry out this section. The Secretary shall
issue final regulations to carry out this section, based on
such notice, after providing opportunity for public comment
on the notice.
(o) Authorization of Appropriations.--There are authorized
to be appropriated $34,000,000 for fiscal years 1996, 1997,
1998, 1999, and 2000 to carry out the Program.
SEC. 5. AUTHORIZATION.
Section 5(c) of the United States Housing Act of 1937 (42
U.S.C. 1437c(c)) is amended by adding at the end the
following new paragraph:
``(9) Using the additional budget authority that becomes
available during fiscal years 1996, 1997, 1998, 1999, and
2000, the Secretary shall, to the extent approved in
appropriation Acts, reserve authority to enter into
obligations aggregating, for public housing grants for Indian
families under subsection (a)(2), an amount sufficient to
provide assistance for an additional 4,000 units of Indian
housing for each such year.''.
SEC. 6. ELIGIBLE INDIANS.
Section 201 of the United States Housing Act of 1937 (42
U.S.C. 1437aa) is amended by adding at the end the following
new subsection:
``(d) Eligible Families.--
``(1) In general.--Except as provided in section 202(d) of
this title and paragraph (2) of this subsection, low-income
housing developed or operated pursuant to a contract between
the Secretary and an Indian housing authority shall be
limited to Indian low-income families.
``(2) Exception.--An Indian housing authority may provide
assistance to any non-Indian family on an Indian reservation
or other Indian area if the Indian housing authority
determines that the need for housing for such families on the
Indian reservation or other Indian area cannot reasonably be
met without such assistance.
``(3) Existing assistance.--Nothing in this subsection
shall be construed to prohibit or otherwise affect any
assistance provided to a family served by an Indian housing
authority on the date of enactment of this subsection.''.
SEC. 7. CERTAIN WAGE RATES NOT APPLICABLE.
(a) Wage Rates.--Beginning on the date of enactment of this
Act, the provisions of the Davis-Bacon Act shall not be
applicable to any construction, alteration, or repair,
including painting and decorating, carried out pursuant to
any contract entered into after the date of enactment of this
Act, except as provided in subsection (b), in connection with
any housing project of 40 units or less involving Indian
housing developed or operated by an Indian housing authority.
(b) Existing Contracts.--The provisions of subsection (a)
shall not affect any contract in effect on the date of
enactment of this Act, or any contract that is entered into
on or after such date of enactment pursuant to invitations
for bids that were outstanding on such date of enactment.
SEC. 8. TECHNICAL ASSISTANCE.
(a) Technical Assistance Grants.--The Secretary is
authorized to make grants to Indian tribes for use by such
tribes in obtaining technical assistance in connection with
Indian housing programs.
(b) Authorization of Appropriations.--There are authorized
to be appropriated $500,000 to carry out the provisions of
subsection (a).
____
Section-by-Section Analysis of the Indian Housing Development and
Reform Act of 1994
Section 1. Short Title.
Section 2. Congressional findings.
Section 3. Definitions.
Section 4. This section transfers the Housing Improvement
Program at the Bureau of Indian Affairs to the Department of
Housing and Urban Development. The department would use the
same goals, standards and objectives of the existing HIP
program. In addition, program funding would still be made to
Indian tribal governments. The bill authorizes $34 million
per year through FY 2000. HIP funding has generally ranged
between $17 million to $20 million per year.
Section 5. This section authorizes budget authority
sufficient to provide 4,000 units of Indian housing per year
through FY 2000. The current authorization is 3,000 units.
Section 6. (a) Amends the 1937 Housing Act by requiring
that the HUD Indian housing program is limited to low-income
Indian families.
(b) An Indian housing authority is authorized to assist
non-Indian families only if it is determined that the housing
needs of non-Indian families on an Indian reservation cannot
be reasonably met without such assistance.
(c) Any non-Indian family currently being served by an
Indian housing authority is not affected by this section.
Section 7. (a) provides that the prevailing wage rates
shall not apply to an Indian housing project that involves 40
units or less.
(b) provides that existing contracts, contracts signed on
the date of enactment or invitations for bids issued before
the date of enactment shall not be affected by this section.
Section 8. This section authorizes technical assistance
grants to be made to Indian tribes. Tribes may then purchase
technical assistance from the provider of choice. The bill
authorizes $500,000 for this section.
______
By Mr. KENNEDY (for himself, Mr. Dodd, Mr. DeConcini, and Mr.
Kerry):
S. 1961. A bill to provide for necessary medical care for former
civilian prisoners of war; to the Committee on Labor and Human
Resources.
civilian ex-pow health and disability legislation
Mr. KENNEDY. Mr. President, on behalf of Senators Dodd, DeConcini,
Kerry, and myself, I am introducing legislation to address the health
and disability needs of civilian ex-prisoners of war.
The bill concerns basic issues of fairness and justice for a group of
Americans who have endured a great deal of suffering and who urgently
need relief. In 1948, Congress passed the War Claims Act which extended
health disability and detention benefits to more than 6,000 American
civilians interned by the Japanese during World War II. Most of them
were private citizens residing in the Philippines at the outbreak of
the war.
Like military ex-POW's, civilian internees suffer from a number of
physical and psychological disabilities caused by their imprisonment.
Among the most common are gum disease caused by their poor diet in the
internment camps, and post-traumatic stress syndrome.
The War Claims Act created a War Claims Commission to administer
benefits to these individuals. That function was later taken over by
the Department of Labor's Office of Worker's Compensation Program
[OWCP]. It also established eligibility criteria, benefit levels, and
procedural requirements that claimants must meet in order to receive
medical and disability benefits. Of close to 5,000 cases administered
since the War Claims Act was passed, between 75-100 cases remain
active.
By the time War Claims Act became law, the needs of other POW groups
had already been addressed. Former military POW's had access to health
and disability benefits through the Veterans' Administration.
Compensation programs for Federal employees interned in wartime prison
camps had been authorized in 1916 by the Federal Employees Compensation
Act. Similar benefits for the employees of independent Federal
contractors were established in 1942 under the Defense Base Act.
Despite the importance of the 1948 law in securing health and
disability benefits for civilian ex-POW's, the act is deficient in a
number of important respects.
First, the 1948 law covers only those who were interned in the
Philippines and other Japanese-controlled territories during World War
II. This provision excludes a majority of WWII-era detainees. According
to the Committee on Civilian Internee Rights, eliminating this
exclusion would extend coverage by an additional 5,600 survivors,
raising the total number of civilian ex-POW's covered by Federal health
and disability benefits to 8,600. It also denies coverage to
approximately 100 American civilians detained in Korea and Vietnam
during the conflicts in those regions.
Second, the process for filing claims is unnecessarily burdensome and
out of step with the more streamlined approach used to administer
medical and disability benefits to other POW's. The Department of
Veterans Affairs automatically approves claims related to presumptive
conditions--conditions widely recognized as caused or exacerbated by
periods of internment. But former civilian POW's must document that an
injury or medical condition is related to their detainment, no matter
how common the condition.
Finally, the disability benefits established by the War Claims Act
have been unfairly eroded by four and a half decades of inflation.
Under the act, the level of disability benefits is set at $25 a week--
an amount derived by taking 66 percent of the National Average Weekly
Wage in 1948.
Further, the maximum amount of disability benefits is set by the law
at $7,500 per claimant. By contrast, the law covering those who were
Federal workers or Federal contractors at the time of their capture
imposes no such limit, benefit levels are automatically adjusted for
increases in the cost of living.
The Civilian Ex-Prisoner of War Health and Disability Benefits Act of
1994 corrects these deficiencies. All civilian POW's from WWII and the
Korean and Vietnam wars will be eligible to receive health and
disability benefits. This eligibility extension also applies to
civilians who went into hiding to avoid becoming prisoners of war in
those conflicts.
In determining eligibility, the bill extends to civilian POW's the
same presumptive conditions used by the VA to evaluate claims filed by
former military POW's.
Benefit levels are also updated by the measure. The bill eliminates
the per claimant cap on total disability payments under the War Claims
Act. In addition, the bill sets weekly disability payment levels at the
levels established by FECA, thereby creating parity with ex-POW's who
were Federal workers of Federal contractors when they were interned.
Linking compensation levels to FECA also assures that disability
benefit levels will be adjusted every year of increases in the cost of
living.
Mr. President, this bill is long overdue as a matter of simple
justice. I hope that Congress will expedite its action, and I ask
unanimous consent that its text may be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1961
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Civilian Ex-Prisoner of War
Health and Disability Benefits Act of 1994''.
SEC. 2. MEDICAL CARE AND DISABILITY BENEFITS.
(a) Eligibility.--A former civilian prisoner of war is
entitled to receive necessary medical care and disability
benefits for any injury or disability resulting from the
period of internment or hiding. Any presumptive medical and
dental condition related to a period of internment provided
for former military prisoners of war under section 1112(b) of
title 38, United States Code, shall be extended to former
civilian prisoners of war and shall be considered to have
been incurred in or aggravated by such period of internment
or hiding without regard to the absence of any record of such
injury.
(b) Payment of Benefits.--Prompt monetary payment or
reimbursement shall be facilitated for reasonable and
necessary expenditures for all medical treatment, including
rehabilitation, mental health services, and dental care,
provided for under this section for which a claim and any
documentation determined necessary by the Secretary of Labor
has been filed with the Secretary of Labor.
(c) Waiver of Limitations.--There shall be no limitation on
the total medical or disability benefits which a person may
receive for any injury or disability resulting from the
period of internment or hiding.
(d) Rate of Compensation.--Compensation for disability
shall be equal to the weekly equivalent of the minimum
monthly rate of compensation payable for a total disability
covered by chapter 81 of title 5, United States Code, as
computed under section 8112(a) of such title.
(e) Crediting Benefits Under the Social Security Act.--The
benefits provided by this section to any individual shall be
reduced to the extent such benefits are provided under title
XVIII of the Social Security Act, or any private insurance,
for the same medical condition or disability.
SEC. 3. ADVISORY COMMITTEE.
(a) Establishment.--The Secretary of Labor shall establish
an advisory committee to be known as the Former Civilian
Prisoner of War Committee (herafter in this section referred
to as the ``advisory committee''). The members of the
advisory committee shall be appointed by the Secretary of
Labor from the general public and shall include appropriate
representatives of former civilian prisoners of war and
individuals who are recognized authorities in fields
pertinent to the injuries and disabilities prevalent among
former civilian prisoners of war.
(b) Authority of the Secretary of Labor.--The Secretary of
Labor shall determine the number, terms of service, and pay
and allowances of members of the advisory committee. The
Secretary of Labor shall consult with and seek the advice of
the advisory committee with respect to the administration of
benefits under this Act.
(c) Report.--Not later than January 1, 1996, the Secretary
of Labor shall submit to Congress a report on the programs
and activities of the Department of Labor that pertain to
those former civilian prisoners of war. The Secretary of
Labor shall include in the report--
(A) an assessment of the needs of such civilian prisoners
of war with respect to health and disability benefits;
(B) a review of the programs and activities of the Office
of Workers' Compensation Program designed to meet such needs;
and
(C) such recommendations as the advisory committee
considers to be appropriate.
(d) Information on Benefits.--Not later than 90 days after
the date of enactment of this Act, and at appropriate times
thereafter, the Secretary of Labor shall seek out former
civilian prisoners of war and provide them with information
regarding applicable changes in law, regulations, and
services to which such citizens are entitled by virtue of
this Act.
SEC. 4. REGULATIONS.
The Secretary of Labor shall prescribe regulations as may
be necessary to ensure that benefits provided to former
civilian prisoners of war under this Act are coordinated with
and do not duplicate any benefits provided such persons under
the War Claims Act.
SEC. 5. DEFINITIONS.
For purposes of this Act--
(1) the term ``former civilian prisoner of war'' means a
person determined by the Department of Labor, in consultation
with the Department of State and the Department of Defense,
as being someone who, being then a citizen of the United
States was forcibly interned by an enemy government or its
agents, or a hostile force, or who went into hiding in order
to avoid capture by such government, its agents, or hostile
force, during a period of war, or other period for at least
30 days, including those interned or who went into hiding
during the Asian-Pacific Theater or in the European Theater
of World War II during the period beginning September 1,
1939, and ending December 31, 1946, in Korea during the
period beginning June 25, 1950, and ending July 1, 1955, or
in Vietnam during the period beginning February 28, 1961, and
ending on the date designated by the President by Executive
order as the date of termination of the Vietnam conflict,
except--
(A) a person who at any time voluntarily gave aid to,
collaborated with, or in any manner served such a government,
or
(B) a person who at the time of his capture or entrance
into hiding was--
(i) a person within the purview of the Act entitled ``An
Act to provide compensation for employees of the United
States suffering injuries while in the performance of their
duties, and for other purposes'', approved September 7, 1916,
as amended, and as extended;
(ii) a person within the purview of the Act entitled ``An
Act to provide benefits for the injury, disability, death, or
enemy detention of employees of contractors with the United
States, and for other purposes'', approved December 2, 1942,
as amended; or
(iii) a regularly appointed, enrolled, enlisted, or
inducted member of any military or naval force; and
(2) the term ``hostile force'' means any nation, or any
national thereof, or any other person serving a foreign
nation--
(A) engaged in war against the United States or any of its
allies; or
(B) engaged in armed conflict, whether or not war has been
declared, against the United States or any of its allies.
SEC. 6. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated to carry out this
Act, such sums as may be necessary for each of the fiscal
years 1995 through 2000.
______
By Mr. DODD (for himself and Mr. Rockefeller):
S. 1962. A bill to provide for demonstration projects in 6 States to
establish or improve a system of assured minimum child support
payments; to the Committee on Finance.
child support assurance act of 1994
Mr. DODD. Mr. President, I rise today to introduce a piece of
legislation whose subject should be central to our debate over welfare
reform. This bill, the Child Support Assurance Act of 1994, seeks to
put a stop to one of the principal causes of child poverty in this
country, lack of financial support from absent parents. I am delighted
to be joined in this effort by my colleague from West Virginia, Senator
Rockefeller, who has long been a champion of children's causes and this
concept in particular.
If I had to sum this legislation in one word, it would be
responsibility: Parents' responsibility to support their kids and our
responsibility as a nation to support struggling families. If we can
begin to live up to these responsibilities, we will go a long way
toward solving the problems that lead people to turn to welfare.
welfare reform, welfare prevention
I firmly believe we will not succeed in reforming welfare until we
succeed in reforming child support. In my view, the term welfare reform
does not do justice to the task at hand. Of course, we need welfare
reform that will encourage people to become self-sufficient and leave
government assistance. But just as important, we need welfare
prevention--policies to allow people to avoid welfare in the first
place. We need to seriously ask ourselves, what can we as a nation do
to support families in danger of sliding into poverty?
At or near the top of our list of answers should be putting some
teeth and some assurances into our child support system. Lack of child
support is one of the principal causes of poverty for one-parent
families. The census bureau illustrated this fact when it estimated
that between 1984 and 1986 approximately half-a-million children fell
into poverty after their father left home.
In 1989 alone, the children and single parents of America were owed
$5.1 billion in unpaid child support. This week, we will discuss a
budget resolution in which we had to squeeze and cut just to come up
with an extra $700 million for Head Start this year. And that $700
million should make a real difference in the fight against child
poverty. But $700 million is tiny in comparison with the amount of
money owed in back child support. Can you imagine the difference it
would make for the children of America if they received that $5 billion
they are being cheated out of annually?
Connecticut is no different from any other State. Despite a child
support enforcement system that ranks among the best in the Nation, its
child support delinquencies now total nearly half-a-billion dollars.
That is half-a-billion dollars in a State of only 3\1/2\ million
people.
clear connection
The clear connection between child support and welfare was
illustrated for the subcommittee on children last August during a
hearing I chaired on this topic. Geraldine Jensen testified about
struggling as a single mother, receiving no help from her ex-husband.
She had to work 60 hours a week just to make ends meet. One day she
realized her kids had gone from two parents to one parent when her
husband left, and then from one parent to none when she had to take her
second job. She was working so much that she had no time for her
children.
So Ms. Jensen quit her jobs and went on AFDC. She finally collected
the child support owed her 7 years later, and she was able to get back
on her feet. As president of the Association for Children for the
Enforcement of Support, Ms. Jensen is now working to fashion a child
support system that will make stories like hers a thing of the past.
But the reality today is that there are far too many families out
there like Ms. Jensen's. And far too many children are plunged into
poverty when their parents do not live up to their responsibilities.
The poverty rate for single-parent families headed by women is nearly
33 percent. This compares to a poverty rate of under 8 percent for 2-
parent families.
Why is the poverty rate so high for households led by single women?
The primary reason is a lack of support from absent fathers. Forty-two
percent of single mothers do not even have child support orders for
their children. For poor women, this figure is 57 percent. And a child
support order is no guarantee of support. In 1989, half of all mother-
let families with child support orders received no support at all or
less than the amount due.
childhood's end
As a recent report titled ``Childhood's End'' by the National Child
Support Assurance Consortium poignantly illustrated, these are much
more than simply numbers on a page for the children involved. For far
too many young Americans, the lack of child support means poverty. It
means not being able to go to the doctor when they're sick. It means
going to bed hungry. It means teetering on the brink of homelessness.
We have known for some time now that our child support system needs a
major overhaul. The Child Support Amendments of 1984 and the Family
Support Act of 1988 made modest improvements. For every 100 child
support cases in 1983, there were 15 in which there was a collection.
In 1990, there were 18. Out of 100, 15 to 18 is a step in the right
direction, but we clearly have a long, long way to go.
The bill we are introducing today would take us further down the road
toward an effective child support system. It would create incentives
for responsible behavior: Incentives for custodial parents to seek
child support orders, incentives for noncustodial parents to follow
those orders, and incentives for States to make sure this whole process
works. As a last resort, it would provide a minimum level of support
for all children not living with both parents.
Right now, the poor children of America are the ones paying for the
failings of our families and the failings of our child support system.
It is time for all of us to help shoulder this burden.
rigorous requirements
The bill would authorize demonstrate grants to six States for use in
guaranteeing and assured child support benefit. Participating States
would have to meet a rigorous set of requirements. To qualify, States
would already have to be doing a good job of collecting child support
and would have to be at, or above, the national median for paternity
establishment. And during the course of the grant, the State would have
to show real, measurable improvement in paternity establishment, child
support orders, and collections.
Just as the Child Support Assurance Act calls on participating States
to meet their obligations, it would do the same for participating
families. To qualify, the custodial parent would have to possess, or be
seeking, a child support award or have a good reason not to.
We hope that this approach will serve as a model for the country. To
test this proposition, the Department of Health and Human Services
would conduct 3-and 5-year evaluations of the demonstration programs to
gauge whether the approach should be extended nationally.
I hope my colleagues will join Senator Rockefeller and me in
supporting this legislation and demanding that we all meet our
responsibilities to America's children.
I ask unanimous consent that the full text of this bill be printed in
the Record, along with several letters of support.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1962
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Child Support Assurance Act
of 1994''.
SEC. 2. FINDINGS AND PURPOSE.
(a) Findings.--The Congress finds that--
(1) the number of single-parent households has increased
significantly;
(2) there is a high correlation between childhood poverty
and growing up in a single-parent household;
(3) family dissolution often brings the economic
consequence of a lower standard of living for the custodian
and children;
(4) children are nearly twice as likely to be in poverty
after a family dissolution as before a family dissolution;
(5) one-fourth of the single mothers who are owed child
support receive none and another one-fourth of such mothers
receive only partial child support payments;
(6) single mothers above and below the poverty line are
equally likely to receive none of the child support they are
owed; and
(7) the failure of children to receive an adequate level of
child support limits the ability of such children to thrive
and to develop their potential and leads to long-term
societal costs in terms of health care, welfare, and loss in
labor force productivity.
(b) Purpose.--It is the purpose of this Act to enable
participating States to establish child support assurance
systems in order to improve the economic circumstances of
children who do not receive a minimum level of child support
from the noncustodial parents of such children and to
strengthen the establishment and enforcement of child
support awards. The child support assurance approach is
structured on a demonstration basis in order to implement
and evaluate different options with respect to the
provision of intensive support services and mechanisms for
administering the program on a national basis.
SEC. 3. ESTABLISHMENT OF CHILD SUPPORT ASSURANCE
DEMONSTRATION PROJECTS.
(a) In General.--In order to encourage States to provide a
guaranteed minimum level of child support for every eligible
child not receiving such support, the Secretary of Health and
Human Services (hereafter in this section referred to as the
``Secretary'') shall make grants to not more than 6 States to
conduct demonstration projects for the purpose of
establishing or improving a system of assured minimum child
support payments in accordance with this section.
(b) Contents of Application.--An application for grants
under this section shall be submitted by the Governor of a
State and shall--
(1) contain a description of the proposed child support
assurance project to be established, implemented, or improved
using amounts provided under this section, including the
level of the assured benefit to be provided, the specific
activities to be undertaken, and the agencies that will be
involved;
(2) specify whether the project will be carried out
throughout the State or in limited areas of the State;
(3) estimate the number of children who will be eligible
for assured minimum child support payments under the project,
and the amounts to which they will be entitled on average as
individuals and in the aggregate;
(4) describe the child support guidelines and review
procedures which are in use in the State and any expected
modifications;
(5) contain a commitment by the State to carry out the
project during a period of not less than 3 and not more than
5 consecutive fiscal years beginning with fiscal year 1996;
(6) contain assurances that the State--
(A) is currently at or above the national median paternity
establishment rate (as defined in section 452(g)(2) of the
Social Security Act),
(B) will improve the performance of the agency designated
by the State to carry out the requirements under part D of
title IV of the Social Security Act by at least 4 percent
each year in which the State operates a child support
assurance project under this section in--
(i) the number of cases in which paternity is established
when required;
(ii) the number of cases in which child support orders are
obtained; and
(iii) the number of cases with child support orders in
which collections are made; and
(C) to the maximum extent possible under current law, will
use Federal, State, and local job training assistance to
assist individuals who have been determined to be unable to
meet such individuals' child support obligations;
(7) describe the extent to which multiple agencies,
including those responsible for administering the Aid to
Families With Dependent Children Program under part A of
title IV of the Social Security Act and child support
collection, enforcement, and payment under part D of such
title, will be involved in the design and operation of the
child support assurance project; and
(8) contain such other information as the Secretary may
require by regulation.
(c) Use of Funds.--A State shall use amounts provided under
a grant awarded under this section to carry out a child
support assurance project designed to provide a minimum
monthly child support benefit for each eligible child in the
State to the extent that such minimum child support is not
paid in a month by the noncustodial parent.
(d) Requirements.--(1) A child support assurance project
funded under this section shall provide that--
(A) any child (as defined in paragraph (2)) with a living
noncustodial parent for whom a child support order has been
sought (as defined in paragraph (3)) or obtained and any
child who meets ``good cause'' criteria for not seeking or
enforcing a support order is eligible for the assured child
support benefit;
(B) the assured child support benefit shall be paid
promptly to the custodial parent at least once a month and
shall be--
(i) an amount determined by the State which is--
(I) not less than $1,500 per year for the first child,
$1,000 per year for the second child, and $500 per year for
the third and each subsequent child, and
(II) not more than $3,000 per year for the first child and
$1,000 per year for the second and each subsequent child;
(ii) offset and reduced to the extent that the custodial
parent receives child support in a month from the
noncustodial parent;
(iii) indexed and adjusted for inflation; and
(iv) in the case of a family of children with multiple
noncustodial parents, calculated in the same manner as if all
such children were full siblings, but any child support
payment from a particular noncustodial parent shall only be
applied against the assured child support benefit for the
child or children of that particular noncustodial parent;
(C) for purposes of determining the need of a child or
relative and the level of assistance, one-half of the amount
received as a child support payment shall be disregarded from
income until the total amount of child support and Aid to
Families With Dependent Children benefit received under part
A of title IV of the Social Security Act equals the Federal
poverty level for a family of comparable size;
(D) in the event that the family as a whole becomes
ineligible for Aid to Families With Dependent Children under
part A of the Social Security Act due to consideration of
assured child support benefits, the continuing eligibility of
the caretaker for Aid to Families With Dependent Children
under such title shall be calculated without consideration of
the assured child support benefit; and
(E) in order to participate in the child support assurance
project, the child's caretaker shall apply for services of
the State's child support enforcement program under part D of
title IV of the Social Security Act.
(2) For purposes of this section, the term ``child'' means
an individual who is of such an age, disability, or
educational status as to be eligible for child support as
provided for by the law of the State in which such individual
resides.
(3) For purposes of this section, a child support order
shall be deemed to have been ``sought'' where an individual
has applied for services from the State agency designated by
the State to carry out the requirements of part D of title IV
of the Social Security Act or has sought a child support
order through representation by private or public counsel or
pro se.
(e) Consideration and Priority of Applications.--(1) The
Secretary shall consider all applications received from
States desiring to conduct demonstration projects under
this section and shall approve not more than 6
applications which appear likely to contribute
significantly to the achievement of the purpose of this
section. In selecting States to conduct demonstration
projects under this section, the Secretary shall--
(A) ensure that the applications selected represent a
diversity of minimum benefits distributed throughout the
range specified in subsection (d)(1)(B)(i);
(B) consider the geographic dispersion and variation in
population of the applicants;
(C) give priority to States the applications of which
demonstrate--
(i) significant recent improvements in--
(I) establishing paternity and child support awards,
(II) enforcement of child support awards, and
(III) collection of child support payments;
(ii) a record of effective automation; and
(iii) that efforts will be made to link child support
systems with other service delivery systems;
(D) ensure that the proposed projects will be of a size
sufficient to obtain a meaningful measure of the effects of
child support assurance;
(E) give priority, first, to States intending to operate a
child support assurance project on a statewide basis, and,
second, to States that are committed to phasing in an
expansion of such project to the entire State, if interim
evaluations suggest such expansion is warranted; and
(F) ensure that, if feasible, the States selected use a
variety of approaches for child support guidelines.
(2) Of the States selected to participate in the
demonstration projects conducted under this section, the
Secretary shall require, if feasible--
(A) that at least 2 provide intensive integrated social
services for low-income participants in the child support
assurance project, for the purpose of assisting such
participants in improving their employment, housing, health,
and educational status; and
(B) that at least 2 have adopted the Uniform Interstate
Family Support Act.
(f) Duration.--(1) During fiscal year 1995, the Secretary
shall develop criteria, select the States to participate in
the demonstration, and plan for the evaluation required
under subsection (h). The demonstration projects conducted
under this section shall commence on October 1, 1995, and
shall be conducted for not less than 3 and not more than 5
consecutive fiscal years, except that the Secretary may
terminate a project before the end of such period if the
Secretary determines that the State conducting the project
is not in substantial compliance with the terms of the
application approved by the Secretary under this section.
(g) Cost Savings Recovery.--The Secretary shall develop a
methodology to identify any State cost savings realized in
connection with the implementation of a child support
assurance project conducted under this Act. Any such savings
realized as a result of the implementation of a child support
assurance project shall be utilized for child support
enforcement improvements or expansions and improvements in
the Aid to Families With Dependent Children Program conducted
under part A of title IV of the Social Security Act within
the participating State.
(h) Evaluation and Report to Congress.--(1) The Secretary
shall conduct an evaluation of the effectiveness of the
demonstration projects funded under this section. The
evaluation shall include an assessment of the effect of an
assured benefit on--
(A) income from nongovernment sources and the number of
hours worked;
(B) the use and amount of government supports;
(C) the ability to accumulate resources;
(D) the well-being of the children, including educational
attainment and school behavior; and
(E) the State's rates of establishing paternity and support
orders and of collecting support.
(2) Three and 5 years after commencement of the
demonstration projects, the Secretary shall submit an interim
and final report based on the evaluation to the Committee on
Finance and the Committee on Labor and Human Resources of the
Senate, and the Committee on Ways and Means and the Committee
on Education and Labor of the House of Representatives
concerning the effectiveness of the child support assurance
projects funded under this section.
(i) State Reports.--The Secretary shall require each State
that conducts a demonstration project under this section to
annually report such information on the project's operation
as the Secretary may require, except that all such
information shall be reported according to a uniform format
prescribed by the Secretary.
(j) Restrictions on Matching and Use of Funds.--(1) A State
conducting a demonstration project under this section shall
be required--
(A) except as provided in paragraph (2), to provide not
less than 20 percent of the total amounts expended in each
calendar year of the project to pay the costs associated with
the project funded under this section;
(B) to maintain its level of expenditures for child support
collection, enforcement, and payment at the same level, or at
a higher level, than such expenditures were prior to such
State's participation in a demonstration project provided by
this section; and
(C) to maintain the Aid to Families With Dependent Children
benefits provided under part A of title IV of the Social
Security Act at the same level, or at a higher level, as the
level of such benefits on the date of the enactment of this
Act.
(2) A State participating in a demonstration project under
this section may provide no less than 10 percent of the total
amounts expended to pay the costs associated with the project
funded under this section in years after the first year such
project is conducted in a State if the State meets the
improvements specified in subsection (b)(6)(B).
(k) Coordination With Certain Means-Tested Programs.--For
purposes of--
(1) the United States Housing Act of 1937;
(2) title V of the Housing Act of 1949;
(3) section 101 of the Housing and Urban Development Act of
1965;
(4) sections 221(d)(3), 235, and 236 of the National
Housing Act;
(5) the Food Stamp Act of 1977;
(6) title XIX of the Social Security Act; and
(7) child care assistance provided through part A of title
IV of the Social Security Act, the Child Care and Development
Block Grant, or title XX of the Social Security Act,
any payment made to an individual within the demonstration
project area for child support up to the amount which an
assured child support benefit would provide shall not be
treated as income and shall not be taken into account in
determining resources for the month of its receipt and the
following month.
(l) Treatment of Child Support Benefit.--Any assured child
support benefit received by an individual under this Act
shall be considered child support for purposes of the
Internal Revenue Code of 1986.
(m) Authorization of Appropriations.--There are authorized
to be appropriated such sums as may be necessary in each of
the fiscal years 1995, 1996, 1997, 1998, 1999, and 2000 to
carry out the purposes of this Act.
____
Center for Law and Social Policy,
Washington, DC, March 21, 1994.
Hon. Christopher Dodd,
Committee on Labor and Human Resources, Subcommittee on
Children, Families, Drugs and Alcoholism, Washington, DC.
Dear Senator Dodd, the Center for Law and Social Policy
commends you for sponsoring the Child Support Assurance Act
of 1994.
In recent times, a great deal of attention has been paid to
the idea of ``ending welfare as we know it.'' The real issue,
however, is ending poverty as we know it. In particular, we
must be committed to eliminating the poverty of children
being raised in single-parent families. To ameliorate this
poverty, a child support assurance system is absolutely
essential. Your bill takes a strong positive step toward
creating such a system.
The Child Support Assurance Act of 1994 authorizes up to
six demonstration projects. In a demonstration project site,
any eligible child could receive a monthly guaranteed child
support payment. If the child's non-custodial parent paid
support, that money would be used to reimburse the government
for the assured benefit. If the non-custodial parent paid no
support or paid less than the guaranteed amount, the child
would still receive the guaranteed payment. Each site would
set its own payment structure (within the limits set out in
the bill) and would use a variety of guideline approaches to
determine what the non-custodial parent should pay.
Three aspects of the Child Support Assurance Act of 1994
are particularly important. First, it gives priority to
states which have already shown a commitment to improving
child support enforcement and requires all participating
states to improve enforcement over the life of the
demonstration project. Any test of child support assurance
ought to be conducted in conjunction with improving
enforcement. Not only is this fiscally prudent, but also it
emphasizes that the child's parent is and should be the
primary source of his/her support.
Second, the bill gives priority to state's wishing to
operate state-wide demonstration projects. The primary reason
for having demonstration projects, rather than moving
immediately to a national child support assurance system, is
to learn how to phase in an assurance system nationwide. To
learn as much as we can, large scale projects are needed and
your bill recognizes this.
Third, the bill helps the most vulnerable children--those
receiving AFDC. By providing a partial disregard of the
assurance payment, it allows children subsisting on meager
AFDC benefits the chance to obtain a family income that is
closer to the poverty line. By providing a source of reliable
child support to supplement the wages of a parent when the
family leaves AFDC, it makes escape from poverty possible.
We look forward to working with you to make child support
assurance a reality.
Sincerely,
Paula Roberts,
Senior Staff Attorney.
____
Women's Legal Defense Fund,
Washington, DC, March 21, 1994.
Hon. Christopher J. Dodd and Hon. Jay D. Rockefeller IV,
U.S. Senate,
Washington, DC.
Dear Senators Dodd and Rockefeller, the Women's Legal
Defense Fund is a national, nonprofit advocacy organization
that for more than twenty years has worked for policies that
help women and their families achieve economic security,
equal opportunity in the workplace, and access to quality
health care. For more than ten years, we have worked in
Congress, the executive branch, and the states, to improve
this country's child support system. We write to express our
strong support for a program of child support assurance, and
to commend the important steps in that direction that would
be taken under the Child Support Assurance Act of 1994.
Children need and deserve the support of both parents.
Single parents, usually mothers, struggle to provide both
nurturance and economic support for their children. They
confront a labor market that offers many of them only low
wage, part time, and insecure jobs, if any; often unavailable
or unaffordable child care; and still insufficient
flexibility to combine paid work and caretaking, even with
the improvements of the Family and Medical Leave Act. As a
result, over half of the children in single parent families
live in poverty.
Despite reforms, a majority of single mothers and their
children cannot count on the child support system to deliver
economic support from the other parent. Now, when a
noncustodial parent fails to pay, and the state fails to
collect, the burden of these failures falls on children.
Child support assurance would protect children from this
loss, just as Social Security survivors' insurance protects
against the loss of a parent. Thus, child support assurance
is needed as a matter of simple justice.
In addition, child support assurance is an effective route
to both child support and welfare reform. With child support
assured, mothers who now despair of ever actually receiving
child support will have a greater incentive to seek child
support awards. The states will have a greater incentive to
collect them. And a child support assurance program that
allows mothers to combine paid work and an assured minimum
benefit can truly ``make work pay.'' With a reliable source
of income in place to supplement their wages, many mothers
will be able to avoid applying for public assistance. If the
program is designed so that mothers receiving public
assistance do not experience a dollar for dollar reduction in
income, they will be able to improve their families' economic
security with the assured benefit. The disincentives to work
that are part of the current public assistance program will
be reduced. And the fathers of children now receiving public
assistance will have a greater incentive to pay. Most
importantly, child support assurance can alleviate the
poverty that far too many children and single mothers must
bear.
The Women's Legal Defense Fund believes that every child
deserves an assurance of child support. Although the Child
Support Assurance Act of 1994 authorizes only demonstration
projects, not a universal program, the demonstration projects
it would authorize include several crucial features:
Participation would be open to custodial parents who have
child support awards; are seeking awards; or have good cause
not to seek a child support award. This creates an incentive
for single parents to seek to establish child support,
without penalizing them for system delays or failures, or
putting them at risk of additional abuse.
There would be real economic benefits for all families, and
work incentives would remain, because half of the assured
benefit would be disregarded from income for families
receiving AFDC.
At least some demonstration projects would assure a minimum
benefit large enough to make a real difference in children's
lives.
The Child Support Assurance Act of 1994 would represent
real progress toward equity and security for children in
single parent families, goals the Women's Legal Defense Fund
will work to help achieve.
Sincerely,
Judith L. Lichtman,
President.
____
Children's Defense Fund,
Washington, DC, March 21, 1994.
Hon. Christopher J. Dodd and Hon. John D. Rockefeller,
U.S. Senate,
Washington, DC 20510.
Dear Senators Dodd and Rockefeller, we want to congratulate
you for your leadership in developing a proposal to create
six state demonstrations of child support assurance. We
believe your partnership in supporting this concept will
provide the impetus to help make child support assurance a
reality.
Child support assurance is a key building block in a long-
term strategy to meet the needs of children and families.
With its emphasis on personal responsibility and incentives
to work, as well as on reducing child poverty and economic
insecurity, the proposal will unite advocates for children.
It will make a genuine difference in children's lives by
making child support a regular, reliable source of income
that encourages custodial parents to work because they can
anticipate having reliable contributions from the non-
custodial parent or the government. It is an essential
component of a welfare reform strategy that encourages work
and parental responsibility.
We are heartened by your expectation that states must
improve the way they establish paternity and enforce support
in order to participate in child support assurance. We agree
that child support assurance must be coupled with aggressive
efforts to improve child support enforcement, both to keep
government cost down and to underscore the message that every
child deserves the support of both parents.
Child support assurance is built on the premise that
government will insure children against harm when parents
fail to meet their responsibilities, but will continue to
hold parents responsible. When a parent leaves the household,
this parental responsibility does not end. Child support
assurance protects children and reinforces parent
responsibility by helping provide a stable economic base for
children, but also by aggressively pursuing reimbursement
from the non-custodial parent when he or she fails to pay
support.
We appreciate your longstanding work to help children, and
look forward to working with you on this important proposal.
Sincerely,
Nancy Ebb,
Senior Staff Attorney.
Mr. ROCKEFELLER. Mr. President, I am proud to join my distinguished
colleague from Connecticut [Mr. Dodd] in introducing a demonstration
project which will help us chart a bold course in promoting parental
responsibility and stable support for children. It truly is an honor to
join with such a dedicated, effective advocate for children in
promoting a new concept of security for children.
Today, we are joining forces to promote a demonstration project, the
Child Support Assurance Act of 1994. It is a combination of our
previous individual initiatives, but we are united in our commitment to
aggressively push this concept as part of comprehensive welfare reform.
Child support assurance, we believe, will be the effective carrot to
get the Federal Government, States, and individuals working to collect
the billions of dollars that parents owe their children in child
support.
This demonstration is just one piece of the puzzle--but, I believe,
is a key piece to link others together. We understand and agree that
child support assurance will not be effective unless we dramatically
improve child support enforcement efforts. But our child support
assurance demonstration will provide tremendous incentives for States
and parents to work with the Federal Government to establish paternity,
get child support awards in place, and collect the money from all
parents who have an obligation to support their children. Only as a
last resort would a minimum benefit kick in for the child if the parent
did not pay after all efforts were made to collect. The minimum benefit
will ensure that children aren't penalized when an absent parent shirks
their obligations.
Such stable, consistent support is vital for children. A recent study
by the National Institute of Child Health and Human Development noted
that children of single-parent families are at increased risk. It noted
that the single most important factor in accounting for the lower
achievement of children in single-parent families is poverty and
economic insecurity. Income differences account for half of the
increased risk for disadvantages. The researchers noted that because
income is such an important factor in the increased risk for
disadvantages among children in single-parent families, policies that
serve to minimize the negative economic impact on children may help
reduce their difficulties.
The National Child Support Assurance Consortium issued a compelling
report called Childhood's End in January 1993 that outlined what
happens to children when child support payments are missing or just
late. Let me share just a few of the report's significant findings
about what happens to children when child support is not paid:
Fifty-five percent of mothers reported that their children missed
regular health check-ups.
Thirty-six percent of mothers reported that their children did not
get medical care when they became ill.
Fifty-seven percent of the mothers reported that their children lost
their regular child care.
The list goes on and on, and it is tragic that parents are not living
up to their financial obligations and placing their own children at
risk. And demographers warn us that one out of every two children
growing up today will spend some time living with only one parent, and
therefore half of our children will be dependent on child support.
All these statistics indicate that we must dramatically strengthen
our child support enforcement system to protect all children who are at
risk, and I believe this child support assurance demonstration will do
exactly that.
As chairman of the National Commission on Children, I wanted to put
this initiative into perspective. Our bipartisan commission issued a
unanimous report entitled ``Beyond Rhetoric, A New American Agenda for
Children and Families.'' This historic report clearly stated that the
best way to help children is to strengthen families, and I wish that
every child could grow up in a stable home, with two loving parents and
financial security.
But in reality, over 15.7 million children are living in single-
parent families and dependent on child support. Only 26 percent of
those children receive the financial support they deserve from their
absent parent. This means that 74 percent are placed at risk. These
children deserve our compassion and support, not penalties and
sanctions. We believe our child support assurance demonstration which
will require improved child support enforcement, should help.
I believe this demonstration will promote parental responsibility and
over the long-run strengthen families by sending a clear signal we
believe every parent has obligation to support their children.
This demonstration should also promote work and responsibility for
single-parents on welfare. While our child support assurance program is
not means tested, it will offer stronger incentives for parents on
welfare to return to work. For example, if a parent on welfare goes to
work, their AFDC benefits are reduced, but if that same parent returns
to work their child support award is continued and the family is better
off. Our hope is that the vast majority of the child support awards
will be paid by the absent parent. But when it is impossible to collect
from the absent parent, and the single-parent has fully cooperated, the
assured minimum benefit will ensure that the child is not penalized and
put at risk.
The concept of child support assurance has attracted interest from
groups across a broad range of the political spectrum, and it holds
enormous potential to offer security to children. It deserves to be
tested and this demonstration project is an ideal opportunity to
explore this innovative idea.
I ask for unanimous consent that background information on child
support facts be printed in the Record following my remarks.
There being no objection, the material was ordered to be printed in
the Record as follows:
Facts and Figures on Child Support
One out of every two children growing up today will spend
some time living with only one parent, and therefore will be
dependent on child support.\1\
---------------------------------------------------------------------------
\1\Irwin Garfinkel and Sara McLanahan, ``Single Mothers and
Their Children: A New American Dilemma'' (Washington, DC: The
Urban Institute Press, 1986) p.1.
---------------------------------------------------------------------------
10 million women are custodial parents of 15.7 million
children, but only 58 percent have a child support award in
place, and of those women, only 26 percent receive full
payment.\2\
---------------------------------------------------------------------------
\2\U.S. Census Bureau, ``Statistical Brier: Who's Supporting
the Kids?'' October 1991.
---------------------------------------------------------------------------
$11.2 billion was collected in child support in 1989, but
$5.1 billion more was due in support.\3\
---------------------------------------------------------------------------
\3\Same.
---------------------------------------------------------------------------
(This does not include arrearages, which are estimated by
the Office of Child Support Enforcement at about 22 billion
cases in the system. Nor does it include support for 42
percent of cases in which an award has not been established.)
If all eligible mothers had child support award pegged to
current state guidelines, children would be eligible for
about $30 billion in support payments each year.\4\
---------------------------------------------------------------------------
\4\David Good and Maureen Pirog-Good, ``The efficiency of
State Child Support Enforcement Programs'' in Public
Budgeting and Finance,'' Fall 1990, p. 25.
---------------------------------------------------------------------------
Researchers estimate that if we improved child support
enforcement and established a national child support
assurance system, the results could yield:
A reduction of 8 percent to 9 percent in the poverty rate,
and
A decline of 12 percent to 20 percent in welfare
dependency.\5\
---------------------------------------------------------------------------
\5\Daniel Meyer, Irwin Garfinkel, Philip Roobins, and Donald
Oellerich, ``The Costs and Effects of a National Child
Support Assurance System'' (University of Wisconsin-Madison
Institute for Research on Poverty, Discussion Paper 940-91,
March 1991), p. 28.
---------------------------------------------------------------------------
Footnotes
____________________