[Congressional Record Volume 141, Number 10 (Wednesday, January 18, 1995)]
[Senate]
[Pages S1064-S1069]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CLOTURE MOTION
Mr. DOLE. Mr. President, I send a cloture motion to the desk.
The PRESIDING OFFICER. The cloture motion having been presented
[[Page S1065]] under rule XXII, the Chair directs the clerk to read the
motion.
The legislative clerk read as follows:
Cloture Motion
We, the undersigned Senators, in accordance with the
provisions of rule XXII of the Standing Rules of the Senate,
do hereby move to bring to a close debate on S. 1, the
unfunded mandates bill:
Bob Dole, William Roth, Dirk Kempthorne, Bill Frist,
Trent Lott, Chuck Grassley, Craig Thomas, Judd Gregg,
John Ashcroft, Ted Stevens, Conrad Burns, James Inhofe,
Paul Coverdell, Spencer Abraham, Christopher S. Bond,
Bob Smith, Rod Grams, Don Nickles, Alfonse D'Amato,
Larry Craig.
Mr. DOLE. Mr. President, when will that motion ripen?
The PRESIDING OFFICER. One hour after the Senate convenes after 1 day
of session.
Mr. DOLE. Mr. President, I apologize to the Senator from Arkansas for
taking so long.
I say to my colleagues that at 11 o'clock tomorrow we will be back on
S. 1. There will be 30 minutes equally divided between the Senator from
Michigan and Senator Kempthorne and Senator Byrd. At the hour of 11:30
the Senate will proceed to vote on the Levin amendment regarding
feasibility, and immediately thereafter we will proceed to a cloture
vote on S. 1; and, we will waive the mandatory quorum under rule XXII
B.
Mr. President, I yield the floor. I thank my colleague from Arkansas.
Mr. BUMPERS addressed the Chair.
Mr. DASCHLE. Mr. President, if I might just take 1 more minute to
comment about the importance of the vote tomorrow, I think it is very
important that Senators understand the difference between germaneness
and relevance. We have a lot of amendments pending that are very
relevant and that, under the strict rules of parliamentary definition,
may not be germane.
The distinguished Senator from Michigan has raised his point on a
number of occasions during the debate over the course of the last
several days. Senators need to be aware that in many cases, while an
amendment in question may directly affect this legislation, may be
directly relevant, it may be ruled not germane.
So this is a very important vote tomorrow morning, and I hope
Senators will take care as we consider the importance of our
opportunity to raise these issues in a constructive way as we have been
doing the last several days.
With that, I yield the floor.
Mr. BUMPERS addressed the Chair.
The PRESIDING OFFICER. The Senator from Arkansas.
Mr. BUMPERS. Mr. President, the question was how much business is the
catalog industry doing in this country? The answer is almost $100
billion a year and growing at a rate of 6 percent a year.
To judge by the number of catalogs coming into my house, they are
growing much faster than that. So you might ask, No. 1, why should
these people bother with collecting a tax on behalf of the States where
they sell merchandise?
I used to be a small town merchant. I had a hardware, furniture, and
appliance store. I even had a cemetery and practiced law as well. I did
anything to try to feed my wife and three children.
My biggest competitor was not the guy down the street. It was the
Sears & Roebuck catalog. They do not do much catalog business anymore;
I think maybe Sears does no catalog business now. But I can tell you
that offices of every Senator in the U.S. Senate has received
communique after communique in the last 3 days saying, please support
Senator Bumpers' amendment. They are from small town, main street
retailers all across America because it is not just Wal-Mart and K-Mart
that are putting them out of business; it is the catalog business which
enjoys a competitive advantage because they do not have to collect that
5 to 8 percent sales tax.
What would this mean to your State? In my State of Arkansas, it would
mean $19.6 million a year. In Illinois, $233 million a year;
Pennsylvania, $145 million; New York, $359 million; and California,
$482 million.
Call our former colleague, Governor Wilson in California, and ask him
how he feels about this legislation. It is supported by the National
Conference of Mayors, the National Governors Conference, the National
Conference of County Executives. Who are we trying to help with S. 1?
The Governors, the mayors, and the county executives.
Mr. President, I used to be Governor of my State. These mandates
drove me crazy. It was a big issue with me 24 years ago when I first
became Governor of my State.
I am not too crazy about this particular unfunded mandates bill, even
though I was a cosponsor of it last year, and I am not at all sure I am
going to vote for this one. But be that as it may, if you were to ask
some Governors in their State, ``Would you rather have the right you
would get under the Bumpers amendment or the mandates bill?'' they
would take this legislation, because they are scared to death that this
mandate legislation will never amount to anything.
And you might say, ``These people do not do business in your State,
so why should they collect a sales tax there?'' But they do impose a
burden on the States--they send 3.3 million tons of catalogs and
solicitations into the landfills of this country every year. And what
is one of the biggest problems every mayor has? Why, the local
landfill. In a lot of jurisdictions in this country it costs $100 a ton
to dispose of garbage. But it is not just the 3.3 million tons of
catalogs which mail-order companies send into the States. All the
packaging that their merchandise comes in has to be disposed of, too.
How much are the catalog houses contributing to the mayors to help them
dispose of these millions of tons of garbage? Not one red dime.
Mr. President, this is not designed to be punitive. It is designed to
be fair. In order to be fair, I want to say this: There are a few mail
order houses in this country which collect sales taxes in every State
where they send products. There is one very notable case of such a
company--essentially an office supply house which does over $200
million in business a year. When they formed the company, they sat down
in the boardroom and said, ``Shall we or shall we not collect sales
taxes on our sales and remit to the States?'' They decided, as good
citizens, they would collect a sales tax and remit it back to every
State they shipped into. Do you know who the founder of that company
was? It was Senator Robert Bennett of the great State of Utah. He said
to the Small Business Committee during a hearing last year that ``We
thought it was the right thing to do.''
Mr. President, we have made this bill as simple and fair as we know
how to make it. No. 1, we only require mail order companies to file a
return with the States every 3 months. No. 2, we set up a toll-free
telephone number at the State level so that any questions the catalog
houses have can be resolved free of charge. And we have exempted all
but 875 of the 7,500 mail order houses in the country, because we
exempt every company which does less than $3 million in business a
year. Of the 7,500 mail order companies in this country, 6,675 of them
do not do $3 million a year. The mayors did not like it because I
exempted them. But we thought it was fair to do so because this
amendment could create a slight administrative burden on small
companies. So only 825 of the 7,500 catalog sales houses in this
country are going to be affected by this bill.
Mr. President, sometimes the mail order houses say this is too
complicated. I am not going to belabor it tonight, but tomorrow I am
going to bring about a week's supply of catalogs that came into my
home, and I am going to show you why that argument that this is too
complicated on us will not fly. The reason it will not fly is because a
lot of them already collect use taxes in as many as 25 or 30 States.
Senator Bennett's company says, ``Include sales tax unless you are from
Alaska, Delaware, Montana, New Hampshire or Oregon, which do not have
sales taxes.'' And then look at what they say: ``If your order is less
than $10, include $2 for shipping charge. If your order is $10 to $25,
include $2.50,'' and here is another chart that you have to look at
when you order. So they themselves have very complicated catalogs
sometimes. And it would be immensely less cumbersome if you simply
said: ``Send with your order the local sales tax.''
[[Page S1066]] Mr. President, main street merchants are suffering
because they are at such a competitive disadvantage. Let me tell you
one other thing. There are some out-of-State companies that really
drive local retailers up the wall. There are out-of-State companies
which say, ``Go down to the local store, get the model number of the
product you want, and call us toll free at this 800 number.'' You think
they do not say that? Look at this advertisement: ``Discount
Wallcovering. Shop the phone way. All brands, first quality, free
delivery. No sales tax (outside Pennsylvania).'' But here is the real
clincher: ``Shop in your neighborhood. Write down the pattern number
book and then call Wallcovering, Inc.''
How would you like to be a wallcovering retailer and somebody comes
in and goes through all your merchandise, picks out the number of the
wallcovering they like and they said, ``Adios, see you later.'' They go
home, get on a 1-800 line and call this outfit and they say, ``Here is
the pattern I want, ship it to me with no sales tax.''
There are going to be a lot of Senators that vote against this
amendment. But there is not one Senator in the U.S. Senate in his heart
of hearts that would not tell you that such a practice is grossly
unfair.
Here is an ad by an outfit that is too small for anybody to read
unless you are right on top of it, so I will tell you what it says. It
is a company that sells boats, motors, fuel, water pump kits,
everything from the world of boats to everything that makes a boat run.
What do they do? They say, ``Nobody beats our deal.'' Up here in red it
says, ``No sales tax added outside of North Carolina.''
Mr. President, I hate to belabor the Record, and I am not going to do
the whole thing, but I want to read you a letter that I got from a
person in the state of California that was in the boat business, Long
Beach Yacht Sales, Long Beach, CA.
January 18, 1994.
Hon. Senator Bumpers,
Chairman, Committee on Small Business, Russell Senate Office
Building, Washington, DC.
Attention: Mr. Stan Fendley, Tax Council: Thank you, in
advance, for your sponsorship of legislation regarding the
collection of interstate sales tax. This week we lost a
$240,000 deal as a result of a sales tax issue. The buyer
bought a boat in Oregon to avoid our local and state sales
tax. The vessel will be kept out of state for the required
period of time and will be subsequently brought into
California after the waiting period has elapsed. Based on our
local tax rate of 8.25% the resulting tax would have been
$19,800.
Not only did we (and the State) lose this deal, but we also
lost the time and expenses involved in upselling the customer
to a more expensive boat (from $140,000 to $240,000), sea
trialing the boat and providing extensive consultation
regarding the product. The customer thanked us but basically
said for $19,800 he would have to make an economic choice to
buy elsewhere.
Sincerely,
Ray Jones, Owner.
He told them, ``I can buy it in another State and bring it into this
State and save myself almost $20,000.''
Who in their heart of hearts in the U.S. Senate thinks that is fair?
So I say, this is not punitive, and I am not just pointing the finger
at all of these people. Fingerhut out in Minnesota said they do not
think this would be much of a burden on them. L.L. Bean, in the State
of Maine, said they did not think this would be much of a burden on
them, either. So I applaud them. I applaud them for their generous
statements and their citizenship. I do not blame them for not
collecting the applicable taxes. I would not collect them either if I
did not have to.
Mr. President, the thrust of this amendment is to give the States the
discretion. This does not impose one single thing on the States. It
says to the States, ``You have the discretion of requiring the
collection of use tax on merchandise being shipped into your State so
that retailers in your State are competing on a level playing field
with out-of-State companies.''
Mr. President, until that fateful November 8, 1994, I was chairman of
the Small Business Committee. As chairman of the Small Business
Committee, and as a former small businessman, I have always championed
the rights of people to start a business, make Government as
unobtrusive as possible, reduce the paperwork burden, reduce the
regulatory burden, everything to give people an opportunity to grow and
prosper.
When we held hearings on this bill last year, we had retailers from
all over the country come and testify. We had a music store owner in my
State talk about how many people came into his store, got the model
number off the instrument they wanted, and went back home and ordered
it.
The retail Main Street jewelry stores left in this country, you can
count them on one hand, because they cannot compete. Yet these are the
people we look to organize the Christmas parades in rural America. They
are the people that every State depends on to pay sales taxes to
educate their children. They are losing billions of dollars of sales
every year to this absolutely burgeoning catalog sales business and it
is time we give the States an opportunity to do something about it.
Mr. President, in the morning I am going to do two things: I am going
to read you some additional letters from retailers as to what they are
putting up with out there. Second, I have a whole stack of catalogs. I
am going to go through some of them and show you how complicated it is
now and how, if you adopt this amendment, you not only curry favor of
the mayors and Governors of this country, you probably lighten the
administrative burden on some catalog companies because they will only
have one tax rate to worry about in each State instead of many
different local rates.
Mr. President, before I yield the floor, I ask unanimous consent that
this amendment be set aside until we return to S. 1 tomorrow morning. I
am not sure what the hour is.
Mr. President, when are we scheduled to return to S. 1 in the
morning?
Mr. President, I will withdraw that request.
Mr. COHEN addressed the Chair.
The PRESIDING OFFICER (Mr. Santorum). The Senator from Maine.
Mr. COHEN. Mr. President, I was home when I learned that the Senator
from Arkansas was going to take the floor this evening and offer this
amendment. I had no prior notification that it was coming up this
evening.
I can perhaps understand why the Senator from Arkansas would want to
file this amendment prior to the cloture vote tomorrow. This is
precisely what the majority leader was just talking about.
Here we have a bill dealing with unfunded mandates, and we have the
minority leader saying, ``Well, we just want to amend it in a
substantive way dealing with relevant and germane issues pertaining to
unfunded mandates,'' and the first thing that happens is the Senator
from Arkansas gets up and offers this amendment which has no particular
relevance to this bill.
It is an example of what I mentioned on the floor the other day. We
are back at it again. No sooner do we go into a new session with a new
Congress, with new hopes of perhaps moving legislation at a much more
expeditious fashion, at least, than we just have a series of amendments
and more amendments that have nothing to do with the bill under
consideration.
Now that is consistent with the Senate rules. And the majority leader
said he does not want to see a change in the Senate rules; keep the
Senate as the Senate and not as the House.
But the American people ought to understand why it is we cannot move
forward with legislation: because every individual Member has his or
her particular amendment that they want to offer.
With respect to this particular amendment, this would reflect a major
change in existing law. There is no mistake about it. This would be a
major change in existing law.
It is being offered without any hearings having been held in the
Finance Committee--not one. And yet on the floor of the Senate, the
Senator from Arkansas wishes to make this rather significant change.
The Small Business Committee, I am told, held one hearing on the issue.
But none in Finance which is the committee of jurisdiction.
Now the supporters of the amendment argue this is a matter of
fairness for local retailers.
It is grossly unfair to ask mail order companies to collect taxes for
over 6,000 jurisdictions. Do you really want to talk about putting
burdens on people? Ask a mail order company to collect taxes for 46
States. There are some
[[Page S1067]] 6,000--just count them, 6,000--different taxes in this
country that would have to be considered.
But the Senator from Arkansas says, ``Well, that is just too bad. We
are going to impose that burden on these mail order companies.''
We have a Maine snack tax, to give you an example. It is virtually
indecipherable to most Maine companies. I think it would be absurd--
absurd--to expect every fruitcake vendor in this country to understand
it. But that is what the Senator's amendment would do.
Second, about 30 percent of all of the mail orders are paid not by
credit cards, but by check. So if the check is made out in the wrong
amount, any mail order company, L.L. Bean or any other company in the
country-would have a difficult time collecting this particular tax if
the calculation is wrong.
Now the Home Shopping Network collects State and local taxes. They
are made via credit cards, where the seller simply adds an appropriate
tax to it.
The Senator from Arkansas has talked about the great advantage that
is being held by these mail order companies over the local retailer.
The fact is, the local retailers also pay taxes to enjoy benefits that
out-of-State companies do not.
As a matter of fact the out-of-State companies are not at a
competitive advantage. They have to add the shipping cost. These are
costs that are added to the product. They have to do it on a single
item basis rather than in bulk, because when people call up and say,
``Can we have the product?'' they have to order and pay the shipping
and mailing costs, which far exceed the sales tax in many cases. That
is an added expense the local retailer does not have to bear. So
Senator Bumpers may talk about competitive advantage, but it does not
exist. Mail order companies do not, let me repeat, do not enjoy a
competitive advantage by not having to collect these taxes.
The States have numerous ways to handle the collection of their
taxes? In Maine, for instance, we assume that people in each income
category have purchased a number of goods from out of State, and the
State imposes a presumptive use tax. Maine has devised its own means of
collecting taxes for goods purchased across State lines through mail
order. Why not let the States handle it without the Senator from
Arkansas mandating another rule, where no hearings have been held by
the committee on jurisdiction. It is an extensive change. We ought not
to undertake it on this particular bill.
Mr. President, as I indicated, I was not aware that this was going to
be brought up this evening. But I understand why it was. Last year an
agreement was nearly reached involving the voluntary collection of
State use taxes. This was negotiated by the direct marketing
association and the multistate taxes commission, federation of tax
administers, and small businesses. They tried to reach an agreement to
reduce the 6,000 taxes down to maybe 46 so that within each State there
would be only one rate. Unfortunately, the agreement fell apart in the
end.
This amendment is very significant and should not be offered to this
bill. I support the majority leader, where he says it is time to file
cloture. I hope that we do invoke cloture tomorrow. And to eliminate
those amendments including these types of amendments that are being
offered tonight on the Senate floor.
Mr. President, I will have more to say tomorrow, but for the moment I
will yield the floor.
Mr. BUMPERS. Mr. President, I just want to comment for a minute or
two, because I know the other Senator from Maine wishes to be heard.
No. 1, if I were a Senator from Maine I would be making the same
speech I just heard. The second biggest catalog sales house in the
United States is L.L. Bean from the great State of Maine.
But there is another very cogent point I neglected to make in my
opening comments, and that is the State of Maine collects the sales
taxes for every dime's worth of goods that L.L. Bean sells in the State
of Maine. They do not collect 1 penny for the other 49 States. They are
probably in the half billion dollar range now, maybe much more than
that. They are the second biggest. I believe Lands' End in Wisconsin is
the biggest in the country.
So, No. 1, everybody should understand that under current law, law
established in various Supreme Court decisions, any mail order house
that maintains a retail outlet in another State has to collect the
sales tax for that State. J. Crew, they have retail outlets in Maryland
and Virginia. Eddie Bauer has retail outlets in about 15 States. So
those companies must collect use taxes when their mail order
merchandise goes into States where they maintain retail outlets. It is
only when they do not have a retail outlet in a particular State that
they do not have to collect use taxes on the mail order goods sent into
that State.
To suggest that this does not give mail order houses a competitive
advantage when I just got through reading a letter about how this
company in Long Beach, CA, lost a $250,000 sale because of a $20,000
savings in the sales tax. Why, of course people price shop. I will fill
the record up tomorrow with cases just like it where people tried their
very best to make a sale, and they say thank you very much for telling
us about it, we will go across the State line and buy the merchandise
and bring it back in and save the money.
Mr. President, to say that this amendment is not germane to the
Unfunded Mandates bill is something that defies imagination. With the
Unfunded Mandates bill, we are talking about the burden that Congress
has been putting on the States of this Nation, ordering them how to
build their landfills, how to fill the landfill, what their municipal
water supplies must do, every kind of environmental regulation we could
put on them. They say ``we want you to start paying for it.''
The thrust of that idea is legitimate. I believe in it. It is a very
complex issue. But this amendment says to the States, ``Those burdens
we have already placed on you, we will help you pay for that.'' And to
say that principle is not germane to this bill makes no sense. We are
simply saying we will help you pay for your landfill, if you, State and
local government, want us to.
Let me repeat what I started off saying in the beginning: Maine,
since it already collects the sales tax from all the sales made off of
L.L. Bean--and I misspoke earlier, Senator--it was Lands' End that said
they do not think this would be a burden.
L.L. Bean has not said that, to my knowledge.
But Maine has the best of all worlds. And I love Maine. I have the
utmost respect for my colleagues from Maine. But they are collecting
sales taxes on all the sales they make in Maine, but they do not
collect a red cent for the merchandise they send into other States
through catalog sales. They do not pay for disposing of the catalogs in
the local landfill or the packaging they send the merchandise in. The
Senator says that is not germane. That is what this bill is all about,
trying to help the States.
So, Mr. President, I cannot say it often enough, this amendment gives
the States the discretion. It does not require the States to do one
blessed thing. It says if the States want to require out-of-State
companies to collect use taxes, just as retail outlets in your State
have to collect sales taxes, the States can do it. It has only been
since 1992 when the Supreme Court ruled in Quill versus North Dakota,
that we could even debate this issue here.
Now, Mr. President, this is an idea that will not go away. It will
happen, sure as God made little apples. Maybe not on this bill, but it
will happen. And the sooner the people in this business understand
that, the better off we will all be. I yield the floor.
Ms. SNOWE. Mr. President, I rise in opposition to the amendment that
has been offered by the Senator from Arkansas, and I want to associate
myself with the remarks made by the Senator from Maine, [Mr. Cohen].
I guess in hearing the arguments presented by the Senator from
Arkansas tonight one would think this is a very simple matter. In fact,
it would put national marketers and mail order companies as well as
consumers at a disadvantage, and certainly would hurt the thousands of
jobs that are provided by these companies.
There is no tax advantage for mail order companies, as the Senator
from Maine indicated. They have to charge for postal rates, and many
times these charges exceed the cost of local taxes
[[Page S1068]] or State taxes. Also, mail order companies do not derive
the benefits from having their presence in a local community like many
of the local merchants and, therefore, do not create additional costs
do a local community.
In a State like Maine, we have taken a very reasonable approach. What
we have done is require the taxpayer to play a flat rate on their tax
return when they file it in April for the amount of the taxes they owe
in out-of-State purchases. That is the requirement. Granted, it
requires a good-faith effort on the part of the taxpayers in Maine, but
it has worked and it is a far better approach than applying this kind
of a tax through a bill that has no relation to the issue before us in
the Senate.
This amendment would impose a major new burden on many companies
throughout the country without the benefit of hearings to explore the
ramifications of such a tax on mail order companies. We are not only
talking about the imposition of a tax, we are talking about compliance
costs, and those are not minimal, if you consider the fact that mail
order companies would be required to cope with no less than 46 types of
procedures and exemptions from over 6,000 State and local tax rates.
The compliance tax alone would be 6.5 times greater for mail order
companies than for local retailers who must only contend with one tax
rate and one set of exemptions.
The Senator from Arkansas mentioned L.L. Bean. For L.L. Bean, that
would cost $500,000 per year for compliance, just in the administrative
accounting and legal fees that would be involved, not to mention the
fact that, of course, a blended tax rate would mean that for many
customers, in fact, for probably half the customers, they would pay
more tax than they actually owe. So, of course, that would contribute
to a loss of confidence and erode sales for the company. I suspect the
100 million Americans who shop by mail order today would also find such
an unfair tax scheme unjustifiable.
This amendment would have an economic impact on everyone. Jobs would
be lost in Maine and elsewhere in the country.
This is an unfair imposition, it is an unreasonable administrative
burden when there are other approaches that can be taken and, in fact,
are being pursued.
As Senator Cohen mentioned, there has been an approach taken by the
industry to look at resolving this matter in a way which could be fair
to the industry without creating additional and onerous burdens, as
well as excessive costs far beyond the local taxes that they would be
required to collect, and they are working on such an agreement.
I think we ought to encourage a negotiated settlement that would
satisfy both parties without unnecessarily burdening companies or
consumers and costing thousands of jobs all across this country.
The revenues raised under this proposal, according to the Senator
from Arkansas, would be about $1.6 billion. But, in fact, it would be
far less than that when you deduct compliance costs. This amendment
would require States to audit out-of-State firms.
It would certainly add costs to the States as well as to the mail
order companies.
The Senator from Arkansas mentioned that this would benefit local
merchants and small businesses, but it is interesting to note that the
one organization that represents thousands of small businesses and
merchants all across America undertook a survey last year asking their
clients whether or not they support such a collection by mail order
companies. Only 25 percent said yes and 67 percent said no to such a
mandate.
It is because they recognize that it would hurt many local economies
across America. It would cost jobs, and the administrative burden would
be a nightmare. It would be very difficult to comply with such a
mandate and that the tax structure would be so complex that there would
be many mistakes in the process of calculation.
I hope that my colleagues in the Senate will oppose the amendment
offered by the Senator from Arkansas because, clearly, it would not
result in the kind of benefits that he mentioned this evening and
certainly would result in the loss of thousands of jobs and additional
regulatory costs. Now is not at a time when we can afford these
economic losses.
I thank my colleagues and yield the floor.
Mr. LOTT addressed the Chair.
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. LOTT. Mr. President, Senator Hatch, the chairman of the Judiciary
Committee, has provided a statement which addresses constitutional
issues raised earlier today by Senator Byrd with regard to the unfunded
mandates legislation. He states in this statement that he is
``unpersuaded that there would be any constitutional problem'' with the
issues raised.
(At the request of Mr. Lott, the following statement was ordered to
be printed in the Record:)
Mr. HATCH. Mr. President, I have listened with care to what Senator
Byrd has said regarding what he sees as a constitutional question
raised by one provision of this unfunded mandates legislation. I
appreciate his thoughts on this issue. I am unpersuaded, however, that
he has identified a serious constitutional problem. Indeed, I am
convinced that a careful analysis will show that his concern is
unwarranted.
In the first place, Senator Byrd's concern is not that a provision of
S. 1 is facially unconstitutional but merely that it might possibly be
applied in an unconstitutional manner. This same objection could be
raised against virtually every law. The mere possibility that a
provision might be applied in an unconstitutional manner has never been
regarded as sufficient to invalidate it. Otherwise, Congress could
never enact anything. In any event, if a problem with a possible
application of this provision were to arise in the future, that problem
would be raised by an implementing bill. It is that future implementing
bill that would require reconsideration, not the bill currently before
us. In other words, since the concern raised by Senator Byrd relates to
one manner in which the provision might be applied, that concern should
be raised if and when a later bill adopts that manner. In short, the
concerns raised by Senator Byrd are not suited to a facial challenge to
the provisions of this unfunded mandates legislation.
Second, even under the speculative possibility raised by Senator
Byrd, I am unpersuaded that there would be any constitutional problem
with the possibility that he raises. It is noteworthy that Senator Byrd
is unable to cite even a single Supreme Court case--or any case from
any court, for that matter--in support of his argument that the
provision he is concerned about presents constitutional problems. This
is not surprising, for his argument is, I believe, unsustainable.
Congress can act to sunset legislation through a variety of means. That
it might do so through a mechanism that involves administrative
agencies does not make that mechanism ipso facto constitutionally
suspect. In short, I see nothing in the provision at issue that
involves any delegation of legislative powers to agencies, much less
any unconstitutional delegation.
Third, it seems clear to me that Senator Byrd misunderstands the
provision that he is worried about. This provision specifies a
requirement that must under some circumstances be satisfied in order to
avoid having a point of order lie. Let's assume for the sake of
argument that the requirement was constitutionally defective. All that
would mean is that the requirement could not be lawfully satisfied and
that a point of order would therefore lie. Were this the case, the
Senate could decide whether or not to overrule the point of order.
Mr. President, some people will look for any excuse, however flimsy,
to continue imposing burdensome unfunded mandates on States and
localities. It is especially amusing that my colleagues on the other
side of the aisle who have championed a massive Federal bureaucracy are
now invoking an exaggerated, hyperrestrictive version of the doctrine
that Congress is limited in the powers that it can delegate to
administrative agencies. There is no merit to the argument, and no one
should hide behind it.
Ms. MIKULSKI. Mr. President, I rise today to discuss S. 1, the
Unfunded Mandate Reform Act. Mr. President, in traveling throughout the
State of Maryland, I have heard complaints of
[[Page S1069]] local officials who have been forced to balance the
needs of their community against compliance with Federal regulations.
These local officials have raised valid concerns over the pressure to
implement mandates imposed by Washington with no funds to back it up. I
believe we need to work as a partner with our cities, towns, and
counties--not as their adversary.
I support the validity of their concerns. I am on their side.
We need to have a better understanding about the costs of Federal
mandates--on the public sector and private sector--and help our local
partners meet those costs.
I am glad the Senate has finally begun the debate on this important
issue. I believe the Unfunded Mandate Reform Act takes an important
step toward correcting many of the problems of the past.
This legislation will make Congress estimate the costs of new
legislation and regulations on State and local governments and the
private sector, specify the means to pay for it, and reduce or
eliminate a mandate if adequate funding is not provided.
This bill applies only to new legislation. It does not effect any
existing law or program. Furthermore, this legislation exempts any law
or regulation that enforces constitutional rights, establishes or
enforces laws that prohibit discrimination, provides emergency
assistance to State and local governments, pertains to national
security or treaty ratification and any bill designated as an emergency
by the President and Congress.
While I wholeheartedly support these exemptions, as well as the
overall intent of this legislation, I have a number of questions
regarding its impact and applicability.
I am very concerned about this bill's impact on laws that are
designed to protect public health and safety. Will this bill diminish
the Government's ability to protect public health and provide essential
public safety?
I am concerned about how this bill defines public and private and how
it impacts future laws and programs. Could a mandate exempt the public
sector while applying to the private sector? Could public schools be
exempt from a mandate while Catholic or other religious day schools
would be forced to comply?
Would future emissions standards apply to UPS trucks but not MTA
buses?
I am concerned about how Federal agencies will have to implement the
complex provisions of this legislation. For example, will Federal
agencies be forced to rewrite regulations every year if funding levels
change?
I am concerned about confusion this bill may generate to State and
local governments and the private sector.
I believe we need laws and regulations that are clear, enforceable,
and universally applicable. I support the intent of this legislation
and many of its provisions; at the same time I remain concerned over
the issues I have outlined. I believe these questions need to be
answered before the Senate adopts any unfunded mandates legislation.
regarding relationship between unfunded mandates and sound risk
regulation
Mr. JOHNSTON. Mr. President, I want to point out to my colleagues the
connection between S. 1, the unfunded mandates bill, and a matter that
is close to my heart--the risk assessment and cost-benefit provision
that passed the Senate twice on the last Congress, only to die in the
House. As my colleagues may recall, it passed by a vote of 95 to 3 on
the EPA Cabinet bill in 1993, and then, after significant revision,
passed again on the safe drinking water bill in 1994 by a vote of 90 to
8.
One of the best ways to reduce unfunded mandates--whether it be on
State and local governments or the private sector--is to set aside the
issue of funding and examine whether the mandate itself is sound.
Federal regulations that do not address a significant risk in a cost-
effective manner must be avoided, regardless of who pays. Put another
way, the argument over who should pay for a mandate will be much easier
to resolve if the mandate itself is as lean as possible to do the job.
Section 202 of S. 1 begins to get at this idea when it requires the
Federal agency, when promulgating a regulation that will cost $100
million or more, to prepare a written statement providing ``a
qualitative, and if possible, a quantitative assessment of costs and
benefits anticipated from the Federal intergovernmental mandate, such
as the enhancement of health and safety and the protection of the
natural environment * * *.'' This is a certainly a good provision as
far as it goes.
But this problem will not be fully addressed until the Senate turns
once again to the subject of risk-based regulatory reform. I was
initially inclined to offer last year's risk amendment to this bill,
but I have been convinced to withhold so that we can consider possible
improvements to last year's risk provision.
Right now, Chairman Murkowski and I are working on legislation that
will build on last year's provision. We intend to introduce the bill
soon, hold hearings in the Energy Committee soon thereafter, and move
to consideration of the bill on the Senate floor at the earliest
opportunity.
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