[Congressional Record Volume 141, Number 11 (Thursday, January 19, 1995)]
[Senate]
[Pages S1207-S1237]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. GRASSLEY:
  S. 243. A bill to provide greater access to civil justice by reducing 
costs and delay, and for other purposes; to the Committee on the 
Judiciary.


                  the civil justice reform act of 1995

  Mr. GRASSLEY. Mr. President, I rise today to introduce legislation to 
reform America's Federal Civil Justice System. The purpose of this 
bill, the Civil Justice Reform Act of 1995, is to 
[[Page S1208]] improve deserving parties' access to the Federal courts 
by reducing the volume of frivolous cases, to reduce the costs of 
Federal civil litigation, and to encourage the settlement of disputes. 
It is similar to the bill introduced by Senator DeConcini and myself in 
March 1993.
  This bill introduces some modest reforms that will reduce the 
economic and social costs our society has borne due to the litigation 
explosion. Our society spends billions of dollars every year on civil 
lawsuits. More than $1 billion goes just to pay for the Federal 
district courts, which handle hundreds of thousands of civil cases 
annually. It has become clear to most Americans that our system of 
dispute resolution through adversarial lawsuits has gotten out of hand, 
and reason needs to be restored to it. More litigation does not 
necessarily translate into more justice.
  Many of the elements of this bill are based on the 1992 Access to 
Justice Act. For example, my bill reintroduces a modified English rule 
on attorney's fees that will award prevailing parties in Federal 
diversity cases reasonable attorney's fees, with adequate safeguards to 
protect against possible injustice. This provision is hardly the 
radical proposition some will paint it as being. In fact, for those of 
my colleagues who are always fond of pointing out that the United 
States is the only industrialized country that fails to provide some 
benefit or another, I would point out that this so-called English rule 
is followed by most industrialized countries, with the United States 
being the most notable exception. So I think it is worth trying in the 
United States in a limited class of cases--diversity suits--in order to 
see if it is effective in discouraging frivolous lawsuits.
  By limiting the rule to diversity cases, the bill ensures that no one 
will be denied a forum for their dispute, since all such cases can be 
filed in State court. If the defendant removes the case to Federal 
court, then the loser pays rule will not apply. This limited English 
rule will expire in 5 years unless Congress chooses to continue it, 
after a fourth-year report by the administrative office of the courts 
on the effectiveness of the rule.
  The bill also includes a number of safeguards to avoid any unintended 
consequences. The amount the loser must pay is limited to the amount of 
his or her own fees. Moreover, the court is given broad discretion to 
limit the amount the loser must pay if it finds such payment to be 
unjust under the circumstances of the case before it.
  The bill also requires 30 days advance notice of intent to sue--
something most responsible lawyers already do. It also requires 
prisoners with civil rights cases--which currently constitute of around 
10 percent of the Federal civil docket--to first exhaust their 
administrative remedies before filing suit in Federal court.
  To promote early settlement of cases and reduce litigation costs, the 
bill contains a statutory offer of judgment rule. It is similar to a 
proposal by Judge William Schwartzer, former director of the Federal 
Judicial Center. This rule will allow either party to a lawsuit to 
offer a settlement to the other party at any point in the litigation. 
If the settlement is declining and the party rejecting the offer 
ultimately gets a judgment less favorable than the settlement offer, he 
or she is then responsible for the offeror's attorneys fees from the 
time the offer was made. This will give parties a strong incentive to 
offer and accept reasonable settlements.
  Another provision of my bill will begin to curtail some of the 
excesses of the expert witness battles that dominate too many Federal 
trials. Following the example of several States, particularly Arizona, 
my bill will limit parties to one expert witness on a given issue.
  The Civil Justice Reform Act of 1990 has had a positive effect on the 
Federal courts in reforming pretrial, processes to reduce costs and 
delay. This bill takes the next step by making some limited fee 
shifting proposals and a few other modest reforms for reducing 
litigation costs. I look forward to the hearings I intend to hold in 
the Subcommittee on Administrative Oversight and Courts, and to 
discussing these proposals with my colleagues on the Judiciary 
Committee, as well as the full Senate.
  I ask unanimous consent that the full text of the bill appear in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 243

       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 ``Civil Justice Reform Act of 
     1995''.

     SEC. 2. DIVERSITY OF CITIZENSHIP JURISDICTION; AWARD OF 
                   ATTORNEYS' FEES TO PREVAILING PARTY.

       (a) Award of Fees.--Section 1332 of title 28, United States 
     Code, is amended by inserting after subsection (e) the 
     following new subsection:
       ``(f)(1) The prevailing party in an action under this 
     section shall be entitled to attorneys' fees only to the 
     extent that such party prevails on any position or claim 
     advanced during the action. Attorneys' fees under this 
     paragraph shall be paid by the nonprevailing party but shall 
     not exceed the amount of the attorneys' fees of the 
     nonprevailing party with regard to such position or claim. If 
     the nonprevailing party receives services under a contingent 
     fee agreement, the amount of attorneys' fees under this 
     paragraph shall not exceed the reasonable value of those 
     services.
       ``(2) In order to receive attorneys' fees under paragraph 
     (1), counsel of record in any actions under this section 
     shall maintain accurate, complete records of hours worked on 
     the matter regardless of the fee arrangement with his or her 
     client.
       ``(3) The court may, in its discretion, limit the fees 
     recovered under paragraph (1) to the extent that the court 
     finds special circumstances that make payment of such fees 
     unjust.
       ``(4) This subsection shall not apply to any action removed 
     from a State court under section 1441 of this title, or to 
     any action in which the United States, any State, or any 
     agency, officer, or employee of the United States or any 
     State is a party.
       ``(5) As used in this subsection, the term `prevailing 
     party' means a party to an action who obtains a favorable 
     final judgment (other than by settlement), exclusive of 
     interest, on all or a portion of the claims asserted in the 
     action.''.
       (b) Study and Report.--(1) The Director of the 
     Administrative Office of the United States Courts shall 
     conduct a study regarding the effect of the requirements of 
     subsection (f) of section 1332 of title 28, United States 
     Code, as added by subsection (a) of this section, on the 
     caseload of actions brought under such section, which study 
     shall include--
       (A) data on the number of actions, within each judicial 
     district, in which the nonprevailing party was required to 
     pay the attorneys' fees of the prevailing party; and
       (B) an assessment of the deterrent effect of the 
     requirements on frivolous or meritless actions.
       (2) No later than 4 years after the date of enactment of 
     this Act, the Director of the Administrative Office of the 
     United States Courts shall submit a report to the appropriate 
     committees of Congress containing--
       (A) the results of the study described in paragraph (1); 
     and
       (B) recommendations regarding whether the requirements 
     should be continued or applied with respect to additional 
     actions.
       (c) Repeal.--No later than 5 years after the date of 
     enactment of this Act, this section and the amendment made by 
     this section shall be repealed.

     SEC. 3. OFFER OF JUDGMENT.

       (a) In General.--Part V of title 28, United States Code, is 
     amended by inserting after chapter 113 the following new 
     chapter:

                   ``CHAPTER 114--PRETRIAL PROVISIONS

``Sec.
``1721. Offer of judgment.

     ``Sec. 1721. Offer of judgment

       ``(a)(1) In any civil action filed in a district court, any 
     party may serve upon any adverse party a written offer to 
     allow judgment to be entered for the money or property 
     specified in the offer.
       ``(2) If within 14 days after service of the offer, the 
     adverse party serves written notice that the offer is 
     accepted, either party may file the offer and notice of 
     acceptance and the clerk shall enter judgment.
       ``(3) An offer not accepted within such 14-day period shall 
     be deemed withdrawn and evidence thereof is not admissible, 
     except in a proceeding to determine reasonable attorney fees.
       ``(4) If the final judgment obtained by the offeree is not 
     more favorable than the offer made under paragraph (1) which 
     was not accepted by the offeree, the offeree shall pay the 
     offeror's reasonable attorney fees incurred after the 
     expiration of the time for accepting the offer, to the extent 
     necessary to make the offeror whole.
       ``(5) In no case shall an award of attorney fees under this 
     section exceed the amount of the judgment obtained. The court 
     may reduce the award of costs and attorney fees to avoid the 
     imposition of undue hardship on a party.
       ``(6) The fact that an offer is made under this section 
     shall not preclude a subsequent offer.
       ``(7)(A) Subject to the provisions of subparagraph (B), 
     when the liability of 1 party [[Page S1209]] has been 
     determined by verdict, order, or judgment, but the amount or 
     extent of the liability remains to be determined by further 
     proceedings, any party may make an offer of judgment, which 
     shall have the same effect as an offer made before trial.
       ``(B) The court may shorten the period of time an offeree 
     may have to accept an offer under subparagraph (A), but in no 
     case shall such period be less than 7 days.
       ``(b) A party making an offer shall not be deprived of the 
     benefits of an offer it makes by an adverse party's 
     subsequent offer, unless the subsequent offer is more 
     favorable than the judgment obtained.
       ``(c) If the judgment obtained includes nonmonetary relief, 
     a determination that it is more favorable to the offeree than 
     was the offer shall be made only when the terms of the offer 
     included all such nonmonetary relief.
       ``(d) This section shall not apply to class or derivative 
     actions under rules 23, 23.1 and 23.2 of the Federal Rules of 
     Civil Procedure.
       ``(e)(1) Except as provided under paragraph (2), the 
     provisions of this section shall not be construed to prohibit 
     an award or reduce the amount of an award a party may receive 
     under a statute which provides for the payment of attorney's 
     fees by another party.
       ``(2) The amount a party may receive under this section may 
     be set off against the amount of an award made under a 
     statute described in paragraph (1).''.
       (b) Technical and Conforming Amendment.--The table of 
     chapters for part IV of title 28, United States Code, is 
     amended by inserting after the item relating to chapter 113 
     the following:

``114. Pretrial provisions..................................1721''.....

     SEC. 4. PRIOR NOTICE AS A PREREQUISITE OF FILING A CIVIL 
                   ACTION IN THE UNITED STATES DISTRICT COURT.

       (a) In General.--Chapter 23 of title 28, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 483. Prior notice of civil action

       ``(a)(1) No less than 30 days before filing a civil action 
     in a court of the United States the claimant intending to 
     file such action shall transmit written notice to any 
     intended defendant of the specific claims involved, including 
     the amount of actual damages and expenses incurred and 
     expected to be incurred. The claimant shall transmit such 
     notice to any intended defendant at an address reasonably 
     expected to provide actual notice.
       ``(2) For purposes of this section, the term `transmit' 
     means to mail by first class-mail, postage prepaid, or 
     contract for delivery by any company which physically 
     delivers correspondence as a commercial service to the public 
     in its regular course of business.
       ``(3) The claimant shall at the time of filing a civil 
     action, file in the court a certificate of service evidencing 
     compliance with this subsection.
       ``(b) If the applicable statute of limitations for such 
     action would expire during the period of notice required by 
     subsection (a), the statute of limitations shall expire on 
     the thirtieth day after the date on which written notice is 
     transmitted to the intended defendant or defendants under 
     subsection (a). The parties may by written agreement extend 
     that 30-day period for an additional period of not to exceed 
     90 days.
       ``(c) The requirements of this section shall not apply--
       ``(1) in any action to seize or forfeit assets subject to 
     forfeiture or in any bankruptcy, insolvency, receivership, 
     conservatorship, or liquidation proceeding;
       ``(2) if the assets that are the subject of the action or 
     would satisfy a judgment are subject to flight, dissipation, 
     or destruction, or if the defendant is subject to flight;
       ``(3) if a written notice prior to filing an action is 
     otherwise required by law, or the claimant has made a prior 
     attempt in writing to settle the claim with the defendant;
       ``(4) in proceedings to enforce a civil investigative 
     demand or an administrative summons;
       ``(5) in any action to foreclose a lien; or
       ``(6) in any action pertaining to a temporary restraining 
     order, preliminary injunctive relief, or the fraudulent 
     conveyance of property, or in any other type of action 
     involving exigent circumstances that compel immediate resort 
     to the courts.
       ``(d) If the district court finds that the requirements of 
     subsection (a) have not been met by the claimant, and such 
     defect is asserted by the defendant within 60 days after 
     service of the summons or complaint upon such defendant, the 
     claim shall be dismissed without prejudice and the costs of 
     such action, including attorneys' fees, shall be imposed upon 
     the claimant. Whenever an action is dismissed under this 
     subsection, the claimant may refile such claim within 60 days 
     after dismissal regardless of any statutory limitations 
     period if--
       ``(1) during the 60 days after dismissal, notice is 
     transmitted under subsection (a); and
       ``(2) the original action was timely filed in accordance 
     with subsection (b).''.
       (b) Conforming Amendment.--The table of sections at the 
     beginning of chapter 23 of title 28, United States Code, is 
     amended by adding at the end the following:

``483. Prior notice of civil action.''.

     SEC. 5. CIVIL RIGHTS OF INSTITUTIONALIZED PERSONS ACT.

       (a) Exhaustion of Administrative Remedies.--Section 7 of 
     the Civil Rights of Institutionalized Persons Act (42 U.S.C. 
     1997e) is amended--
       (1) by amending subsection (a) to read as follows:
       ``(a) In any action brought pursuant to section 1979 of the 
     Revised Statutes of the United States, by any adult convicted 
     of a crime confined in any jail, prison, or other 
     correctional facility, the court shall continue such case for 
     a period not to exceed 180 days in order to require 
     exhaustion of such plain, speedy, and effective 
     administrative remedies as are available.''; and
       (2) in subsection (b)--
       (A) by redesignating paragraphs (1) and (2) as paragraphs 
     (2) and (3), respectively; and
       (B) by inserting immediately after ``(b)'' the following:
       ``(1) Upon the request of a State or local corrections 
     agency, the Attorney General of the United States shall 
     provide the agency with technical advice and assistance in 
     establishing plain, speedy, and effective administrative 
     remedies for inmate grievances.''.
       (b) Proceedings in Forma Pauperis.--Section 1915(d) of 
     title 28, United States Code, is amended to read as follows:
       ``(d) The court may request an attorney to represent any 
     such person unable to employ counsel and may dismiss the case 
     if the allegation of poverty is untrue, or if satisfied that 
     the action fails to state a claim upon which relief can be 
     granted or is frivolous or malicious.''.
       (c) Effective Date.--The amendments made by subsections (a) 
     and (b) shall take effect on the date of the enactment of 
     this Act.

     SEC. 6. EXPERT WITNESSES.

       (a) In General.--Chapter 119 of title 28, United States 
     Code, is amended by inserting after section 1828 the 
     following new section:

     ``Sec. 1829. Multiple expert witnesses

       ``In any civil action filed in a district court, the court 
     shall not permit opinion evidence on the same issue from more 
     than 1 expert witness for each party, except upon a showing 
     of good cause.''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 119 of title 28, United States Code, is 
     amended by inserting after the item relating to section 1828 
     the following new section:

``1829. Multiple expert witnesses.''.

     SEC. 7. SEVERABILITY.

       If any provision of this Act or the amendments made by this 
     Act or the application of any provision or amendment to any 
     person or circumstance is held invalid, the remainder of this 
     Act and such amendments and the application of such provision 
     and amendments to any other person or circumstance shall not 
     be affected by that invalidation.

     SEC. 8. EFFECTIVE DATE.

       Except as expressly provided otherwise, this Act and the 
     amendments made by this Act shall become effective 90 days 
     after the date of the enactment of this Act. This Act shall 
     not apply to any action or proceeding commenced before such 
     effective date.
                                 ______

      By Mr. NUNN (for himself, Mr. Roth, Mr. Glenn, Mr. Bond, Mr. 
        Bumpers, Mr. Pressler, Mr. Lieberman, Mrs. Hutchison, Mr. 
        Johnston, Mr. Domenici, Mr. Hollings, Mr. Nickles, Mr. Breaux, 
        Mr. Warner, Mr. Robb, Mr. Cochran, Mr. Bryan, Mr. Smith, Mr. 
        Lautenberg, Mr. Mack, Ms. Moseley-Braun, and Mr. Shelby):
  S. 244. A bill to further the goals of the Paperwork Reduction Act to 
have Federal agencies become more responsible and publicly accountable 
for reducing the burden of Federal paperwork on the public, and for 
other purposes; to the Committee on Governmental Affairs.


                  the paperwork reduction act of 1995

  Mr. NUNN. Mr. President, I rise this morning on behalf of myself, Mr. 
Roth, Mr. Glenn, Mr. Bond, and Mr. Bumpers, to introduce the Paperwork 
Reduction Act of 1995. This bill is substantially identical to S. 560, 
which was unanimously approved by the Senate in the closing days of the 
103d Congress.
  I am pleased that the bill enjoys even broader bipartisan support 
this Congress. It is being cosponsored by the chairman and ranking 
Democratic member of the Committee on Governmental Affairs, Bill Roth 
and John Glenn, both have worked long and hard on legislation to 
strengthen the Paperwork Reduction Act of 1980 and to reauthorize 
appropriations for the Office of Information and Regulatory Affairs 
[OIRA], which has been without authorizing legislation since October of 
1989. Leading cosponsors also include the chairman, Mr. Bond, and 
ranking Democratic member, Mr. Bumpers, of the Committee on Small 
Business. The Committee on Small Business, of which I am the senior 
member, has played a crucial supporting role on behalf of the small 
business community in maintaining the effort to enact legislation to 
strengthen the 1980 act. We are being joined by 22 of our colleagues 
[[Page S1210]] from both sides of the aisle, many of whom are present 
or former members of the Committee on Small Business of the 
Governmental Affairs.
  Mr. President, as previously mentioned, the Paperwork Reduction Act 
of 1995 is substantively identical to S. 560 introduced in the 103d 
Congress. That bill represented the culmination of years of work which 
began in the 100th Congress. It represents a skillful blending of S. 
560, as introduced by me and S. 681, a bill introduced by my friend 
from Ohio, Mr. Glenn, then chairman of the Governmental Affairs 
Committee. His skill and leadership, and the tenacity of all of the 
those involved in both bills made possible the crafting of this text of 
S. 560. It garnered unanimous support within the Governmental Affairs 
Committee. S. 560, as reported last year, had the support of the 
Clinton administration and I am hopeful that the administration will 
also support this bill I introduce today.
  Senator Roth, chairman of the Governmental Affairs Committee 
indicated to me that we will have a markup on this bill next week. It 
is my hope that it will be an early legislative initiative in this 
Congress. I have also talked to Speaker Gingrich about the bill, and it 
is my hope that they will make it an important part of their 
legislative agenda on the House side. So I am hoping, Mr. President, we 
will be able to get this bill to the President's desk in the next 
several weeks, certainly in the next several months, for actual 
implementation as law.
  It also had the support of the broad-based Paperwork Reduction Act 
Coalition as well as elected officials, and many in the educational and 
nonprofit communities. S. 560, the Paperwork Reduction Act of 1994, 
passed the Senate by unanimous voice vote on October 6, 1994. The 
following day, the text of S. 560 was attached to a House-passed 
measure, H.R. 2561, and returned to the House. Unfortunately, the House 
Governmental Operations Committee declined to clear either measure 
before the adjournment of the 103d Congress, so we start anew with our 
legislative effort this year.
  In this congress, I am hopeful that the House of Representatives will 
be more receptive to this legislation and that we can see it enacted 
into law. A modified version of S. 560 has been included in H.R. 9, the 
Job Creation and Wage Enhancement Act of 1995, which includes many of 
the regulatory and paperwork relief provisions of the Republican 
Contract With America. Representative Bill Clinger, the new chairman of 
the House Committee on Government Reform and Oversight, the new name 
for the Committee on Government Operations, was the principal 
Republican cosponsor of H.R. 2995, the House companion to S. 560.
  The Paperwork Reduction Act of 1995 provides a 5-year reauthorization 
of appropriations for the Office of Information and Regulatory Affairs 
[OIRA]. Created by the 1980 Act, OIRA serves as the focal point at the 
Office of Management and Budget for the act's implementation.
  The principal purpose of the Paperwork Reduction Act of 1995 is to 
reaffirm and provide additional tools by which to attain the 
fundamental objective of the Paperwork Reduction Act of 1980--to 
minimize the Federal paperwork burdens imposed by individuals, 
businesses, especially small businesses, educational and nonprofit 
institutions, and State and local governments.
  Mr. President, let me highlight some of the provisions of the bill. 
This legislation reemphasizes the fundamental responsibilities of each 
Federal agency minimize new paperwork burden by thoroughly reviewing 
each proposed collection of information for need and practical utility, 
the act's fundamental standards. The bill make explicit the 
responsibility of each Federal agency to conduct this review itself, 
before submitting the propose collection of information for public 
comment and clearance by OIRA.
  The bill before us reflects the provisions of S. 560 that further 
enhance public participation in the review of paperwork burdens, when 
such burdens are first being proposed or when an agency is seeking to 
obtain approval to continue to use an existing paperwork requirement. 
Strengthening public participation is at the core of the 1980 act.
  The Paperwork Reduction Act of 1995 maintains the 1980 act's 
Government-wide 5-percent goal for the reduction of paperwork burdens 
on the public. Given past experience, some question the effectiveness 
of such goals in producing net reductions in Government-wide paperwork 
burdens. I believe that the bill should reflect individual agency goals 
as well, and although this provision is not in the bill introduced 
today, I am hopeful it will be strengthened in the future. If seriously 
implemented, such agency goals can become an effective restraint on the 
cumulative growth of Government-sponsored paperwork burdens.
  Mr. President, the bill includes amendments to the 1980 act which 
further empower members of the public to help police Federal agency 
compliance with the act. I would like to describe two of these 
provisions.
  One provision would enable a member of the public to obtain a written 
determination from the OIRA Administrator regarding whether a federally 
sponsored paperwork requirement is in compliance with the act. If the 
agency requirement is found to be noncompliant, the Administrator is 
charged with taking appropriate remedial action. This provision is 
based upon a similar process added to the Office of Federal Procurement 
Policy Act in 1988.
  The second provision encourages members of the public to identify 
paperwork requirements that have not been submitted for review and 
approval pursuant to the act's requirements. Although the act's public 
protection provisions explicitly shield the public from the imposition 
of any formal agency penalty for failing to comply with such an 
unapproved, or bootleg, paperwork requirement, individuals often feel 
compelled to comply. This is especially true when the individual has an 
on-going relationship with the agency and that relationship accords the 
agency substantial discretion that could be used to redefine their 
future dealings. Under this bill, which we are introducing today, a 
member of the public can blow the whistle on such a bootleg paperwork 
requirement and be accorded the protection of anonymity.
  Next, Mr. President, I would like to emphasize that the Paperwork 
Reduction Act of 1995 clarifies the 1980 Act to make explicit that it 
applies to Government-sponsored third-party paperwork burdens.
  These are recordkeeping, disclosure, or other paperwork burdens that 
one private party imposes on another private party at the direction of 
a Federal agency. In 1990, the U.S. Supreme Court decided that such 
Government-sponsored third-party paperwork burdens were not subject to 
the Paperwork Reduction Act. The Court's decision in Dole versus United 
Steelworkers of America created a potentially vast loophole. The public 
could be denied the Act's protections on the basis of the manner in 
which a Federal agency chose to impose a paperwork burden, indirectly 
rather than directly. It is worthy of note that Senator Chiles, now 
Governor Chiles, the father of the Paperwork Reduction Act went to the 
trouble and expense of filing an amicus brief to the Supreme Court 
arguing that no such exemption for third-party paperwork burdens was 
intended. The Court decided otherwise. I know that Governor Chiles will 
be gratified that this bill makes explicit the Act's coverage of all 
Government-sponsored paperwork burdens. Once this bill is enacted, we 
can feel confident that this major loophole will be closed. But given 
more than a decade of experience under the Act, it is prudent to remain 
vigilant to additional efforts to restrict the Act's reach and public 
protections.
  The smart use of information by the Government, and its potential to 
minimize the burdens placed on the public, is a core concept of the 
1980 Act. The information resources management [IRM] provisions of the 
Paperwork Reduction Act of 1995 build upon the foundation laid more 
than a decade ago by our former colleague from Florida, Lawton Chiles, 
the father of the Paperwork Reduction Act. These provisions of the bill 
are the major contribution of my friend from Ohio, Senator Glenn, who 
has emphasized the potential of improved IRM policies to make 
government more effective in serving the public.
  Mr. President, I will not take any more of the Senate's time today to 
discuss the individual provisions of the Paperwork Reduction Act of 
1995.
[[Page S1211]]
  Mr. President, the Paperwork Reduction Act of 1995 enjoys strong 
support from the business community, especially the small business 
community. It has the support of a broad Paperwork Reduction Act 
Coalition, representing virtually every segment of the business 
community. They have worked long and hard on this legislation for many 
years. Without them, we would not be able to have the consensus bill 
that we have today.
  Participating in the coalition are the major national small business 
associations--the National Federation of Independent Business [NFIB], 
the Small Business Legislative Council [SBLC], and National Small 
Business United [NSBU] as well as the many specialized national small 
business associations, like the American Subcontractors Association, 
that comprise the membership of the SBLC or NSBU. Other participants 
represent manufacturers, aerospace and electronics firms, construction 
firms, providers of professional and technical services, retailers of 
various products and services, and the wholesalers and distributors who 
support them. I would like to identify a few other organizations that 
comprise the Coalition's membership: the Aerospace Industries 
Association [AIA], the American Consulting Engineers Council [ACEC], 
the Associated Builders and Contractors [ABC], the Associated General 
Contractors of America [AGC], the Chemical Manufacturers Association 
[CMA], the Computer and Business Equipment Manufacturers Association 
[CBEMA], the Contract Services Association [CSA], the Electronic 
Industries Association [EIA], the Independent Bankers Association of 
America [IBAA], the International Communications Industries Association 
[ICIA], the National Association of Manufacturers, the National 
Association of Wholesalers and Distributors, the National Security 
Industrial Association [NSIA], the National Tooling and Machining 
Association [NTMA], the Printing Industries Association [PIA], and the 
Professional Service Council [PSC]. Leadership for the coalition is 
being provided by the Council on Regulatory and Information Management 
[C-RIM] and by the U.S. Chamber of Commerce. C-RIM is the new name for 
the Business Council on the Reduction of Paperwork, which has dedicated 
itself to paperwork reduction and regulatory reform issues for more 
than a half century.

  The coalition also includes a number of professional associations and 
public interest groups that support strengthening the Paperwork 
Reduction Act of 1980. These include the Association of Records 
Managers and Administrators [ARMA] and Citizens for a Sound Economy 
[CSE], to name but two very active coalition members.
  Mr. President, given the regulatory and paperwork burdens faced by 
State and local governments, legislation to strengthen the Paperwork 
Reduction Act is high on the agenda of the associations representing 
elected officials. The Governor of Florida, my friend Lawton Chiles, 
has worked hard on this issue within the National Governors 
Association. During its 1994 annual meeting, the National Governors 
Association adopted a resolution in support of legislation to 
strengthen the Paperwork Reduction Act of 1980.
  Mr. President, I urge my colleagues to join me in supporting this 
legislation.
  As I mentioned, Chairman Roth and Senator Glenn are both cosponsors 
of this legislation, as is Senator Bond, the new chairman of the Small 
Business Committee, and the previous chairman and now ranking member, 
Senator Bumpers.
  It is my understanding that we will have a markup on this bill next 
week. It is my hope it can be on an accelerated schedule here on the 
Senate floor. It is my hope that the Paperwork Reduction Act of 1995 
will get similar expedited treatment on the House side, so that 
President Clinton will have this bill on his desk in the next few 
weeks. So that with a strengthened Paperwork Reduction Act we can 
continue the difficult but very important process of cracking down on 
Federal agency paperwork burdens that do not meet the Act's standards.
  Mr. President, I ask unanimous consent that the text of the bill and 
additional material be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 244

       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 ``Paperwork Reduction Act of 
     1995''.

     SEC. 2. COORDINATION OF FEDERAL INFORMATION POLICY.

       Chapter 35 of title 44, United States Code, is amended to 
     read as follows:

        ``CHAPTER 35--COORDINATION OF FEDERAL INFORMATION POLICY

``Sec.
``3501. Purposes.
``3502. Definitions.
``3503. Office of Information and Regulatory Affairs.
``3504. Authority and functions of Director.
``3505. Assignment of tasks and deadlines.
``3506. Federal agency responsibilities.
``3507. Public information collection activities; submission to 
              Director; approval and delegation.
``3508. Determination of necessity for information; hearing.
``3509. Designation of central collection agency.
``3510. Cooperation of agencies in making information available.
``3511. Establishment and operation of Government Information Locator 
              Service.
``3512. Public protection.
``3513. Director review of agency activities; reporting; agency 
              response.
``3514. Responsiveness to Congress.
``3515. Administrative powers.
``3516. Rules and regulations.
``3517. Consultation with other agencies and the public.
``3518. Effect on existing laws and regulations.
``3519. Access to information.
``3520. Authorization of appropriations.

     ``Sec. 3501. Purposes

       ``The purposes of this chapter are to--
       ``(1) minimize the paperwork burden for individuals, small 
     businesses, educational and nonprofit institutions, Federal 
     contractors, State, local and tribal governments, and other 
     persons resulting from the collection of information by or 
     for the Federal Government;
       ``(2) ensure the greatest possible public benefit from and 
     maximize the utility of information created, collected, 
     maintained, used, shared and disseminated by or for the 
     Federal Government;
       ``(3) coordinate, integrate, and to the extent practicable 
     and appropriate, make uniform Federal information resources 
     management policies and practices as a means to improve the 
     productivity, efficiency, and effectiveness of Government 
     programs, including the reduction of information collection 
     burdens on the public and the improvement of service delivery 
     to the public;
       ``(4) improve the quality and use of Federal information to 
     strengthen decisionmaking, accountability, and openness in 
     Government and society;
       ``(5) minimize the cost to the Federal Government of the 
     creation, collection, maintenance, use, dissemination, and 
     disposition of information;
       ``(6) strengthen the partnership between the Federal 
     Government and State, local, and tribal governments by 
     minimizing the burden and maximizing the utility of 
     information created, collected, maintained, used, 
     disseminated, and retained by or for the Federal Government;
       ``(7) provide for the dissemination of public information 
     on a timely basis, on equitable terms, and in a manner that 
     promotes the utility of the information to the public and 
     makes effective use of information technology;
       ``(8) ensure that the creation, collection, maintenance, 
     use, dissemination, and disposition of information by or for 
     the Federal Government is consistent with applicable laws, 
     including laws relating to--
       ``(A) privacy and confidentiality, including section 552a 
     of title 5;
       ``(B) security of information, including the Computer 
     Security Act of 1987 (Public Law 100-235); and
       ``(C) access to information, including section 552 of title 
     5;
       ``(9) ensure the integrity, quality, and utility of the 
     Federal statistical system;
       ``(10) ensure that information technology is acquired, 
     used, and managed to improve performance of agency missions, 
     including the reduction of information collection burdens on 
     the public; and
       ``(11) improve the responsibility and accountability of the 
     Office of Management and Budget and all other Federal 
     agencies to Congress and to the public for implementing the 
     information collection review process, information resources 
     management, and related policies and guidelines established 
     under this chapter.

     ``Sec. 3502. Definitions

       ``As used in this chapter--
       ``(1) the term `agency' means any executive department, 
     military department, Government corporation, Government 
     controlled corporation, or other establishment in the 
     executive branch of the Government (including the Executive 
     Office of the President), or any independent regulatory 
     agency, but does not include--
       ``(A) the General Accounting Office;
       ``(B) Federal Election Commission; [[Page S1212]] 
       ``(C) the governments of the District of Columbia and of 
     the territories and possessions of the United States, and 
     their various subdivisions; or
       ``(D) Government-owned contractor-operated facilities, 
     including laboratories engaged in national defense research 
     and production activities;
       ``(2) the term `burden' means time, effort, or financial 
     resources expended by persons to generate, maintain, or 
     provide information to or for a Federal agency, including the 
     resources expended for--
       ``(A) reviewing instructions;
       ``(B) acquiring, installing, and utilizing technology and 
     systems;
       ``(C) adjusting the existing ways to comply with any 
     previously applicable instructions and requirements;
       ``(D) searching data sources;
       ``(E) completing and reviewing the collection of 
     information; and
       ``(F) transmitting, or otherwise disclosing the 
     information;
       ``(3) the term `collection of information'--
       ``(A) means the obtaining, causing to be obtained, 
     soliciting, or requiring the disclosure to third parties or 
     the public, of facts or opinions by or for an agency, 
     regardless of form or format, calling for either--
       ``(i) answers to identical questions posed to, or identical 
     reporting or recordkeeping requirements imposed on, ten or 
     more persons, other than agencies, instrumentalities, or 
     employees of the United States; or
       ``(ii) answers to questions posed to agencies, 
     instrumentalities, or employees of the United States which 
     are to be used for general statistical purposes; and
       ``(B) shall not include a collection of information 
     described under section 3518(c)(1);
       ``(4) the term `Director' means the Director of the Office 
     of Management and Budget;
       ``(5) the term `independent regulatory agency' means the 
     Board of Governors of the Federal Reserve System, the 
     Commodity Futures Trading Commission, the Consumer Product 
     Safety Commission, the Federal Communications Commission, the 
     Federal Deposit Insurance Corporation, the Federal Energy 
     Regulatory Commission, the Federal Housing Finance Board, the 
     Federal Maritime Commission, the Federal Trade Commission, 
     the Interstate Commerce Commission, the Mine Enforcement 
     Safety and Health Review Commission, the National Labor 
     Relations Board, the Nuclear Regulatory Commission, the 
     Occupational Safety and Health Review Commission, the Postal 
     Rate Commission, the Securities and Exchange Commission, and 
     any other similar agency designated by statute as a Federal 
     independent regulatory agency or commission;
       ``(6) the term `information resources' means information 
     and related resources, such as personnel, equipment, funds, 
     and information technology;
       ``(7) the term `information resources management' means the 
     process of managing information resources to accomplish 
     agency missions and to improve agency performance, including 
     through the reduction of information collection burdens on 
     the public;
       ``(8) the term `information system' means a discrete set of 
     information resources and processes, automated or manual, 
     organized for the collection, processing, maintenance, use, 
     sharing, dissemination, or disposition of information;
       ``(9) the term `information technology' has the same 
     meaning as the term `automatic data processing equipment' as 
     defined by section 111(a)(2) of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 759(a)(2));
       ``(10) the term `person' means an individual, partnership, 
     association, corporation, business trust, or legal 
     representative, an organized group of individuals, a State, 
     territorial, or local government or branch thereof, or a 
     political subdivision of a State, territory, or local 
     government or a branch of a political subdivision;
       ``(11) the term `practical utility' means the ability of an 
     agency to use information, particularly the capability to 
     process such information in a timely and useful fashion;
       ``(12) the term `public information' means any information, 
     regardless of form or format, that an agency discloses, 
     disseminates, or makes available to the public; and
       ``(13) the term `recordkeeping requirement' means a 
     requirement imposed by or for an agency on persons to 
     maintain specified records.

     ``Sec. 3503. Office of Information and Regulatory Affairs

       ``(a) There is established in the Office of Management and 
     Budget an office to be known as the Office of Information and 
     Regulatory Affairs.
       ``(b) There shall be at the head of the Office an 
     Administrator who shall be appointed by the President, by and 
     with the advice and consent of the Senate. The Director shall 
     delegate to the Administrator the authority to administer all 
     functions under this chapter, except that any such delegation 
     shall not relieve the Director of responsibility for the 
     administration of such functions. The Administrator shall 
     serve as principal adviser to the Director on Federal 
     information resources management policy.
       ``(c) The Administrator and employees of the Office of 
     Information and Regulatory Affairs shall be appointed with 
     special attention to professional qualifications required to 
     administer the functions of the Office described under this 
     chapter. Such qualifications shall include relevant 
     education, work experience, or related professional 
     activities.

     ``Sec. 3504. Authority and functions of Director

       ``(a)(1) The Director shall oversee the use of information 
     resources to improve the efficiency and effectiveness of 
     governmental operations to serve agency missions, including 
     service delivery to the public. In performing such oversight, 
     the Director shall--
       ``(A) develop, coordinate and oversee the implementation of 
     Federal information resources management policies, 
     principles, standards, and guidelines; and
       ``(B) provide direction and oversee--
       ``(i) the review of the collection of information and the 
     reduction of the information collection burden;
       ``(ii) agency dissemination of and public access to 
     information;
       ``(iii) statistical activities;
       ``(iv) records management activities;
       ``(v) privacy, confidentiality, security, disclosure, and 
     sharing of information; and
       ``(vi) the acquisition and use of information technology.
       ``(2) The authority of the Director under this chapter 
     shall be exercised consistent with applicable law.
       ``(b) With respect to general information resources 
     management policy, the Director shall--
       ``(1) develop and oversee the implementation of uniform 
     information resources management policies, principles, 
     standards, and guidelines;
       ``(2) foster greater sharing, dissemination, and access to 
     public information, including through--
       ``(A) the use of the Government Information Locator 
     Service; and
       ``(B) the development and utilization of common standards 
     for information collection, storage, processing and 
     communication, including standards for security, 
     interconnectivity and interoperability;
       ``(3) initiate and review proposals for changes in 
     legislation, regulations, and agency procedures to improve 
     information resources management practices;
       ``(4) oversee the development and implementation of best 
     practices in information resources management, including 
     training; and
       ``(5) oversee agency integration of program and management 
     functions with information resources management functions.
       ``(c) With respect to the collection of information and the 
     control of paperwork, the Director shall--
       ``(1) review proposed agency collections of information, 
     and in accordance with section 3508, determine whether the 
     collection of information by or for an agency is necessary 
     for the proper performance of the functions of the agency, 
     including whether the information shall have practical 
     utility;
       ``(2) coordinate the review of the collection of 
     information associated with Federal procurement and 
     acquisition by the Office of Information and Regulatory 
     Affairs with the Office of Federal Procurement Policy, with 
     particular emphasis on applying information technology to 
     improve the efficiency and effectiveness of Federal 
     procurement and acquisition and to reduce information 
     collection burdens on the public;
       ``(3) minimize the Federal information collection burden, 
     with particular emphasis on those individuals and entities 
     most adversely affected;
       ``(4) maximize the practical utility of and public benefit 
     from information collected by or for the Federal Government; 
     and
       ``(5) establish and oversee standards and guidelines by 
     which agencies are to estimate the burden to comply with a 
     proposed collection of information.
       ``(d) With respect to information dissemination, the 
     Director shall develop and oversee the implementation of 
     policies, principles, standards, and guidelines to--
       ``(1) apply to Federal agency dissemination of public 
     information, regardless of the form or format in which such 
     information is disseminated; and
       ``(2) promote public access to public information and 
     fulfill the purposes of this chapter, including through the 
     effective use of information technology.
       ``(e) With respect to statistical policy and coordination, 
     the Director shall--
       ``(1) coordinate the activities of the Federal statistical 
     system to ensure--
       ``(A) the efficiency and effectiveness of the system; and
       ``(B) the integrity, objectivity, impartiality, utility, 
     and confidentiality of information collected for statistical 
     purposes;
       ``(2) ensure that budget proposals of agencies are 
     consistent with system-wide priorities for maintaining and 
     improving the quality of Federal statistics and prepare an 
     annual report on statistical program funding;
       ``(3) develop and oversee the implementation of 
     Governmentwide policies, principles, standards, and 
     guidelines concerning--
       ``(A) statistical collection procedures and methods;
       ``(B) statistical data classification;
       ``(C) statistical information presentation and 
     dissemination;
       ``(D) timely release of statistical data; and
       ``(E) such statistical data sources as may be required for 
     the administration of Federal programs;
       ``(4) evaluate statistical program performance and agency 
     compliance with Governmentwide policies, principles, 
     standards and guidelines;
       ``(5) promote the sharing of information collected for 
     statistical purposes consistent [[Page S1213]] with privacy 
     rights and confidentiality pledges;
       ``(6) coordinate the participation of the United States in 
     international statistical activities, including the 
     development of comparable statistics;
       ``(7) appoint a chief statistician who is a trained and 
     experienced professional statistician to carry out the 
     functions described under this subsection;
       ``(8) establish an Interagency Council on Statistical 
     Policy to advise and assist the Director in carrying out the 
     functions under this subsection that shall--
       ``(A) be headed by the chief statistician; and
       ``(B) consist of--
       ``(i) the heads of the major statistical programs; and
       ``(ii) representatives of other statistical agencies under 
     rotating membership; and
       ``(9) provide opportunities for training in statistical 
     policy functions to employees of the Federal Government under 
     which--
       ``(A) each trainee shall be selected at the discretion of 
     the Director based on agency requests and shall serve under 
     the chief statistician for at least 6 months and not more 
     than 1 year; and
       ``(B) all costs of the training shall be paid by the agency 
     requesting training.
       ``(f) With respect to records management, the Director 
     shall--
       ``(1) provide advice and assistance to the Archivist of the 
     United States and the Administrator of General Services to 
     promote coordination in the administration of chapters 29, 
     31, and 33 of this title with the information resources 
     management policies, principles, standards, and guidelines 
     established under this chapter;
       ``(2) review compliance by agencies with--
       ``(A) the requirements of chapters 29, 31, and 33 of this 
     title; and
       ``(B) regulations promulgated by the Archivist of the 
     United States and the Administrator of General Services; and
       ``(3) oversee the application of records management 
     policies, principles, standards, and guidelines, including 
     requirements for archiving information maintained in 
     electronic format, in the planning and design of information 
     systems.
       ``(g) With respect to privacy and security, the Director 
     shall--
       ``(1) develop and oversee the implementation of policies, 
     principles, standards, and guidelines on privacy, 
     confidentiality, security, disclosure and sharing of 
     information collected or maintained by or for agencies;
       ``(2) oversee and coordinate compliance with sections 552 
     and 552a of title 5, the Computer Security Act of 1987 (40 
     U.S.C. 759 note), and related information management laws; 
     and
       ``(3) require Federal agencies, consistent with the 
     Computer Security Act of 1987 (40 U.S.C. 759 note), to 
     identify and afford security protections commensurate with 
     the risk and magnitude of the harm resulting from the loss, 
     misuse, or unauthorized access to or modification of 
     information collected or maintained by or on behalf of an 
     agency.
       ``(h) With respect to Federal information technology, the 
     Director shall--
       ``(1) in consultation with the Director of the National 
     Institute of Standards and Technology and the Administrator 
     of General Services--
       ``(A) develop and oversee the implementation of policies, 
     principles, standards, and guidelines for information 
     technology functions and activities of the Federal 
     Government, including periodic evaluations of major 
     information systems; and
       ``(B) oversee the development and implementation of 
     standards under section 111(d) of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 759(d));
       ``(2) monitor the effectiveness of, and compliance with, 
     directives issued under sections 110 and 111 of the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C. 
     757 and 759) and review proposed determinations under section 
     111(e) of such Act;
       ``(3) coordinate the development and review by the Office 
     of Information and Regulatory Affairs of policy associated 
     with Federal procurement and acquisition of information 
     technology with the Office of Federal Procurement Policy;
       ``(4) ensure, through the review of agency budget 
     proposals, information resources management plans and other 
     means--
       ``(A) agency integration of information resources 
     management plans, program plans and budgets for acquisition 
     and use of information technology; and
       ``(B) the efficiency and effectiveness of inter-agency 
     information technology initiatives to improve agency 
     performance and the accomplishment of agency missions; and
       ``(5) promote the use of information technology by the 
     Federal Government to improve the productivity, efficiency, 
     and effectiveness of Federal programs, including through 
     dissemination of public information and the reduction of 
     information collection burdens on the public.

     ``Sec. 3505. Assignment of tasks and deadlines

       ``In carrying out the functions under this chapter, the 
     Director shall--
       ``(1) in consultation with agency heads, set an annual 
     Governmentwide goal for the reduction of information 
     collection burdens by at least five percent, and set annual 
     agency goals to--
       ``(A) reduce information collection burdens imposed on the 
     public that--
       ``(i) represent the maximum practicable opportunity in each 
     agency; and
       ``(ii) are consistent with improving agency management of 
     the process for the review of collections of information 
     established under section 3506(c); and
       ``(B) improve information resources management in ways that 
     increase the productivity, efficiency and effectiveness of 
     Federal programs, including service delivery to the public;
       ``(2) with selected agencies and non-Federal entities on a 
     voluntary basis, conduct pilot projects to test alternative 
     policies, practices, regulations, and procedures to fulfill 
     the purposes of this chapter, particularly with regard to 
     minimizing the Federal information collection burden;
       ``(3) in consultation with the Administrator of General 
     Services, the Director of the National Institute of Standards 
     and Technology, the Archivist of the United States, and the 
     Director of the Office of Personnel Management, develop and 
     maintain a Governmentwide strategic plan for information 
     resources management, that shall include--
       ``(A) a description of the objectives and the means by 
     which the Federal Government shall apply information 
     resources to improve agency and program performance;
       ``(B) plans for--
       ``(i) reducing information burdens on the public, including 
     reducing such burdens through the elimination of duplication 
     and meeting shared data needs with shared resources;
       ``(ii) enhancing public access to and dissemination of, 
     information, using electronic and other formats; and
       ``(iii) meeting the information technology needs of the 
     Federal Government in accordance with the requirements of 
     sections 110 and 111 of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 757 and 759), 
     and the purposes of this chapter; and
       ``(C) a description of progress in applying information 
     resources management to improve agency performance and the 
     accomplishment of missions; and
       ``(4) in cooperation with the Administrator of General 
     Services, issue guidelines for the establishment and 
     operation in each agency of a process, as required under 
     section 3506(h)(5) of this chapter, to review major 
     information systems initiatives, including acquisition and 
     use of information technology.

     ``Sec. 3506. Federal agency responsibilities

       ``(a)(1) The head of each agency shall be responsible for--
       ``(A) carrying out the agency's information resources 
     management activities to improve agency productivity, 
     efficiency, and effectiveness; and
       ``(B) complying with the requirements of this chapter and 
     related policies established by the Director.
       ``(2)(A) Except as provided under subparagraph (B), the 
     head of each agency shall designate a senior official who 
     shall report directly to such agency head to carry out the 
     responsibilities of the agency under this chapter.
       ``(B) The Secretary of the Department of Defense and the 
     Secretary of each military department may each designate a 
     senior official who shall report directly to such Secretary 
     to carry out the responsibilities of the department under 
     this chapter. If more than one official is designated for the 
     military departments, the respective duties of the officials 
     shall be clearly delineated.
       ``(3) The senior official designated under paragraph (2) 
     shall head an office responsible for ensuring agency 
     compliance with and prompt, efficient, and effective 
     implementation of the information policies and information 
     resources management responsibilities established under this 
     chapter, including the reduction of information collection 
     burdens on the public. The senior official and employees of 
     such office shall be selected with special attention to the 
     professional qualifications required to administer the 
     functions described under this chapter.
       ``(4) Each agency program official shall be responsible and 
     accountable for information resources assigned to and 
     supporting the programs under such official. In consultation 
     with the senior official designated under paragraph (2) and 
     the agency Chief Financial Officer (or comparable official), 
     each agency program official shall define program information 
     needs and develop strategies, systems, and capabilities to 
     meet those needs.
       ``(5) The head of each agency shall establish a permanent 
     information resources management steering committee, which 
     shall be chaired by the senior official designated under 
     paragraph (2) and shall include senior program officials and 
     the Chief Financial Officer (or comparable official). Each 
     steering committee shall--
       ``(A) assist and advise the head of the agency in carrying 
     out information resources management responsibilities of the 
     agency;
       ``(B) assist and advise the senior official designated 
     under paragraph (2) in the establishment of performance 
     measures for information resources management that relate to 
     program missions;
       ``(C) select, control, and evaluate all major information 
     system initiatives (including acquisitions of information 
     technology) in accordance with the requirements of subsection 
     (h)(5); and
       ``(D) identify opportunities to redesign business practices 
     and supporting information systems to improve agency 
     performance. [[Page S1214]] 
       ``(b) With respect to general information resources 
     management, each agency shall--
       ``(1) develop information systems, processes, and 
     procedures to--
       ``(A) reduce information collection burdens on the public;
       ``(B) increase program efficiency and effectiveness; and
       ``(C) improve the integrity, quality, and utility of 
     information to all users within and outside the agency, 
     including capabilities for ensuring dissemination of public 
     information, public access to government information, and 
     protections for privacy and security;
       ``(2) in accordance with guidance by the Director, develop 
     and maintain a strategic information resources management 
     plan that shall describe how information resources management 
     activities help accomplish agency missions;
       ``(3) develop and maintain an ongoing process to--
       ``(A) ensure that information resources management 
     operations and decisions are integrated with organizational 
     planning, budget, financial management, human resources 
     management, and program decisions;
       ``(B) develop and maintain an integrated, comprehensive and 
     controlled process of information systems selection, 
     development, and evaluation;
       ``(C) in cooperation with the agency Chief Financial 
     Officer (or comparable official), develop a full and accurate 
     accounting of information technology expenditures, related 
     expenses, and results; and
       ``(D) establish goals for improving information resources 
     management's contribution to program productivity, 
     efficiency, and effectiveness, methods for measuring progress 
     towards those goals, and clear roles and responsibilities for 
     achieving those goals;
       ``(4) in consultation with the Director, the Administrator 
     of General Services, and the Archivist of the United States, 
     maintain a current and complete inventory of the agency's 
     information resources, including directories necessary to 
     fulfill the requirements of section 3511 of this chapter; and
       ``(5) in consultation with the Director and the Director of 
     the Office of Personnel Management, conduct formal training 
     programs to educate agency program and management officials 
     about information resources management.
       ``(c) With respect to the collection of information and the 
     control of paperwork, each agency shall--
       ``(1) establish a process within the office headed by the 
     official designated under subsection (a), that is 
     sufficiently independent of program responsibility to 
     evaluate fairly whether proposed collections of information 
     should be approved under this chapter, to--
       ``(A) review each collection of information before 
     submission to the Director for review under this chapter, 
     including--
       ``(i) an evaluation of the need for the collection of 
     information;
       ``(ii) a functional description of the information to be 
     collected;
       ``(iii) a plan for the collection of the information;
       ``(iv) a specific, objectively supported estimate of 
     burden;
       ``(v) a test of the collection of information through a 
     pilot program, if appropriate; and
       ``(vi) a plan for the efficient and effective management 
     and use of the information to be collected, including 
     necessary resources;
       ``(B) ensure that each information collection--
       ``(i) is inventoried, displays a control number and, if 
     appropriate, an expiration date;
       ``(ii) indicates the collection is in accordance with the 
     clearance requirements of section 3507; and
       ``(iii) contains a statement to inform the person receiving 
     the collection of information--

       ``(I) the reasons the information is being collected;
       ``(II) the way such information is to be used;
       ``(III) an estimate, to the extent practicable, of the 
     burden of the collection; and
       ``(IV) whether responses to the collection of information 
     are voluntary, required to obtain a benefit, or mandatory; 
     and

       ``(C) assess the information collection burden of proposed 
     legislation affecting the agency;
       ``(2)(A) except as provided under subparagraph (B), provide 
     60-day notice in the Federal Register, and otherwise consult 
     with members of the public and affected agencies concerning 
     each proposed collection of information, to solicit comment 
     to--
       ``(i) evaluate whether the proposed collection of 
     information is necessary for the proper performance of the 
     functions of the agency, including whether the information 
     shall have practical utility;
       ``(ii) evaluate the accuracy of the agency's estimate of 
     the burden of the proposed collection of information;
       ``(iii) enhance the quality, utility, and clarity of the 
     information to be collected; and
       ``(iv) minimize the burden of the collection of information 
     on those who are to respond, including through the use of 
     automated collection techniques or other forms of information 
     technology; and
       ``(B) for any proposed collection of information contained 
     in a proposed rule (to be reviewed by the Director under 
     section 3507(d)), provide notice and comment through the 
     notice of proposed rulemaking for the proposed rule and such 
     notice shall have the same purposes specified under 
     subparagraph (A) (i) through (iv); and
       ``(3) certify (and provide a record supporting such 
     certification, including public comments received by the 
     agency) that each collection of information submitted to the 
     Director for review under section 3507--
       ``(A) is necessary for the proper performance of the 
     functions of the agency, including that the information has 
     practical utility;
       ``(B) is not unnecessarily duplicative of information 
     otherwise reasonably accessible to the agency;
       ``(C) reduces to the extent practicable and appropriate the 
     burden on persons who shall provide information to or for the 
     agency, including with respect to small entities, as defined 
     under section 601(6) of title 5, the use of such techniques 
     as--
       ``(i) establishing differing compliance or reporting 
     requirements or timetables that take into account the 
     resources available to those who are to respond;
       ``(ii) the clarification, consolidation, or simplification 
     of compliance and reporting requirements; or
       ``(iii) an exemption from coverage of the collection of 
     information, or any part thereof;
       ``(D) is written using plain, coherent, and unambiguous 
     terminology and is understandable to those who are to 
     respond;
       ``(E) is to be implemented in ways consistent and 
     compatible, to the maximum extent practicable, with the 
     existing reporting and recordkeeping practices of those who 
     are to respond;
       ``(F) contains the statement required under paragraph 
     (1)(B)(iii);
       ``(G) has been developed by an office that has planned and 
     allocated resources for the efficient and effective 
     management and use of the information to be collected, 
     including the processing of the information in a manner which 
     shall enhance, where appropriate, the utility of the 
     information to agencies and the public;
       ``(H) uses effective and efficient statistical survey 
     methodology appropriate to the purpose for which the 
     information is to be collected; and
       ``(I) to the maximum extent practicable, uses information 
     technology to reduce burden and improve data quality, agency 
     efficiency and responsiveness to the public.
       ``(d) With respect to information dissemination, each 
     agency shall--
       ``(1) ensure that the public has timely and equitable 
     access to the agency's public information, including ensuring 
     such access through--
       ``(A) encouraging a diversity of public and private sources 
     for information based on government public information, and
       ``(B) agency dissemination of public information in an 
     efficient, effective, and economical manner;
       ``(2) regularly solicit and consider public input on the 
     agency's information dissemination activities; and
       ``(3) not, except where specifically authorized by 
     statute--
       ``(A) establish an exclusive, restricted, or other 
     distribution arrangement that interferes with timely and 
     equitable availability of public information to the public;
       ``(B) restrict or regulate the use, resale, or 
     redissemination of public information by the public;
       ``(C) charge fees or royalties for resale or 
     redissemination of public information; or
       ``(D) establish user fees for public information that 
     exceed the cost of dissemination.
       ``(e) With respect to statistical policy and coordination, 
     each agency shall--
       ``(1) ensure the relevance, accuracy, timeliness, 
     integrity, and objectivity of information collected or 
     created for statistical purposes;
       ``(2) inform respondents fully and accurately about the 
     sponsors, purposes, and uses of statistical surveys and 
     studies;
       ``(3) protect respondents' privacy and ensure that 
     disclosure policies fully honor pledges of confidentiality;
       ``(4) observe Federal standards and practices for data 
     collection, analysis, documentation, sharing, and 
     dissemination of information;
       ``(5) ensure the timely publication of the results of 
     statistical surveys and studies, including information about 
     the quality and limitations of the surveys and studies; and
       ``(6) make data available to statistical agencies and 
     readily accessible to the public.
       ``(f) With respect to records management, each agency shall 
     implement and enforce applicable policies and procedures, 
     including requirements for archiving information maintained 
     in electronic format, particularly in the planning, design 
     and operation of information systems.
       ``(g) With respect to privacy and security, each agency 
     shall--
       ``(1) implement and enforce applicable policies, 
     procedures, standards, and guidelines on privacy, 
     confidentiality, security, disclosure and sharing of 
     information collected or maintained by or for the agency;
       ``(2) assume responsibility and accountability for 
     compliance with and coordinated management of sections 552 
     and 552a of title 5, the Computer Security Act of 1987 (40 
     U.S.C. 759 note), and related information management laws; 
     and
       ``(3) consistent with the Computer Security Act of 1987 (40 
     U.S.C. 759 note), identify and afford security protections 
     commensurate with the risk and magnitude of the harm 
     resulting from the loss, misuse, or unauthorized access to or 
     modification of information [[Page S1215]] collected or 
     maintained by or on behalf of an agency.
       ``(h) With respect to Federal information technology, each 
     agency shall--
       ``(1) implement and enforce applicable Governmentwide and 
     agency information technology management policies, 
     principles, standards, and guidelines;
       ``(2) assume responsibility and accountability for any 
     acquisitions made pursuant to a delegation of authority under 
     section 111 of the Federal Property and Administrative 
     Services Act of 1949 (40 U.S.C. 759);
       ``(3) promote the use of information technology by the 
     agency to improve the productivity, efficiency, and 
     effectiveness of agency programs, including the reduction of 
     information collection burdens on the public and improved 
     dissemination of public information;
       ``(4) propose changes in legislation, regulations, and 
     agency procedures to improve information technology 
     practices, including changes that improve the ability of the 
     agency to use technology to reduce burden; and
       ``(5) establish, and be responsible for, a major 
     information system initiative review process, which shall be 
     developed and implemented by the information resources 
     management steering committee established under subsection 
     (a)(5), consistent with guidelines issued under section 
     3505(4), and include--
       ``(A) the review of major information system initiative 
     proposals and projects (including acquisitions of information 
     technology), approval or disapproval of each such initiative, 
     and periodic reviews of the development and implementation of 
     such initiatives, including whether the projected benefits 
     have been achieved;
       ``(B) the use by the committee of specified evaluative 
     techniques and criteria to--
       ``(i) assess the economy, efficiency, effectiveness, risks, 
     and priority of system initiatives in relation to mission 
     needs and strategies;
       ``(ii) estimate and verify life-cycle system initiative 
     costs; and
       ``(iii) assess system initiative privacy, security, records 
     management, and dissemination and access capabilities;
       ``(C) the use, as appropriate, of independent cost 
     evaluations of data developed under subparagraph (B); and
       ``(D) the inclusion of relevant information about approved 
     initiatives in the agency's annual budget request.

     ``Sec. 3507. Public information collection activities; 
       submission to Director; approval and delegation

       ``(a) An agency shall not conduct or sponsor the collection 
     of information unless in advance of the adoption or revision 
     of the collection of information--
       ``(1) the agency has--
       ``(A) conducted the review established under section 
     3506(c)(1);
       ``(B) evaluated the public comments received under section 
     3506(c)(2);
       ``(C) submitted to the Director the certification required 
     under section 3506(c)(3), the proposed collection of 
     information, copies of pertinent statutory authority, 
     regulations, and other related materials as the Director may 
     specify; and
       ``(D) published a notice in the Federal Register--
       ``(i) stating that the agency has made such submission; and
       ``(ii) setting forth--

       ``(I) a title for the collection of information;
       ``(II) a summary of the collection of information;
       ``(III) a brief description of the need for the information 
     and the proposed use of the information;
       ``(IV) a description of the likely respondents and proposed 
     frequency of response to the collection of information;
       ``(V) an estimate of the burden that shall result from the 
     collection of information; and
       ``(VI) notice that comments may be submitted to the agency 
     and Director;

       ``(2) the Director has approved the proposed collection of 
     information or approval has been inferred, under the 
     provisions of this section; and
       ``(3) the agency has obtained from the Director a control 
     number to be displayed upon the collection of information.
       ``(b) The Director shall provide at least 30 days for 
     public comment prior to making a decision under subsection 
     (c), (d), or (h), except as provided under subsection (j).
       ``(c)(1) For any proposed collection of information not 
     contained in a proposed rule, the Director shall notify the 
     agency involved of the decision to approve or disapprove the 
     proposed collection of information.
       ``(2) The Director shall provide the notification under 
     paragraph (1), within 60 days after receipt or publication of 
     the notice under subsection (a)(1)(D), whichever is later.
       ``(3) If the Director does not notify the agency of a 
     denial or approval within the 60-day period described under 
     paragraph (2)--
       ``(A) the approval may be inferred;
       ``(B) a control number shall be assigned without further 
     delay; and
       ``(C) the agency may collect the information for not more 
     than 2 years.
       ``(d)(1) For any proposed collection of information 
     contained in a proposed rule--
       ``(A) as soon as practicable, but no later than the date of 
     publication of a notice of proposed rulemaking in the Federal 
     Register, each agency shall forward to the Director a copy of 
     any proposed rule which contains a collection of information 
     and any information requested by the Director necessary to 
     make the determination required under this subsection; and
       ``(B) within 60 days after the notice of proposed 
     rulemaking is published in the Federal Register, the Director 
     may file public comments pursuant to the standards set forth 
     in section 3508 on the collection of information contained in 
     the proposed rule;
       ``(2) When a final rule is published in the Federal 
     Register, the agency shall explain--
       ``(A) how any collection of information contained in the 
     final rule responds to the comments, if any, filed by the 
     Director or the public; or
       ``(B) the reasons such comments were rejected.
       ``(3) If the Director has received notice and failed to 
     comment on an agency rule within 60 days after the notice of 
     proposed rulemaking, the Director may not disapprove any 
     collection of information specifically contained in an agency 
     rule.
       ``(4) No provision in this section shall be construed to 
     prevent the Director, in the Director's discretion--
       ``(A) from disapproving any collection of information which 
     was not specifically required by an agency rule;
       ``(B) from disapproving any collection of information 
     contained in an agency rule, if the agency failed to comply 
     with the requirements of paragraph (1) of this subsection;
       ``(C) from disapproving any collection of information 
     contained in a final agency rule, if the Director finds 
     within 60 days after the publication of the final rule that 
     the agency's response to the Director's comments filed under 
     paragraph (2) of this subsection was unreasonable; or
       ``(D) from disapproving any collection of information 
     contained in a final rule, if--
       ``(i) the Director determines that the agency has 
     substantially modified in the final rule the collection of 
     information contained in the proposed rule; and
       ``(ii) the agency has not given the Director the 
     information required under paragraph (1) with respect to the 
     modified collection of information, at least 60 days before 
     the issuance of the final rule.
       ``(5) This subsection shall apply only when an agency 
     publishes a notice of proposed rulemaking and requests public 
     comments.
       ``(6) The decision by the Director to approve or not act 
     upon a collection of information contained in an agency rule 
     shall not be subject to judicial review.
       ``(e)(1) Any decision by the Director under subsection (c), 
     (d), (h), or (j) to disapprove a collection of information, 
     or to instruct the agency to make substantive or material 
     change to a collection of information, shall be publicly 
     available and include an explanation of the reasons for such 
     decision.
       ``(2) Any written communication between the Office of the 
     Director, the Administrator of the Office of Information and 
     Regulatory Affairs, or any employee of the Office of 
     Information and Regulatory Affairs and an agency or person 
     not employed by the Federal Government concerning a proposed 
     collection of information shall be made available to the 
     public.
       ``(3) This subsection shall not require the disclosure of--
       ``(A) any information which is protected at all times by 
     procedures established for information which has been 
     specifically authorized under criteria established by an 
     Executive order or an Act of Congress to be kept secret in 
     the interest of national defense or foreign policy; or
       ``(B) any communication relating to a collection of 
     information which has not been approved under this chapter, 
     the disclosure of which could lead to retaliation or 
     discrimination against the communicator.
       ``(f)(1) An independent regulatory agency which is 
     administered by 2 or more members of a commission, board, or 
     similar body, may by majority vote void--
       ``(A) any disapproval by the Director, in whole or in part, 
     of a proposed collection of information of that agency; or
       ``(B) an exercise of authority under subsection (d) of 
     section 3507 concerning that agency.
       ``(2) The agency shall certify each vote to void such 
     disapproval or exercise to the Director, and explain the 
     reasons for such vote. The Director shall without further 
     delay assign a control number to such collection of 
     information, and such vote to void the disapproval or 
     exercise shall be valid for a period of 3 years.
       ``(g) The Director may not approve a collection of 
     information for a period in excess of 3 years.
       ``(h)(1) If an agency decides to seek extension of the 
     Director's approval granted for a currently approved 
     collection of information, the agency shall--
       ``(A) conduct the review established under section 3506(c), 
     including the seeking of comment from the public on the 
     continued need for, and burden imposed by the collection of 
     information; and
       ``(B) after having made a reasonable effort to seek public 
     comment, but no later than 60 days before the expiration date 
     of the control number assigned by the Director for the 
     currently approved collection of information, submit the 
     collection of information for review and approval under this 
     section, which shall include an explanation of how the agency 
     has used the information that it has 
     collected. [[Page S1216]] 
       ``(2) If under the provisions of this section, the Director 
     disapproves a collection of information contained in an 
     existing rule, or recommends or instructs the agency to make 
     a substantive or material change to a collection of 
     information contained in an existing rule, the Director 
     shall--
       ``(A) publish an explanation thereof in the Federal 
     Register; and
       ``(B) instruct the agency to undertake a rulemaking within 
     a reasonable time limited to consideration of changes to the 
     collection of information contained in the rule and 
     thereafter to submit the collection of information for 
     approval or disapproval under this chapter.
       ``(3) An agency may not make a substantive or material 
     modification to a collection of information after such 
     collection has been approved by the Director, unless the 
     modification has been submitted to the Director for review 
     and approval under this chapter.
       ``(i)(1) If the Director finds that a senior official of an 
     agency designated under section 3506(a) is sufficiently 
     independent of program responsibility to evaluate fairly 
     whether proposed collections of information should be 
     approved and has sufficient resources to carry out this 
     responsibility effectively, the Director may, by rule in 
     accordance with the notice and comment provisions of chapter 
     5 of title 5, United States Code, delegate to such official 
     the authority to approve proposed collections of information 
     in specific program areas, for specific purposes, or for all 
     agency purposes.
       ``(2) A delegation by the Director under this section shall 
     not preclude the Director from reviewing individual 
     collections of information if the Director determines that 
     circumstances warrant such a review. The Director shall 
     retain authority to revoke such delegations, both in general 
     and with regard to any specific matter. In acting for the 
     Director, any official to whom approval authority has been 
     delegated under this section shall comply fully with the 
     rules and regulations promulgated by the Director.
       ``(j)(1) The agency head may request the Director to 
     authorize collection of information prior to expiration of 
     time periods established under this chapter, if an agency 
     head determines that--
       ``(A) a collection of information--
       ``(i) is needed prior to the expiration of such time 
     periods; and
       ``(ii) is essential to the mission of the agency; and
       ``(B) the agency cannot reasonably comply with the 
     provisions of this chapter within such time periods because--
       ``(i) public harm is reasonably likely to result if normal 
     clearance procedures are followed; or
       ``(ii) an unanticipated event has occurred and the use of 
     normal clearance procedures is reasonably likely to prevent 
     or disrupt the collection of information related to the event 
     or is reasonably likely to cause a statutory or court-ordered 
     deadline to be missed.
       ``(2) The Director shall approve or disapprove any such 
     authorization request within the time requested by the agency 
     head and, if approved, shall assign the collection of 
     information a control number. Any collection of information 
     conducted under this subsection may be conducted without 
     compliance with the provisions of this chapter for a maximum 
     of 90 days after the date on which the Director received the 
     request to authorize such collection.

     ``Sec. 3508. Determination of necessity for information; 
       hearing

       ``Before approving a proposed collection of information, 
     the Director shall determine whether the collection of 
     information by the agency is necessary for the proper 
     performance of the functions of the agency, including whether 
     the information shall have practical utility. Before making a 
     determination the Director may give the agency and other 
     interested persons an opportunity to be heard or to submit 
     statements in writing. To the extent that the Director 
     determines that the collection of information by an agency is 
     unnecessary for the proper performance of the functions of 
     the agency, for any reason, the agency may not engage in the 
     collection of information.

     ``Sec. 3509. Designation of central collection agency

       ``The Director may designate a central collection agency to 
     obtain information for two or more agencies if the Director 
     determines that the needs of such agencies for information 
     will be adequately served by a single collection agency, and 
     such sharing of data is not inconsistent with applicable law. 
     In such cases the Director shall prescribe (with reference to 
     the collection of information) the duties and functions of 
     the collection agency so designated and of the agencies for 
     which it is to act as agent (including reimbursement for 
     costs). While the designation is in effect, an agency covered 
     by the designation may not obtain for itself information for 
     the agency which is the duty of the collection agency to 
     obtain. The Director may modify the designation from time to 
     time as circumstances require. The authority to designate 
     under this section is subject to the provisions of section 
     3507(f) of this chapter.

     ``Sec. 3510. Cooperation of agencies in making information 
       available

       ``(a) The Director may direct an agency to make available 
     to another agency, or an agency may make available to another 
     agency, information obtained by a collection of information 
     if the disclosure is not inconsistent with applicable law.
       ``(b)(1) If information obtained by an agency is released 
     by that agency to another agency, all the provisions of law 
     (including penalties which relate to the unlawful disclosure 
     of information) apply to the officers and employees of the 
     agency to which information is released to the same extent 
     and in the same manner as the provisions apply to the 
     officers and employees of the agency which originally 
     obtained the information.
       ``(2) The officers and employees of the agency to which the 
     information is released, in addition, shall be subject to the 
     same provisions of law, including penalties, relating to the 
     unlawful disclosure of information as if the information had 
     been collected directly by that agency.

     ``Sec. 3511. Establishment and operation of Government 
       Information Locator Service

       ``In order to assist agencies and the public in locating 
     information and to promote information sharing and equitable 
     access by the public, the Director shall--
       ``(1) cause to be established and maintained a distributed 
     agency-based electronic Government Information Locator 
     Service (hereafter in this section referred to as the 
     `Service'), which shall identify the major information 
     systems, holdings, and dissemination products of each agency;
       ``(2) require each agency to establish and maintain an 
     agency information locator service as a component of, and to 
     support the establishment and operation of the Service;
       ``(3) in cooperation with the Archivist of the United 
     States, the Administrator of General Services, the Public 
     Printer, and the Librarian of Congress, establish an 
     interagency committee to advise the Secretary of Commerce on 
     the development of technical standards for the Service to 
     ensure compatibility, promote information sharing, and 
     uniform access by the public;
       ``(4) consider public access and other user needs in the 
     establishment and operation of the Service;
       ``(5) ensure the security and integrity of the Service, 
     including measures to ensure that only information which is 
     intended to be disclosed to the public is disclosed through 
     the Service; and
       ``(6) periodically review the development and effectiveness 
     of the Service and make recommendations for improvement, 
     including other mechanisms for improving public access to 
     Federal agency public information.

     ``Sec. 3512. Public protection

       ``Notwithstanding any other provision of law, no person 
     shall be subject to any penalty for failing to maintain, 
     provide, or disclose information to or for any agency or 
     person if the collection of information subject to this 
     chapter--
       ``(1) does not display a valid control number assigned by 
     the Director; or
       ``(2) fails to state that the person who is to respond to 
     the collection of information is not required to comply 
     unless such collection displays a valid control number.

     ``Sec. 3513. Director review of agency activities; reporting; 
       agency response

       ``(a) In consultation with the Administrator of General 
     Services, the Archivist of the United States, the Director of 
     the National Institute of Standards and Technology, and the 
     Director of the Office of Personnel Management, the Director 
     shall periodically review selected agency information 
     resources management activities to ascertain the efficiency 
     and effectiveness of such activities to improve agency 
     performance and the accomplishment of agency missions.
       ``(b) Each agency having an activity reviewed under 
     subsection (a) shall, within 60 days after receipt of a 
     report on the review, provide a written plan to the Director 
     describing steps (including milestones) to--
       ``(1) be taken to address information resources management 
     problems identified in the report; and
       ``(2) improve agency performance and the accomplishment of 
     agency missions.

     ``Sec. 3514. Responsiveness to Congress

       ``(a)(1) The Director shall--
       ``(A) keep the Congress and congressional committees fully 
     and currently informed of the major activities under this 
     chapter; and
       ``(B) submit a report on such activities to the President 
     of the Senate and the Speaker of the House of Representatives 
     annually and at such other times as the Director determines 
     necessary.
       ``(2) The Director shall include in any such report a 
     description of the extent to which agencies have--
       ``(A) reduced information collection burdens on the public, 
     including--
       ``(i) a summary of accomplishments and planned initiatives 
     to reduce collection of information burdens;
       ``(ii) a list of all violations of this chapter and of any 
     rules, guidelines, policies, and procedures issued pursuant 
     to this chapter; and
       ``(iii) a list of any increase in the collection of 
     information burden, including the authority for each such 
     collection;
       ``(B) improved the quality and utility of statistical 
     information;
       ``(C) improved public access to Government information; and
       ``(D) improved program performance and the accomplishment 
     of agency missions through information resources management.
       ``(b) The preparation of any report required by this 
     section shall be based on performance results reported by the 
     agencies and shall [[Page S1217]] not increase the collection 
     of information burden on persons outside the Federal 
     Government.

     ``Sec. 3515. Administrative powers

       ``Upon the request of the Director, each agency (other than 
     an independent regulatory agency) shall, to the extent 
     practicable, make its services, personnel, and facilities 
     available to the Director for the performance of functions 
     under this chapter.

     ``Sec. 3516. Rules and regulations

       ``The Director shall promulgate rules, regulations, or 
     procedures necessary to exercise the authority provided by 
     this chapter.

     ``Sec. 3517. Consultation with other agencies and the public

       ``(a) In developing information resources management 
     policies, plans, rules, regulations, procedures, and 
     guidelines and in reviewing collections of information, the 
     Director shall provide interested agencies and persons early 
     and meaningful opportunity to comment.
       ``(b) Any person may request the Director to review any 
     collection of information conducted by or for an agency to 
     determine, if, under this chapter, a person shall maintain, 
     provide, or disclose the information to or for the agency. 
     Unless the request is frivolous, the Director shall, in 
     coordination with the agency responsible for the collection 
     of information--
       ``(1) respond to the request within 60 days after receiving 
     the request, unless such period is extended by the Director 
     to a specified date and the person making the request is 
     given notice of such extension; and
       ``(2) take appropriate remedial action, if necessary.

     ``Sec. 3518. Effect on existing laws and regulations

       ``(a) Except as otherwise provided in this chapter, the 
     authority of an agency under any other law to prescribe 
     policies, rules, regulations, and procedures for Federal 
     information resources management activities is subject to the 
     authority of the Director under this chapter.
       ``(b) Nothing in this chapter shall be deemed to affect or 
     reduce the authority of the Secretary of Commerce or the 
     Director of the Office of Management and Budget pursuant to 
     Reorganization Plan No. 1 of 1977 (as amended) and Executive 
     order, relating to telecommunications and information policy, 
     procurement and management of telecommunications and 
     information systems, spectrum use, and related matters.
       ``(c)(1) Except as provided in paragraph (2), this chapter 
     shall not apply to the collection of information--
       ``(A) during the conduct of a Federal criminal 
     investigation or prosecution, or during the disposition of a 
     particular criminal matter;
       ``(B) during the conduct of--
       ``(i) a civil action to which the United States or any 
     official or agency thereof is a party; or
       ``(ii) an administrative action or investigation involving 
     an agency against specific individuals or entities;
       ``(C) by compulsory process pursuant to the Antitrust Civil 
     Process Act and section 13 of the Federal Trade Commission 
     Improvements Act of 1980; or
       ``(D) during the conduct of intelligence activities as 
     defined in section 4-206 of Executive Order No. 12036, issued 
     January 24, 1978, or successor orders, or during the conduct 
     of cryptologic activities that are communications security 
     activities.
       ``(2) This chapter applies to the collection of information 
     during the conduct of general investigations (other than 
     information collected in an antitrust investigation to the 
     extent provided in subparagraph (C) of paragraph (1)) 
     undertaken with reference to a category of individuals or 
     entities such as a class of licensees or an entire industry.
       ``(d) Nothing in this chapter shall be interpreted as 
     increasing or decreasing the authority conferred by Public 
     Law 89-306 on the Administrator of the General Services 
     Administration, the Secretary of Commerce, or the Director of 
     the Office of Management and Budget.
       ``(e) Nothing in this chapter shall be interpreted as 
     increasing or decreasing the authority of the President, the 
     Office of Management and Budget or the Director thereof, 
     under the laws of the United States, with respect to the 
     substantive policies and programs of departments, agencies 
     and offices, including the substantive authority of any 
     Federal agency to enforce the civil rights laws.

     ``Sec. 3519. Access to information

       ``Under the conditions and procedures prescribed in section 
     716 of title 31, the Director and personnel in the Office of 
     Information and Regulatory Affairs shall furnish such 
     information as the Comptroller General may require for the 
     discharge of the responsibilities of the Comptroller General. 
     For the purpose of obtaining such information, the 
     Comptroller General or representatives thereof shall have 
     access to all books, documents, papers and records, 
     regardless of form or format, of the Office.

     ``Sec. 3520. Authorization of appropriations

       ``(a) Subject to subsection (b), there are authorized to be 
     appropriated to the Office of Information and Regulatory 
     Affairs to carry out the provisions of this chapter, and for 
     no other purpose, $8,000,000 for each of the fiscal years 
     1996, 1997, 1998, 1999, and 2000.
       ``(b)(1) No funds may be appropriated pursuant to 
     subsection (a) unless such funds are appropriated in an 
     appropriation Act (or continuing resolution) which separately 
     and expressly states the amount appropriated pursuant to 
     subsection (a) of this section.
       ``(2) No funds are authorized to be appropriated to the 
     Office of Information and Regulatory Affairs, or to any other 
     officer or administrative unit of the Office of Management 
     and Budget, to carry out the provisions of this chapter, or 
     to carry out any function under this chapter, for any fiscal 
     year pursuant to any provision of law other than subsection 
     (a) of this section.''.

     SEC. 3. EFFECTIVE DATE.

       The provisions of this Act and the amendments made by this 
     Act shall take effect on June 30, 1995.
                                                                    ____


         S. 244, THE `Paperwork Reduction Act of 1995'--Summary

       The ``Paperwork Reduction Act of 1995'' will--
       Reaffirm the fundamental purpose of the Paperwork Reduction 
     Act of 1980: to minimize the Federal paperwork burdens 
     imposed on individuals, small businesses, State and local 
     governments, educational and non-profit institutions, and 
     Federal contractors.
       Provide a five-year authorization of appropriations for the 
     Office of Information and Regulatory Affairs (OIRA) within 
     the Office of Management and Budget, the paperwork 
     ``watchdog'' under the Act.
       Clarify that the Act's public protections apply to all 
     Government-sponsored paperwork, eliminating any confusion 
     over the coverage of so-called ``third-party burdens'' (those 
     imposed by one private party on another private party due to 
     a Federal regulation), caused by the U.S. Supreme Court's 
     1989 decision in Dole v. United Steelworkers of America.
       Seek to reduce the paperwork burdens imposed on the public 
     through an annual Government-wide paperwork reduction goal of 
     5 percent.
       Emphasize the fundamental responsibilities of each Federal 
     agency to minimize paperwork burdens and foster paperwork 
     reduction, by requiring--
       a thorough review of each proposed collection of 
     information for need and practical utility, the Paperwork 
     Reduction Act's fundamental standards, which enables an 
     agency to collect needed information while minimizing the 
     burden imposed on the public;
       agency planning to maximize the use of information already 
     collected by the public;
       better notice and opportunity for public participation with 
     at least a 60-day comment period for each proposed paperwork 
     requirement;
       agency certification of compliance with public 
     participation requirements and the Act's fundamental 
     standards of need and practical utility for each proposed 
     paperwork requirement before its submission to OIRA for 
     review, approval and assignment of a control number 
     clearance; and
       Strengthen OIRA's responsibilities in the fight to minimize 
     paperwork burdens imposed on the public, by--
       empowering OIRA to establish standards under which Federal 
     agencies can more accurately estimate the burden placed upon 
     the public by a proposed paperwork requirements;
       working with the Office of Federal Procurement Policy 
     (OFPP) to reduce the substantial paperwork burdens associated 
     with Government contracting; and
       Empower the public further in the paperwork reduction fight 
     by enabling an individual to obtain a written determination 
     from the OIRA Administrator regarding whether a Federally 
     sponsored paperwork requirement complies with the Act's 
     standards and public protections, in the same manner that a 
     determination can be sought from the OFPP Administrator 
     regarding whether a procurement regulation issued by an 
     individual agency or buying activity is consistent with the 
     Government-wide Federal Acquisition Regulation.
       Improves the Government's ability to make more effective 
     use of the information collected from the public by--
       specifying responsibilities of individual agencies 
     regarding information resources management (IRM);
       enhancing OIRA's responsibility and authority for 
     establishing Government-wide IRM policy;
       establishing policies for linking information technology 
     (IT) budgeting and IRM decision-making to agency program 
     performance, consistent with ``Best Practices'' studies 
     conducted by the U.S. General Accounting Office.
       Strengthen OIRA's leadership role in Federal statistical 
     policy.
                                                                    ____


                 The Paperwork Reduction Act Coalition

       Aerospace Industries Association of America.
       Air Transport Association of America.
       Alliance of American Insurers.
       American Consulting Engineers Council.
       American Institute of Merchant Shipping.
       American Iron and Steel Institute.
       American Petroleum Institute.
       American Subcontractors Association.
       American Telephone & Telegraph.
       Associated Builders & Contractors.
       Associated Credit Bureaus.
       Associated General Contractors of America.
       Association of Manufacturing Technology.
       Association of Records Managers and Administrators.
       Automative Parts and Accessories 
     Association. [[Page S1218]] 
       Biscuit and Cracker Manufacturers' Association.
       Bristol Myers.
       Chemical Manufacturers Association.
       Chemical Specialties Manufacturers Association.
       Citizens Against Government Waste.
       Citizens For A Sound Economy.
       Computer and Business Equipment Manufacturers Association.
       Contract Services Association of America.
       Copper & Brass Fabricators Council.
       Dairy and Food Industries Supply Association.
       Direct Selling Association.
       Eastman Kodak Company.
       Electronic Industries Association.
       Financial Executive Institute.
       Food Marketing Institute.
       Gadsby & Hannah.
       Gas Appliance Manufacturers Association.
       General Electric.
       Glaxo, Inc.
       Greater Washington Board of Trade.
       Hardwood Plywood and Veneer Association.
       Independent Bankers Association of America.
       International Business Machines.
       International Communication Industries Association.
       International Mass Retail Association.
       Kitchen Cabinet Manufacturers Association.
       Mail Advertising Service Association International.
       McDermott, Will & Emery.
       Motorola Government Electronics Group.
       National Association of Homebuilders of the United States.
       National Association of Manufacturers.
       National Association of Plumbing-Heating-Cooling 
     Contractors.
       National Association of the Remodeling Industry.
       National Association of Wholesalers-Distributors.
       National Federation of Independent Business.
       National Food Brokers Association.
       National Food Processors Association.
       National Foundation for Consumer Credit.
       National Glass Association.
       National Restaurant Association.
       National Roofing Contractors Association.
       National Security Industrial Association.
       National Small Business United.
       National Society of Professional Engineers.
       National Society of Public Accountants.
       National Tooling and Machining Association.
       Northrop Corporation.
       Packaging Machinery Manufacturers Institute.
       Painting and Decorating Contractors of America.
       Printing Industries of America.
       Professional Services Council.
       Shipbuilders Council of America.
       Small Business Legislative Council.
       Society for Marketing Professional Services.
       Sun Company, Inc.
       Sunstrand Corporation.
       Texaco.
       United Technologies.
       Wholesale Florists and Florist Suppliers of America.
                                                                    ____


           Members of the Small Business Legislative Council

       Air Conditioning Contractors of America.
       Alliance for Affordable Health Care.
       Alliance of Independent Store Owners and Professionals.
       American Animal Hospital Association.
       American Association of Nurserymen.
       American Bus Association.
       American Consulting Engineers Council.
       American Council of Independent Laboratories.
       American Floorcovering Association.
       American Gear Manufacturers Association.
       American Machine Tool Distributors Association.
       American Road & Transportation Builders Association.
       American Society of Travel Agents, Inc.
       American Sod Producers Association.
       American Subcontractors Association.
       American Textile Machinery Association.
       American Trucking Associations, Inc.
       American Warehouse Association.
       American Wholesale Marketers Association.
       AMT-The Association for Manufacturing Technology.
       Apparel Retailers of America.
       Architectural Precast Association.
       Associated Builders & Contractors.
       Associated Equipment Distributors.
       Associated Landscape Contractors of America.
       Association of Small Business Development Centers.
       Automotive Service Association.
       Automotive Recyclers Association.
       Bowling Proprietors Association of America.
       Building Service Contractors Association International.
       Business Advertising Council.
       Christian Booksellers Association.
       Council of Fleet Specialists.
       Council of Growing Companies.
       Direct Selling Association.
       Electronics Representatives Association.
       Florists' Transworld Delivery Association.
       Health Industry Representatives Association.
       Helicopter Association International.
       Independent Bakers Association.
       Independent Bankers Association of America.
       Independent Medical Distributors Association.
       International Association of Refrigerated Warehouses.
       International Communications Industries Association.
       International Formalwear Association.
       International Television Association.
       Machinery Dealers National Association.
       Manufacturers Agents National Association.
       Manufacturers Representatives of America, Inc.
       Mechanical Contractors Association of America, Inc.
       National Association for the Self-Employed.
       National Association of Catalog Showroom Merchandisers.
       National Association of Home Builders.
       National Association of Investment Companies.
       National Association of Plumbing-Heating-Cooling 
     Contractors.
       National Association of Private Enterprise.
       National Association of Realtors.
       National Association of Retail Druggists.
       National Association of RV Parks and Campgrounds.
       National Association of Small Business Investment 
     Companies.
       National Association of the Remodeling Industry.
       National Association of Truck Stop Operators.
       National Association of Women Business Owners.
       National Chimney Sweep Guild.
       National Association of Catalog Showroom Merchandisers.
       National Coffee Service Association.
       National Electrical Contractors Association.
       National Electrical Manufacturers Representatives 
     Association.
       National Food Brokers Association.
       National Independent Flag Dealers Association.
       National Knitwear Sportswear Association.
       National Lumber & Building Material Dealers Association.
       National Moving and Storage Association.
       National Ornamental & Miscellaneous Metals Association.
       National Paperbox Association.
       National Shoe Retailers Association.
       National Society of Public Accountants.
       National Tire Dealers & Retreaders Association.
       National Tooling and Machining Association.
       National Tour Association.
       National Venture Capital Association.
       Opticians Association of America.
       Organization for the Protection and Advancement of Small 
     Telephone Companies.
       Passenger Vessel Association.
       Petroleum Marketers Association of America.
       Power Transmission Representatives Association.
       Printing Industries of America, Inc.
       Promotional Products Association International.
       Retail Bakers of America.
       Small Business Council of America, Inc.
       Small Business Exporters Association.
       SMC/Pennsylvania Small Business.
       Society of American Florists.

  Mr. ROTH. Mr. President, I am pleased to join today with the 
distinguished gentleman from Georgia [Senator Nunn] in introducing the 
Paperwork Reduction Act of 1995. Last year, this legislation, after 
thorough consideration by the Committee on Governmental Affairs, was 
reported unanimously and then passed the Senate on two different 
occasions, also unanimously.
  This legislation is part of the Contract With America. While the 
contract contains the original version which Senator Nunn and I 
introduced in the last Congress, we believe that the new House 
leadership would be receptive to the improved version we are today 
introducing. I am hopeful that the Senate will take the lead once again 
in passing this legislation. As chairman of the Committee on 
Governmental Affairs, I intend to process this legislation quickly, and 
ask my colleagues on the committee to join with Senator Nunn, Senator 
Glenn, and myself in this effort.
  I would hope that this legislation could be acted on this month to 
become the third Governmental Affairs bill in this young session to be 
considered on the floor.
  This legislation enjoys widespread support among the business 
community, both big and small, as well as among State, local, and 
tribal governments and the people--all who bear the burden of Federal 
Government paperwork collections. This legislation strengthens the 
paperwork reduction [[Page S1219]] aspects of the 1980 act and directs 
OIRA to reduce paperwork burdens on the public by 5 percent annually. 
By overturning the 1990 Supreme Court decision in Dole versus United 
Steel Workers of America, it extends the jurisdiction of the act by 50 
percent. One could thus expect the burden-saving results of this 
legislation to be substantial.
  The Committee on Governmental Affairs has broad jurisdiction over 
subjects of paperwork burdens, information technology, and regulations. 
No one piece of legislation can adequately deal with all facets of 
those subjects. This legislation is not the last that will be addressed 
on those subjects by the committee.
  On February 1, 1995, the committee will hold a hearing on the 
Government's use of information technology as part of the Committee's 
Reinventing Government effort.
  On February 8, 1995, the committee will begin a set of hearings on 
the broad subject of regulatory reform.
  Mr. GLENN. Mr. President, it gives me great pleasure to join with my 
colleagues from the Government Affairs Committee, Senator Nunn and 
Senator Roth, to cosponsor our bipartisan legislation to reauthorize 
the Paperwork Reduction Act. The legislation we introduce today 
reflects the compromise we achieved in the last Congress, which the 
Senate passed by a unanimous vote on October 6, 1994. I am confident 
that this bill will once again be passed by the Senate and then move 
quickly in the House.
  This legislation has two very important and closely related purposes. 
First, the Paperwork Reduction Act is vital to reducing Government 
paperwork burdens on the American public. Too often, individuals and 
businesses are burdened by having to fill out questionnaires and forms 
that simply are not needed to implement the laws of the land. Too much 
time and money is wasted in an effort to satisfy bureaucratic excess. 
The Paperwork Reduction Act of 1980 created a clearance process to 
control this Government appetite for information. The Paperwork 
Reduction Act of 1995 strengthens this process and will reduce the 
burdens of Government redtape on the public.
  Second, the act is key to improving the efficiency and effectiveness 
of government information activities. The Federal Government is now 
spending over $25 billion a year on information technology. The new age 
of computers and telecommunications provides many opportunities for 
improvements in Government operations. Unfortunately, as oversight by 
our committee and others has shown, the Government is wasting millions 
of dollars on poorly designed and often incompatible systems. This must 
stop. The Paperwork Reduction Act of 1980 took a first step on the road 
to reform when it created information resources management [IRM] 
policies to be overseen by OMB. The Paperwork Reduction Act of 1995 
strengthens that mandate and establishes new requirements for agency 
IRM improvements.
  In these and other ways, this legislation strengthens the Paperwork 
Reduction Act and reflects the concerns of a broad array of Senators. 
As my colleagues know, I have been working for several years to 
reauthorize this important law. I am very pleased with the result. With 
this legislation, we:
  Reauthorize the act for 5 years;
  Overturn the Dole versus United Steelworkers Supreme Court decision, 
so that information disclosure requirements are covered by the OMB 
paperwork clearance process;
  Require agencies to evaluate paperwork proposals and solicit public 
comment on them before the proposals go to OMB for review;
  Create additional opportunities for the public to participate in 
paperwork clearance and other information management decisions;
  Strengthen agency and OMB information resources management [IRM] 
requirements;
  Establish information dissemination standards and require the 
development of a government information locator service [GILS] to 
ensure improved public access to government information, especially 
that maintained in electronic format; and
  Make other improvements in the areas of government statistics, 
records management, computer security, and the management of 
information technology.
  These are important reforms. They are the result of over a year long 
process of consultation among members of the Governmental Affairs 
Committee, the administration, and the General Accounting Office. Of 
course, reaching agreement on this legislation has involved compromises 
that displease some. It may also not completely resolve conflicting 
views on many of the OMB paperwork and regulatory review controversies 
that have dogged congressional oversight of the Paperwork Reduction 
Act. But again, this legislation is a compromise that addresses many 
important issues and will help the Government reduce paperwork burdens 
on the public and improve the management of Federal information 
resources. I believe this is a very good compromise that can and should 
pass both the Senate and the House. I urge my colleagues to support 
this legislation.
                                 ______

      By Mr. COHEN (for himself, Mr. Dole, Mr. Simpson, Mr. Stevens, 
        Mr. D'Amato, Mr. Graham, Mr. Coats, Mr. Gregg, Mr. Warner, Mr. 
        Nickles, Mr. Pryor, Mr. Bond, Mr. Chafee, Mr. Ford, and Mr. 
        Domenici):
  S. 245. A bill to provide for enhanced penalties for health care 
fraud, and for other purposes; to the Committee on Finance.


              the health care fraud prevention act of 1995

  Mr. COHEN. Mr. President, I rise today to introduce, on behalf of 
myself, Senators Dole, Simpson, Stevens, D'Amato, Graham of Florida, 
Coats, Gregg, Warner, Nickles, Pryor, Chafee, Bond, and Ford, the 
Health Care Fraud Prevention Act of 1995.
  Mr. President, health care reform has now taken a back seat to some 
other measures that are now before the Congress, as our colleagues in 
the House debate their Contract With America provisions and this body 
debates unfunded mandates, a balanced budget amendment, and entitlement 
reform. Apparently health care reform is going to have to wait. But I 
must say that it is just as important as these other issues as far as 
the American people are concerned. But as we await the debate on health 
care reform, which I believe must come this session, we also have to 
take steps immediately to toughen our defenses against fraudulent 
practices that are driving up the cost of health care for families, 
businesses and taxpayers alike.
  You may recall that last year I introduced a measure which contained 
some additions to the criminal law provisions of our title 18 statutes. 
Those provisions were adopted unanimously by the Senate. They were sent 
over to the House where they were stripped out of the anticrime bill at 
conference because the majority rationalized that these provisions 
should not go on the crime bill but on a health care reform bill. As we 
know, there was no health care reform bill passed last year.
  On a number of occasions, I sought to attach the provisions to 
pending legislation, for example, the D.C. appropriations bill and the 
Labor, HHS appropriations bill. I was prevailed upon to withdraw the 
legislation at that time so as to allow the appropriations bills to go 
forward. And I pointed out at that time, which was at the conclusion of 
last year's session of Congress, that we would lose as much as $100 
billion a year due to health care fraud and abuse. That amounts to $275 
million a day or $11.5 million every single hour.
  Mr. President, I do not think we can afford to delay this any longer. 
Over the past 5 years, we have lost as much as $418 billion from health 
care fraud and abuse, which is approximately four times the total 
losses associated with the savings and loan crisis.
  Just imagine the furor that enveloped this country over the bailout 
necessary because of the savings and loan problems that afflicted this 
country. It is four times that as far as health care fraud is 
concerned, and yet there does not seem to be much of a sense of urgency 
on the part of our colleagues to do much about it.

  Mr. President, I have worked with the Justice Department, the FBI, 
Medicaid fraud units, inspectors general, and others in developing this 
legislation. As I pointed out last year there is a song, I think it was 
by Paul Simon-- [[Page S1220]] not our Paul Simon but the song writer 
Paul Simon--who had a song called ``Fifty Ways To Leave Your Lover.'' 
We showed through an Aging Committee's year-long investigation at least 
50 ways in which to pick the pockets of Uncle Sam and of private 
insurers.
  I will not, because of the length of the report, introduce it now 
into the Record. I will simply ask unanimous consent that at the 
conclusion of my remarks the executive summary of this year-long 
investigation be introduced in the Record and included as part of it.
  Let me simply add a few more examples of the kinds of activities that 
are taking place now while we are debating other amendments, germane 
and nongermane, to the pending unfunded mandates bill. First, let me 
point out that there are roughly a half billion Medicare claims 
processed each year and the overwhelming majority of those are 
submitted for legitimate services by conscientious health care 
providers and beneficiaries--the overwhelming majority. It is the 
minority who are taking as much as $100 billion out of the system.
  Let me give you examples of what is going on. A doctor promoted his 
clinic in television, radio, newspaper, and telephone book ads as a 
``one-stop, walk-in diagnostic center.'' You can walk in, and they can 
take care of any problem you have got. So a person might go in for an 
examination for a shoulder injury and be subjected to a huge battery of 
tests which have nothing to do with the shoulder, resulting in bills of 
$4,000 and more per patient.
  Using the names of dozens of dead patients, a phantom laboratory in 
Miami allegedly cheated the Government out of $300,000 in Medicare 
payments in a matter of just a few weeks for lab tests never performed. 
The lab that was submitting the bills for the tests was basically a 
rented mailbox and a Medicare billing number. That was it.
  Employees of an airline were indicted for filing false and fraudulent 
claims for reimbursement to a private insurance company for medical 
care and services they claimed to have received in another country. The 
allegations are that the employees attempted to mail false and 
fictitious forms totaling close to $600,000 for treatments and services 
never performed.
  A durable medical equipment company, its owner and sales manager pled 
guilty to supplying unnecessary medical equipment such as hospital beds 
and oxygen concentrators to residents of adult congregate living 
facilities and then billing Medicare for more than $600,000. These 
conspirators induced the facilities' managers to allow them to provide 
the equipment by promising to leave the equipment when the patients 
died or were transferred.
  Physician-owners of a clinic in New York stole over $1.3 million from 
the State Medicaid program by fraudulently billing for over 50,000 
phantom psychotherapy sessions never given to Medicaid patients.
  Finally, a medical equipment supplier stole $1.45 million from 
Medicaid by repeatedly billing for expensive back supports that were 
never authorized by the patients' physicians.
  These cases are but a small sample of the fraudulent and abusive 
schemes that are plaguing our health care system daily, freezing 
millions of Americans out of affordable health care coverage, and 
driving up costs for taxpayers.
  The bill I am introducing today will go far in strengthening our 
defenses against health care fraud.
  Specifically, it will:
  Give prosecutors stronger tools and tougher statutes to combat 
criminal health care fraud. It would, for example, provide a specific 
health care offense in title 18 so that prosecutors are not forced to 
spend excessive time and resources to develop a nexus to the mail or 
wire fraud statutes to pursue clear cases of fraud, or to track the 
cash-flow from health care schemes in order to prosecute under money 
laundering statutes.
  It will allow injunctive relief and forfeiture for criminal health 
care fraud; provide greater authority to exclude violators from 
Medicare and Medicaid programs; create tough administrative civil 
penalties and remedies for fraud and abuse so that a range of sanctions 
will be available; and coordinate enforcement programs and beef up 
investigative resources, which are now woefully inadequate. For 
example, the HHS' inspector general states that it produces $80 in 
savings for each Federal dollar invested in their office yet their 
full-time equivalent position level has actually decreased over the 
last few years.
  The FBI recently testified that they have over 1,300 cases pending 
but that regardless of this prioritization, the amount of health care 
fraud not being addressed due to a lack of available resources is 
growing and that health care fraud appears to be a problem of immense 
proportion which is presently not being fully addressed.
  I might point out we have been reading about the extent of global 
international crime, even all the way from Russia, now moving into this 
country and ripping off the Medicare-Medicaid Programs and other health 
care systems by the millions. This is a growing problem of great 
concern to me,  so the FBI needs help. This bill helps agencies like 
the FBI and HHS and DOD inspectors general by financing additional 
health care fraud enforcement resources with proceeds derived from 
forfeiture, fines, and other health care fraud enforcement efforts.

  It will also provide guidance to health care providers and industries 
on how to comply with fraud rules, so they will know what is and what 
is not prohibited activity.
  I have worked closely with law enforcement and health care fraud 
experts in developing these proposals, and am continuing to work with 
industry representatives to ensure that fraud and abuse statutes and 
requirements are fair, clearly understood by health care providers, and 
reflect the changing health care market. Our goal should not be to 
burden health care providers with complicated, murky rules on fraud and 
abuse, but rather to lay down clear rules and guidance, followed by 
tough enforcement for violations.
  Mr. President, when we are losing as much as $275 million per day to 
health care fraud and abuse, we cannot afford to delay any longer. The 
only ones who benefit from delay on this important issue are those who 
are bilking billions from our system. The very big losers will be the 
American taxpayers, patients, and families who cannot afford health 
care coverage because premiums and health care costs are escalating to 
cover the exorbitant costs of fraud and abuse.
  I want to thank Senator Dole for his steadfast support and leadership 
on this issue and I urge my colleagues to support and act expeditiously 
on this legislation.
  Mr. President, I ask unanimous consent that the text of the bill and 
additional material be printed in the Record.
  There being no objection, the material was ordered to be printed.

                           Executive Summary


 gaming the health care system: billions of dollars lost each year to 
                            fraud and abuse

       For the past year, the Minority Staff of the Senate Special 
     Committee on Aging under my direction has investigated the 
     explosion of fraud and abuse in the U.S. health care system. 
     This report examines emerging trends, patterns of abuse, and 
     types of tactics used by fraudulent providers, unscrupulous 
     suppliers, and ``professional'' patients who game the system 
     in order to reap billions of dollars in reimbursements by 
     Medicare, Medicaid, and private insurers.
       The consequences of fraud and abuse to the health care 
     system are staggering: as much as 10 percent of U.S. health 
     care spending, or $100 billion, is lost each year to health 
     care fraud and abuse. Over the last five years, estimated 
     losses from these fraudulent activities totaled about $418 
     billion--or almost four times as much as the cost of the 
     entire savings and loan crisis to date.
       Our investigation revealed that vulnerabilities to fraud 
     exist throughout the entire health care system and that 
     patterns of fraud within some provider groups have become 
     particularly problematic. Major patterns of abuse that plague 
     the system are overbilling, billing for services not 
     rendered, ``unbundling'' (whereby one item, for example a 
     wheelchair, is billed as many separate component parts), 
     ``upcoding'' services to receive higher reimbursements, 
     providing inferior products to patients, paying kickbacks and 
     inducements for referrals of patients, falsifying claims and 
     medical records to fraudulently certify an individual for 
     government benefits, and billing for ``ghost'' patients, or 
     ``phantom'' sessions or services.
       This report provides 50 case examples of scams that have 
     recently infiltrated our health care system. While these are 
     but a [[Page S1221]] small sampling of schemes that were 
     reviewed during the investigation, they serve to illustrate 
     how our health care system is rife with abuse, and how 
     Medicare, Medicaid and private insurers have left their doors 
     wide open to fraud.
       Patients--and, in the case of Medicare and Medicaid, 
     taxpayers--pay a high price for health care fraud and abuse 
     in the form of higher health care costs, higher premiums, and 
     at times, serious risks to patients' health and safety. For 
     example;
       Physician-owners of a clinic in New York stole over $1.3 
     million from the State Medicaid program by fraudulently 
     billing for over 50,000 ``phantom'' psychotherapy sessions 
     never given to Medicaid recipients;
       A speech therapist submitted false claims to Medicare for 
     services ``rendered to patients'' several days after they had 
     died;
       A home health care company stole more than $4.6 million 
     from Medicaid by billing for home care provided by 
     unqualified home care aides. In addition to cheating 
     Medicaid, elderly and disabled individuals were at risk from 
     untrained and unsupervised aides;

       Nursing home operators charged personal items such as 
     swimming pools, jewelry, and the family nanny to Medicaid 
     cost reports;
       Fifteen hundred workers lost their prescription drug 
     coverage because a scam drove up the cost of the insurance 
     plan for their employer. The scam involved a pharmacist who 
     stole over $370,000 from Medicaid and private health 
     insurance plans by billing over one thousand times for 
     prescription drugs that he did not actually dispense;
       Large quantities of sample and expired drugs were dispensed 
     to nursing home patients and pharmacy customers without their 
     knowledge. When complaints were received from nursing home 
     staff and patient relatives regarding the ineffectiveness of 
     the medications, one of the scam artists stated ``those 
     people are old, they'll never know the difference and they'll 
     be dead soon anyway'';
       Durable medical equipment suppliers stole $1.45 million 
     from the New York State Medicaid program by repeatedly 
     billing for expensive orthotic back supports that were never 
     prescribed by physicians;
       A scheme involved the distribution of $6 million worth of 
     reused pacemakers and mislabeled pacemakers intended for 
     ``animal use only.'' The scheme involved kickbacks to 
     cardiologists and surgeons to induce them to use pacemakers 
     that had already expired; and
       A clinical psychologist was indicted for having sexual 
     intercourse with some of his patients and then seeking 
     reimbursement from a federal health plan for these encounters 
     as ``therapy'' sessions.
       Our investigation found that scams such as these are 
     perpetrated against both public and private health plans, and 
     that health care fraud schemes have become more complex and 
     sophisticated, often involving regional or national 
     corporations and other organized entities. No part of the 
     health care system is exempt from these fraudulent practices, 
     however, we found that major patterns of fraud and abuse have 
     infiltrated the following health care sectors: ambulance and 
     taxi services, clinical laboratories, durable medical 
     equipment suppliers, home health care, nursing homes, 
     physicians, psychiatric services, and rehabilitative services 
     in nursing homes. Our investigation further concludes that 
     fraud and abuse is particularly rampant in Medicaid, and 
     that many of the fraudulent schemes that have preyed on 
     the Medicare program in recent years are now targeting the 
     Medicaid program for further abuse.


  Greater Opportunities For Fraud Will Exist Under Health Care Reform

       As our health care system moves toward a managed care 
     model, opportunities for fraud and abuse will increase unless 
     enforcement efforts and tools are strengthened. The structure 
     and incentives of a managed care system will result in a 
     concentration of particular types of schemes, such as the 
     failure to provide services and quality of care deficiencies 
     in order to cut costs. In addition, while efforts toward 
     simplification and electronic filing of health care claims 
     offer tremendous savings, they also pose particular 
     opportunities for abuse. Thus, it is crucial that any such 
     system be designed with safeguards built in to detect and 
     deter fraud and abuse.


                       Findings of Investigation

     Deficiencies in the current system expose billions of health 
         care dollars to fraud and abuse
       A. Current Criminal and Civil Statutes Are Inadequate to 
     Effectively Sanction and Deter Hearth Care Fraud:
       Federal prosecutors now use traditional fraud statutes, 
     such as the mail and wire fraud statutes, the False Claims 
     Act, false statement statutes, and money laundering statute 
     to persecute health care fraud. Our investigation found that 
     the lack of a specific federal health care fraud criminal 
     statute, inadequate tools available to prosecutors, and weak 
     sanctions have significantly hampered law enforcement's 
     efforts to combat health care fraud. Inordinate time and 
     resources are lost in pursuing these cases under indirect 
     federal statutes. Often, even when law enforcement shuts down 
     a fraudulent scheme, the same players resurface and continue 
     their fraud in another part of the health care system.
       This cumbersome federal response to health care fraud has 
     resulted in a system whereby the mouse has outsmarted the 
     mousetrap. Those defrauding the system are ingenious and 
     motivated, while the government and private sector responses 
     to these perpetrators have not kept pace with the 
     sophistication and extent of those they must pursue.
       B. The Fragmentation of Health Care Fraud Enforcement 
     Allows Fraud to Flourish:
       Despite the multiplicity of Federal, State and local law 
     enforcement agencies, and private health insurers and health 
     plans involved in the investigation and prosecution of health 
     care fraud, these enforcement efforts are inadequately 
     coordinated, allowing health care fraud to permeate the 
     system. While some strides have been made in coordinating law 
     enforcement efforts, immediate steps must be taken to 
     streamline and toughen our response to health care fraud.


                            Recommendations

       Based on our investigation and findings, we recommend the 
     following to reduce fraud and abuse throughout the health 
     care system:
       1. Establish an all-payer fraud and abuse program to 
     coordinate the functions of the Attorney General, Department 
     of Health and Human Services, and other organizations, to 
     prevent, detect, and control fraud and abuse; to coordinate 
     investigations; and to share data and resources with Federal, 
     State, and local law enforcement and health plans.
       2. Establish an all-payer fraud and abuse trust fund to 
     finance enforcement efforts. Fines, penalties, assessments, 
     and forfeitures collected from health care fraud offenders 
     would be deposited in this fund, which would in turn be used 
     to fund additional investigations, audits, and prosecutions.
       3. Toughen federal criminal laws and enforcement tools for 
     intentional health care fraud.
       4. Improve the anti-kickback statute and extend 
     prohibitions of Medicare and Medicaid to private payers.
       5. Provide a greater range of enforcement remedies to 
     private sector health plans, such as civil penalties.
       6. Establish a national health care fraud data base which 
     includes information on final adverse actions taken against 
     health care providers. Such a data base should contain strong 
     safeguards in order to ensure the confidentiality and 
     accuracy of the information data contained in the data base.
       7. Design a simplified, uniform claims form for 
     reimbursement and an electronic billing system, with tough 
     anti-fraud controls incorporated into these designs.
       8. Take several steps to better protect Medicare from 
     fraudulent and abusive provider billing practices and 
     excessive payments by Medicare. Specifically:
       Revise and strengthen national standards that suppliers and 
     other providers must meet in order to obtain or renew a 
     Medicare provider number;
       Prohibit Medicare from issuing more than one provider 
     billing number to an individual or entity (except in 
     specified circumstances), in order to prevent providers from 
     ``jumping'' from one billing number to another in order to 
     double-bill or avoid detection by auditors;
       Require Medicare to establish more uniform national 
     coverage and utilization policies for what is reimbursed 
     under Medicare, so that providers cannot ``forum shop'' in 
     order to seek out the Medicare carrier who will pay a higher 
     reimbursement rate;
       Require the Health Care Financing Administration to review 
     and revise its billing codes for supplies, equipment and 
     services in order to guard against egregious overpayments for 
     inferior quality items or services; and
       As we revise the health care system, give guidance to 
     health care providers on how to do business properly and how 
     to avoid fraud.
       Adoption of these recommendations will go far in shoring up 
     our defenses against unscrupulous providers, patients, and 
     suppliers who are bleeding billions of dollars from our 
     health care system through fraud and abuse. Since Medicare 
     and Medicaid lose as much as $31 billion annually to fraud 
     and abuse, the savings from reducing fraud in these programs 
     would go far toward paying for much needed reforms in our 
     health care system, such as providing access to health care 
     coverage for the uninsured, prescription drug benefits for 
     the elderly, or long-term care for the elderly and 
     individuals with disabilities.
       We must not wait to fix these serious problems in the 
     health care system until we see what form health care reform 
     takes. We are losing as much as $275 million each day to 
     health care fraud, and effective steps can be taken within 
     the current system to curb this abuse. With billions of 
     dollars and millions of lives at stake, we can no longer 
     afford to wait.
                                                                    ____


                      Section-by-section Analysis

       The Cohen legislation establishes an improved coordinated 
     federal effort to combat fraud and abuse in our health care 
     system. It expands certain existing criminal and civil 
     penalties for health care fraud to provide a stronger 
     deterrent to the billing of fraudulent claims and to 
     eliminate waste in our health care system resulting from such 
     practices.
       Section 101. a. All-Payer Fraud and Abuse Control Program: 
     The Secretary of Health [[Page S1222]] and Human Services and 
     the Attorney General are required to jointly establish and 
     coordinate an all-payer national health care fraud control 
     program to restrict fraud and abuse in private and public 
     health programs. The Secretary and Attorney General (through 
     its Inspectors General and the Federal Bureau of 
     Investigation) would be authorized to conduct investigations, 
     audits, evaluations and inspections relating to the delivery 
     and payment for health care and would be required to arrange 
     for the sharing of data with representatives of health plans.
       b. Health Care Fraud and Abuse Control Account: To 
     supplement regularly appropriated funds, a special account 
     would be established to fund the all-payer program, managed 
     by the Secretary and Attorney General. All criminal fines, 
     penalties, and civil monetary penalties imposed for 
     violations of fraud and abuse provisions of this legislation 
     would be deposited into the account and used for carrying out 
     the proposed requirements.
       Section 102. Application of Certain Federal Health Anti-
     Fraud and Abuse Sanctions to All Fraud and Abuse Against Any 
     Health Plan: The provisions under the Medicare and Medicaid 
     program, which provide for criminal penalties for specified 
     fraud and abuse violations, would apply and be extended in 
     certain circumstances to similar violations for all payers in 
     the health care system. The violations would include willful 
     submission of false information or claims. Penalties would 
     include fines and possible imprisonment. The Secretary could 
     also consider community service opportunities.
       Section 103. Health Care Fraud and Abuse Guidance: Provides 
     mechanisms for further guidance to health care providers on 
     the scope and applicability of the anti-fraud statutes in 
     order to better comply with these statutes. The further 
     guidance would be provided by the modifications of existing 
     safe harbors and the promulgation of new safe harbors; 
     interpretive rulings providing the HHS' Inspector General's 
     interpretation of anti-fraud statutes; and special fraud 
     alerts setting activities that the Inspector General 
     considers suspect under the anti-fraud statutes.
       Section 104. Reporting of Fraudulent Actions Under 
     Medicare: The Secretary is required to establish a program 
     through which Medicare beneficiaries may report instances of 
     suspected fraudulent actions on a confidential basis.
       Section 201. Mandatory Exclusion from Participation in 
     Medicare and State Health Care Programs: The Secretary 
     currently has authority to exclude individuals and entities 
     from Medicare and Medicaid based on convictions or program-
     related crimes relating to patient abuse or neglect. This 
     section would extend the Secretary's authority to felony 
     convictions relating to fraud and felony convictions relating 
     to controlled substances. Currently, the Secretary is 
     permitted, but not required, to exclude those convicted of 
     such an offense. Adoption of this proposal would better 
     recognize the seriousness of such offenses and ensure that 
     beneficiaries are well protected from dealing with such 
     individuals.
       Section 202. Establishment of Minimum Period of Exclusion 
     for Certain Individuals and Entities Subject to Permissive 
     Exclusion from Medicare and State Health Care Programs: 
     Mandatory exclusions contain a minimum period of exclusion 
     for five years. This section establishes a minimum period of 
     exclusion expressly determined in statute for certain 
     permissive exclusions, such as three years for specific 
     convictions.
       Section 203. Permissive Exclusion of Individuals with 
     Ownership or Control Interest in Sanctioned Entities: Some of 
     the current permissive exclusions are ``derivative'' 
     exclusions--that is they are based on an action previously 
     taken by a court, licensure board, or other agency. Current 
     law allows permissive exclusion authority for entities when a 
     convicted individual has ownership, control or agency 
     relationship with such entity. However, if an entity rather 
     than an individual is convicted under Medicare fraud, the IG 
     has no authority to exclude the individuals who own or 
     control the entity and who may really have been behind the 
     fraud.
       This creates a loophole whereby an individual who is 
     indicated for fraud along with a corporation owned by his can 
     avoid being excluded from the programs by persuading the 
     prosecutor to dismiss his indictment in exchange for agreeing 
     to have the corporation plead guilty or pay fines. The bill 
     would extend the current permissive exclusion authority for 
     entities controlled by a sanctioned individual to individuals 
     with control interest in sanctioned entities.
       Section 205. Intermediate Sanctions for Medicare Health 
     Maintenance Organizations: The Secretary would be able to 
     impose civil monetary penalties on Medicare-qualified HMOs 
     for violations of Medicare contracting requirements.
       Section 301. Establishment of the Health Care Fraud and 
     Abuse Data Collection Program: The Secretary would create a 
     comprehensive national data collection program for the 
     reporting of information about final adverse actions against 
     health care providers, suppliers, or licensed practitioners 
     including criminal convictions, exclusions from participation 
     in Federal and State programs, civil monetary penalties and 
     license revocations and suspensions.
       Section 401. Civil Monetary Penalties: The provisions under 
     Medicare and Medicaid which provide for civil monetary 
     penalties for specified violations apply to similar 
     violations in certain circumstances for all payers in the 
     health care system. The violations would include billing for 
     services not provided or submitting fraudulent claims for 
     payment.
       The provisions would also clarify that repeatedly claiming 
     a higher code, or repeatedly billing for medically 
     unnecessary services, for purposes of reimbursement is 
     prohibited and subject to civil monetary penalties. The 
     intent of this provision is to impose sanctions for patterns 
     of prohibited conduct.
       An intermediate civil monetary penalty would also be 
     established for criminal anti-kickback violations.
       One abusive technique now used by some Medicare providers 
     is to waive the patient's copayment for services covered by 
     Medicare. The concern is that routine waivers of copayments 
     result in unnecessary procedures and overutilization (because 
     the beneficiary has no financial stake in the decision to 
     order a medical item or service). The provision would clarify 
     that the routine waiver of Medicare Part B copayments and 
     deductibles would be prohibited and subject to civil monetary 
     penalties although exceptions are provided.
       In addition, retention by an excluded individual of an 
     ownership or control interest of an entity who is 
     participating in Medicare or Medicaid would be prohibited and 
     subject to civil monetary penalties.
       Finally, the amount of civil monetary penalty that can be 
     assessed is increased from $2,000 to $10,000.
       Section 501. Health Care Fraud: Establishes a new health 
     care fraud statute in the criminal code. Provides a penalty 
     of up to 10 years in prison, or fines, or both for knowingly 
     executing a scheme to defraud a health plan in connection 
     with the delivery of health care benefits, as well as for 
     obtaining money or property under false pretenses from a 
     health plan. This section is patterned after existing mail 
     and wire fraud statutes.
       Section 502. Forfeitures for Federal Health Care Offenses: 
     Requires the court, in imposing sentence on a person 
     convicted of a Federal health care offense, to order the 
     forfeiture to the United States of property used in 
     commission of an offense if it results in a loss or gain of 
     $50,000 or more and constitutes or is derived from proceeds 
     traceable to the commission of the offense.
       Section 503. Injunctive Relief Relating to Federal Health 
     Care Offenses: This provision expands the scope of the 
     current injunctive relief section by adding the commission of 
     a health care offense. This provision allows the Attorney 
     General to commence a civil action to enjoin such violation 
     as well as to freeze assets.
       Section 504. Grand Jury Disclosure: This provision allows 
     the disclosure of grand jury information to federal 
     prosecutors to use in a civil proceeding relating to health 
     care fraud.
       Section 505. False Statements: Provides penalties for 
     making false statements relating to health care matters.
       Section 506. Voluntary Disclosure Program: Creates a 
     program of voluntary disclosure to the Attorney General and 
     Secretary to provide an incentive for disclosure of 
     violations and wrongdoing.
       Section 507. Obstruction of Criminal Investigations: 
     Provides a penalty for the obstruction of criminal 
     investigations of federal health care offenses.
       Section 508. Theft or Embezzlement: Establishes a statute 
     that provides penalties for the willful embezzlement or theft 
     from a health care benefit program.
       Section 509. Laundering of Monetary Instruments: Provides 
     that a federal health care offense is a predicate to current 
     money laundering statutes.
       Sections 601-604: Payments for State Health Care Fraud 
     Control Units: Provides language to establish state health 
     care provider fraud control units modeled on the current 
     state Medicaid Fraud Control Units. The jurisdiction of these 
     units would be expanded to include investigation and 
     prosecution of provider fraud in other federally-funded or 
     mandated programs. The proposal also allows the states to 
     choose whether to conduct investigations and prosecutions for 
     patient abuse related crimes occurring in board and care 
     facilities and other alternative residential settings.
       The HHS' Inspector General would continue oversight and the 
     state units would detail its activities in its yearly grant 
     applications. This section also contains a recitation of the 
     units' original authorization language as currently contained 
     in the Social Security Act, and also allows the units to 
     participate in the all-payer fraud abuse control program.

  Mr. DOLE. Mr. President, I want to take a few moments to express my 
support for the Health Care Fraud Prevention Act of 1995, which was 
introduced earlier today by my distinguished colleague from Maine, 
Senator Cohen.
  As Senator Cohen has pointed out, health care fraud and abuse costs 
the American taxpayers literally billions and billions of hard-earned 
dollars each year. Unscrupulous doctors who overbill patients, medical 
suppliers who sell unnecessary or defective equipment to unsuspecting 
customers, clinic operators who submit false Medicaid reimbursement 
claims--all these scams have the effect of driving up the 
[[Page S1223]] cost of health care for families and businesses alike.
  To combat these activities, the act establishes a new health care 
fraud statute in title 18 of the United States Code. This statute 
provides for an array of penalties, including imprisonment and fines, 
for those who knowingly scheme to defraud a health care plan. This 
statute is patterned after the existing mail and wire fraud statutes.
  The act also gives the Secretary of HHS greater authority to exclude 
health care scam artists from the Medicaid and Medicare programs, while 
establishing tough civil penalties for fraud so that a range of 
sanctions will be available.
  In addition, the act directs the Attorney General and the Secretary 
of Health and Human Services to establish an all-payer national health 
care fraud control program. Under this program, both the Secretary and 
the Attorney General would be authorized to conduct investigations and 
audits of health care delivery systems. To pay for these 
investigations, the act establishes a ``Health care fraud and abuse 
control account.'' Criminal and civil fines imposed on violators would 
be deposited into the account and then used to finance future law 
enforcement efforts.
  Of course, the vast majority of health care providers are good people 
committed to the well-being of their patients. Their hard work and 
commitment should not be tarnished in any way by those few bad apples 
who attempt to game the health care system for their own personal 
benefit. This legislation won't put an end to the health care fraud 
racket, but it will help to ensure that our law enforcement authorities 
have the tools to get the job done.
  Not surprisingly, the Health Care Fraud Prevention Act was crafted 
with the help of law enforcement officials, including officials at both 
the FBI and the Department of Justice.
  Finally, I want to commend my distinguished colleague from Maine for 
bringing this important issue to the attention of the Senate. Today's 
legislation is the product of a 2-year ongoing investigation conducted 
by the staff of the Special Committee on Aging. And last year, Senator 
Cohen successfully offered many of the provisions contained in this 
bill as an amendment to the 1994 Crime-Control Act. Unfortunately, the 
amendment was dropped in conference.
  To his credit, Senator Cohen has continued to speak out on this 
issue, and I fully expect that his persistence will pay off later this 
year when the Senate has an opportunity to consider this important 
legislation.
  Mr. DORGAN. Mr. President, let me say as I begin, to my friend from 
Maine, the work he has done on this issue in Medicare fraud is 
extraordinary work. During the period between the end of the last 
session and the beginning of this session, I saw some newspaper reports 
about Medicare fraud. I bothered to once again review the work he did 
in the last session, the bill he introduced in the last session on this 
issue. I hope we make progress on this issue that he is leading on, in 
this session of the Senate, because I think what he is doing is very 
important. There is too much fraud. The fact is, we are not detecting 
enough of it and not prosecuting enough of it vigorously, so I support 
his efforts and thank him for making those efforts.
  Mr. PRYOR. Mr. President, I rise to support S. 245, the Health Care 
Fraud Prevention Act of 1995. Health care fraud and abuse in our health 
care system is draining billions of dollars a year from American 
families, businesses, and government. The Department of Justice and 
other experts have estimated that as much as 10 percent of our national 
health care bill is lost to fraud and abuse. Every dollar stolen from 
the health care system--be it from Medicare, Medicaid, or a private 
health care plan--means one less dollar for patient care or for lower 
insurance premiums. With health care costs still escalating, the last 
thing we need to be doing is allowing criminals to steal from the 
system.
  Fraud also tarnishes the good names of honest health care 
professionals and companies. While the vast majority of providers are 
honest and hard working, the crooks cast a cloud over the entire health 
care system.
  Mr. President, there are too many examples of fraud in our health 
care system. For example, seven New York physicians were recently 
excluded from the New York Medicaid program for their part in a scheme 
that stole over $8 million from the program. As part of this Medicaid 
fraud scheme, indigent individuals with no legitimate medical need for 
prescription drugs would enter the doctors' clinics and obtain 
prescriptions for expensive drugs. They, in turn, would resell the 
prescriptions to people on the street. In exchange for the 
prescriptions, the ``patients'' would subject themselves to unnecessary 
medical tests and procedures for which Medicaid could then be 
fraudulently billed.
  In other cases, it is not so clear that there has been fraud, but 
rather that a health care plan has been taken advantage of. As an 
example, I received a letter from a constituent of mine, Jennie H., not 
too long ago. Jennie wrote that Medicare had paid a medical supplier 
$2,136 for 300 adult incontinence pads that were delivered to her 
mother. That works out to almost $7.12 for each pad, far more than what 
they would cost at the drug store.
  Much studying has been on the health care fraud problem in recent 
years. In addition to the report issued last year by my friend from 
Maine, Senator Cohen, the incoming chairman of the Senate Special 
Committee on Aging, reports by the General Accounting Office, the HHS 
inspector general, and congressional committees have also documented 
the extent and range of the problem. They have detailed abuses ranging 
from the billing of services never provided to the illegal sale of 
controlled substances.
  This is a subject about which I too have long been concerned. When I 
was chairman of the Senate Special Committee on Aging, I held several 
hearings on fraud and abuse in the health care system. In addition, the 
health care bill reported out of the Finance Committee last year 
included an antifraud provision that I helped develop.
  Mr. President, now is the time to take action against health care 
fraud. While I would have preferred to see the health care fraud 
problem addressed as part of health care reform, it is clear that we 
cannot wait for that to happen. Each day we wait to give crime fighters 
the authority and tools they need to combat fraud in a coordinated and 
effective manner means millions of wasted health care dollars.
  The bill which I have joined Senator Cohen in sponsoring today 
represents a balanced, bipartisan approach to combating health care 
fraud and takes the best provisions common to the bills debated last 
year, such as the President's proposal. It establishes an improved, 
coordinated effort to combat fraud and abuse. It expands certain 
existing criminal and civil penalties for health care fraud to provide 
a stronger deterrent to the billing of fraudulent claims and to 
eliminate waste in our health care system. I encourage my colleagues to 
support this legislation.
                                 ______

      By Mr. LIEBERMAN:
  S. 246. A bill to establish demonstration projects to expand 
innovations in State administration of the aid to families with 
dependent children under title IV of the Social Security Act, and for 
other purposes; to the Committee on Finance.


                   the welfare reforms that work act

  Mr. LIEBERMAN. Mr. President, today I am introducing the Welfare 
Reforms That Work Act of 1995. The welfare system is in crisis. The 
United States has one of the most expensive welfare systems in the 
world. But 20 percent of America's children are poor, a higher 
percentage than any other industrialized country. The welfare system is 
a disaster for those who are on it and those who pay for it.
  This Congress has a historic opportunity to begin to fix this 
disaster. The primary welfare program--Aid to Families With Dependent 
Children [AFDC]--is viewed by those participating in it and those 
paying for it as a failure. It is failing at its primary task, moving 
people into the work force. Worse yet, it is contributing to the cycle 
of poverty. By rewarding single parents who don't work, don't marry, 
and have additional children out of wedlock, the current system demeans 
our most cherished values and deepens society's most serious problems. 
Democrats, Republicans, and the American [[Page S1224]] public agree 
that the system must be changed.
  But little consensus exists on how best to reform the system so that 
it promotes work and family. Last year both President Clinton and 
Republicans in Congress proposed legislation that would impose time 
limits and work requirements on welfare recipients and would begin to 
turn welfare incentives around. But in this Congress some have gone 
further. The Republican Contract With America proposes, among other 
things, ending benefits abruptly for teenage mothers who have children 
out of wedlock. More recently some Members have advocated giving the 
States total control of AFDC and other Federal welfare programs, ending 
the entitlement status of these programs, and capping Federal outlays.
  While I believe that each of these ideas should be tested to see if 
they will produce better results than the current failed welfare 
system, I cannot support mandating any of them nationally because no 
one knows whether they will work. If Congress imposes them nationally 
and they do not work, millions of children's lives will be put at risk.
  While I am pleased to see that my colleagues are advocating State 
flexibility, I am concerned about their blank-check approach. I agree 
that States should be the testing ground for bold programmatic changes. 
But handing the AFDC Program over to the States with no strings 
attached does not guarantee reform and may produce national division 
and welfare shopping. And, placing caps on block grants works against 
State flexibility by limiting State experiments to those that save 
money in the short term but may do nothing to promote work and 
reconstruct families in the long term. The American people are asking 
us to reform, not eliminate, the way we are carrying out our 
responsibility to help poor children.
  Mr. President, today I am proposing an alternative welfare reform 
approach that I hope will meet our welfare reform goals in a way that 
is acceptable to both sides of the aisle--the Welfare Reforms That Work 
Act. The bill would allow States to test--with appropriate Federal 
oversight--bold welfare reform initiatives that are promising but 
unproven, and that involve some human or financial risk. It would also 
establish a process for identifying successful reform approaches--
welfare reforms that work--that can be applied nationally. The bill 
does not preclude our mandating immediately those reforms about which 
there is growing agreement--such as requiring unwed teenage mothers to 
live at home as a condition of receiving welfare payments--and which 
involve limited human risk or Federal expense.
  States should be at the forefront of reform for three reasons. First, 
a State-based approach is financially prudent. Some reforms that merit 
testing--including imposing time limits and work requirements or 
expanding residential child care options, including orphanages--will 
cost money in the short term. In an article in the New Republic, Paul 
Offner of the Senate Finance Committee staff advises us to learn an 
important lesson from the 1988 Family Support Act: overly ambitious and 
underfunded reform efforts are doomed to failure. They do little to 
change the expectations of those working in the system or those using 
it. My bill would allow States to fund ambitious changes at the more 
affordable city, county, or State level.
  Second, a State-driven approach allows us to test bold changes 
responsibly. We have few proposed reforms that we know will work, and 
those that have been tested, such as the model education and training 
programs launched in California and Florida, have delivered only 
marginal results to date. In a recent Wall Street Journal James Q. 
Wilson bluntly confessed that he simply does not know what reforms will 
work.
  Absent better information, we would be wise to heed the advice of 
proverbs and avoid zealous acts without knowledge. Changes to welfare 
are consequential. They affect people's lives, children's lives. Under 
my bill States could test bold welfare rules changes--such as totally 
denying benefits to teenage mothers or establish orphanages--but only 
if the States can ensure that children are not unintended victims of 
these tests. As we try to change the behavior of parents, we must not 
cause more pain to the children.
  Third, States are eager and able to lead our reform efforts. In 
testimony last year before the Senate Finance Committee's Subcommittee 
on Social Security and Family Policy, the American Public Welfare 
Association [APWA] and other State organizations indicated their strong 
desire to pursue innovative strategies. When I introduced S. 1932, a 
similar State-based welfare reform bill last year, all 11 States that 
commented on the bill praised the bill's general approach.
  States are already leading the way. Over half the States have 
proposed reforms and received waivers from Federal rules under section 
1115 of the Social Security Act to implement their proposed changes. My 
own State of Connecticut recently received a waiver to implement a 
comprehensive reform initiative.
  But the waiver process does not go far enough. In testimony before 
the House Committee on Government Operations last September, the APWA, 
State welfare administrators, and other witnesses testified that the 
budget neutrality requirement of the current process creates a 
substantial barrier to reform. As States seek to promote work and 
family through changing eligibility rules, it give States an incentive 
to test sticks but not carrots. Witnesses at the hearing urged that the 
Federal Government share in the cost of demonstrations programs, make 
the results of demonstrations readily available, and tallow States to 
adopt, without a waiver, those demonstrations that prove effective. In 
other words, we must be honest and acknowledge that we may have to 
spend a little more money in the short run to save a lot more money and 
a lot more lives in the long run.
  My bill addresses these and other concerns voiced by States about the 
current waiver process. To ensure that States will be able to test the 
broadest array of reforms, my bill authorizes $675 million over 5 years 
to support demonstration projects and independent program evaluations. 
Half of these funds would support innovative pilot programs specified 
in the bill, and the remaining half would fund other State-proposed 
demonstrations. Demonstration projects would last up to 5 years. States 
would report on progress annually. As results of interim and final 
reports on State tests become available, the Secretary of the 
Department of Health and Human Services [HHS] will submit legislation 
to Congress to provide for the national implementation of successful 
programs. As a result of this process, those innovations that proved 
successful could be rapidly adopted by other States or imposed 
nationwide.
  The bill promotes State-initiated welfare reforms that meet what I 
believe should be our four main reform goals: moving welfare recipients 
into the work force; strengthening families, stopping illegitimate 
births and breaking the cycle of welfare dependency; increasing child 
support collection and paternal responsibility, and improving the 
delivery of welfare services.


title i authorizes initiatives to move welfare recipients into the work 
                                 force

  We must make returning to work the primary focus of the welfare 
system. The current system demands little of people on welfare. It 
often impedes, rather than empowers, those who seek to return to the 
work force. If an AFDC mother goes back to work, her income increases 
only minimally--often not enough to cover child care--and she loses her 
Medicaid benefits. She is likely to be economically worse off if she 
returns to the work force, so she stays on welfare.
  Title I includes initiatives to move people on welfare into the work 
force. Two pilot programs focus on teenage parents--those at greatest 
risk for long-term welfare dependency. The first allows States to 
condition AFDC benefits for single parents under 20 years of age on: 
first, attending school, participating in job training or holding a 
job; and second, living at home. The second allows States to include 
young AFDC clients in the Job Corps--a successful, residential 
antipoverty program for youths 16 to 22 years of age.
  Title I also allows States to require 30 days of State-assisted job 
search or, where appropriate, substance abuse treatment, during the 
usual lag time between application for and receipt of 
[[Page S1225]] benefits. Welfare clients should be engaged in job 
search from the day they first seek a welfare grant. Other provisions 
in this title assist people on welfare in accumulating assets to invest 
in education or to start a small business.


 title II authorizes initiatives to strengthen families and break the 
                      cycle of welfare dependency

  Current Federal welfare rules discourage family unification and 
encourage out-of-wedlock childbearing. This title seeks to turn these 
incentives around. It recognizes that while welfare is a privilege 
granted by Government, not a right for parents, the States and the 
Federal Government have a moral responsibility to ensure the well-being 
of American children.
  The title seeks to address what is perhaps the most compelling and 
difficult challenge of welfare reform, to discourage out-of-wedlock 
births without harming children. An increasing percentage of those 
entering the welfare system are never-married mothers at greatest risk 
of long-term welfare dependency. Between 1983 and 1992, families headed 
by unwed mothers accounted for about four-fifths of the growth in 
people on welfare, and at least 40 percent of never-married mothers 
receiving AFDC remain in the system for 10 years or more.
  Never-married teen parents are particularly likely to fall into long-
term welfare dependency. More than one half of welfare spending goes to 
women who first gave birth as teens. As William Raspberry noted last 
winter in a Washington Post column aptly entitle ``Out of Wedlock, Out 
of Luck,'' children born to parents who had their first child out-of-
wedlock before they finished high school and reached the age of 20 are 
``almost guaranteed a life of poverty.'' In other words, they and their 
parents are almost guaranteed a life on welfare. Citing William A. 
Galston's analyses, Raspberry notes that a startling 79 percent of 
children in this category lived in poverty in 1992. In contrast, only 8 
percent of children whose parents had achieved all three milestones--
marriage, graduation, and the 20th birthday--before having their first 
child were living in poverty.
  The potential effect of welfare on illegitimacy has taken center 
stage in the welfare reform debate but there is considerable 
disagreement about its effects. David Ellwood, economist and Department 
of Heath and Human Services official, has found little evidence that 
welfare contributes to the increase in illegitimacy. In his book, 
``Poor Support,'' he points to several other concurrent social changes 
that are likely contributors to the increase--the growing percentage of 
women in the work force, the drop in earnings and rise in unemployment 
among young men, and changes in attitudes toward marriage.
  Others interpret the data differently. Most notably, Charles Murray 
believes that welfare is the primary cause of the increase in 
illegitimate births. In a catalytic Wall Street Journal article 
published October 29, 1993, Murray argues that welfare has reduced the 
economic penalty associated with out-of-wedlock childbearing and, in 
turn, has reduced the social stigma associated with it. He concludes 
that the removal of both of these disincentives has led to more out-of-
wedlock births. Based on this conclusion, Murray recommends the 
dramatic step of ending welfare altogether. Murray acknowledges that 
his approach may put this generation of children at risk and advocates, 
among other things, Government investment in new facilities to care for 
these children--thus the ensuing brouhaha about orphanages--just the 
kinds of facilities this act would enable states to create.
  The stigma of illegitimacy was not just an accident of social 
history; it was a societal attempt to protect children. Today, the 
stigma is largely gone and so the children have suffered terribly. 
Raspberry's previously mentioned article cites polling results 
indicating that 70 percent of Americans aged 18 to 34 believe that 
people having children out of wedlock do not deserve any moral 
reproach. That is an outrageous result, one that we must turn around 
because the decision to bear a child has profound moral and human 
content. We must infuse our children with a clear understanding of the 
consequences of teenage childbearing. We must teach them that it is 
wrong to have children unless you are married, always morally wrong for 
the mother and father, and usually horrible for the child and the 
mother.
  Few would argue that a national campaign to discourage unmarried 
teenagers from having children is not a good thing to do. Indeed, 
Senate Minority leader Daschle introduced a bill, S. 8, on the first 
day of this session to combat teen pregnancy. His bill, among other 
things, would require unwed mothers under age 18 to live at home or in 
an alternative adult-supervised living arrangement as a condition of 
receiving AFDC. This measure seems appropriate; it would eliminate the 
incentive teenagers now have to bear a child so they can move out of 
the house, and it imposes little risk to the children of teenagers who 
have a child anyway.
  The more difficult question for those of us working on welfare reform 
is this: Should we pursue changes in welfare policy--such as cutting 
off benefits to teenage mothers--that may discourage out-of-wedlock 
births but would put children at risk? Some might say no, believing 
that there is little correlation between welfare and out-of-wedlock 
births. The empirical evidence is generally viewed as inconclusive. But 
some controlled studies have demonstrated a positive association 
between welfare payments and out-of-wedlock births, and my own 
conversations with teenage mothers bears this out.
  If we choose to reduce or eliminate AFDC grants to deter 
childbearing, however, we should acknowledge that a portion of the 
current and potential welfare population--perhaps a small but 
significant portion--is unlikely to respond to stronger inducements and 
penalties and will continue to have children society must provide for. 
In a Los Angeles Times article published last January, Adela de la 
Torre, an economist at California State University at Long Beach, 
writes that the children of such parents ``become victims of trickle 
down welfare programs * * * if we deem the parent unfit for welfare 
support, the child, too, loses.'' De la Torre rejects the notion that 
building stronger parental inducements into the welfare system will 
change the behavior of all parents and calls instead for a more child-
centered social service agenda that recognizes and serves the needs of 
children in a more direct, comprehensive, and integrated fashion. She 
makes an important point.

  Similarly, Thomas Corbett of the University of Wisconsin asks in a 
spring, 1993 Focus article whether it is ``compassionate to throw a 
little bit of welfare into troubled families and do little else to aid 
the children?'' The answer is, of course, relative. AFDC reflects our 
best intentions toward these children, but it has more often failed 
them. Whether cash payments to unresponsive parents is the most 
compassionate approach, Corbett concludes, ``depends partly on how many 
children are involved and whether we can design and finance the 
technologies required to assist them.''
  It is incumbent on us, as part of welfare reform, to explore the 
alternatives to a largely parent-based system, and find the answers to 
his question. Title II of the bill supports State efforts to do just 
that. Section 201 allows States to shift part or all of AFDC payments 
to block grants and combine the grants with other funds available under 
this bill to care for children, strengthen families, and implement 
other reforms. In contrast to the Republican block grant proposals, 
however, the provision requires the Secretary of HHS to ensure that 
States pursuing the Block Grant Program protect the well-being of 
affected children. Title II supports other demonstrations as well, 
including pilots that discourage welfare recipients from having 
additional children while on welfare by denying benefit increases for 
additional children and pilots to test innovative teen pregnancy 
prevention programs.


 title iii of the bill authorizes state initiatives to increase child 
             support collection and paternal responsibility

  Too often absent parents, typically fathers, are not held accountable 
for their children's care. The Federal Government must also take the 
lead in improving child support enforcement. As a starting point, we 
should fully implement the recommendations of the U.S. 
[[Page S1226]] Commission on Interstate Child Support. In the last 
Congress Senator Bill Bradley, a member of the Commission, introduced 
S. 689, the Interstate Child Support Enforcement Act, to implement the 
Commission's recommendations. My Connecticut colleague, Congresswoman 
Kennelly, also a Commission member, introduced a similar bill, H.R. 
1961, in the House. This year I will again support Senator Bradley's 
legislation which will, among other things: Mandate hospital-based 
paternity acknowledgement programs; require employers to submit 
W-4 forms for all new employees to State child support 
enforcement agencies; and provide States the authority they need to 
assert jurisdiction over nonresident parents. The era of deadbeat dads 
should end.
  While improving interstate coordination is critical to strengthening 
child support enforcement, State innovation should play a role as well. 
Title III of my bill authorizes State efforts to improve child support 
collection and paternity establishment. To strengthen welfare 
recipients incentives to work with authorities to collect child 
support, it would allow States to increase the child support disregard 
from $50 to a higher level decided by the State. States could also hold 
parents accountable for the child support obligations of their minor 
children. Additionally, States could propose their own demonstrations 
projects to increase paternity establishment and improve child support 
collection.


     title IV authorizes initiatives to diversify and improve the 
                    performance of welfare services

  Changing the welfare system to move people back into the work force 
and to better serve the needs of children will require changing the way 
the welfare bureaucracy does business. Too many welfare workers focus 
on whether and how to get a welfare check to the recipient rather than 
how to get the recipient off of welfare and back to work. Many welfare 
offices don't know how many children they have in foster care. Many 
still operate out of cardboard files and lose people in the shuffle of 
paper. Offices often suffer from interagency rivalry and bureaucratic 
bickering. It is tragic when a child suffers needlessly because the 
system fails under the weight of its own inefficiency.
  This need not happen. Some innovative States and municipalities have 
tried to make their welfare systems more efficient and service 
oriented. At a hearing I held in the last Congress, Carmen Nazario, the 
Secretary of Health and Human Services in Delaware, testified that her 
State has brought public and private social services together in a 
single location and is now developing a computer network to link 
programs.
  David Truax from the Maryland Department of Human Resources described 
a second approach to improving services. Maryland now provides each 
participant with a debit card that has AFDC, food stamps, and general 
assistance benefits on it. Electronic benefit transfer [EBT] cards have 
several advantages: They preclude the trading of food stamps for drugs; 
they introduce people to the banking system; they make it easier for 
them to budget their money since they don't have to cash one single 
check, and they reduce recipients vulnerability to crime.
  Further, offices should encourage and empower, not discourage and 
demean, those they serve. It can be done. America Works, a private 
organization that trains people on welfare for work and places them in 
jobs, provides proof. During my visit to their Hartford, CT, office I 
found that clients felt they were getting the help they needed to 
succeed, and were motivated and optimistic. I asked one young woman who 
had just completed her training if she expected to be placed 
successfully in a job. She responded with enthusiasm, ``absolutely.'' 
This spirit does not typically pervade traditional welfare offices.
  Most important, welfare offices should be held accountable for 
results. They need to make the shift from writing checks to moving 
people on welfare into jobs. To promote this change, we should seek to 
establish competition among agencies and greater choice for people on 
welfare. We should encourage public agencies to contract with effective 
private sector companies and to better reward those public employees 
who successfully help people become self-sufficient.
  Title IV supports initiatives to diversify and improve the 
performance of welfare services. It supports State pilots to provide 
incentives to private sector, for-profit and nonprofit groups to place 
people on welfare in private sector jobs. Companies would keep a 
portion of welfare savings as payment for successful job placements. 
Title IV also supports State pilots to improve the performance of 
welfare office employees through, for example, providing direct bonuses 
to employees and judging their performance based on their clients' 
progress toward self-sufficiency.
  In addition, title IV incorporates legislation I introduced earlier 
this month with Senators Domenici, Feinstein, Pressler, and Hatfield to 
remove a Federal barrier to improving services. That bill, S. 131, the 
Electronic Benefits Regulatory Relief Act of 1995, exempts EBT cards 
from the Federal Reserve Board's regulation E. Regulation E limits 
cardholder liability to $50 for lost or stolen cards--a policy that 
promotes fraud and makes EBT Programs costly for States. Earlier this 
month the Vice President issued the first report from the EBT task 
force and called for nationwide implementation. Without passage of this 
provision, that goal will not be reached.


finally, title v authorizes offsetting expenditure reductions to ensure 
                       the bill is budget neutral

  In other words, the bills pay for itself. Specifically, it eliminates 
the three-entity rule. Currently, an individual farmer can qualify for 
up to $125,000 per year in certain Government subsidies. If he forms 
two other business entities with two other individuals (say, a friend 
and a sister), each of these entities can qualify for another $125,000 
per year. So the individual farmer can receive up to $250,000 in 
subsidies per year--$125,000 for his first business entity, and half of 
$125,000 for each of his second and third entities. My bill says, 
``enough is enough,'' and caps the amount of agricultural subsidies any 
one person gets from the Federal Government at $125,000. A preliminary 
Congressional Budget Office estimate indicates this change will save 
$675 million over 5 years, money that is better spent on the truly 
needy.
  Americans continue to show concern for the poor, and particularly 
poor children. A 1994 poll commissioned by the Children's Defense Fund 
and others found that 64 percent of Americans believe we should spend 
more on poor children. But the same poll found that 55 percent think we 
spend too much on welfare, and 68 percent think we should not increase 
payments to parents for any additional children they have while on 
welfare.
  Our current approach to helping the poor is clearly not working. The 
goal of welfare reform is to shake up the status quo which promotes 
dependency, illegitimacy, and social disfunctions like crime into a 
system that promotes work, family, and responsibility and protects 
children from a life of poverty. The Federal Government does not have a 
ready formula for how to achieve this goal. I concur with my colleagues 
who say that we should look to the States for answers. But we must 
proceed in a way that meets our obligation to ensure the well-being of 
all of America's children. Our aim should be to make sure that this 
generation of welfare children do not become the next generation of 
welfare parents. This bill offers an approach to do just that.
  Mr. President, I ask unanimous consent that the text of the bill and 
additional material be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 246

       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 ``Welfare 
     Reforms That Work Act''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Purpose.
Sec. 3. Definitions.
Sec. 4. General provisions relating to demonstration 
              projects. [[Page S1227]] 
Sec. 5. Authorization of appropriations.

  TITLE I--INITIATIVES TO MOVE WELFARE RECIPIENTS INTO THE WORK FORCE

Sec. 101. Demonstration projects which condition AFDC benefits for 
              certain individuals on school attendance or job training, 
              limit the time period for receipt of such benefits, and 
              require teenage parents to live at home.
Sec. 102. Pilot Job Corps program for recipients of Aid to Families 
              with Dependent Children.
Sec. 103. Demonstration projects requiring up-front 30-day assisted job 
              search, or substance abuse treatment before receiving 
              AFDC benefits.
Sec. 104. Disregard of education and employment training savings for 
              AFDC eligibility.
Sec. 105. Incentives and assistance in starting a small business.
Sec. 106. Increased emphasis in JOBS program on moving people into the 
              work force.
Sec. 107. Additional demonstration projects to move AFDC recipients 
              into the work force.

  TITLE II--INITIATIVES TO STRENGTHEN FAMILIES AND BREAK THE CYCLE OF 
                           WELFARE DEPENDENCY

Sec. 201. Demonstration projects to establish child centered programs 
              through conversion of certain AFDC and JOBS payments into 
              block grants.
Sec. 202. Demonstration projects providing no additional benefits with 
              respect to children born while a family is receiving AFDC 
              and allowing increases in the earned income disregard.
Sec. 203. Demonstration projects providing incentives to marry.
Sec. 204. Demonstration projects reducing AFDC benefits if school 
              attendance is irregular or preventive health care for 
              dependent children is not obtained.
Sec. 205. Demonstration projects to develop community-based programs 
              for teenage pregnancy prevention and family planning
Sec. 206. Additional demonstration projects to strengthen families and 
              break the cycle of welfare dependency.

 TITLE III--CHANGES TO FEDERAL LAWS AND STATE INITIATIVES TO INCREASE 
               CHILD SUPPORT AND PATERNAL RESPONSIBILITY

Sec. 301. Demonstration projects to increase paternity establishment.
Sec. 302. Demonstration projects to increase child support collection.

   TITLE IV--INITIATIVES TO DIVERSIFY AND IMPROVE THE PERFORMANCE OF 
                            WELFARE SERVICES

Sec. 401. Demonstration projects for providing placement of AFDC 
              recipients in private sector jobs.
Sec. 402. Demonstration projects providing performance-based incentives 
              for State public welfare providers.
Sec. 403. Electronic benefit transfers.

               TITLE V--OFFSETTING EXPENDITURE REDUCTIONS

Sec. 501. Offsetting expenditure reductions.

     SEC. 2. PURPOSE.

       The purposes of this Act are--
       (1) to promote bold State initiated welfare reforms that 
     will--
       (A) move welfare recipients into the work force,
       (B) strengthen families,
       (C) break the cycle of welfare dependence,
       (D) increase child support collection and paternal 
     responsibility, and
       (E) improve the delivery of welfare services; and
       (2) to make immediate State-by-State changes to the 
     existing system while establishing a process for identifying 
     successful reform approaches that can be applied nationally.

     SEC. 3. DEFINITIONS.

       For purposes of this Act:
       (1) Aid to families with dependent children.--The term 
     ``aid to families with dependent children'' has the meaning 
     given to such term by section 406(b) of the Social Security 
     Act (42 U.S.C. 606(b)).
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.

     SEC. 4. GENERAL PROVISIONS RELATING TO DEMONSTRATION 
                   PROJECTS.

       (a) Applications.--
       (1) In general.--Each State desiring to conduct a 
     demonstration project under this Act shall prepare and submit 
     to the Secretary an application in such manner and containing 
     such information as the Secretary may require. The Secretary 
     shall actively encourage States to submit such applications.
       (2) Approval.--The Secretary shall consider all 
     applications received from States desiring to conduct 
     demonstration projects under this Act and shall approve such 
     applications in a number of States to be determined by the 
     Secretary, taking into account the overall funding levels 
     available under section 5.
       (3) Consideration of research needs and purposes.--The 
     Secretary shall pursue a broad range of reforms consistent 
     with the purposes of this Act and with research needs in 
     approving demonstration projects under this Act.
       (b) Duration.--A demonstration project under this Act shall 
     be conducted for not more than 5 years plus an additional 
     time period of up to 12 months for final evaluation and 
     reporting. The Secretary may terminate a project 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 Act.
       (c) Evaluation Plan.--
       (1) In general.--Each State conducting a demonstration 
     project under this Act shall submit an evaluation plan 
     (meeting the standards developed by the Secretary under 
     paragraph (2)) to the Secretary not later than 90 days after 
     the State is notified of the Secretary's approval for such 
     project. A State shall not receive any Federal funds for the 
     operation of the demonstration project or be granted any 
     waivers of the Social Security Act necessary for operation of 
     the demonstration project until the Secretary approves such 
     evaluation plan.
       (2) Standards.--Not later than 3 months after the date of 
     the enactment of this Act, the Secretary shall develop 
     standards for the evaluation plan required under paragraph 
     (1) which shall include the requirement that an independent 
     expert entity provide an evaluation of each demonstration 
     project to be included in the State's annual and final 
     reports to the Secretary under subsection (d)(1).
       (d) Reports.--
       (1) State.--A State that conducts a demonstration project 
     under this Act shall prepare and submit to the Secretary 
     annual and final reports in accordance with the State's 
     evaluation plan under subsection (c)(1) for such 
     demonstration project.
       (2) Secretary.--The Secretary shall prepare and submit to 
     the Congress annual reports concerning each demonstration 
     project under this Act.
       (e) Legislative Proposal.--
       (1) Evaluations.--
       (A) In general.--On each of the dates described in 
     subparagraph (B), the Secretary shall evaluate the 
     demonstration projects based on the reports received from 
     each State under subsection (d)(1) and if the Secretary 
     determines that any of the reforms in the demonstration 
     projects will be effective in achieving the purposes of this 
     Act, the Secretary shall submit proposed legislation to the 
     Congress to--
       (i) implement such successful reforms nationally if 
     appropriate, or
       (ii) give States the option of adopting a successful reform 
     in a State plan approved under section 402 of the Social 
     Security Act (42 U.S.C. 602) where the reform may be 
     effective in some States but not in others.

     The proposed legislation shall take into account factors 
     important to implementing local demonstration projects on a 
     national scale, including variation in population density and 
     poverty.
       (B) Dates for evaluation and submission.--A date is 
     described in this subparagraph, if it is a date that is--
       (i) 2 years after the date of the enactment of this Act,
       (ii) 4 years after the date of the enactment of this Act, 
     or
       (iii) not later than 6 months after the date the Secretary 
     receives the last final report due under subsection (d)(1) 
     with respect to a demonstration project.
       (2) Other legislative submissions.--At any time other than 
     a date described in paragraph (1)(B), if the Secretary 
     determines that a reform in a demonstration project is ready 
     to be implemented on a national scale or to be made a State 
     option, the Secretary may submit proposed legislation to the 
     Congress to implement the reform.
       (f) Clearinghouse.--The Secretary shall establish and 
     maintain a clearinghouse to collect and disseminate to State 
     officials and the public current information on approved 
     demonstration projects, and on interim and final reports 
     submitted under subsection (d)(1) with respect to 
     demonstration projects. To the extent practicable, 
     clearinghouse information shall be made available through 
     electronic format.
       (g) Provisions Subject To Waiver.--The Secretary may waive 
     such requirements of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.) as the Secretary determines to be 
     necessary to carry out the purposes of the demonstration 
     projects established under this Act.
       (h) Expenditures Otherwise Included Under the State Plan.--
     The costs of a demonstration project under this Act which 
     would not otherwise be included as expenditures under the 
     applicable State plan under title IV of the Social Security 
     Act (42 U.S.C. 601 et seq.) shall to the extent and for the 
     period prescribed by the Secretary, be regarded as 
     expenditures under the applicable State plan under such 
     title, or for administration of such State plan or plans, as 
     may be appropriate.

     SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There is authorized to be appropriated 
     $150,000,000 for each of fiscal years 1996 and 1997, and 
     $125,000,000 for each of fiscal years 1998, 1999, and 2000 to 
     carry out the provisions of sections 4(c), 4(d), 101, 103, 
     105(b), 105(c), 105(d), 107, 201, 202, 203, 204, 205, 206, 
     207, 301, and 302. [[Page S1228]] 
       (b) Allocation of Funds.--Of the amount appropriated 
     pursuant to subsection (a), the Secretary shall obligate--
       (1) 50 percent of such amount to--
       (A) offset any increase in the amount of the Federal share 
     resulting from any demonstration project established under a 
     section described in subsection (a) (other than demonstration 
     projects established under sections 107 and 207 of this Act); 
     and
       (B) to the extent such amount remains after any such 
     offset--
       (i) increase the otherwise applicable Federal share rate 
     under a State plan under title IV of the Social Security Act 
     (42 U.S.C. 601 et seq.) for such demonstration projects; and
       (ii) increase the amount of a State's block grant under the 
     demonstration project under section 201 of this Act; and
       (2) 50 percent of such amount to--
       (A) offset any increase in the amount of the Federal share 
     resulting from any demonstration project established under 
     sections 107 and 207 of this Act; and
       (B) to the extent such amount remains after any such offset 
     increase the otherwise applicable Federal share rate under a 
     State plan under title IV of the Social Security Act (42 
     U.S.C. 601 et seq.) for such demonstration projects.
       (c) Reservation of Certain Amounts Until Final Report 
     Submitted.--The Secretary shall reserve 10 percent of any 
     amounts obligated to a State for a demonstration project 
     under subsection (b), and shall not pay such reserved amounts 
     until such State has submitted a final report on such 
     demonstration project.
  TITLE I--INITIATIVES TO MOVE WELFARE RECIPIENTS INTO THE WORK FORCE

     SEC. 101. DEMONSTRATION PROJECTS WHICH CONDITION AFDC 
                   BENEFITS FOR CERTAIN INDIVIDUALS ON SCHOOL 
                   ATTENDANCE OR JOB TRAINING, LIMIT THE TIME 
                   PERIOD FOR RECEIPT OF SUCH BENEFITS, AND 
                   REQUIRE TEENAGE PARENTS TO LIVE AT HOME.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--
       (1) In general.--Except as provided in paragraph (2), each 
     State conducting a demonstration project under this section 
     shall provide that--
       (A) a family described in paragraph (3) shall not receive 
     aid to families with dependent children--
       (i) unless the individual described in paragraph (3)(A) is, 
     for a minimum of 35 hours a week--

       (I) attending school,
       (II) studying for a general equivalency diploma, or
       (III) participating in a job, job training, or job 
     placement program; and

       (ii) except in the case of a situation described in clause 
     (i) through (v) of section 402(a)(43)(B) of the Social 
     Security Act (42 U.S.C. 602(a)(43)(B))--

       (I) such individual is residing in a place of residence 
     maintained by a parent, legal guardian, or other adult 
     relative of such individual as such parent's, guardian's, or 
     adult relative's own home, or residing in a foster home, 
     maternity home, or other adult-supervised supportive living 
     arrangement, and
       (II) such aid (where possible) shall be provided to the 
     individual's parent, legal guardian, or other adult relative 
     on behalf of such individual and the individual's dependent 
     child; and

       (B) such family shall be entitled to receive such aid for a 
     time period determined appropriate by the State which shall, 
     at a minimum, permit such individual to complete the 
     activities described in subparagraph (A)(i).
       (2) Limitation.--A State conducting a demonstration project 
     under this section shall not apply the provisions of 
     paragraph (1) to a family unless--
       (A) the State has made adequate child care available to 
     such family;
       (B) the State has paid all tuition and fees applicable to 
     the activities described in paragraph (1)(A); and
       (C) such application does not endanger the welfare and 
     safety of a dependent child who is a member of such family.
       (3) Family described.--A family described in this paragraph 
     is a family which--
       (A) includes a parent under 20 years of age;
       (B) includes at least 1 dependent child of such parent; and
       (C) does not include a child under 6 months of age.

     SEC. 102. PILOT JOB CORPS PROGRAM FOR RECIPIENTS OF AID TO 
                   FAMILIES WITH DEPENDENT CHILDREN.

       Section 433 of the Job Training Partnership Act (29 U.S.C. 
     1703) is amended by adding at the end the following new 
     subsection:
       ``(f)(1) The Secretary may enter into appropriate 
     agreements with agencies as described in section 427(a)(1) 
     for the development of pilot projects to provide services at 
     Job Corps centers to eligible individuals--
       ``(A) who are eligible youth described in section 423;
       ``(B) whose families receive aid to families with dependent 
     children under part A of title IV of the Social Security Act 
     (42 U.S.C. 601 et seq.); and
       ``(C) who are mothers of children who have not reached the 
     age of compulsory school attendance in the State in which the 
     children reside.
       ``(2) A Job Corps center serving the eligible individuals 
     shall--
       ``(A) provide child care at or near the Job Corps center 
     for the individuals;
       ``(B) provide the activities described in section 428 for 
     the individuals; and
       ``(C) provide for the individuals, and require that each 
     such individual participate in, activities through a parents 
     as teachers program that--
       ``(i) establishes and operates parent education programs, 
     including programs of developmental screening of the children 
     of the eligible individuals;
       ``(ii) provides group meetings and home visits for the 
     family of each such individual by parent educators who have 
     had supervised experience in the care and education of 
     children and have had training; and
       ``(iii) provides periodic screening, by such parent 
     educators, of the educational, hearing, and visual 
     development of the children of such individuals.
       ``(3) The Secretary shall prescribe specific standards and 
     procedures under section 424 for the screening and selection 
     of applicants to participate in pilot projects carried out 
     under this subsection. In addition to the agencies described 
     in the second sentence of such section, such standards and 
     procedures may be implemented through arrangements with 
     welfare agencies.
       ``(4) As used in this subsection:
       ``(A) The term `developmental screening' means the process 
     of measuring the progress of children to determine if there 
     are problems or potential problems or advanced abilities in 
     the areas of understanding and use of language, perception 
     through sight, perception through hearing, motor development 
     and hand-eye coordination, health, and physical development.
       ``(B) The term `parent education' includes parent support 
     activities, the provision of resource materials on child 
     development and parent-child learning activities, private and 
     group educational guidance, individual and group learning 
     experiences for the eligible individual and child, and other 
     activities that enable the eligible individual to improve 
     learning in the home.''.

     SEC. 103. DEMONSTRATION PROJECTS REQUIRING UP-FRONT 30-DAY 
                   ASSISTED JOB SEARCH, OR SUBSTANCE ABUSE 
                   TREATMENT BEFORE RECEIVING AFDC BENEFITS.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--
       (1) In general.--Except as provided in paragraph (2), each 
     State conducting a demonstration project under this section 
     shall require a parent or other relative of a dependent child 
     to undergo 30 days of assisted job search or substance abuse 
     treatment (or both) before the family may receive aid to 
     families with dependent children as part of the application 
     process for the receipt of such aid.
       (2) Limitation.--A State conducting a demonstration project 
     under this section shall not apply the provisions of 
     paragraph (1) to a family unless--
       (A) all of the dependent children in the family are over 6 
     months of age;
       (B) the State has made adequate child care available to 
     such family;
       (C) the State has paid all fees applicable to the 
     activities described in paragraph (1); and
       (D) such application does not endanger the welfare and 
     safety of a dependent child who is a member of such family.

     SEC. 104. DISREGARD OF EDUCATION AND EMPLOYMENT TRAINING 
                   SAVINGS FOR AFDC ELIGIBILITY.

       (a) Disregard as Resource.--Subparagraph (B) of section 
     402(a)(7) of the Social Security Act (42 U.S.C. 602(a)(7)) is 
     amended--
       (1) by striking ``or'' before ``(iv)'', and
       (2) by inserting ``, or (v) except in the case of the 
     family's initial determination of eligibility for aid to 
     families with dependent children, any amount up to $10,000 in 
     a qualified education and employment account (as defined in 
     section 406(i)(1))'' before ``; and''.
       (b) Disregard as Income.--
       (1) In general.--Subparagraph (A) of section 402(a)(8) of 
     such Act (42 U.S.C. 602(a)(8)) is amended--
       (A) by striking ``and'' at the end of clause (vii), and
       (B) by inserting after clause (viii) the following new 
     clause:
       ``(ix) shall disregard any qualified distributions (as 
     defined in section 406(i)(2)) made from any qualified 
     education and employment account (as defined in section 
     406(i)(1)) while the family is receiving aid to families with 
     dependent children; and''.
       (2) Nonrecurring lump sum exempt from lump sum rule.--
     Section 402(a)(17) (42 U.S.C. 602(a)(17)) is amended by 
     adding at the end the following: ``; and that this paragraph 
     shall not apply to earned and unearned income received in a 
     month on a nonrecurring basis to the extent that such income 
     is placed in a qualified education and employment account (as 
     defined in section 406(i)(1)) the total amount which, after 
     such placement, does not exceed $10,000.''.
       (c) Qualified Education and Employment Accounts.--Section 
     406 of such Act (42 U.S.C. 606) is amended by adding at the 
     end the following:
       ``(i)(1) The term `qualified education and employment 
     account' means a mechanism established by the State (such as 
     escrow accounts or education savings bonds) that allows 
     savings from the earned income of a dependent child or parent 
     of such child in a [[Page S1229]] family receiving aid to 
     families with dependent children to be used for qualified 
     distributions.
       ``(2) The term `qualified distributions' means 
     distributions from a qualified education and employment 
     account for expenses directly related to the attendance at an 
     eligible postsecondary or secondary institution or directly 
     related to improving the employability (as determined by the 
     State) of a member of a family receiving aid to families with 
     dependent children.
       ``(3) The term `eligible postsecondary or secondary 
     institution' means a postsecondary or secondary institution 
     determined to be eligible by the State under guidelines 
     established by the Secretary.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to payments under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.) for calendar 
     quarters beginning on or after January 1, 1995.

     SEC. 105. INCENTIVES AND ASSISTANCE IN STARTING A SMALL 
                   BUSINESS.

       (a) Authority for States To Permit Certain Self-Employment 
     Program Participants a One-Time Election To Purchase Capital 
     Equipment for a Small Business in Lieu of Depreciation; 
     Repayments by Such Persons of the Principal Portion of Small 
     Business Loans Treated as Business Expenses for Purposes of 
     AFDC.--
       (1) Amendments to the social security act.--Section 
     402(a)(8) of the Social Security Act (42 U.S.C. 602(a)(8)) is 
     amended--
       (A) in subparagraph (B)(ii)(II), by striking ``and'' after 
     the semicolon;
       (B) by redesignating subparagraph (C) as subparagraph (D); 
     and
       (C) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) provide that, in determining the earned income of a 
     family any of the members of which owns a small business and 
     is a participant in a self-employment program offered by a 
     State in accordance with section 482(d)(1)(B)(ii), the State 
     may--
       ``(i)(I) during the 1-year period beginning on the date the 
     family makes an election under this clause, treat as an 
     offset against the gross receipts of the business the sum of 
     the capital expenditures for the business by any member of 
     the family during such 1-year period; and
       ``(II) allow each such family eligible for aid under this 
     part not more than 1 election under this clause; and
       ``(ii) treat as an offset against the gross receipts of the 
     business--
       ``(I) the amounts paid by any member of the family as 
     repayment of the principal portion of a loan made for the 
     business; and
       ``(II) cash retained by the business for future use by the 
     business; and''.
       (2) Amendment to the internal revenue code of 1986.--
     Section 167 of the Internal Revenue Code of 1986 (relating to 
     depreciation) is amended by redesignating subsection (g) as 
     subsection (h) and by inserting after subsection (f) the 
     following new subsection:
       ``(g) Certain Property of AFDC Recipients Not 
     Depreciable.--No depreciation deduction shall be allowed 
     under this section (and no depreciation or amortization 
     deduction shall be allowed under any other provision of this 
     subtitle) with respect to the portion of the adjusted basis 
     of any property which is attributable to expenditures treated 
     as an offset against gross receipts under section 
     402(a)(8)(C)(i) of the Social Security Act.''.
       (3) Effective date.--
       (A) Social security act amendments.--The amendments made by 
     paragraph (1) shall apply to payments made under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.) 
     on or after January 1, 1996.
       (B) Internal revenue code amendment.--The amendments made 
     by paragraph (2) shall apply to property placed in service on 
     or after January 1, 1996.
       (b) Demonstration Projects Establishing Public-Private 
     Partnerships for Technical Assistance to Self-Employed AFDC 
     Recipients.--
       (1) In general.--The Secretary shall provide for 
     demonstration projects to be conducted in States with 
     applications approved under this Act under which one or more 
     partnerships are developed between State agencies and 
     community businesses or educational institutions to provide 
     assistance to eligible participants.
       (2) Eligible participants.--For purposes of this 
     subsection, the term ``eligible participants'' means--
       (A) individuals who are receiving aid to families with 
     dependent children; and
       (B) individuals who cease to be eligible to receive such 
     aid who have been participating in a demonstration project 
     conducted by a State under this subsection.
       (3) Permissible expenditures.--Funds from any demonstration 
     project conducted under this subsection may be used to pay 
     the costs associated with developing and implementing a 
     process through which businesses or educational institutions 
     would work with the State agency to provide assistance to 
     eligible participants seeking to start or operate small 
     businesses, including--
       (A) mentoring;
       (B) training for eligible participants in administering a 
     business;
       (C) technical assistance in preparing business plans; and
       (D) technical assistance in the process of applying for 
     business loans, marketing services, and other activities 
     related to conducting such small businesses.
       (c) Demonstration Projects for Training AFDC Recipients as 
     Self-Employed Providers of Child Care Services.--
       (1) In general.--The Secretary shall provide for 
     demonstration projects to be conducted in States with 
     applications approved under this Act under which one or more 
     partnerships are developed between State agencies and 
     community businesses or educational institutions to provide 
     assistance to eligible participants in the establishment and 
     operation of child care centers in the home or in the 
     community which would provide child care services.
       (2) Eligible participants.--For purposes of this 
     subsection, the term ``eligible participants'' means--
       (A) individuals who are receiving aid to families with 
     dependent children; and
       (B) individuals who cease to be eligible to receive such 
     aid who have been participating in a demonstration project 
     conducted by a State under this subsection.
       (3) Permissible expenditures.--Funds from any demonstration 
     project conducted under this subsection may be used to pay 
     the costs associated with developing and implementing a 
     process through which businesses or educational institutions 
     would work with the State agency to provide assistance to 
     train eligible participants to provide licensed child care 
     services, including--
       (A) mentoring;
       (B) training in the provision of child care services;
       (C) training for eligible participants in administering a 
     business;
       (D) training in early childhood education;
       (E) technical assistance in preparing business plans;
       (F) technical assistance in the process of applying for 
     loans, marketing services, qualifying for Federal and State 
     programs, and other activities related to the provision of 
     child care services; and
       (G) technical assistance in obtaining a license and 
     complying with Federal, State, and local regulations 
     regarding the provision of child care.
       (d) Demonstration Project To Promote Ownership of Family-
     Owned Businesses by AFDC Recipients.--
       (1) Establishment.--The Secretary shall provide for 
     demonstration projects described in paragraph (2) in States 
     with applications approved under this Act.
       (2) Project described.--Each State conducting a 
     demonstration project under this subsection shall develop a 
     program under which the State shall--
       (A) encourage incentives for families receiving aid to 
     families with dependent children to work together as managers 
     and employees in family-owned businesses;
       (B) develop State and private partnerships for making or 
     guaranteeing small business loans, including seed money, 
     available to such families;
       (C) provide such families with technical training in small 
     business management, accounting, and bookkeeping;
       (D) regularly evaluate the status of the recipients of 
     assistance under the project; and
       (E) continue a transitional period of benefits under title 
     IV and title XIX of the Social Security Act for recipients of 
     assistance under the project until such time as the State 
     determines such family is self-sufficient.

     For purposes of this paragraph, a family-owned business may 
     include other relatives of the family receiving aid to 
     families with dependent children regardless if such relatives 
     are also receiving aid to families with dependent children.

     SEC. 106. INCREASED EMPHASIS IN JOBS PROGRAM ON MOVING PEOPLE 
                   INTO THE WORK FORCE.

       Section 481(a) of the Social Security Act (42 U.S.C. 
     681(a)) is amended by adding at the end the following new 
     sentence: ``It is further the purpose of this part to 
     encourage individuals receiving education and training to 
     enter the permanent work force by developing programs through 
     which such individuals enter the work force and then receive 
     post-employment education and training.''.

     SEC. 107. ADDITIONAL DEMONSTRATION PROJECTS TO MOVE AFDC 
                   RECIPIENTS INTO THE WORK FORCE.

       (a) Establishment.--The Secretary shall provide for 
     additional demonstration projects described in subsection (b) 
     in States with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall develop a 
     program or programs to better move recipients of aid to 
     families with dependent children into the work force.
  TITLE II--INITIATIVES TO STRENGTHEN FAMILIES AND BREAK THE CYCLE OF 
                           WELFARE DEPENDENCY

     SEC. 201. DEMONSTRATION PROJECTS TO ESTABLISH CHILD CENTERED 
                   PROGRAMS THROUGH CONVERSION OF CERTAIN AFDC AND 
                   JOBS PAYMENTS INTO BLOCK GRANTS.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--
       (1) In general.--Each State conducting a demonstration 
     project under this section shall elect to receive payments 
     under paragraph (2) in lieu of--
       (A) all payments to which the State would otherwise be 
     entitled to under section 403 of the Social Security Act (42 
     U.S.C. 603) for aid to families with dependent children under 
     part A of title IV of such Act or the job opportunities and 
     basic skills training program under part F of such title; 
     or [[Page S1230]] 
       (B) any portion of the payment described in subparagraph 
     (A) to which the State would otherwise be entitled under such 
     section for benefits (identified by the State) under part A 
     or part F of such title for populations (identified by the 
     State) who receive such benefits.
       (2) Payment.--The Secretary shall make payment under this 
     paragraph for each year of the project in an amount equal 
     to--
       (A) during fiscal year 1996--
       (i) 100 percent of the total amount to which the State was 
     entitled under section 403 of the Social Security Act (42 
     U.S.C. 603) for aid to families with dependent children under 
     part A of title IV of such Act or the job opportunities and 
     basic skills training program under part F of such title; or
       (ii) the amount to which the State was entitled to under 
     such section for those benefits and populations identified by 
     the State in paragraph (1)(B),

     for fiscal year 1995 plus the product of such amount and the 
     percentage increase in the consumer price index for all urban 
     consumers (U.S. city average) during such fiscal year; and
       (B) during each subsequent fiscal year, the amount 
     determined under this paragraph in the previous fiscal year 
     plus the product of such amount and the percentage increase 
     in such consumer price index during such previous fiscal 
     year.
       (3) Description of activities.--
       (A) In general.--Each State which is paid under paragraph 
     (2) shall expend the amount received under such paragraph and 
     the amount, if any, made available to such State under 
     section 5(b)(1)(B)(ii) for one or more of the following 
     purposes:
       (i)(I) Establish residential programs for teenage mothers 
     with dependent children where education, job training, 
     community service, or other employment is provided.
       (II) Support the pilot project described in section 433(f) 
     of the Jobs Training Partnership Act, as added by section 102 
     of this Act, to provide such services to teenage mothers with 
     dependent children.
       (ii) Establish programs to promote, expedite, and ensure 
     adoption of children, particularly neglected or abused 
     children.
       (iii) Expand child care assistance for the children of 
     needy working parents (as determined by the State).
       (iv) Establish residential schooling with appropriate 
     support services for children from needy families (as 
     determined by the State) enrolled at the request of the 
     parents of such children.
       (v) Establish other services which will be provided 
     directly to children from needy families (as determined by 
     the State).
       (vi) Implement other reforms consistent with this Act.
       (4) Community-based activities.--The Secretary shall ensure 
     that each State receiving a grant under this section--
       (A) takes adequate steps to assure the well-being of the 
     children affected by the State's receipt of the grant; and
       (B) to the fullest extent possible, utilizes the grant 
     under this section to support community-based services in 
     communities affected by the State's receipt of the grant.

     SEC. 202. DEMONSTRATION PROJECTS PROVIDING NO ADDITIONAL 
                   BENEFITS WITH RESPECT TO CHILDREN BORN WHILE A 
                   FAMILY IS RECEIVING AFDC AND ALLOWING INCREASES 
                   IN THE EARNED INCOME DISREGARD.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--If a child is born to a family 
     after the date on which such family begins receiving aid to 
     families with dependent children, a State conducting a 
     demonstration project under this section--
       (1) shall not take such child into account in determining 
     the need of such family for such aid; and
       (2) shall increase the amounts disregarded from earned 
     income under section 402(a)(8)(A) of the Social Security Act 
     (42 U.S.C. 602(a)(8)(A)).

     SEC. 203. DEMONSTRATION PROJECTS PROVIDING INCENTIVES TO 
                   MARRY.

       (a) Aid to Two-Parent Families.--
       (1) Establishment.--The Secretary shall provide for 
     demonstration projects described in paragraph (2) in States 
     with applications approved under this Act.
       (2) Project described.--
       (A) In general.--Each State conducting a demonstration 
     project under this subsection shall not apply the 
     requirements described in subparagraph (B) to a parent of a 
     dependent child who is married to the natural parent of such 
     child.
       (B) Requirements waived.--The requirements described in 
     this subparagraph are:
       (i) The work history requirement described in section 
     407(b)(1)(A)(iii) of the Social Security Act (42 U.S.C. 
     607(b)(1)(A)(iii)).
       (ii) The 100-hour rule under section 233.100(a)(1)(i) of 
     title 45, Code of Federal Regulations.
       (b) Increase in Stepparent Earned Income Disregard.--
       (1) Establishment.--The Secretary shall provide for 
     demonstration projects described in paragraph (2) in States 
     with applications approved under this Act.
       (2) Project described.--For purposes of making 
     determinations for any month under section 402(a)(7) of the 
     Social Security Act (42 U.S.C. 602(a)(7)), each State 
     conducting a demonstration project under this subsection 
     shall modify the income disregards provided in subparagraphs 
     (A) through (D) of section 402(a)(31) of such Act (42 U.S.C. 
     602(a)(31)) in order to decrease the amount of income 
     determined under such section with respect to a dependent 
     child's stepparent.

     SEC. 204. DEMONSTRATION PROJECTS REDUCING AFDC BENEFITS IF 
                   SCHOOL ATTENDANCE IS IRREGULAR OR PREVENTIVE 
                   HEALTH CARE FOR DEPENDENT CHILDREN IS NOT 
                   OBTAINED.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--
       (1) In general.--Each State conducting a demonstration 
     project under this section shall reduce the amount of aid to 
     families with dependent children received by a family if the 
     State agency determines that one or both (at the State's 
     option) of the following conditions exist:
       (A) A member of such family is attending school or 
     participating in a course of vocational or technical training 
     and such family member is absent from such school or training 
     with no excuse for more than a number of days per month 
     determined appropriate by the State.
       (B) A member of such family is a child under the age of 6 
     who has not received appropriate immunizations (as determined 
     by the State).
       (2) Limitation.--Each State conducting a demonstration 
     project under this section shall establish procedures which 
     ensure that no reduction in aid to families with dependent 
     children under paragraph (1) will endanger the welfare and 
     safety of any dependent child.

     SEC. 205. DEMONSTRATION PROJECTS TO DEVELOP COMMUNITY-BASED 
                   PROGRAMS FOR TEENAGE PREGNANCY PREVENTION AND 
                   FAMILY PLANNING

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall develop a 
     community-based program for teenage pregnancy prevention and 
     family planning.

     SEC. 206. ADDITIONAL DEMONSTRATION PROJECTS TO STRENGTHEN 
                   FAMILIES AND BREAK THE CYCLE OF WELFARE 
                   DEPENDENCY.

       (a) Establishment.--The Secretary shall provide for 
     additional demonstration projects described in subsection (b) 
     in States with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall develop a 
     program or programs to strengthen families and break the 
     cycle of welfare dependency.
 TITLE III--CHANGES TO FEDERAL LAWS AND STATE INITIATIVES TO INCREASE 
               CHILD SUPPORT AND PATERNAL RESPONSIBILITY

     SEC. 301. DEMONSTRATION PROJECTS TO INCREASE PATERNITY 
                   ESTABLISHMENT.

       (a) Establishment.-- The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall develop a 
     program to increase paternity establishment.

     SEC. 302. DEMONSTRATION PROJECTS TO INCREASE CHILD SUPPORT 
                   COLLECTION.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall increase the 
     State's child support collection efforts through one or more 
     of the following methods:
       (1) Enhanced child support enforcement and collection, 
     including holding a parent accountable for supporting any 
     children of the parent's minor children.
       (2) Applying section 402(a)(8)(vi) of the Social Security 
     Act (42 U.S.C. 602(a)(8)(vi)) by substituting an amount 
     greater than $50 (to be determined by the State) for ``$50'' 
     each place such dollar amount appears.
       (3) Any other method that the State deems appropriate.
   TITLE IV--INITIATIVES TO DIVERSIFY AND IMPROVE THE PERFORMANCE OF 
                            WELFARE SERVICES

     SEC. 401. DEMONSTRATION PROJECTS FOR PROVIDING PLACEMENT OF 
                   AFDC RECIPIENTS IN PRIVATE SECTOR JOBS.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects described in subsection (b) in States 
     with applications approved under this Act.
       (b) Project Described.--Each State conducting a 
     demonstration project under this section shall--
       (1) contract with private for-profit and nonprofit groups 
     to provide any individual receiving aid to families with 
     dependent children with training, support services, and 
     placement in a private sector job which permits such 
     individual to cease receiving aid to families with dependent 
     children; and
       (2) upon employment of such individual, pay such groups a 
     negotiated portion of the total amount that such individual's 
     family [[Page S1231]] would have received over the course of 
     the year in which such individual began such employment in 
     the form of aid to families with dependent children.

     SEC. 402. DEMONSTRATION PROJECTS PROVIDING PERFORMANCE-BASED 
                   INCENTIVES FOR STATE PUBLIC WELFARE PROVIDERS.

       (a) Establishment.--The Secretary shall provide for 
     demonstration projects to establish performance-based 
     incentives for State public welfare providers in States with 
     applications described in subsection (b)(1) which are 
     approved under this Act.
       (b) Applications.--
       (1) Application described.--An application described under 
     this paragraph is an application which--
       (A) identifies the State offices or administrative units 
     which will participate in the demonstration project;
       (B) describes indicators of employee or program performance 
     based on outcome measures for--
       (i) training and education;
       (ii) job search and placement assistance;
       (iii) child support collection;
       (iv) teen pregnancy prevention programs; and
       (v) any other program objective that the State finds 
     appropriate;
       (C) describes budgetary incentives for program performance, 
     including direct financial incentives for employees where 
     appropriate;
       (D) describes a process for developing, in cooperation with 
     employees of participating offices or units, a job evaluation 
     system based on performance measures; and
       (E) describes the way in which State public welfare 
     providers, private providers, welfare clients, and members of 
     the community have been or shall be involved in the planning 
     and implementation of a performance based welfare delivery 
     system.
       (2) Technical assistance.--The Secretary shall provide a 
     State desiring to submit an application for a demonstration 
     project under this section with technical assistance in 
     preparing an application described under paragraph (1).

     SEC. 403. ELECTRONIC BENEFIT TRANSFERS.

       Section 904(d) of the Electronic Fund Transfer Act (15 
     U.S.C. 1693b(d)) is amended--
       (1) by inserting ``(1)'' after ``(d)''; and
       (2) by adding at the end the following new paragraph:
       ``(2)(A) The disclosures, protections, responsibilities, 
     and remedies created by this title or any rules, regulations, 
     or orders issued by the Board in accordance with this title, 
     do not apply to an electronic benefit transfer program 
     established under State or local law, or administered by a 
     State or local government, unless the payment under such 
     program is made directly into a consumer's account held by 
     the recipient.
       ``(B) Subparagraph (A) does not apply to employment related 
     payments, including salaries, pension, retirement, or 
     unemployment benefits established by Federal, State, or local 
     governments.
       ``(C) Nothing in subparagraph (A) alters the protections of 
     benefits established by any Federal, State, or local law, or 
     preempts the application of any State or local law.
       ``(D) For purposes of subparagraph (A), an electronic 
     benefit transfer program is a program under which a Federal, 
     State, or local government agency distributes needs-tested 
     benefits by establishing accounts to be accessed by 
     recipients electronically, such as through automated teller 
     machines, or point-of-sale terminals. A program established 
     for the purpose of enforcing the support obligations owed by 
     absent parents to their children and the custodial parents 
     with whom the children are living is not an electronic 
     benefit transfer program.''.
               TITLE V--OFFSETTING EXPENDITURE REDUCTIONS

     SEC. 501. OFFSETTING EXPENDITURE REDUCTIONS.

       (a) In General.--Subparagraph (C) of section 1001(5) of the 
     Food Security Act of 1985 (7 U.S.C. 1308(5)(C)) is amended to 
     read as follows:
       ``(C) In the case of corporations and other entities 
     included in subparagraph (B) and partnerships, the Secretary 
     shall attribute payments to natural persons in proportion to 
     their ownership interests in an entity and in any other 
     entity, or partnership, that owns or controls the entity, or 
     partnership, receiving the payments.''.
       (b) Removal of 3-Entity Rule.--Section 1001A(a)(1) of the 
     Food Security Act of 1985 (7 U.S.C. 1308-1(a)(1)) is 
     amended--
       (1) in the first sentence--
       (A) by striking ``substantial beneficial interests in more 
     than two entities'' and inserting ``a substantial beneficial 
     interest in any other entity''; and
       (B) by striking ``receive such payments as separate 
     persons'' and inserting ``receives the payments as a separate 
     person''; and
       (2) by striking the second sentence.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on October 1, 1995.
                                                                    ____


               The Welfare Reforms That Work Act--Summary

       Sections 1-4.--Purpose of bill and general provisions 
     relating to state pilot projects:
       Sec. 2. States that the purpose of the bill is to promote 
     bold State-initiated welfare reforms to move welfare 
     recipients into the work force; strengthen families; break 
     the cycle of welfare dependency; increase child support 
     collection and paternal responsibility; and improve the 
     delivery of welfare services. The bill is designed to make 
     immediate State-by-State changes to the existing system while 
     establishing a process for identifying successful reform 
     approaches that can be applied nationally. The bill reflects 
     the findings that: the current welfare system is failing 
     children and contributing to the cycle of poverty and other 
     societal ills; mandatory job training and many other 
     incremental reforms tested to date have had minimal effects 
     on welfare dependency; and the States are best positioned to 
     test far-reaching reform proposals that involve some human or 
     financial risk. While this bill in no way precludes national 
     reforms such as time-limits, work requirements or requiring 
     teenage parents to live at home, it gives States the central 
     reform role and provides the authority and resources they 
     need to pursue bold and untested reforms.
       Sec. 4. Sets forth general provisions relating to 
     demonstration projects. Authorizes $150 million/yr for the 
     first two years and $125 million/yr in the following three 
     year to support pilots and evaluations of pilots, and 
     requires States to have evaluation plans approved by the 
     Department of Health and Human Services (HHS) before 
     receiving funds. A portion of these funds would support 
     innovative pilot programs not specified in the bill but 
     proposed by States. Demonstration projects could last up to 5 
     years. States would report on progress annually. As results 
     of interim and final reports become available, the Secretary 
     of HHS will submit legislation to Congress to implement 
     promising reforms nationally.


  title I.--initiatives to move welfare recipients into the work force

       From the first day that an individual applies for welfare, 
     the primary focus of welfare offices should be to help that 
     person move into the work force. A welfare grant should be 
     conditioned on responsible behavior. This Title supports 
     state reforms to move welfare recipients into the work force.
       Sec. 101. Supports State pilots to condition AFDC benefits 
     for single parents under 20 years of age with at least one 
     dependent child and no children under 6 months of age on 
     attending school or participating in a job or job training 
     program for a minimum of 35 hours per week and on living at 
     home. States would also impose a time limit (not specified) 
     on benefits, and make child care available during training 
     and work activities. Since the program would be expensive, it 
     targets those at greatest risk of long-term welfare 
     dependency--teenage mothers.
       Sec. 102. Authorizes the Secretary of HHS to establish a 
     pilot program with the Jobs Corps (a successful, residential 
     anti-poverty program for youths 16-22 years of age) targeting 
     teenage mothers on AFDC with below school-age children. The 
     pilot would include a Parents-as-Teachers type program 
     designed to teach parents how to help prepare their children 
     for school and learning.
       Sec. 103. Supports State pilots to require 30 days of 
     assisted job search or, where appropriate, substance abuse 
     treatment immediately following application for AFDC, 
     coinciding with the usual lag time between application for 
     and receipt of benefits. Applicants would have to complete 
     the assigned activities before receiving AFDC payments.
       Sec. 104. A national change to permit States to allow AFDC 
     families to save money (up to $10,000) for education and 
     training or starting a small business.
       Sec. 105. Expands on legislation introduced in 1993 with 
     Senator Dodd.
       A national change to permit States to help recipients start 
     a small business by allowing participants a one-time election 
     to fully deduct capital equipment purchases in one year;
       Supports State pilots to establish public-private 
     partnerships to provide technical assistance to self-employed 
     AFDC recipients;
       Supports State pilots to train AFDC recipients as self-
     employed providers of child care services; and
       Supports State pilot projects to promote ownership of 
     extended family-owned businesses by AFDC recipients. Would 
     provide incentives and assistance for families receiving aid 
     to families with dependent children to work together as 
     managers and employees in extended family-owned businesses.
       Sec. 106. Amends JOBS provisions to emphasize efforts to 
     move people into the work force over training and education.
       Sec. 107. Supports additional demonstration projects 
     proposed by States to move AFDC recipients into the work 
     force.


 Title II.--Initiatives to Strengthen Families and Break the Cycle of 
                           Welfare Dependency

       The current Federal welfare rules discourage family 
     unification and encourage out-of-wedlock childbearing. The 
     most serious victims of these policies are children born into 
     poor, unstable families. This Title supports State reforms 
     that promote parental responsibility and family unity. It 
     recognizes that while welfare is a privilege for parents, 
     States and the Federal government have a moral responsibility 
     to ensure the well-being of all American children.
       Sec. 201. Supports State pilots to establish child centered 
     programs through conversion of AFDC and JOBS payments into 
     block grants, plus funds available under other sections of 
     this bill. States could apply portions of funds to: (1) 
     establish residential homes for teenage mothers with 
     children, including [[Page S1232]] supporting the pilot 
     project described in section 102; (2) expand programs to 
     expedite and improve adoption of children; (3) expand child 
     care assistance for needy children of working families; (4) 
     establish supportive residential schools for children 
     enrolled at the request of their parents; (5) provide other 
     services directly to needy children; and (6) fund other 
     programs that are consistent with the purposes of the Act. 
     The Secretary of HHS, in reviewing the application, must 
     ensure that the State's program will protect the well-being 
     of affected children.
       Sec. 202. Supports State pilots to discourage welfare 
     recipients from having additional children while on welfare 
     and increase the financial reward for work. Recipients who 
     had a second child would not get additional benefits but 
     would be allowed to keep a higher portion of job earnings.
       Sec. 203. Supports State pilots to improve incentives to 
     get married. States would disregard to a greater extent the 
     second parent's earnings and work patterns in determining 
     benefits.
       Sec. 204. Supports State pilots to reduce AFDC benefits if 
     school attendance of mother or child is irregular or 
     preventive health care for the dependent children is not 
     attained.
       Sec. 205. Supports State demonstrations of innovative 
     teenage pregnancy prevention programs.
       Sec. 206. Supports additional demonstration projects 
     proposed by States to strengthen families and break the cycle 
     of welfare dependency.


 title iii.--changes to federal laws and state initiatives to increase 
          child support collection and paternal responsibility

       Increased child support enforcement and paternity 
     establishment must be part of the welfare reform. Too often 
     absent parents, typically fathers, are not held accountable 
     for their children's care. In the last Congress Senator 
     Bradley introduced and I cosponsored the comprehensive 
     Interstate Child Support Enforcement Act, which I will 
     support again this year. My bill authorizes additional State 
     efforts to improve child support collection and paternity 
     establishment.
       Sec. 301. Supports demonstration projects to increase 
     paternity establishment.
       Sec. 302. Supports demonstration projects to increase child 
     support collection, including: increasing the child support 
     disregard, from $50 to a higher level decided by the state; 
     and, holding parents accountable for child support 
     obligations of their minor children.


title iv.--initiatives to diversify and improve performance of welfare 
                                services

       Welfare offices are notoriously bureaucratic and 
     unresponsive. Under current Federal laws, they have few 
     incentives and some disincentives to improve performance. 
     This Title supports state efforts to promote competition 
     among welfare service providers and to implement performance-
     based management programs in welfare offices. It also removes 
     a current Federal impediment to the use of electronic benefit 
     transfer ``smart cards.''
       Sec. 401. Supports State pilots to provide incentives to 
     private sector, for profit and non-profit groups to place 
     welfare recipients in private sector jobs. Companies would 
     keep a portion of welfare savings as payment for successful 
     job placements.
       Sec. 402. Supports State pilots to implement performance-
     based management systems for public welfare providers.
       Sec. 403. To promote the use of electronic benefit transfer 
     (EBT) ``smart cards'' that reduce fraud and improve services, 
     this section exempts state EBT programs from the Federal 
     Reserve Board's ``Regulation E.'' Reg. E currently limits 
     cardholder liability to $50 for lost or stolen cards--a 
     policy that promotes fraud and makes EBT programs costly for 
     States.


              title v.--offsetting expenditure reductions

       Sec. 501. Eliminates the ``three-entity'' rule, reducing 
     the amount of certain Federal subsidies individual farmers 
     can receive from $250,000 to $125,000 per year.
                                 ______

      By Mr. GREGG (for himself and Mr. Cochran):
  S. 247. A bill to improve senior citizen housing safety; to the 
Committee on Banking, Housing, and Urban Affairs.


                 the senior citizens housing safety act

 Mr. GREGG. Mr. President, last year, I introduced the Senior 
Citizens Housing Safety Act, a bill that will end the terror that 
unfortunately runs rampant throughout many housing projects 
specifically designated for elderly and disabled residents. I 
reintroduce this important legislation.
  In my home State of New Hampshire, most people are still afforded the 
luxury of not having to lock their front door before turning in for the 
evening. However, many elderly residents of public housing facilities 
in my State and across America have been forced to not only lock their 
front doors, but are literally being held prisoner in their own homes. 
I believe this is outrageous. I have received numerous complaints from 
residents of elderly housing facilities throughout New Hampshire who 
are worried about their personal safety in housing specifically 
reserved for them.
  Under current housing laws nonelderly persons considered disabled, 
because of past drug and alcohol abuse problems, are eligible to live 
in section 8 housing designated for the elderly. This mixing of 
populations may have filled up the housing projects across the country, 
but it has opened a Pandora's box of trouble. Simply put, young, 
recovering alcoholics and drug addicts are not compatible with elderly 
persons. Many of these young people hold all-night, loud parties, shake 
down many of the elderly residents for money, sell drugs within the 
housing facility, and generally disturb the right to the peaceful 
enjoyment of the premises by other tenants.
  This problem has occurred because the definition of handicapped under 
the Fair Housing Act was amended in 1988 to include recovering 
alcoholics and drug addicts. Under the mixed population rules of 1992, 
Congress determined that the elderly and disabled should be housed 
together. Historically, disabled individuals have lived in complexes 
for the elderly because the apartments there--one-bedroom units 
equipped with such features as hand rails--best fit their needs. 
However, drug addicts and alcoholics who are considered disabled do not 
have the same needs. Many elderly persons hope to retire in a community 
surrounded by persons their own age, elderly people who choose to live 
a peaceful existence in the company of their peers. I want to restore 
that hope and this legislation will attack this problem with a two-tier 
approach.

  First, my legislation will institute a front-end screening process. 
This will prevent nonelderly individuals, classified as disabled 
because they are recovering from alcoholism and drug addiction, from 
becoming eligible for housing that is designated for the elderly. It 
simply says they cannot live in housing designated for the elderly 
additionally, it will prevent the further mixing of two groups that are 
obviously incompatible. This will not, however, exclude these 
nonelderly, disabled individuals from the housing I believe they need 
and deserve.
  Second, my legislation will force local public housing agencies to 
evict nonelderly individuals occupying the facility who engage on three 
separate documented occasions in activities that threaten the health, 
safety, or right to peaceful enjoyment of the premises by other tenants 
and involves the use of drugs or alcohol.
  This process, by no means, circumvents the current housing eviction 
procedure. Under current law the public housing agency could evict 
these persons after one infraction if deemed necessary. It simply 
mandates that these nonelderly individuals be evicted after three 
incidents which threaten the health, safety, or right to peaceful 
enjoyment of the premises by other tenants.
  This is a simple bill that prevents the mixing of two populations who 
have proved incompatible.
  This bill will restore order in housing projects designated for 
elderly and disabled tenants by screening out nonelderly alcoholics and 
drug addicts, as well as evicting those nonelderly persons who 
continuously raise havoc within the housing project. I urge my 
colleagues to support this important bill. I ask unanimous consent that 
the text of the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 247

       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 ``Senior Citizen Housing 
     Safety Act''.

     SEC. 2. SENIOR CITIZEN HOUSING SAFETY.

       (a) Limitation on Occupancy in Public Housing Designated 
     for Elderly Families.--
       (1) In general.--Section 7(a) of the United States Housing 
     Act of 1937 (42 U.S.C. 1437e(a)) is amended--
       (A) in paragraph (1), by striking ``Notwithstanding any 
     other provision of law'' and inserting ``Subject only to the 
     provisions of this subsection'';
       (B) in paragraph (4), by inserting ``, except as provided 
     in paragraph (5)'' before the period at the end; and
       (C) by adding at the end the following new 
     paragraph: [[Page S1233]] 
       ``(5) Limitation on occupancy in projects for elderly 
     families.--
       ``(A) Occupancy limitation.--Notwithstanding any other 
     provision of law, a dwelling unit in a project (or portion of 
     a project) that is designated under paragraph (1) for 
     occupancy by only elderly families or by only elderly and 
     disabled families shall not be occupied by--
       ``(i) any person with disabilities who is not an elderly 
     person and whose history of use of alcohol or drugs 
     constitutes a disability; or
       ``(ii) any person who is not an elderly person and whose 
     history of use of alcohol or drugs provides reasonable cause 
     for the public housing agency to believe that the occupancy 
     by such person may interfere with the health, safety, or 
     right to peaceful enjoyment of the premises by other tenants.
       ``(B) Required statement.--A public housing agency may not 
     make a dwelling unit in such a project available for 
     occupancy to any person or family who is not an elderly 
     family, unless the agency acquires from the person or family 
     a signed statement that no person who will be occupying the 
     unit--
       ``(i) uses (or has a history of use of) alcohol; or
       ``(ii) uses (or has a history of use of) drugs;
     that would interfere with the health, safety, or right to 
     peaceful enjoyment of the premises by other tenants.''.
       (2) Lease provisions.--Section 6(l) of the United States 
     Housing Act of 1937 (42 U.S.C. 1437d(l)) is amended--
       (A) in paragraph (5), by striking ``and'' at the end;
       (B) by redesignating paragraph (6) as paragraph (7); and
       (C) by inserting after paragraph (5) following new 
     paragraph:
       ``(6) provide that any occupancy in violation of the 
     provisions of section 7(a)(5)(A) or the furnishing of any 
     false or misleading information pursuant to section 
     7(a)(5)(B) shall be cause for termination of tenancy; and''.
       (b) Eviction of Nonelderly Tenants Having Drug or Alcohol 
     Use Problems From Public Housing Designated for Elderly 
     Families.--Section 7(c) of the United States Housing Act of 
     1937 (42 U.S.C. 1437e(c)) is amended to read as follows:
       ``(c) Standards Regarding Evictions.--
       ``(1) Limitation.--Any tenant who is lawfully residing in a 
     dwelling unit in a public housing project may not be evicted 
     or otherwise required to vacate such unit because of the 
     designation of the project (or a portion of the project) 
     pursuant to this section or because of any action taken by 
     the Secretary or any public housing agency pursuant to this 
     section.
       ``(2) Requirement to evict nonelderly tenants for 3 
     instances of prohibited activity involving drugs or 
     alcohol.--With respect to a project (or portion of a project) 
     described in subsection (a)(5)(A), the public housing agency 
     administering the project shall evict any person who is not 
     an elderly person and who, during occupancy in the project 
     (or portion thereof), engages on 3 separate occasions 
     (occurring after the date of the enactment of this Act) in 
     any activity that threatens the health, safety, or right to 
     peaceful enjoyment of the premises by other tenants and 
     involves the use of alcohol or drugs.
       ``(3) Rule of construction.--The provisions of paragraph 
     (2) requiring eviction of a person may not be construed to 
     require a public housing agency to evict any other persons 
     who occupy the same dwelling unit as the person required to 
     be evicted.''.
                                 ______

      By Mr. GREGG (for himself, Mrs. Hutchison, Mr. Lott, Mr. Gramm, 
        Mr. Nickles, and Mr. Warner):
  S. 248. A bill to delay the required implementation date for enhanced 
vehicle inspection and maintenance programs under the Clean Air Act and 
to require the Administrator of the Environmental Protection Agency to 
reissue the regulations relating to the programs, and for other 
purposes; to the Committee on Environment and Public Works.


                 the auto inspection reform act of 1995

 Mr. GREGG. Mr. President, I introduce the Auto Inspection 
Reform [AIR] Act of 1995. I am pleased that Senators Hutchison, Lott, 
Gramm, Nickles, and Warner have joined as cosponsors. This legislation 
will postpone the implementation of the enhanced vehicle inspection and 
maintenance programs under the Clean Air Act until March 1, 1996. The 
bill requires EPA to reissue the regulations relating to these 
programs, and to reassess its initial position that effectively 
mandated centralized tests.
  Under the 1990 Clean Air Act, Congress imposed enhanced auto emission 
inspection and maintenance requirements on States in nonattainment 
areas and on States in the statutory-mandated Northeast ozone transport 
region. Under the act, Congress provided a clear option to centralized 
systems for States that proved that decentralized testing could be as 
effective.
  Despite the clear statutory language that indicates Congress wanted 
decentralized testing to be a viable option, EPA has acted to 
fundamentally undermine this congressional intent. Through two 
decisions, EPA has effectively forced States to adopt centralized 
systems. First, EPA determined that an extremely high cost test known 
as the IM-240 was mandated under the act. Second, EPA determined that 
the pollution reduction that States say can be achieved by a 
decentralized system must be discounted by roughly 50 percent.
  As a result, States have either yielded to EPA's mandate, or are 
trying to get EPA to change its views. States that chose the first 
course are facing a citizen rebellion and States choosing the second 
are facing a brick wall. If a State does not meet the enhanced 
emissions testing requirements to EPA's satisfaction, the Agency can 
have the State's Federal highway funding cut off.
  EPA has just recently indicated a willingness to reconsider and 
negotiate increased flexibility with some of the affected States' 
Governors and not implement fines for States moving forward in ``good 
faith.'' This is a good first step. However, it has only been 
implemented on a State-by-State basis and EPA has yet to issue any 
codified guidance to define this apparent change in policy. States 
remain at the mercy of EPA's discretion. I believe that any new policy 
should be formalized to provide States certainty and predictability. 
This bill will help ensure that the Clean Air Act will be complied with 
by giving States the necessary flexibility to implement the most 
suitable inspection program for their States. I urge my colleagues to 
give this bill careful consideration.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 248

       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 ``Auto Inspection Reform (AIR) 
     Act of 1995''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds that, in carrying out title I 
     of the Clean Air Act (42 U.S.C. 7401 et seq.), the 
     Administrator of the Environmental Protection Agency 
     (referred to in this Act as the ``Administrator'') has failed 
     to--
       (1) adequately consider alternative programs to centralized 
     vehicle emission testing programs, as required by section 
     182(c)(3)(C)(vi) of the Clean Air Act (42 U.S.C. 
     7511a(c)(3)(C)(vi)); and
       (2) provide adequate credit to States for the alternative 
     programs.
       (b) Purpose.--The purpose of this Act is to require the 
     Administrator to--
       (1) reassess the determinations of the Administrator with 
     respect to the equivalency of centralized and decentralized 
     programs under section 182(c)(3)(C)(vi) of the Clean Air Act 
     (42 U.S.C. 7511a(c)(3)(C)(vi)); and
       (2) issue new regulations governing the programs that--
       (A) result in minimum disruption to the ability of States 
     to comply with other requirements of the Act (42 U.S.C. 7401 
     et seq.); and
       (B) provide States a reasonable opportunity to comply with 
     the new regulations and implement any decentralized testing 
     programs that the States demonstrate are equally effective as 
     centralized programs.

     SEC. 3. IMPLEMENTATION OF ENHANCED VEHICLE INSPECTION 
                   PROGRAMS.

       (a) In General.--Notwithstanding any other provision of 
     law, a State shall not be required to implement an enhanced 
     vehicle inspection and maintenance program under section 
     182(c)(3) of the Clean Air Act (42 U.S.C. 7511a(c)(3)) prior 
     to March 1, 1996.
       (b) Reassessment of Regulations.--
       (1) In general.--The Administrator shall--
       (A) immediately rescind the regulations issued on November 
     5, 1992 (57 Fed. Reg. 52950), relating to operation of the 
     program described in subsection (a) on a centralized basis; 
     and
       (B) during the period beginning on the date of enactment of 
     this Act and ending on March 1, 1996--
       (i) reassess the determinations made by the Administrator 
     with respect to operation of the program described in 
     subsection (a) on a centralized basis, taking into 
     consideration comments submitted by States; and
       (ii) issue new regulations relating to operation of the 
     program described in subsection (a) on a centralized basis, 
     or, at the option of each State, on any decentralized basis 
     if the State demonstrates that such a decentralized program 
     is equally effective as a centralized program.
       (2) Requirements.--The regulations issued under paragraph 
     (1)(B)(ii) shall--
       (A) in accordance with the intent of section 
     182(c)(3)(C)(vi) of the Clean Air Act (42 U.S.C. 
     7511a(c)(3)(C)(vi))--
       (i) make reasonably available to States the option of 
     operation of the program described [[Page S1234]] in 
     subsection (a) on any decentralized basis if the State 
     demonstrates that such a decentralized program is equally 
     effective as a centralized program; and
       (ii) establish criteria that a State must meet in order to 
     demonstrate that a decentralized program of the State is 
     equally effective as a centralized program; and
       (B)(i) provide each State a reasonable opportunity to 
     submit (at the option of the State) a new revision to a plan 
     under section 182(c)(3) of the Act (42 U.S.C. 7511a(c)(3)) 
     based on the new regulations, which revision shall replace 
     any revision to a plan previously submitted by the State 
     under section 182(c)(3) of the Act; and
       (ii) include a schedule that provides States a reasonable 
     opportunity to implement any new revisions to plans that the 
     States submit.
       (3) Judicial review.--Notwithstanding section 706 of title 
     5, United States Code, or any other provision of law, if the 
     regulations issued pursuant to paragraph (1)(B)(ii) are 
     reviewed by a court, the court shall hold unlawful and set 
     aside the regulations if the regulations are found to be 
     unsupported by a preponderance of the evidence.
       (c) Prohibition on Imposition of Sanctions.--Until such 
     time as the Administrator has carried out subsection (b)(1)--
       (1) the Administrator may not issue a finding, disapproval, 
     or determination under section 179(a) of the Clean Air Act 
     (42 U.S.C. 7509(a)), or apply a sanction specified in section 
     179(b) of the Act, to a State with respect to a failure to 
     implement a program described in subsection (a), or any 
     portion of such a program; and
       (2) the Administrator and the Administrator of the Federal 
     Highway Administration of the Department of Transportation 
     may not take any adverse action, against a State with respect 
     to a failure described in paragraph (1), under--
       (A) section 176 of the Clean Air Act (42 U.S.C. 7506);
       (B) chapter 53 of title 49, United States Code;
       (C) subpart T of part 51, or subpart A of part 93, of title 
     40, Code of Federal Regulations (commonly known as the 
     ``transportation conformity rule''); or
       (D) part 6, 51, or 93 of title 40, Code of Federal 
     Regulations (commonly known as the ``general conformity 
     rule'').
       (d) Full Credit for Decentralized Programs.--Until such 
     time as the Administrator has carried out subsection (b)(1), 
     for the purpose of the attainment demonstration and the 
     reasonable further progress demonstration required under 
     section 182(c)(2) of the Clean Air Act (42 U.S.C. 
     7511a(c)(2)), the Administrator shall--
       (1) deem that the emission reductions calculated by States 
     for inspection and maintenance under their State 
     implementation plans would be achieved as if the planned 
     program had been implemented; or
       (2) if appropriate, consider the operation of the program 
     described in subsection (a) on a decentralized basis as 
     equivalent to the operation of the program on a centralized 
     basis in any case in which a State demonstrates that a 
     determination of such an equivalency is reasonable.
                                 ______

      By Mr. McCONNELL:
  S. 250. A bill to amend chapter 41 of title 28, United States Code, 
to provide for an analysis of certain bills and resolutions pending 
before the Congress by the Director of the Administrative Office of the 
United States Courts, and for other purposes; to the Committee on the 
Judiciary.


              the litigation impact statements act of 1995

 Mr. McCONNELL. Mr. President, today, I am introducing a bill 
that joins the effort to improve our legal system with the goal of 
eliminating unfunded Federal mandates.
  Too often, Mr. President, Congress passes a bill without regard as to 
its impact on the court system. How many new cases will the law 
generate? Will they be Federal court cases or State court cases? How 
much will it cost government to enforce the new law through the legal 
system? How much liability will government, as well as the private 
sector, incur as a result of the new law?
  These questions are rarely asked by Congress before a bill becomes 
law. The bill I am introducing will change all of that. It requires the 
Administrative Office of the U.S. Courts to provide a litigation impact 
statement for all bills reported from committees--except private relief 
bills and appropriation bills.
  The A.O. is equipped to perform this task; in fact, the staff already 
does provide a judicial impact statement for certain bills. They did it 
for the Violence Against Women's Act, and they did for a bill I 
introduced in the 102d Congress, the Pornography Victims' Compensation 
Act.
  In 1994, more than 281,000 new cases were filed in the Federal 
courts, with an increase in the civil filings of 3 percent over last 
year--Interestingly, the criminal filings have gone down.
  In 4 of the last 5 years, filings in the Federal courts have 
increased. This increase in court filings occurs at the State level, 
where hundreds of thousands of cases are also filed. Too many of these 
cases are a direct result of Federal legislation enacted without a 
thought as to the effect on the courts. My bill will give Congress the 
opportunity to consider, for every bill, what burdens it will create 
for the courts, as well as the financial impact for potential liability 
the new law will have on governmental and private entities. Cities and 
towns are spending more and more of their budgets on liability 
insurance, and part of the blame for that rests with Congress for the 
new laws creating runaway liability.

  Will a litigation impact statement slow Congress down? I certainly 
hope so. It would be just fine with the American people, if Congress 
imposed fewer burdens on them. After all, they delivered a loud message 
last November. They said our government does not work properly; it's 
too big, too expensive and inefficient. So, before Congress goes off 
passing laws which will create more lawsuits, let's get Congress 
educated about the impact any new laws will have on our court system.
  Congress already gets an assessment of the budget impact for any new 
legislation. Let's also have a litigation impact statement. It is a 
very good beginning on the road to reforming the legal system.
  And on reforming the legal system, I will have more to say in the 
coming days. The time is right to undertake comprehensive reform of our 
legal system. I know it will be a top priority of the Senate Judiciary 
Committee, and I look forward to working with that committee on this 
issue.
                                 ______

      By Mr. McCAIN:
  S. 251. A bill to make provisions of title IV of the Trade Act of 
1974 applicable to Cambodia; to the Committee on Finance.


          most-favored-nation status for cambodia legislation

 Mr. McCAIN. Mr. President, last year, I introduced legislation 
to clear up an anomaly in United States law that prohibits the 
President from granting Cambodia most-favored-nation status [MFN]. 
Despite my efforts, Cambodia is without MFN and the President is still 
without the statutory power to grant it. There were many more important 
issues for Congress to address in 1994. But MFN is very important to 
Cambodia. And it should be important to all of us interested in a 
stable and prosperous Southeast Asia. Accordingly, today, I am 
reintroducing legislation to grant MFN to Cambodia.
  Areas of Indochina under Communist control, including significant 
portions of Cambodia, were denied MFN under the Trade Agreements 
Extension Act of 1951 and the 1974 Trade Act. Cambodia as a whole was 
denied MFN in 1975 by Executive action and its new trading status was 
confirmed by Congress in the 1988 Trade Act.
  The 1974 Trade Act provided a process for restoring MFN to those 
nations then denied it. However, only a portion of Cambodia was denied 
MFN at the time the 1974 act was signed into law. There is no clear 
legal authority for restoring MFN to the entire nation under the 
processes established by the 1974 Trade Act. It cannot be restored by 
reversing the action taken in 1975 through an Executive order because 
Cambodia's non-MFN trading status was made law in the 1988 Trade Act. 
In short, the President wants to grant MFN to Cambodia, but lacks the 
authority to do so.
  The legislation I am introducing would give the President the 
authority to grant Cambodia MFN status by bringing the entire country 
under the restoration procedure of the 1974 Trade Act. Under these 
procedures, Cambodia will have to demonstrate compliance with the 
requirements of the Jackson-Vanik amendment, reach a bilateral 
agreement with the United States, and have its status approved by the 
Congress. The President may also waive the requirements of Jackson-
Vanik, which has for political reasons come to mean a policy decision 
far beyond the original concern for emigration, and immediately upon 
this legislation becoming law, extend MFN to Cambodia. Cambodia would 
be eligible to receive MFN by virtually the same process 
[[Page S1235]] that all other non-MFN countries, except the Baltics, 
have received it since the signing of the 1974 Trade Act.
  I want to emphasize that if this bill becomes law, the President will 
retain his prerogatives to respond to developments in Cambodia.
  Despite some disturbing developments in Cambodia since I introduced 
this legislation for the first time last May, I remain hopeful for the 
future of Cambodia. Cambodia's democracy is a very fragile and 
incomplete one, but it is a democracy. It needs careful attention to 
fully develop and sustain the rights of the Cambodian people. Promoting 
economic development through open markets would offer considerable 
support for Cambodian democracy and demonstrate American concern for 
its future. I encourage my colleagues to act on legislation to grant 
MFN to Cambodia at the earliest possible opportunity.
                                 ______

      By Mr. THOMPSON (for himself, Mr. Ashcroft, Mr. Abraham, Mr. 
        Bond, Mr. Brown, Mr. Burns, Mr. Coverdell, Mr. Craig, Mr. 
        Faircloth, Mr. Frist, Mrs. Hutchison, Mr. Inhofe, Mr. Mack, Mr. 
        Packwood, Mr. Smith, and Mr. Thomas):
  S.J. Res. 21. A joint resolution proposing a constitutional amendment 
to limit congressional terms; to the Committee on the Judiciary.


                  TERM LIMITS CONSTITUTIONAL AMENDMENT

  Mr. THOMPSON. Mr. President, today, I, along with Senator Ashcroft, 
will introduce a joint resolution to impose term limits on Members of 
Congress. This legislation will limit Members of the Senate to two 
terms and it will limit Members of the House to three terms. The time 
has come to pass this legislation. It is needed and it has the 
overwhelming support of the American people. In fact, never has there 
been an idea so popular that has received so little attention by the 
U.S. Congress. It is because term limits does not have to do with 
spending other people's tax money or regulating other people's lives as 
is the case with most legislation coming out of Congress. This 
provision, term limits, hits much closer to home. It calls for 
sacrifice or at least adjustment in the lives of ourselves. At least, 
with regard to those in Congress who see the Congress as a permanent 
career. It is time that the Congress put aside the personal interest 
that individual Members might have and respond to the will of the 
people, the good of the country, as well as the good of Congress as an 
institution.
  Because term limits is not about punishing Congress or denigrating 
the institution of Congress, although it has come to the point where 
many in our society would love to do so. On the contrary. Term limits 
would strengthen and elevate Congress in the eyes of the American 
people at a time when it is most needed. Today people feel alienated 
from their Government and have concluded that Congress does not have 
the will to deal with the tough challenges that face this country in 
the future. And who can disagree with that notion. Yesterday we passed 
out of the Judiciary Committee a balanced budget amendment to the 
Constitution. I have concluded, as I think most others have, that 
passage of a balanced budget amendment is absolutely necessary if we 
are going to avoid bankrupting the next generation. The reason is that 
Congress doesn't have the political will to do what we all know is 
necessary. Therefore, we must resort to the straitjacket of a balanced 
budget amendment. It is a reflection upon us and upon our current 
system that such a straitjacket is needed. But constitutional 
amendments with regard to specific matters cannot indefinitely save us 
from ourselves. We must start developing the will that is necessary to 
face tough issues. To me that means that we must have more people 
coming into the system who view service in the U.S. Congress not as a 
permanent career but as an interruption to a career. I believe that 
term limits would more likely produce individuals who would take on the 
tough challenges, since their careers would not be at stake every time 
they did so. It would also draw them into the system and encourage more 
citizens to run for office since they would not automatically face the 
difficult uphill struggle of running against a well-entrenched, well-
financed incumbent.
  There have been many Members who have served much longer than the 
limitations of this legislation would allow. A case can be made for the 
proposition that up until recently our current system has served us 
pretty well. There is no need to argue that point. However, different 
times and different circumstances require different measures. As the 
Federal Government has grown there has been a proliferation of special 
interest groups each with their demand on the Treasury and each holding 
a carrot and a stick for every Member of Congress. The carrot is 
political and financial support. And the stick is mobilizing of their 
forces in order to try to end a Member's career. So every time a Member 
takes a tough stand for the benefit of those yet unborn, who do not 
have votes, his career is on the line. For a Member whose entire future 
is based upon indefinite continued service, these forces are too often 
overwhelming. So we now have a $5 trillion debt and a deficit that will 
start to skyrocket again in 1998. Apparently, we have decided to let 
our children and grandchildren make the tough choices. That's not being 
responsible. Surely, we are better than that. We owe it to them to take 
the measures necessary to give us the best chance of putting ourselves 
in the position to deal with such problems. That is why we need term 
limits and I urge my colleagues support.
  Mr. ASHCROFT. Mr. President, 1994 was a watershed year in America. 
Our people spoke with a clarity and intensity seldom heard in the halls 
of politics. Their voices reverberated across the continent like the 
revolutionary shot heard round the world at Lexington and Concord two 
centuries ago.
  The voters' voice was a clarion cry for revolution in Washington, 
DC--a revolution that returns the right of self-governance to the 
people.
  We, the American people, are self governing. We are free people. We 
have the right to govern ourselves. We have spilt American blood not 
only across this continent, but around the globe, to preserve our right 
to self-government.
  Fifty years ago, to win the Battle of the Bulge, commanders compelled 
the cooks, the clerks, and the corpsmen to join the front lines and to 
defend our freedom of self-governance. For victory, all had to fight, 
all were necessary, none were excluded. Well, we again must invite 
everyone to join the battle and participate in victory for self-
governance.
  Those of us who were in the trenches of politics this year heard the 
battle cry for reentry by the public into the public policy arena. The 
citizens of this Nation are determined to regain the right to 
participate in their government. They want to reopen the door to self-
governance--a door that too often has been slammed in their face. We 
must not slam it in their face again.
  The people want the right to self-governance. They want the 
opportunity to decide on term limits.
  Some say that the States can decide on term limits, but the courts 
have struck those statutes down almost uniformly. In one remaining 
case, the Arkansas case, the Attorney General, the executive branch, 
has slammed the door in the face of the people, saying they have no 
right to make such a determination; States and the people have no right 
to establish term limits, the executive branch says.
  The judicial branch considering the case is likely to slam the door, 
as well, saying the people have no right to chart the course of their 
own future, to establish limits on the terms of those of us who have 
the privilege of representing the people in making public policy 
decisions here in Washington.
  Congress, then, the last remaining branch of Government, holds the 
key to opening the door of self-governance to the people.
  Back in 1951, the Congress sent to the American people the 
opportunity to enact term limits for the President. Congress could not 
enact them, but it called upon the people to make a judgment to 
participate in the process of public policy development.
  Presidential term limits were not imposed by the Congress. The door 
of decisionmaking was swung wide for the people of this great country 
to decide whether or not they wanted term limits for the President. 
Indeed, they did decide; they participated. It was good public policy. 
They ratified the 22nd amendment. [[Page S1236]] 
  The question is not whether we will provide term limits to America. 
The question is whether or not we will allow the American people the 
privilege of participating in public policy determinations, whether we 
will let the American people decide for themselves whether or not they 
want term limits for Members of the U.S. Congress.
  I have a hint about what the American people believe and how they 
think. Twenty-two States have already overwhelmingly endorsed this 
concept. And of the States given the opportunity to make such a 
decision, the people voting in those States almost uniformly and 
without exception have endorsed the understanding that people should 
not go to Washington for an entire lifetime, but should go expecting to 
return from public service.
  The question then is, will we let the people decide or will we slam 
the door of self-governance in the face of the American people again? 
We must let the people decide.
  It is time for us to acknowledge again the principle of self-
governance. Let the people decide.
  It is time that we trust our people, the people of America, as our 
forefathers did. Let the people decide.
  Let us demolish the misleading myth that Congress exists to protect 
people from themselves. We must instead respect the reality that there 
is wisdom in the people. We must acknowledge the reality that self-
governance is not simply a politically expedient idea, it is, in fact, 
governmentally beneficial.
  The people are eager to participate in shaping the tomorrows in which 
they live and in which all of us work. They are demanding the 
opportunity to decide whether or not to limit the terms of Members of 
this body and of the U.S. House of Representatives.
  As servants of the people, we must pass a resolution on term limits 
that recognizes that term limits cannot be in the exclusive province of 
the House or Senate, but this is a decision to be reached by the 
American people. This is an opportunity for self-governance.
  They have spoken with clarity and intensity this year, saying they 
want us to reopen the door of opportunity to decisionmaking and let 
them decide. I submit that we must respond to their call; that we must 
pass a resolution on term limits and thereby let the people decide to 
enact or reject term limits as they would apply to the U.S. House of 
Representatives and the U.S. Senate.
  Mr. BOND. Mr. President, my colleague from Missouri comes to the 
floor for his first floor statement on an issue that will not surprise 
any of his fellow Missourians, and that is a message of change.
  Change is what John Ashcroft talked about so clearly during his 
campaign, and now he is doing exactly what he told the people of 
Missouri he would do if they sent him here--to be a leader for change.
  I take great pleasure in cosponsoring this legislation for term 
limits, because I think this is a very important first step toward 
doing actually what the people so clearly indicated they wanted done 
last November 8. It is no surprise to me that John Ashcroft is leading 
the way.
  John is an old and very dear friend. I have come to know him as an 
American patriot. He believes in this country and its people. He is 
able to cut through the fog of confusion that so often surrounds public 
policy issues. Missourians know him as a plain speaker in the finest 
Missouri tradition. He knows what he believes and how to say it so 
everyone knows just exactly what he believes. We once had a President 
with the same reputation from Missouri. What John Ashcroft believes is 
shaped by an upbringing that reflects the essence of middle-American 
values, its traditions and beliefs.
  John is one of three boys raised in Springfield, MO. His family was 
modest of means, but rich in respect for their community, for each 
other, and for their God.
  Earlier this month, John's father, Dr. J. Robert Ashcroft a highly 
respected educational and religious leader, passed away after returning 
home to Missouri from witnessing John's swearing-in as a U.S. Senator 
in this Chamber. Dr. Ashcroft's passing was a great loss to Missouri, 
but his contribution, his memory, and his commitment will live on. We 
have suffered the loss along with John and his family, but we know that 
he knew his son would continue his efforts to serve, and to serve his 
fellow man. We all give thanks for Dr. Ashcroft's life and the many 
lives which he touched while he was with us.
  John Ashcroft has served as Missouri's State auditor--he followed me 
in that job--and then he served as attorney general, following John 
Danforth. He followed me as Governor. He understands State government 
and its relationship with the Federal Government. He also knows 
something about cleaning up the problems that have been left behind.
  At a time when Congress will reexamine the relationship and hopefully 
return much of the decisionmaking back to the States, Americans will 
have no better leader than John Ashcroft.
  So we hear today from a plain-spoken Missourian what will undoubtedly 
be the first of many clearly reasoned, morally grounded floor speeches 
from our good friend, John Ashcroft.
  I would say that our fellow Senators will understand very well his 
contributions. We value John Ashcroft's friendship. We welcome him and 
his wife, Janet, to Washington. I am confident that all my colleagues 
will come to know and respect him as I have. It will be a great and 
very meaningful friendship for all Members.
                                 ______

      By Mr. GRAMS (for himself, Mr. Lott, Mr. Inhofe, Mr. Thomas, Mr. 
        Grams, and Mr. Mack): Senate Joint Resolution 22. A joint 
        resolution proposing an amendment to the Constitution of the 
        United States to require a balanced budget; to the Committee on 
        the Judiciary.


           THE TAXPAYER PROTECTION BALANCED BUDGET AMENDMENT

 Mr. GRAMS. Mr. President, I am today introducing legislation 
calling for a balanced budget amendment to the Constitution. I am 
pleased to be joined by the distingshed majority whip, Senator Lott, 
and my colleagues, Senate Inhofe, and Thomas.
  This legislation is what the American people are calling for. It 
balances the budget, but ensures that it is not balanced on the backs 
of the American taxpayers.
  There is no question that Congress must pass a balanced budget 
amendment and send it to the States for ratification. For years, 
Washington has been racking up deficits. In the process, we've racked 
up $4\1/2\ trillion national debt. And sadly, we've got very little to 
show for it.
  Without the balanced budget amendment, Congress will continue it 
deficit-digging, debt-building ways. That's bad news for the taxpayers 
and worse news for our children.
  If you look at every so-called deficit reduction package Congress has 
passed in the last decade, you'll find that each one follows a 
consistent formula. Raise taxes now. Cut spending later.
  Tragically, however, once Congress raised in taxes, it always forgot 
about the spending cuts. So, year after year, taxes would go up, 
spending would go up, and the deficit would go up, too. It's time to 
put an end to this madness.
  That's why I am today introducing a taxpayer protection balanced 
budget amendment in the Senate. My amendment would require a three-
fifths super majority vote in both houses of Congress to raise taxes.
  A supermajority requirement is the best way to show the American 
taxpayers that Congress is serious about balancing the budget through 
spending cuts, and not through higher taxes.
  That's what I promised the taxpayers of Minnesota during my campaign 
for the U.S. Senate. That's what they elected me to do. That's what my 
bill delivers.
  Is there enough support in Congress to pass it? If we listen to the 
folks back home there sure ought to be.
  A poll released today by the American Conservative Union that shows 
that the American people overwhelmingly support the supermajority 
requirement.
  In fact, two thirds of those who already support a balanced budget 
amendment say that without a supermajority provision, the bill would be 
a sham.
  The people have spoken. A balanced budget must be achieved through 
cuts in Government spending. Americans are willing to do that, but they 
aren't willing to be patsies for a big-spending 
[[Page S1237]] government that just hasn't learned when to say ``no.''
  The supermajority requirement is simply good government, and 
Americans support it just as they support the $500 per-child tax 
credit. They're tired of watching their paychecks grow smaller while 
Washington grows bigger.
  They voted for change last November, and it's our job to see that 
they get it.
  That's what's best for the taxpayers, that's what's best for our 
children, that's what's best for Minnesota, that's what's best for 
America.

                          ____________________