[Congressional Record Volume 141, Number 57 (Tuesday, March 28, 1995)]
[Senate]
[Pages S4717-S4736]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DOMENICI (for himself, Mr. Biden, Mrs. Kassebaum, Mr. 
        Bingaman, Mr. Jeffords and Mr. Wellstone):
  S. 632. A bill to create a national child custody database, to 
clarify the exclusive continuing jurisdiction provisions of the 
Parental Kidnapping Prevention Act of 1980, and for other purposes; to 
the Committee on the Judiciary.


                  The Child Custody Reform Act of 1995

  Mr. DOMENICI. Mr. President, I am this morning going to introduce a 
bill that I am hopeful the Judiciary Committee of the U.S. Senate will 
take into consideration rather quickly and report something to the U.S. 
Senate akin to what I am going to talk about for the next few minutes.
  There is much talk about seeing to it that we insist that parents be 
responsible and that, where there are custody situations in a split 
household, divorce or otherwise, the obligations to pay child support 
get enforced across the land. The President speaks of it, everyone 
speaks of it, in more or less the notion of the need for parental 
responsibility and the fact that responsible parents alleviate some of 
the Government's expenditures if they were paying their legally 
obligated payments to their children.
  And so today I want to discuss briefly where we are with reference to 
that and what we ought to do.
  Let me talk now about the bill itself.
  Over the past few months, we in Congress have spoken a great deal 
about the need to get our Nation's fiscal house in order. Although we 
may disagree on exactly how we should get there, the debate on this 
matter has demonstrated at least one matter on which we all agree. This 
central point of agreement is about the future, and what 
responsibilities and burdens we will be handing to generations yet to 
come. Concern for the future of our children and grandchildren must be 
the defining issue. I believe this our foremost responsibility, and I 
know there are many women and men in this body who share this 
commitment.
  The need to provide for the future of our children and, indeed, the 
Nation, however, does not hinge solely on fiscal policy. The 
responsibilities we hold for the children of America span all aspects 
of life and incorporate many elements of the law. Children hold a 
special status under the law. We recognize that without a responsible 
parent or guardian, children are at the mercy of society. In the 
absence of measures to protect them, they are our most vulnerable and 
needy citizens. In such a case, the law becomes their primary protector 
and provider, and often their last source of relief in many instances 
in this country. I am addressing these issues today because I rise to 
introduce a bill that seeks to further support children in this 
country, and which will assist in protecting them when their best 
interests are not being served.


                  The Child Custody Reform Act of 1995

  In 1980, Congress passed the Parental Kidnapping Prevention Act--the 
PKPA. This bill sought to end the common situation where feuding 
parents, whether divorced, separated, estranged, or otherwise, used 
their children as pawns in their personal vendettas against each other. 
Often, this would take the form of one parent kidnapping the child and 
moving to another State. Once in the other State, the parent could 
petition that State court in order to obtain a new custody ruling. In 
the event that a different ruling was handed down, the legal battles 
began, with the child being used as leverage in a vicious parental 
battle that often played out over many years. The children thrown into 
the middle of these situations obviously suffered, some think they 
suffered irreparable harm, and congress had to step in to bring this 
practice to a halt. The PKPA did much to alleviate this situation, and 
solidified the statutes that protect children involved in custody 
disputes. Several years of this law in actual practice, however, have 
demonstrated that some gaps exist in this legislation, and there remain 
a few loopholes through which this situation can continue.
  So today I rise to introduce the Child Custody Reform Act of 1995. We 
have worked diligently on this with various entities in our country and 
with the American Bar Association because we have one of these typical 
situations in the law that is spoken of when you go to law school as 
conflicts of interest, or conflict law. So this bill is going to put a 
cap on some of these inconsistencies and to further help resolve a 
troubling situation that continues to this day.
  The Child Custody Reform Act that I am introducing amends the PKPA in 
two ways: First, this act would clarify the language of the PKPA so 
that future jurisdictional disputes are eliminated altogether. And 
second, this act would establish a national child custody registry so 
that the courts and officers of the court would have quick and accurate 
access to information regarding the status of any child in the Nation 
for whom a custody decree has been issued.
  It would not pry into anyone's life. It would just take a matter of 
court record and produce that in a manner that would be available 
interstate, so that in a legal battle in State X with two children 
involved, the court can immediately find out whether those two children 
are already involved in a legal situation in another State.
  So, what we are going to do in this law is as follows.
  Current PKPA provisions still allow a second State to issue a 
separate and oftentimes conflicting child custody ruling. This flaw 
allows a second State to modify a custody ruling made by a first State 
by determining on its own that the first State no longer had 
jurisdiction under its own law.
  That is kind of legal jargon, but essentially if there is a valid 
decree affecting children in State A and one of the parents moves to 
State B, State B has found a way to avoid State A's decree which was 
made and is valid by finding that the first court did not have 
jurisdiction, and so they would take it all over in the second court.
  [[Page S4718]] We have worked long and hard with experts in the bar 
association on the law of conflicts and the law of custody.
  This flaw allows the second State to modify the ruling where only one 
of the parents or one of the contending parties is present.
  So under these proposed changes, the court of the second State would 
not be allowed to issue a ruling modifying the initial custody decree 
as long as one of the contestants still remained in the State that 
issued the original ruling.
  This will say, as a matter of law nationally, the second State 
attempting to change the ruling in a State that already ruled, that 
that court has no jurisdiction as a matter of law in America, and the 
case must be returned to the first State. That means that a contestant 
will enter a motion in court setting this statute up as a defense and 
the judge will have clearly before him or her a national statute that 
says they must defer this back to the State of original jurisdiction.
  If the original issuing State declines to exercise continuing 
jurisdiction, the second State would then be free to modify the ruling 
as it sees fit. This, I believe and many in the legal profession 
believe, will go a long way to stop jurisdictional disputes between 
States and their courts over contesting parties where there is a child 
or children in the middle of this battle from ever occurring.
  We are, obviously, open to better language. We are, obviously, open 
to the Judiciary Committee of the U.S. Senate with its good legal 
counsel and Members of the Senate who have worked on this issue long 
and hard, to see if they can do better by language than we have, but we 
think this will go a long way.
  Currently, States are required to keep a listing of existing child 
custody decrees. I repeat, that is not new. What exists right now is 
that States are required to keep a listing. No way of exchanging this 
between States is currently in the law of the land or being 
accomplished by any kind of standardization.
  So what we decided to do in this bill--myself and cosponsors and I am 
sure there will be others--we have decided that we should encourage the 
establishment of a national registry in conjunction with the already 
existing Federal parent locater service where information on these 
children or their legal status could be entered. Thus, it would be 
available between States, and States would not get hoodwinked where a 
parent could take the children to another State, leave one parent 
behind, and want to start anew, ignoring what has already happened.
  Obviously, the second court would know that those children were the 
subject of a custody decree in another State, and unless the original 
State declines to exercise jurisdiction, that would be returned to the 
original State that entered the decree, thus, not permitting parents to 
use their children as pawns and decide they will move to another State 
to change custody or change the obligation to pay child support.
  So when a proceeding is commenced anywhere in the country, an officer 
of the court could immediately check with the registry of each State, 
which would be available to them, to see if a standing custody order 
currently exists or if a custody proceeding is currently pending in 
another court.
  In the event that another ruling on the same child or children 
exists, the second court, in compliance with the PKPA, would 
immediately know not to proceed any further. If the adult guardian or 
parent still wished to move for a modification of the decree, they 
would have to petition the State in which the original custody decree 
was issued.
  Thus, we can see that the registry would help immensely in 
eliminating jurisdictional fights that occur these days that are not in 
the interest of the children of the adult contestants.


    Sense-of-the-Senate Resolution for Supervised Visitation Centers

  In addition to the changes in the PKPA, this bill would express the 
sense of the Senate that local governments should take full advantage 
of the funds allocated in last year's crime bill, under the provisions 
for local crime prevention block grants, to establish supervised 
visitation centers for children involved in custody disputes. These 
centers would be used for the visitation of children when one or both 
of the parents are believed to put the children at risk of physical, 
emotional, or sexual abuse.


                               Conclusion

  I believe this bill is a valuable and needed step to ensure that the 
children of America are looked after in a responsible and caring 
manner. It is unfortunate that we need to pass laws of this nature. One 
would think that good sense and responsible adult behavior would 
resolve this problem on its own. This presently is not the case, 
however. As a result, the law must step in and serve the public 
interest, and the best interests of children enduring these hardships. 
I am greatly encouraged that my colleagues, Senators Jeffords, 
Bingaman, Biden, and Wellstone have joined me in support of this bill, 
and I look forward to further consideration by the entire Congress.
  Mr. President, 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. 632

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,
     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Custody Reform Act of 
     1995''.

     SEC. 2. FINDINGS.

       The Congress finds that--
       (1) parents who do not find a child custody ruling to their 
     liking in one State will often start a custody proceeding in 
     another State in the hope of obtaining a more favorable 
     ruling;
       (2) although Federal and State child custody jurisdictional 
     laws were established to prevent this situation, gaps still 
     exist that allow for confusion and differing interpretations 
     by various State courts, and which lead to separate and 
     inconsistent custody rulings between States;
       (3) in the event that a different ruling is handed down in 
     the second State's court, the problem then arises of which 
     court has jurisdiction, and which ruling should be granted 
     full faith and credit under the Parental Kidnapping 
     Prevention Act of 1980;
       (4) changes in the Parental Kidnapping Prevention Act of 
     1980 must be made that will provide a remedy for cases where 
     conflicting State rulings exist--
       (A) to prevent different rulings from occurring in the 
     first instance by clarifying provisions with regard to 
     continuing State jurisdiction to modify a child custody 
     order; and
       (B) to assist the courts in this task by establishing a 
     centralized, nationwide child custody database; and
       (5) in the absence of such changes, parents will continue 
     to engage in the destructive practice of moving children 
     across State borders to escape a previous custody ruling or 
     arrangement, and will continue to use their helpless children 
     as pawns in their efforts at personal retribution.

     SEC. 3. MODIFICATION OF REQUIREMENTS FOR COURT JURISDICTION.

       Section 1738A of title 28, United States Code, is amended--
       (1) by amending subsection (d) to read as follows:
       ``(d)(1) Subject to paragraph (2), the jurisdiction of a 
     court of a State that has made a child custody determination 
     in accordance with this section continues as long as such 
     State remains the residence of the child or of any 
     contestant.
       ``(2) Continuing jurisdiction under paragraph (1) shall be 
     subject to any applicable provision of law of the State that 
     issued the initial custody determination in accordance with 
     this section, when such State law establishes limitations on 
     continuing jurisdiction when a child is absent from such 
     State.'';
       (2) in subsection (f)--
       (A) by redesignating paragraphs (1) and (2) as paragraphs 
     (2) and (1), respectively; and
       (B) in paragraph (1), as so redesignated, by inserting 
     ``pursuant to subsection (d),'' after ``the court of the 
     other State no longer has jurisdiction,''; and
       (3) in subsection (g), by inserting ``or continuing 
     jurisdiction'' after ``exercising jurisdiction''.

     SEC. 4. ESTABLISHMENT OF NATIONAL CHILD CUSTODY REGISTRY.

       Section 453 of the Social Security Act (42 U.S.C. 653) is 
     amended by adding at the end the following new subsection:
       ``(g)(1) Subject to the availability of appropriations, the 
     Secretary of Health and Human Services, in cooperation with 
     the Attorney General, shall expand the Federal Parent Locator 
     Service established under this section, to establish a 
     national network to allow State courts to identify every 
     proceeding relating to child custody jurisdiction filed 
     before any court of the United States or of any State. 
     Information identifying custody determinations from other 
     countries will also be accepted for filing in the registry.
       ``(2) As used in this subsection--
       ``(A) the term `information' includes--
       ``(i) the court or jurisdiction where a custody 
     determination is filed;
     [[Page S4719]]   ``(ii) the name of the presiding officer of 
     the issuing court;
       ``(iii) the names and social security numbers of the 
     parties;
       ``(iv) the name, date of birth, and social security numbers 
     of each child; and
       ``(v) the status of the case;
       ``(B) the term `custody determination' has the same meaning 
     given such term in section 1738A of title 28, United States 
     Code;
       ``(C) the term `custody proceeding'--
       ``(i) means a proceeding in which a custody determination 
     is one of several issues, such as a proceeding for divorce or 
     separation, as well as neglect, abuse, dependency, wardship, 
     guardianship, termination of parental rights, adoption, 
     protection from domestic violence, and Hague Child Abduction 
     Convention proceedings; and
       ``(ii) does not include a judgment, decree, or other order 
     of a court regarding paternity or relating to child support 
     or any other monetary obligation of any person, or a decision 
     made in a juvenile delinquency, status offender, or 
     emancipation proceeding.
       ``(3) The Secretary of Health and Human Services, in 
     cooperation with Attorney General, shall promulgate 
     regulations to implement this section.
       ``(4) There are authorized to be appropriated such sums as 
     are necessary to carry out this subsection.''.

     SEC. 5. SENSE OF SENATE REGARDING SUPERVISED VISITATION 
                   CENTERS.

       It is the sense of the Senate that local governments should 
     take full advantage of the Local Crime Prevention Block Grant 
     Program established under subtitle B of title III of the 
     Violent Crime Control and Law Enforcement Act of 1994, to 
     establish supervised visitation centers for children who have 
     been removed from their parents and placed outside the home 
     as a result of abuse or neglect or other risk of harm to 
     them, and for children whose parents are separated or 
     divorced and the children are at risk because of physical or 
     mental abuse or domestic violence.

  Mr. BIDEN. Mr. President, there is no greater legacy we leave on this 
Earth than our children. Keeping our children safe and helping them 
grow into productive adults is our greatest challenge and 
responsibility--as individuals and as a society.
  For the most part, parents assume this responsibility willingly. But 
with more than 50 percent of marriages ending in divorce, some of our 
children face special risks.
  Notwithstanding the fact that many divorced parents are sensitive to 
their children's needs and act in their best interests, in some cases, 
custody battles become prolonged wars. When this occurs, children can 
suffer severe emotional damage.
  More seriously, when conflict escalates, it can place children at 
risk physically through parental kidnapping; in 1988 alone, an 
estimated 354,000 children were abducted by parents or family members 
nationwide.
  In extreme cases, disputes between parents can even become fatal 
conflicts. Consider two recent chilling events in my State of Delaware:
  In one incident, the father picked up his three children in Delaware 
for a visit, but then drove them to North Carolina--where he shot them 
in the head, set the van they were in on fire, and then killed himself 
in a nearby field.
  In a second case, a father killed his two young children as they 
slept, then turned the gun on himself.
  The result of these incidents, which occurred in the space of 2 weeks 
time--five children dead, all innocent victims of divorce and custody 
disputes. Of course, these are extreme cases, but they illustrate what 
can happen when custody disputes escalate.
  That is why over the years, we have worked to ensure that the justice 
system works as smoothly and effectively as possible at handling 
custody matters, and in particular at making sure that interstate 
conflicts in custody orders are resolved quickly and appropriately.
  Between 1969 and 1983, all 50 States adopted the Uniform Child 
Custody Jurisdiction Act, reducing the incentive for parents to abduct 
their children to another State in an attempt to obtain a favorable 
custody order.
  The act spelled out when a State has jurisdiction to issue a custody 
order and when it has to enforce the order of another State.
  We also addressed a second problem, because States had different 
views of when custody orders--which are subject to modification--were 
adequately final so as to trigger the full faith and credit 
requirements of the Constitution.
  In 1980, Congress enacted the Parental Kidnapping Prevention Act to 
impose a Federal duty on the States to enforce and not modify the 
custody orders of sister States that issued orders consistent with the 
act.
  This act gives priority to States with home State jurisdiction over 
States that have what is called significant connections jurisdiction.
  It also provides that the State that issued the first custody order 
has continuing jurisdiction as long as the child or any contestant 
resides in that State.
  Unfortunately, over the years, cracks have surfaced in the 
application of this law, and contrary to congressional intent, many 
State courts have continued to modify the custody orders of States that 
retain continuing jurisdiction.
  Take for example a case in which a married couple obtained a divorce 
in Michigan in 1988. Custody of their child was awarded to the mother, 
with visitation rights to the father. The decree specifically set-out 
that Michigan would maintain jurisdiction over the parents and the 
child.
  But 6 months later, the mother, who had moved with the child to 
Illinois,
 petitioned an Illinois court to modify the father's visitation rights 
under the Michigan order. The Illinois trial court denied her motion, 
ruling that it had no jurisdiction.

  Yet the Illinois Court of Appeals reversed and remanded the case, 
holding in part that Illinois could ``* * * modify a foreign custody 
judgment even if the other State has jurisdiction so long as the 
Illinois court has jurisdiction * * *''
  The Child Custody Reform Act of 1995 that we introduce today makes it 
clear that in the case I just described, Illinois could not modify the 
Michigan court's grant of visitation rights because the father 
continued to reside in Michigan--and thus, Michigan maintained 
continuing jurisdiction to protect his interests.
  The Child Custody Reform Act of 1995 will help prevent conflicting 
custody orders and jurisdictional deadlock. I would like to commend 
Senator Domenici for his leadership on this issue.
  The act clarifies that a sister State may not enter a new custody 
order nor may it modify an existing custody order, as long as the 
original court acted pursuant to the Parental Kidnapping Prevention 
Act.
  It also clarifies that continuing jurisdiction exists as long as the 
child or one of the contestants continues to reside in the State.
  There are two exceptions to this rule:
  If the State that issued the initial custody order declines to 
exercise jurisdiction to modify such determination; or
  If the laws of the State that issued the initial custody order 
otherwise limit continuing jurisdiction when a child is absent from 
such a State.
  Thus, the act we proposed today does not tread on a State's ability 
to formulate child custody policy. Instead, it merely provides a 
Federal obligation to give full faith and credit to the custody orders 
of sister States.
  The importance of this legislation is that it sets a clear line to 
guide State decisions by requiring that a State cannot modify and must 
enforce a custody order issued by a sister State that retains 
jurisdiction under the Parental Kidnapping Prevention Act.
  A second problem the legislation that we are introducing addresses is 
that judges do not now have a reliable, efficient way to know that a 
judge in another State may have already issued a custody order relating 
to a particular child.
  In our age of advanced computer capabilities, we have the technology 
at our fingertips. So, let's put cyberspace to good use for our 
children. And we don't need to reinvent the wheel here--we can build on 
what we know works.
  The Federal Parent Locator Service, which has operated effectively 
and efficiently under the Social Security Administration for the last 
decade, already works to enforce State child support obligations. This 
legislation will expand this service to establish a child custody 
registry.
  We must give judges in different States the ability to communicate 
about custody cases, and computers are the tools to do that. State 
courts already are automated.
  With modest additional effort, we can link this information and put 
it to work for our children to prevent interstate custody battles.
  Finally, this legislation encourages local governments to take 
advantage of 
[[Page S4720]]  visitation centers funded under the 1994 crime law. We 
can never be 100 percent certain when, how, and even if children will 
return safely from visits with noncustodial parents.
  But visitation centers can provide a safe haven where parents can 
transfer their children for visitation, or leave their children for 
court-ordered, supervised visits.
  Such centers, which Senator Wellstone advocated successfully last 
year, should be established in communities in existing facilities, such 
as schools, neighborhood centers, in public housing complexes, and 
other convenient locations.
  So, by clarifying and strengthening the Parental Kidnapping 
Prevention Act, by putting critical child custody information at the 
fingertips of judges, and by providing State and local governments with 
the funding to open visitation centers, Mr. President, we can go a long 
way toward protecting our children from being caught in the middle of 
painful, sometimes violent custody battles.
  Mr. WELLSTONE addressed the Chair.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. WELLSTONE. Mr. President, first, let me thank my colleague, 
someone whom I consider to be a good friend and someone I admire as a 
legislator and a Senator. I am very proud to be an original cosponsor 
of this legislation.
                                 ______

      By Mr. PRYOR:
  S. 633. A bill to amend the Federal Deposit Insurance Act to provide 
certain consumer protections if a depository institution engages in the 
sale of nondeposit investment products, and for other purposes; to the 
Committee on Banking, Housing, and Urban Affairs.


      the bank customer confidentiality and protection act of 1995

  Mr. PRYOR. Mr. President, I rise to introduce the Bank Customer 
Confidentiality and Protection Act of 1995. This legislation has been 
crafted to address problems in the area of bank sales of uninsured 
products, such as mutual funds, identified during a continuing 
investigation conducted by my staff on the U.S. Senate Special 
Committee on Aging.
  After hearing the stories of numerous older Americans who claim they 
did not know what they were buying when they purchased an uninsured 
product through their bank and then lost much of their life savings, I 
am convinced that more stringent protections are needed to ensure that 
financially inexperienced bank customers fully understand what they are 
buying when they invest in uninsured products.
  Mr. President, this legislation is intended to help those who really 
need its protections, such as the 72-year-old widow in Florida who had 
always put her savings into FDIC-insured certificates of deposit until 
she was contacted by telephone by an employee of her bank offering a 
product with a higher rate of return. This woman then went into her 
bank, listened to the advice of a man whom she thought was a banker, 
and then transferred all her savings into an uninsured government bond 
fund. Even though she did not exactly understand the risks associated 
with the product, she trusted the bank to do her right.
  Two years later, the value of the fund declined and she lost about a 
quarter of her life savings, savings that she had intended to use in 
the years ahead to avoid being a burden to her children. It is this 
sort of tragedy, Mr. President, that this legislation is intended to 
prevent.
  Mr. President, under our present banking system financially 
inexperienced customers have reason to be concerned about the safety of 
their deposits. During our investigation, my Senate Aging Committee 
staff found that some banks were, for example, routinely:
  Sharing detailed customer financial information with people selling 
securities, without customers' explicit knowledge;
  Avoiding full and clear disclosure about the risks associated with 
uninsured products;
  Discouraging bank customers from investing in certificates of deposit 
[CD's], savings accounts, and other similar FDIC-insured investments;
  Establishing commission structures that provide incentives for 
securities salespeople to offer the bank's in-house investment 
products, regardless of the products' suitability for a particular 
customer; and
  Operating in a manner that leads some customers to not fully 
understand the relationship between the securities salesperson and the 
depository institution.
  I and a number of my colleagues consider these to be questionable 
marketing practices and find them especially troubling because of the 
special place banks have in our communities.
  Mr. President, many older bank customers hold their bank and the 
people who work there in high regard and feel comfortable about taking 
advice from them about where to put their money.
  In addition, when some customers see the FDIC emblem--something 
analogous to the Good Housekeeping seal of approval for many--they may 
believe that the FDIC coverage applies to all products offered in the 
institution. As customers who have seen their principals drop have 
realized, this is not the case.
  While all bank customers need to exercise caution, older customers 
need to be particularly vigilant when it comes to uninsured investments 
such as mutual funds, principally because the savings of the elderly do 
not represent a renewable resource and the loss of such savings cannot 
be written off as lessons learned for the future.
  Mr. President, to explore the impact on older Americans further, in 
September 1994 I chaired a U.S. Senate Special Committee on Aging 
hearing entitled ``Uninsured Bank
 Products: Risky Business for Seniors?'' At this hearing, we had older 
bank customers, former bank-based brokers, and industry experts come 
and discuss how some banks' brokerage businesses are selling 
inappropriate products to older customers.

  It is clear that something must be done about these questionable 
practices. While I would prefer to avoid legislation, it appears that 
there may be no other option. Although some banks recently have taken 
steps to clean up their practices, many are continuing business as 
usual. In addition, the banking regulators' joint guidelines and the 
industry's voluntary guidelines, while well-intended, do not appear to 
have been totally effective in addressing marketing abuses.
  Mr. President, let me address one part of these guidelines, the 
provision that banks have their customers sign ``disclosure'' documents 
before they make a purchase. One concern I have is that the format of 
these disclosure forms vary from bank to bank. Some banks or their 
investment subsidiaries do a fine job putting in plain English required 
disclosure information, such as the fact that uninsured investment 
products are not backed by the Federal Deposit Insurance Corporation. 
Other banks, however, present the information in such a way that you 
would have to be an attorney or an experienced investor and have great 
eyesight in order to understand what they mean.
  Then there is the even more problematic issue of oral disclosure--
what bank customers are told. More than a few financially inexperienced 
bank customers have told me that when they looked over the disclosure 
forms they did not understand what they meant. These customers 
typically would then ask the investment salespeople to interpret the 
forms for them. In these cases, the salespeople told their customers 
that the documents were just a formality to open the account or that 
the forms simply restated what the salespeople had told the customers. 
The problem is that in some cases the salespeople had made misleading 
or false statements about the nature of the uninsured products when 
they described them, such as that they were ``as safe as the money in 
your pocket and will only lose money if the Federal Government goes 
bankrupt'' or ``backed by something better than the FDIC.''
  Mr. President, the legislation I am introducing, which has been 
crafted after numerous meetings with industry and consumer groups, 
would provide needed consumer protections for financially inexperienced 
customers.
  The legislation would provide protections by:
  Requiring full and clear disclosure about the risks associated with 
uninsured products;
  [[Page S4721]] Limiting the compensation that institution employees 
receive for making referrals to securities salespeople;
  Establishing guidelines for uninsured products' promotional 
materials;
  Requiring common-sense physical separation of deposit and nondeposit 
sales products;
  Prohibiting the sharing of bank customers' personal financial 
information without customers' explicit consent; and
  Improving the coordination of enforcement-related activities between 
the Federal banking agencies and the Securities and Exchange 
Commission.
  These protections will be especially important if the remaining legal 
barriers that currently restrict banks' involvement in the securities 
and insurance industries are broken down, as called for by Treasury 
Secretary Robert E. Rubin and several congressional proposals. These 
changes to our banking system that Secretary Rubin and others are 
advocating are not necessarily bad ones, and I will consider them with 
an open mind if they come to the floor of the Senate. However, without 
the consumer protections called for by my legislation, dropping the 
remaining restrictions likely would create even more confusion among 
customers over which products at a bank are federally insured and which 
are not.
  In the meantime, as we consider the legislation I am introducing 
today, we need to continue reminding all bank customers that not 
everything they put money in at the bank is backed by the FDIC or the 
bank--regardless of what somebody might lead them to believe.
  Mr. President, I ask unanimous consent that the 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. 633

       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 ``Bank Customer 
     Confidentiality and Protection Act of 1995''.

     SEC. 2. CUSTOMER PROTECTIONS REGARDING NONDEPOSIT INVESTMENT 
                   PRODUCTS.

       (a) Amendment to the Federal Deposit Insurance Act.--
     Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 
     1828) is amended by adding at the end the following new 
     subsection:
       ``(q) Safeguards for Sale of Nondeposit Investment 
     Products.--
       ``(1) Definitions.--For purposes of this subsection--
       ``(A) the terms `broker', `dealer', and `registered broker 
     or dealer' have the same meanings as in section 3 of the 
     Securities Act of 1934;
       ``(B) the term `customer'--
       ``(i) means any person who maintains or establishes a 
     deposit, trust, or credit relationship with an insured 
     depository institution;
       ``(ii) includes any person who renews an account in an 
     insured depository institution and any person who rolls over 
     a deposit in any such account; and
       ``(iii) any person who contacts an insured depository 
     institution, in person or otherwise, for the purpose of 
     inquiring about or purchasing a nondeposit investment 
     product;
       ``(C) the term `Federal securities law' has the meaning 
     given to the term `securities laws' in section 3(a)(47) of 
     the Securities Exchange Act of 1934;
       ``(D) the term `nondeposit investment product'--
       ``(i) includes any investment product that is not a 
     deposit; and
       ``(ii) does not include--

       ``(I) any loan or other extension of credit by an insured 
     depository institution;
       ``(II) any letter of credit; or
       ``(III) any other instrument or investment product 
     specifically excluded from the definition of such term by 
     regulations prescribed jointly by the Federal banking 
     agencies after consultation with the Securities and Exchange 
     Commission;

       ``(E) the term `nonpublic customer information'--
       ``(i) means information regarding any person which has been 
     derived from any record of any insured depository institution 
     and pertains to the person's relationship with the 
     institution, including the provision or servicing of a credit 
     card; and
       ``(ii) does not include information about a person that 
     could be obtained from a credit reporting agency that is 
     subject to the restrictions of the Fair Credit Reporting Act 
     by a third party that is not entering into a credit 
     relationship with the person, but that otherwise has a 
     legitimate business need for that information in connection 
     with a business transaction involving the person; and
       ``(F) the term `self-regulatory organization' has the same 
     meaning as in section 3(a)(26) of the Securities Exchange Act 
     of 1934.
       ``(2)  Misrepresentation of guarantees.--It shall be 
     unlawful for any insured depository institution sponsoring, 
     selling, or soliciting the purchase of any nondeposit 
     investment product to represent or imply in any manner 
     whatsoever that such nondeposit investment product--
       ``(A) is guaranteed or approved by the United States or any 
     agency or officer thereof; or
       ``(B) is insured under this Act.
       ``(3) Customer disclosure.--
       ``(A) In general.--An insured depository institution shall, 
     concurrently with the opening of an investment account by a 
     customer or with the initial purchase of a nondeposit 
     investment product by a customer, prominently disclose, in 
     writing, to that customer--
       ``(i) that nondeposit investment products offered, 
     recommended, sponsored, or sold by the institution--

       ``(I) are not deposits;
       ``(II) are not insured under this Act;
       ``(III) are not guaranteed by the insured depository 
     institution; and
       ``(IV) carry risk of a loss of principal;

       ``(ii) the nature of the relationship between the insured 
     depository institution and the broker or dealer;
       ``(iii) any fees that the customer will or may incur in 
     connection with the nondeposit investment product;
       ``(iv) whether the broker or dealer would receive any 
     higher or special compensation for the sale of certain types 
     of nondeposit investment products; and
       ``(v) any other information that the Federal banking 
     agencies jointly determine to be appropriate.
       ``(B) Customer acknowledgment of disclosure.--
       ``(i) In general.--Concurrently with the opening of an 
     investment account by a customer or with the initial purchase 
     of a nondeposit investment product by a customer, an insured 
     depository institution or other person required to make 
     disclosures to the customer under subparagraph (A) shall 
     obtain from each such customer a written acknowledgment of 
     receipt of such disclosures, including the date of receipt 
     and the name, address, account number, and signature of the 
     customer.
       ``(ii) Records of customer acknowledgement.--An insured 
     depository institution shall maintain appropriate records of 
     the written acknowledgement required by this subparagraph for 
     an appropriate period, as determined by the Corporation. Such 
     record shall include the date on which the acknowledgment was 
     obtained and the customer's name and address.
       ``(iii) Duration of acknowledgement.--Written 
     acknowledgement shall not be considered valid for purposes of 
     this subparagraph for a period of more than 5 years, 
     beginning on the date on which it was obtained.
       ``(C) Prohibition on inconsistent oral representations.--No 
     employee of an insured depository institution shall make any 
     oral representation to a customer of an insured depository 
     institution that is contradictory or otherwise inconsistent 
     with the information required to be disclosed to the customer 
     under this paragraph.
       ``(D) Model forms and regulations.--The Federal banking 
     agencies, after consultation with the Securities and Exchange 
     Commission, shall jointly issue appropriate regulations 
     incorporating the requirements of this paragraph. Such 
     regulations shall include a requirement for a model 
     disclosure form solely for such purpose to be used by all 
     insured depository institutions incorporating the disclosures 
     required by this paragraph.
       ``(4) Referral compensation.--A one-time nominal referral 
     fee may be paid by an insured depository institution to any 
     employee of that institution who refers a customer of that 
     institution either to a broker or dealer or to another 
     employee of that insured depository institution for services 
     related to the sale of a nondeposit investment product, if 
     the fee is not based upon whether or not the customer 
     referred makes a purchase from the broker, dealer, or other 
     employee.
       ``(5) Prohibition of joint marketing activities.--No 
     nondeposit investment product may be offered, recommended, or 
     sold by a person unaffiliated with an insured depository 
     institution on the premises of that institution as part of 
     joint marketing activities, unless the person marketing such 
     nondeposit investment product--
       ``(A) prominently discloses to its customers, in writing, 
     in addition to the disclosures required in paragraph (3), 
     that such person is not an insured depository institution and 
     is separate and distinct from the insured depository 
     institution with which it shares marketing activities; and
       ``(B) otherwise complies with the requirements of this 
     subsection.
       ``(6) Limitations on advertising.--
       ``(A) Misleading advertising.--No insured depository 
     institution may employ any advertisement that would mislead 
     or otherwise cause a reasonable person to believe mistakenly 
     that an insured depository institution or the Federal 
     Government is responsible for the activities of an affiliate 
     of the institution, stands behind the affiliate's credit, 
     guarantees any returns on nondeposit investment products, or 
     is a source of payment of any obligation of or sold by the 
     affiliate.
     [[Page S4722]]   ``(B) Names, letterheads, and logos.--In 
     offering, recommending, sponsoring, or selling nondeposit 
     investment products, an insured depository institution shall 
     use names, letterheads, and logos that are sufficiently 
     different from the names, letterheads, and logos of the 
     institution so as to avoid the possibility of confusion.
       ``(C) Separation of literature.--All sales literature 
     related to the marketing of nondeposit investment products by 
     an insured depository institution shall be kept separate and 
     apart from, and not be commingled with, the banking 
     literature of that institution.
       ``(7) Limitations on solicitation.--The place of 
     solicitation or sale of nondeposit investment products by an 
     insured depository institution shall be--
       ``(A) physically separated from the banking activities of 
     the institution; and
       ``(B) readily distinguishable by the public as separate and 
     distinct from that of the institution.
       ``(8) Sales staff requirement.--Solicitation for the 
     purchase or sale of nondeposit investment products by any 
     insured depository institution may only be conducted by a 
     person--
       ``(A) who--
       ``(i) is a registered broker or dealer or a person 
     affiliated with a registered broker or dealer; or
       ``(ii) has passed a qualification examination that the 
     appropriate Federal banking agency, in consultation with the 
     Securities and Exchange Commission, determines to be 
     comparable to those used by a national security exchange 
     registered under section 6 of the Securities Exchange Act of 
     1934, or a national securities association registered under 
     section 15A of that Act, for persons required to be 
     registered with the exchange or association; and
       ``(B) whose responsibilities are restricted to such 
     nondeposit investment products.
       ``(9)  No favoring of captive agents.--No insured 
     depository institution may directly or indirectly require, as 
     a condition of providing any product or service to any 
     customer, or any renewal of any contract for providing such 
     product or service, that the customer acquire, finance, 
     negotiate, refinance, or renegotiate any nondeposit 
     investment product through a named broker or dealer.
       ``(10)  Restrictions on use of nonpublic customer 
     information.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     no insured depository institution may use or disclose to any 
     person any nonpublic customer information for the purpose of 
     soliciting the purchase or sale of nondeposit investment 
     products.
       ``(B) Exception based on disclosure.--An insured depository 
     institution may use or disclose nonpublic customer 
     information for the purpose of soliciting the purchase or 
     sale of nondeposit investment products if, before such use or 
     disclosure--
       ``(i) the customer gives explicit written consent to such 
     use or disclosure; and
       ``(ii) such written consent is given after the institution 
     has provided the customer with written disclosure that--

       ``(I) the information may be used to target the customer 
     for marketing or advertising for nondeposit investment 
     products;
       ``(II) such nondeposit investment products are not 
     guaranteed or approved by the United States or any agency 
     thereof; and
       ``(III) such nondeposit investment products are not insured 
     under this Act.

       ``(C) Records of customer consent.--An insured depository 
     institution shall maintain appropriate records of the written 
     consent required by subparagraph (B) for an appropriate 
     period, as determined by the Corporation. Such record shall 
     include the date on which the consent was signed and the 
     customer's name and address.
       ``(D) Duration of consent.--Written consent shall not be 
     considered valid for purposes of this paragraph for a period 
     of more than 5 years, beginning on the date on which it was 
     obtained.
       ``(E) Additional restrictions.--The Corporation may, by 
     regulation or order, prescribe additional restrictions and 
     requirements limiting the disclosure of nonpublic customer 
     information, including information to be used in an 
     evaluation of the credit worthiness of an issuer or other 
     customer of that insured depository institution and such 
     additional restrictions as may be necessary or appropriate to 
     avoid any significant risk to insured depository 
     institutions, protect customers, and avoid conflicts of 
     interest or other abuses.
       ``(11) Scope of application.--
       ``(A) Application limited to retail activities.--The 
     Federal banking agencies, after consultation with the 
     Securities and Exchange Commission, may waive the 
     requirements of any provision of this subsection, other than 
     paragraph (10), with respect to any transaction otherwise 
     subject to such provision between--
       ``(i) any insured depository institution or any other 
     person who is subject, directly or indirectly, to the 
     requirements of this section; and
       ``(ii) any other insured depository institution, any 
     registered broker or dealer, any person who is, or meets the 
     requirements for, an accredited investor, as such term is 
     defined in section 2(15)(i) of the Securities Act of 1933, or 
     any other customer who the Federal banking agencies, after 
     consultation with the Securities and Exchange Commission, 
     jointly determine, on the basis of the financial 
     sophistication of the customer, does not need the protection 
     afforded by the requirements to be waived.
       ``(B) No effect on other authority.--No provision of this 
     subsection shall be construed as limiting or otherwise 
     affecting--
       ``(i) any authority of the Securities and Exchange 
     Commission, any self-regulatory organization, the Municipal 
     Securities Rulemaking Board, or the Secretary of the Treasury 
     under any Federal securities law;
       ``(ii) any authority of any State securities regulatory 
     agency; or
       ``(iii) the applicability of any Federal securities law, or 
     any rule or regulation prescribed by the Commission, any 
     self-regulatory organization, the Municipal Securities 
     Rulemaking Board, or the Secretary of the Treasury pursuant 
     to any such law, to any person.
       ``(12) Enforcement.--The provisions of this subsection 
     shall be enforced in accordance with section 8.''.
       (b) Regulations.--Not later than 1 year after the date of 
     enactment of this Act, after consultation with the Securities 
     and Exchange Commission, the appropriate Federal banking 
     agencies (as defined in section 3 of the Federal Deposit 
     Insurance Act) shall jointly promulgate appropriate 
     regulations to implement section 18(q) of the Federal Deposit 
     Insurance Act, as added by subsection (a) of this section.

     SEC. 3. REGULATION BY THE SECURITIES AND EXCHANGE COMMISSION.

       (a) SEC Rulemaking.--Not later than 1 year after the date 
     of enactment of this Act, the Securities and Exchange 
     Commission shall, after consultation with the Federal banking 
     agencies (as defined in section 3 of the Federal Deposit 
     Insurance Act), promulgate regulations that--
       (1) would afford customers of brokers and dealers that 
     affect transactions on behalf of insured depository 
     institutions and customers of affiliates of insured 
     depository institutions protections that are substantially 
     similar to section 18(q) of the Federal Deposit Insurance Act 
     (as added by section 2 of this Act) and the regulations 
     promulgated thereunder; and
       (2) are consistent with the purposes of that section 18(q) 
     and the protection of investors.
       (b) Enforcement.--The Commission shall have the same 
     authority to enforce rules or regulations promulgated under 
     subsection (a) as it has to enforce the provisions of the 
     Securities Exchange Act of 1934.

     SEC. 4. ENFORCEMENT COORDINATION.

       The Federal banking agencies and the Securities and 
     Exchange Commission shall work together to develop comparable 
     methods of securities enforcement and a process for the 
     interagency exchange of enforcement-related information.
                                 ______

      By Mr. D'AMATO:
  S. 634. A bill to amend title XIX of the Social Security Act to 
provide a financial incentive for States to reduce expenditures under 
the Medicaid Program, and for other purposes; to the Committee on 
Finance.


            the state medicaid savings incentive act of 1995

 Mr. D'AMATO. Mr. President, I introduce the State Medicaid 
Savings Incentive Act of 1995. This bill will reward States that act 
decisively to contain Medicaid spending by allowing such States to keep 
20 percent of the resulting savings to the Federal Government.
  This legislation is based on an idea put forward by New York's 
Governor, George Pataki, when he testified recently before the House 
Ways and Means Committee. New York is one of several States moving to 
trim the cost of their Medicaid programs through greater use of managed 
care. As a result of New York's efforts, the Federal Government stands 
to save nearly $2 billion. Governor Pataki is right in suggesting that 
if States like New York can save the Federal Government money through 
cost-saving initiatives such as Medicaid managed care, then the States 
should be allowed to share in that savings as a reward. This creates a 
strong incentive for States to put in place programs that can both 
improve the care of Medicaid beneficiaries and lower the bill for 
American taxpayers.
  Federal Medicaid spending will cost American taxpayers an estimated 
$90 billion in 1995. Over the past 5 years it has grown at a rate of 
over 18 percent a year. And since 1984 it has grown from 18 percent of 
all Federal health spending to over 28 percent in 1993.
  The Congressional Budget Office's current estimates are that the cost 
of Medicaid will nearly double by the year 2000. That should serve as a 
wake up call to all of us.
  With Medicaid representing the largest portion of many State budgets, 
our Nation's Governors are increasingly beginning to employ strategies 
such as increased use of managed care in an effort to keep rising 
Medicaid costs in check. Forty-four States already use 
[[Page S4723]]  managed care plans to serve some portion of their 
Medicaid population. According to the Department of Health and Human 
Services, about 23 percent of the nearly 34 million people enrolled in 
Medicaid now receive their medical care through managed care delivery 
systems--up from 14 percent in 1993.
  These efforts not only hold the potential to lower costs, they also 
provide an opportunity to improve the quality of care for many Medicaid 
beneficiaries. This is a point on which there is bipartisan agreement. 
It is a view shared by HCFA Administrator Bruce Vladeck, who has said 
that managed care programs can, in his view, meet the needs of Medicaid 
recipients especially well, particularly because they emphasize 
preventive and primary care. That means better health care for Medicaid 
recipients, and a reduction in the inappropriate use of hospital 
emergency rooms as a source of primary care services.
  We need to do more to encourage States to make their Medicaid 
programs more efficient. That is what our bill would do.
  Our proposal would give States a strong incentive to restrain their 
Medicaid spending by allowing them to keep a share of any Federal 
savings that are achieved as a result. Under our bill, the Secretary of 
HHS would establish a spending baseline for each State. States that are 
successful in holding Medicaid below the baseline would receive a 
payment equal to 20 percent of the resulting savings to the Federal 
Government.
  No State would be penalized for spending above the baseline, but 
those that spend below the baseline would be rewarded. And rewarding 
States that save the Federal Government money makes sense.
  Containing the growth of Medicaid can only be accomplished with the 
help and cooperation of our Nation's Governors. This bill sends the 
message that the Federal Government stands ready to work in partnership 
with those States that have the determination to do what must be done 
to bring Medicaid costs under control.
  I am pleased that this bill has the support of the majority leader; I 
believe it deserves the strong support of each of my colleagues, and 
should be enacted without delay to encourage our Nation's Governors to 
carry out the important and difficult work of reforming Medicaid.
  Mr. President, 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. 634

       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 ``State Medicaid Savings 
     Incentive Act of 1995''.

     SEC. 2. MEDICAID SAVINGS INCENTIVE PAYMENTS.

       (a) Incentive Payments.--Section 1903(a) of the Social 
     Security Act (42 U.S.C. 1396b(a)) is amended--
       (1) in paragraph (7), by striking the period and inserting 
     ``; plus''; and
       (2) by adding at the end the following new paragraph:
       ``(8) in the case of a State to which subsection (x) 
     applies, the amount of the incentive payment determined under 
     such subsection.''.
       (b) Incentive Payment.--Secton 1903 of the Social Security 
     Act (42 U.S.C. 1396b) is amended by adding at the end the 
     following new subsection:
       ``(x)(1) For purposes of subsection (a)(8), if a State 
     achieves a rate of growth for a fiscal year which is less 
     than the State baseline rate of growth for such fiscal year 
     established under paragraph (3), the Secretary shall make an 
     incentive payment to the State for the fiscal year in the 
     amount determined under paragraph (2).
       ``(2) The amount of any incentive payment shall be equal to 
     the amount that is 20 percent of the difference between the 
     amount that the Federal Government would have paid to a State 
     in a fiscal year for providing medical assistance in 
     accordance with this title, if State expenditures for 
     providing such assistance had increased by the State baseline 
     rate of growth established under paragraph (3) for such 
     fiscal year, and the amount that the Federal Government paid 
     to such State in the fiscal year for providing medical 
     assistance in accordance with this title using the actual 
     State rate of growth for State expenditures for providing 
     such assistance.
       ``(3) At the beginning of each fiscal year, the Secretary 
     shall determine for that fiscal year a baseline rate of 
     growth for medicaid expenditures for each State with a State 
     plan approved under this title based on--
       ``(A) the historical rate of growth for such expenditures 
     in the State; and
       ``(B) such other factors as the Secretary deems 
     appropriate.''.
                                 ______

      By Mrs. HUTCHISON (for herself, Mr. Nunn, Mr. Thurmond, and Mr. 
        Graham):
  S. 635. A bill to amend title 10, United States Code, to provide 
uniformity in the criteria and procedures for retiring general and flag 
officers of the Armed Forces of the United States in the highest grade 
in which served, and for other purposes; to the Committee on Armed 
Services.


                    military retirement legislation

  Mrs. HUTCHISON. Mr. President, the bill that we are introducing today 
will streamline the process for retirement of military officers who 
hold 3- or 4-star rank.
  Under present law, the highest permanent rank that an officer may 
hold is that of two stars. All active duty appointments to 3- and 4-
star rank are temporary appointments made by the President of the 
United States and must be approved by the Senate.
  The President must also nominate every 3- and 4-star office for 
retirement in his highest grade, and the Senate must approve of that 
promotion again, or, under the law, the officer retires with two-star 
rank.
  Mr. President, I am well aware of the historical precedents for the 
current law, but I feel that it is time that we conformed retirements 
for officers in the highest flag and general officer grades to those 
for general and flag officers in one and two star grades.
  The bill we are introducing today will accomplish that. Once officers 
in 3- and 4-star grades have served 3 years in grade, they will be 
allowed to retire in grade without further action by the Senate. This 
will reduce the administrative work load of the Senate Armed Services 
Committee and the Department of Defense.
  Our proposed bill will not, however, curtail Senate prerogative over 
the confirmation of senior military officers for active duty 
assignments. The President will still be required to nominate each 3- 
and 4-star officer for any new assignments. The Senate will have to 
review those nominations and approve each and every assignment while on 
active duty. We simply seek to expedite the ability of the Department 
of Defense to retire officers in grade who have completed a statutorily 
imposed period of honorable service and bring more equity into the 
system. In no other area of life does a person retire at a lower level 
than his or her highest rank.
  The president of a business does not retire at vice president unless 
repromoted by the board. The GS-15 doe not retire as a GS-14--he or she 
retires at the grade last served, with pay based on the highest 3 years 
of service. I believe our highest military officers should have the 
same treatment.
  If a person serves honorably in the last promotion in business, 
government, or the military--he or she should have retirement at that 
level.
  Mr. President, 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. 635

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

     SECTION 1. UNIFORM CRITERIA AND PROCEDURES FOR RETIRING 
                   GENERAL AND FLAG OFFICERS IN HIGHEST GRADE IN 
                   WHICH SERVED.

       (a) Applicability of Time-in-Grade Requirements.--Section 
     1370 of title 10, United States Code, is amended--
       (1) in subsection (a)(2)(A), by striking out ``and below 
     lieutenant general or vice admiral''; and
       (2) in the first sentence of subsection (d)(2)(B), by 
     striking out ``and below lieutenant general or vice 
     admiral''.
       (b) Repeal of Requirements for Senate Confirmation.--
     Sections 1370(c), 3962(a), 5034, and 8962(a) of title 10, 
     United States Code, are repealed.

     SEC. 2. TECHNICAL AND CLERICAL AMENDMENTS.

       (a) Redesignation of Subsections.--(1) Subsection (d) of 
     section 1370 of such title is redesignated as subsection (c).
       (2) Sections 3962(b) and 8962(b) of such title are amended 
     by striking out ``(b) Upon'' and inserting in lieu thereof 
     ``Upon''.
       (b) Clerical Amendments.--The table of sections at the 
     beginning of chapter 505 of 
     [[Page S4724]]  such title is amended by striking out the 
     item relating to section 5034.

     SEC. 3. EFFECTIVE DATE FOR AMENDMENTS TO PROVISION TAKING 
                   EFFECT IN 1996.

       The amendments made by sections 1(a)(2) and 2(a) shall take 
     effect immediately after subsection (d) of section 1370 of 
     title 10, United States Code, takes effect.

  Mr. NUNN. Mr. President, I am pleased to join with Senator Hutchison 
in introducing legislation to establish equity in military retirement 
procedures. This legislation will provide that the retirement of 3- and 
4-star officers will be considered under the same standards and 
procedures as other general and flag officers at the 1- and 2-star 
level. It will also ensure that 3- and 4-star officers facing 
retirement are not subjected to confirmation procedures that do not 
apply to their civilian superiors or other civilian government 
officials. In other words, this legislaion would apply the same 
procedures to 3- and 4-star officer retirements that apply to other 
military and civilian officials seeking retirement.
  By way of background, promotions to 3- and 4-star positions are 
treated as temporary, rather than permanent promotions. This means that 
the individual holds the 3- or 4-star grade only while serving in the 
3- or 4-star position. The member also may hold the grade for brief 
transitional periods to cover transfers between assignments, 
hospitalization, and before retirement.
  Because these grades are temporary, an individual who is in a 3- or 
4-star grade retains his or her permanent grade, which is typically a 
2-star grade. This means that if the individual is not nominated, 
confirmed, or appointed to another 3- or 4-star position, the 
individual will revert to his or her permanent--for example, 2-star 
grade.
  Under current law, these considerations apply to retirements as well 
as promotions. As a result, if a 3- or 4-star officer who retires is 
not nominated, confirmed, or appointed to retire in a permanent 3- or 
4-star grade, the individual will revert to his or her permanent--for 
example, 2-star grade upon retirement--with the attendant loss of 
retired pay and status.
  This situation applies uniquely to 3- and 4-star officers. Other flag 
and general officers, as well as other commissioned officers, retire in 
the highest grade held, subject to minimum time-in-grade requirements, 
without a requirement for nomination, Senate confirmation, and 
appointment to a retired grade.
  Similarly, civilian officials who retire from the civil service are 
not required to face Senate confirmation, no matter how high their 
grade. Thus, a cabinet or subcabinent official, as well as career civil 
service officials, who qualify for civil service retirement will 
receive their full retired pay--based on years of service and high-3 
years rate of pay--without action by the President or the Senate.
  The effect is that 3- and 4-star officers are the only Government 
officials who are subject to losing retired pay and status as a result 
of a requirement that they be confirmed in a retired grade. Neither 
their civilian superiors nor any other Government officials can have 
their retired pay and status reduced through the confirmation process.
  The proposal we are introducing today would end the requirement for 
retiring 3- and 4-star officers to be nominated, confirmed, and 
appointed in a permanent 3- and 4-star grade. The result would be that 
3- and 4-star officers would retire under the same conditions as other 
officers--for example, 2-star officers. That is, they will retire in 
the highest grade they held, subject to minimum time in grade 
requirements.
  The proposal would not change the current requirement for nomination 
and Senate confirmation of all 3- and 4-star active duty promotions, 
assignments, and reassignments.
  Mr. President, I want to commend the Senator from Texas [Mrs. 
Hutchison] for preparing this proposal. I believe the concept warrants 
favorable consideration, but the details should receive careful review 
and study. The Committee on Armed Service will obtain the views of the 
Department of Defense, and the proposal will be considered by the 
Personnel Subcommittee. I look forward to working on this issue with 
Chairman Thurmond, and with Senator Coats, the chairman of the 
Personnel Subcommittee, and Senator Byrd, the ranking minority member 
of the subcommittee.
                                 ______

      By Mr. DASCHLE (for himself and Mr. Pressler):
  S. 636. A bill to require the Secretary of Agriculture to issue new 
term permits for grazing on National Forest System lands to replace 
previously issued term grazing permits that have expired, soon will 
expire, or are waived to the Secretary, and for other purposes; to the 
Committee on Energy and Natural Resources.


                      grazing permits legislation

  Mr. DASCHLE. Mr. President, as part of its management of the national 
grasslands, the U.S. Forest Service issues permits to ranchers so that 
they might graze livestock on those lands. Through these permits, the 
Forest Service ensures that ranchers who utilize these public lands 
obey basic stewardship requirements and other important standards. 
Typically, permits are issued for 10 years and therefore must be 
reviewed and reissued at the end of that period.
  In many cases, the ability of ranchers to graze on national 
grasslands means the difference between success and failure of their 
operations. Understandably, they are concerned, therefore, about 
reports that the Forest Service is facing shortfalls in funding needed 
to perform the National Environmental Policy Act [NEPA] analysis 
required to reissue grazing permits. Through no fault of their own, 
these ranchers may face the loss of their grazing privileges simply 
because the Federal bureaucracy is unable to fulfill its statutory 
responsibilities in a timely fashion.
  As the Forest Service looks for funds to perform the required 
analysis, the resulting uncertainty leaves South Dakota ranchers, and 
indeed ranchers throughout the Nation, in an untenable economic 
situation. Moreover, this unfortunate predicament is compounded by the 
possibility that the Forest Service may divert funding allocated to 
other important activities, such as the timber program, research or 
recreation, for the permit renewal process. This prospect is akin to 
robbing Peter to pay Paul. At a time when there are insufficient 
resources to carry out basic management activities; diverting funds to 
perform the NEPA work on grazing allotments in a rushed manner could 
seriously jeopardize other priority programs.
  In light of these concerns, I have drafted legislation to require the 
Forest Service to issue new permits for grazing on National Forest 
System lands where existing grazing permits have expired or will 
expire. This bill would assure ranchers that they could continue to 
graze livestock, even if the Forest Service is unable to complete the 
necessary NEPA analysis this year. Moreover, it would relieve pressure 
on the Forest Service to take funds away from other important 
activities such as timber sale preparation in the rush to complete this 
NEPA work.
  My legislation would require the Forest Service to reissue permits to 
ranchers who are in compliance with the terms of their permits even if 
the NEPA work has not been completed. The terms of the new permits 
would be 3 years or until the necessary NEPA work is completed, 
whichever is sooner. It would not cover ranchers whose permits have 
been revoked for violations of the rules or new applications. These, I 
believe, are fair and reasonable conditions.
  It is not my intention to overturn the requirements of NEPA. I 
believe that NEPA assessments provide valuable insight into the effects 
of range management, insights that in turn can be used to strengthen 
the entire grazing program. But it has become clear that in this time 
of funding constraints, some permits may not be reissued on time for 
procedural rather than substantive reasons. That is not acceptable.
  Penalizing ranchers for a failure of the Federal Government to 
perform the necessary NEPA analysis is neither fair nor defensible. I 
hope that my colleagues will join me in supporting this effort to 
ensure the unbroken use of the range by ranchers who have complied with 
the terms of their permits and thus deserve to have them renewed. I ask 
unanimous consent that the entire 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:

[[Page S4725]]

                                 S. 636

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

     SECTION 1. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds that--
       (1) the Secretary of Agriculture (referred to in this Act 
     as the ``Secretary'') administers the 191,000,000-acre 
     National Forest System for multiple uses in accordance with 
     Federal law;
       (2) where suitable, 1 of the recognized multiple uses for 
     National Forest System land is grazing by livestock;
       (3) the Secretary authorizes grazing through the issuance 
     of term grazing permits that have terms of not to exceed 10 
     years and that include terms and conditions necessary for the 
     proper administration of National Forest System land and 
     resources;
       (4) as of the date of enactment of this Act, the Secretary 
     has issued approximately 9,000 term grazing permits 
     authorizing grazing on approximately 90,000,000 acres of 
     National Forest System land;
       (5) of the approximately 9,000 term grazing permits issued 
     by the Secretary, approximately one-half have expired or will 
     expire by the end of 1996;
       (6) if the holder of an expiring term grazing permit has 
     complied with the terms and conditions of the permit and 
     remains eligible and qualified, that individual is considered 
     to be a preferred applicant for a new term grazing permit in 
     the event that the Secretary determines that grazing remains 
     an appropriate use of the affected National Forest System 
     land;
       (7) in addition to the approximately 9,000 term grazing 
     permits issued by the Secretary, it is estimated that as many 
     as 1,600 term grazing permits may be waived by permit holders 
     to the Secretary in favor of a purchaser of the permit 
     holder's permitted livestock or base property by the end of 
     1996;
       (8) to issue new term grazing permits, the Secretary must 
     comply with the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.) and other laws;
       (9) for a large percentage of the grazing permits that will 
     expire or be waived to the Secretary by the end of 1996, the 
     Secretary has devised a strategy that will result in 
     compliance with the National Environmental Policy Act of 1969 
     and other applicable laws (including regulations) in a timely 
     and efficient manner and enable the Secretary to issue new 
     term grazing permits, where appropriate;
       (10) for a small percentage of the grazing permits that 
     will expire or be waived to the Secretary by the end of 1996, 
     the strategy will not provide for the timely issuance of new 
     term grazing permits; and
       (11) in cases in which ranching operations involve the use 
     of a term grazing permit issued by the Secretary, it is 
     essential for new term grazing permits to be issued in a 
     timely manner for financial and other reasons.
       (b) Purpose.--The purpose of this Act is to ensure that 
     grazing continues without interruption on National Forest 
     System land in a manner that provides long-term protection of 
     the environment and improvement of National Forest System 
     rangeland resources while also providing short-term certainty 
     to holders of expiring term grazing permits and purchasers of 
     a permit holder's permitted livestock or base property.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Expiring term grazing permit.--The term ``expiring term 
     grazing permit'' means a term grazing permit--
       (A) that expires in 1995 or 1996; or
       (B) that expired in 1994 and was not replaced with a new 
     term grazing permit solely because the analysis required by 
     the National Environmental Policy Act of 1969 (42 U.S.C. 4321 
     et seq.) and other applicable laws has not been completed.
       (2) Final agency action.--The term ``final agency action'' 
     means agency action with respect to which all available 
     administrative remedies have been exhausted.
       (3) Term grazing permit.--The term ``term grazing permit 
     means a term grazing permit or grazing agreement issued by 
     the Secretary under section 402 of the Federal Land Policy 
     and Management Act of 1976 (43 U.S.C. 1752), section 19 of 
     the Act entitled ``An Act to facilitate and simplify the work 
     of the Forest Service, and for other purposes'', approved 
     April 24, 1950 (commonly known as the ``Granger-Thye Act'') 
     (16 U.S.C. 580l), or other law.

     SEC. 3. ISSUANCE OF NEW TERM GRAZING PERMITS.

       (a) In General.--Notwithstanding any other law, the 
     Secretary shall issue a new term grazing permit without 
     regard to whether the analysis required by the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and 
     other applicable laws has been completed, or final agency 
     action respecting the analysis has been taken--
       (1) to the holder of an expiring term grazing permit ; or
       (2) to the purchaser of a term grazing permit holder's 
     permitted livestock or base property if--
       (A) between January 1, 1995, and December 1, 1996, the 
     holder has waived the term grazing permit to the Secretary 
     pursuant to section 222.3(c)(1)(iv) of title 36, Code of 
     Federal Regulations; and
       (B) the purchaser of the term grazing permit holder's 
     permitted livestock or base property is eligible and 
     qualified to hold a term grazing permit.
       (b) Terms and Conditions.--Except as provided in subsection 
     (c)--
       (1) a new term grazing permit under subsection (a)(1) shall 
     contain the same terms and conditions as the expired term 
     grazing permit; and
       (2) a new term grazing permit under subsection (a)(2) shall 
     contain the same terms and conditions as the waived permit.
       (c) Duration.--
       (1) In general.--A new term grazing permit under subsection 
     (a) shall expire on the earlier of--
       (A) the date that is 3 years after the date on which it is 
     issued; or
       (B) the date on which final agency action is taken with 
     respect to the analysis required by the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and 
     other applicable laws.
       (2) Final action in less than 3 years.--If final agency 
     action is taken with respect to the analysis required by the 
     National Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
     seq.) and other applicable laws before the date that is 3 
     years after the date on which a new term grazing permit is 
     issued under subsection (a), the Secretary shall--
       (A) cancel the new term grazing permit; and
       (B) if appropriate, issue a term grazing permit for a term 
     not to exceed 10 years under terms and conditions as are 
     necessary for the proper administration of National Forest 
     System rangeland resources.
       (d) Date of Issuance.--
       (1) Expiration on or before date of enactment.--In the case 
     of an expiring term grazing permit that has expired on or 
     before the date of enactment of this Act, the Secretary shall 
     issue a new term grazing permit under subsection (a)(1) not 
     later than 15 days after the date of enactment of this Act.
       (2) Expiration after date of enactment.--In the case of an 
     expiring term grazing permit that expires after the date of 
     enactment of this Act, the Secretary shall issue a new term 
     grazing permit under subsection (a)(1) on expiration of the 
     expiring term grazing permit.
       (3) Waived permits.--In the case of a term grazing permit 
     waived to the Secretary pursuant to section 222.3(c)(1)(iv) 
     of title 36, Code of Federal Regulations, between January 1, 
     1995, and December 31, 1996, the Secretary shall issue a new 
     term grazing permit under subsection (a)(2) not later than 60 
     days after the date on which the holder waives a term grazing 
     permit to the Secretary.

     SEC. 4. ADMINISTRATIVE APPEAL AND JUDICIAL REVIEW.

       The issuance of a new term grazing permit under section 
     3(a) shall not be subject to administrative appeal or 
     judicial review.

     SEC. 5. REPEAL.

       This Act is repealed effective as of January 1, 2001.
                                 ______

      By Mr. McCAIN:
  S. 637. A bill to remove barriers to interracial and interethnic 
adoptions, and for other purposes; to the Committee on Finance.


              the adoption antidiscrimination act of 1995

 Mr. McCAIN. Mr. President, I am pleased to introduce the 
Adoption Antidiscrimination Act of 1995, a bill that will prevent 
discrimination on the basis of race, color, or national origin in the 
placement of children with adoptive families.
  There are few situations in this world more tragic than a child 
without a family. Such children do not have the basic security of 
parents and a permanent home environment that most of us take for 
granted, and that is so important to social development. Consequently, 
there is little that a society could do that is more cruel to a child 
than to deny or delay his or her adoption by a loving family, 
particularly if the reason for the denial or delay is that the child 
and family are of different races. Yet, this is precisely what our 
public policy does.
  In the late 1960's and early 1970's, over 10,000 children were 
adopted by families of a different race. This was before many adoption 
officials decided, without any empirical evidence, that it is essential 
for children to be matched with families of the same race, even if they 
have to wait for long periods for such a family to come along. The 
forces of political correctness declared interracial adoptions the 
equivalent of cultural genocide. This was, and continues to be, 
nonsense.
  Sound social science research has found that interracial adoptions do 
not hurt the children or deprive them of their culture. According to 
Dr. Howard Alstein, who has studied 204 interracial adoptions since 
1972, ``We categorically have not found that white parents cannot 
prepare black kids culturally.'' He further concluded that ``there are 
bumps along the way, but the transracial adoptees in our study are not 
angry, racially confused people'' and that ``They're happy and content 
adults.''
  [[Page S4726]] Since the mid-1970's, there have been very few 
interracial adoptions. For example, African-American children who 
constitute about 14 percent of the child population currently comprise 
over 40 percent of the 100,000 children waiting in foster care. This is 
despite 20 years of Federal efforts to recruit African-American 
adoptive families and substantial efforts by the African-American 
community. As stated by Harvard Law Prof. Randall Kennedy concerning 
the situation in Massachusetts, ``Even if you do a super job of 
recruiting, in a State where only 5 percent of the population is black 
and nearly half the kids in need of homes are black, you are going to 
have a problem.''
  The bottom line is that African-American children wait twice as long 
as other children to be adopted. Our discriminatory adoption policies 
discouraging interracial adoptions are hurting these children, and this 
is entirely unacceptable.
  Last year, Senator Metzenbaum attempted to remedy this problem by 
introducing the Multi-Cultural Placement Act of 1994. That bill was 
conceived and introduced with the best of intentions. Its stated 
purpose was to promote the best interests of children by decreasing the 
time that they wait to be adopted, preventing discrimination in their 
placement on the basis of race, color, or national origin, and 
facilitating the identification and recruitment of foster and adoptive 
families that can meet children's needs.
  Unfortunately, the Metzenbaum bill was weakened throughout the 
legislative process and eviscerated by the Clinton administration 
Department and HHS in conference. After the original bill was hijacked, 
a letter was sent from over 50 of the most prominent law professors in 
the country, including Randall Kennedy, imploring Congress to reject 
the bill. They warned that it ``would give congressional backing to 
practices that have the effect of condemning large numbers of 
children--particularly children of color--to unnecessarily long stays 
in institutions or foster care.'' Their admonition was not heeded, and 
the bill was passed as part of the Goals 200 legislation last year.
  As Senator Metzenbaum concluded, ``HHS intervened and did the bill 
great harm.'' The legislation that was finally signed by the President 
does precisely the opposite of what was originally intended. It allows 
race to continue to be used as a major consideration and effectively 
reinforces the current practice of racial matching. Consequently, 
adoption agencies receiving Federal funds continue to discourage 
interracial adoptions, increasing the time children must wait to be 
adopted and permitting discrimination in the adoption process. I am 
informed that 43 States have laws that in some way keep children in 
foster care due to race.
  The bill that I am introducing today repeals the Metzenbaum law and 
replaces it with a clear unambiguous requirement that adoption agencies 
which receive Federal funds may not discriminate on the basis of race, 
color, or national origin. By far the most important consideration 
concerning adoptions must be that children are placed without delay in 
homes with loving parents, irrespective of their particular racial or 
ethnic characteristics. This overriding goal must take precedence over 
any unproven social theories or notions of political correctness.
  Mr. President, if we owe children without families anything, we owe 
them the right to be adopted by families that want them without being 
impeded by our social prejudices and preconceptions. Denying adoption 
on the basis of race is no less discrimination than denying employment 
on the basis of race. And the consequences are certainly no less 
severe. Let us, finally get beyond race and allow people who need each 
other--children and familes--to get together.
  Mr. President, I request unanimous consent that the text of the bill, 
and a letter of support from the National Council for Adoption, be 
included in the Record. As a result of the efforts of Congressman 
Bunning, similar legislative language has been incorporated into the 
Personal Responsibility Act, H.R. 4.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 637

       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 ``Adoption Antidiscrimination 
     Act of 1995''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds that--
       (1) nearly 500,000 children are in foster care in the 
     United States;
       (2) tens of thousands of children in foster care are 
     waiting for adoption;
       (3) 2 years and 8 months is the median length of time that 
     children wait to be adopted, and minority children often wait 
     twice as long as other children to be adopted; and
       (4) child welfare agencies should work to eliminate racial, 
     ethnic, and national origin discrimination and bias in 
     adoption and foster care recruitment, selection, and 
     placement procedures.
       (b) Purpose.--The purpose of this Act is to promote the 
     best interests of children by--
       (1) decreasing the length of time that children wait to be 
     adopted; and
       (2) preventing discrimination in the placement of children 
     on the basis of race, color, or national origin.

     SEC. 3. REMOVAL OF BARRIERS TO INTERRACIAL AND INTERETHNIC 
                   ADOPTIONS.

       (a) Prohibition.--A State or other entity that receives 
     funds from the Federal Government and is involved in adoption 
     or foster care placements may not--
       (1) deny to any person the opportunity to become an 
     adoptive or a foster parent, on the basis of the race, color, 
     or national origin of the person, or of the child, involved; 
     or
       (2) delay or deny the placement of a child for adoption or 
     into foster care, or otherwise discriminate in making a 
     placement decision, on the basis of the race, color, or 
     national origin of the adoptive or foster parent, or the 
     child, involved.
       (b) Penalties.--
       (1) State violators.--A State that violates subsection (a) 
     shall remit to the Secretary of Health and Human Services all 
     funds that were paid to the State under part E of title IV of 
     the Social Security Act (42 U.S.C. 670 et seq.) (relating to 
     foster care and adoption assistance) during the period of the 
     violation.
       (2) Private violators.--Any other entity that violates 
     subsection (a) shall remit to the Secretary of Health and 
     Human Services all funds that were paid to the entity during 
     the period of the violation by a State from funds provided 
     under part E of title IV of the Social Security Act.
       (c) Private Cause of Action.--
       (1) In general.--Any individual or class of individuals 
     aggrieved by a violation of subsection (a) by a State or 
     other entity may bring an action seeking relief in any United 
     States district court or State court of appropriate 
     jurisdiction.
       (2) Statute of limitations.--An action under this 
     subsection may not be brought more than 2 years after the 
     date the alleged violation occurred.
       (d) Attorney's Fees.--In any action or proceeding under 
     this Act, the court, in the discretion of the court, may 
     allow the prevailing party, other than the United States, a 
     reasonable attorney's fee, including litigation expenses and 
     costs, and the States and the United States shall be liable 
     for the fee to the same extent as a private individual.
       (e) State Immunity.--A State shall not be immune under the 
     11th amendment to the Constitution from an action in Federal 
     or State court of appropriate jurisdiction for a violation of 
     this Act.
       (f) No Effect on Indian Child Welfare Act of 1978.--Nothing 
     in this Act shall be construed to affect the application of 
     the Indian Child Welfare Act of 1978 (25 U.S.C. 1901 et 
     seq.).

     SEC. 4. REPEAL.

       Subpart 1 of part E of title V of the Improving America's 
     Schools Act of 1994 (42 U.S.C. 5115a) is amended--
       (1) by repealing sections 551 through 553; and
       (2) by redesignating section 554 as section 551.

     SEC. 5. EFFECTIVE DATE.

       This Act, and the amendments made by this Act, shall take 
     effect 90 days after the date of enactment of this Act.
                                                                    ____

                                National Council for Adoption,

                                   Washington, DC, March 23, 1995.
     Hon. John McCain,
     U.S. Senate, Russell Senate Office Building, Washington, DC.
       Dear Senator McCain: The National Council For Adoption is 
     very supportive of your proposed legislation to end racism in 
     our child welfare system. The research on transracial 
     adoptions shows that:
       Children of color wait twice as long as white children for 
     permanent loving homes simply because of the color of their 
     skin.
       While African-Americans make up to 12-14 percent of the 
     population an overwhelming 40 percent of the estimated 
     100,000 children waiting for homes are black. The numbers 
     don't match.
       Children of color raised in white homes are not ``lost'' to 
     their ethnic heritage, they do well academically, feel good 
     about themselves and become productive citizens.
       The Multi-Ethnic Placement Act of 1994 ought to be repealed 
     as the legislative language and its purposes were hopelessly 
     hijacked by amendments insisted upon by the Administration.
        [[Page S4727]] We applaud your interest and your proposed 
     legislation which is aimed at reducing the time children of 
     color spend without homes. We stand ready to work closely 
     with you to ensure timely passage.
           Sincerely,

                                   Carol Statuto Bevan, Ed.D.,

                                                Vice President for

                               Research and Public Policy.
                                 ______

      By Mr. MURKOWSKI (by request):
  S. 638. A bill to authorize appropriations for United States insular 
areas, and for other purposes; to the Committee on Energy and Natural 
Resources.


                      the insular development act

 Mr. MURKOWSKI. Mr. President. At the request of the 
administration, I am today introducing legislation ``to authorize 
appropriations for United States insular areas, and for other 
purposes''. The legislation was transmitted by the Assistant Secretary 
of the Interior for Territorial and International Affairs to implement 
the funding recommendations contained in the President's proposed 
budget for fiscal year 1996. The legislation, if enacted, would replace 
the current annual guaranteed funding for the Commonwealth of the 
Northern Mariana Islands with a new program. The new program would 
complete the infrastructure funding contemplated under the agreement 
negotiated by the administration with the Commonwealth and redirect the 
balance of the funds to other territorial needs.
  For the current fiscal year, Congress redirected a portion of the 
Commonwealth funding to support of efforts by the Departments of 
Justice, Labor, and the Treasury to work with the Commonwealth 
government to address a variety of concerns that have arisen in the 
Commonwealth. A report on that effort is due from the Department of the 
Interior shortly, and we will want to consider the findings and 
recommendations in that report to determine whether some of these funds 
might be better spent in support of those activities. I am also 
concerned with that provision of the proposed legislation that would 
provide operational grants to Guam and the Commonwealth for compact 
impact assistance. I do not have any particular objections to providing 
that assistance if it is justified, if the budget limitations allow 
funding, and if that assistance is a higher priority than other needs. 
My concern is providing that assistance through an entitlement rather 
than through discretionary appropriations. The central objective of the 
current 7 year agreement with the Commonwealth is to eliminate 
operational assistance and focus on necessary infrastructure needs. 
Replacing one type of operational assistance with another seems to me 
to be a step back.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                 S. 638

       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 Insular Development Act of 
     1995.

     SEC. 2. NORTHERN MARIANA ISLANDS.

       There is authorized to be appropriated to the Secretary of 
     the Interior for the Commonwealth of the Northern Mariana 
     Islands $6,140,000, backed by the full faith and credit of 
     the United States, for each of fiscal years 1996 through 
     2001, for capital improvement projects in the environmental, 
     health, and public safety areas, administration and 
     enforcement of immigration and labor laws, and contribution 
     toward costs of the compacts of free association (for the 
     same duration and purposes as are applied to Guam in Public 
     Law 99-239 as amended by section 3 of this Act).

     SEC. 3. IMPACT OF THE COMPACT.

       (a) Paragraph (6) of subsection (e) of section 104 of 
     Public Law 99-239 (99 Stat. 1770, 48 U.S.C. 1681 note), is 
     amended by striking everything after the word ``after'' and 
     inserting in lieu thereof the following language: ``September 
     30, 1995 and ending September 30, 2001, $4,580,000 annually, 
     backed by the full faith and credit of the United States, for 
     Guam, as a contribution toward costs that result from 
     increased demands for education and social program benefits 
     by immigrants from the Marshall Islands, the Federated States 
     of Micronesia, and Palau.''

     SEC. 4. CAPITAL INFRASTRUCTURE.

       There is authorized to be appropriated to the Secretary of 
     the Interior $17,000,000 for each fiscal year beginning after 
     September 30, 1995 and ending September 30, 2001, backed by 
     the full faith and credit of the United States, for grants 
     for capital infrastructure construction in American Samoa, 
     Guam, and the United States Virgin Islands, Provided, That 
     the annual grant to American Samoa shall not exceed 
     $15,000,000 and the annual grants for Guam and the United 
     States Virgin Islands shall not exceed $3,000,000 each.

     SEC. 5. CAPITAL INFRASTRUCTURE FUNDING REQUIREMENTS.

       (a) No funds shall be granted under this Act for capital 
     improvement projects without the submission by the respective 
     government of a master plan of capital needs that (1) ranks 
     proposed projects in order of priority, and (2) has been 
     reviewed and approved by the Department of the Interior and 
     the United States Army Corps of Engineers. The insular areas' 
     individual master plans, with comments, shall be presented in 
     the Department of the Interior's annual report on the State 
     of the Islands, and shall be the basis for any requests for 
     capital improvement funding through the Department of the 
     Interior or the Congress.
       (b) Each grant by the Department of the Interior shall 
     include a five percent payment into a trust fund, to be 
     administered by the Governor (as trustee) of the territory in 
     which the project is located, solely for the maintenance of 
     such project. No funds shall be paid pursuant to a grant 
     under subsection (a) of this section without the prior 
     appropriation and payment by the respective territorial 
     government to the trustee, of an amount equal to the federal 
     contribution for maintenance of the project. A maintenance 
     plan covering the anticipated life of each project shall be 
     adopted by the Governor of the respective insular area and 
     approved by the Department of the Interior before any grant 
     payment for construction is released by the Department of the 
     Interior.
       (c) The capital infrastructure funding authorized under 
     this Act is authorized to be extended for an additional 
     three-year phase-out period: Provided, That each grant during 
     the additional period contains a dollar sharing by each 
     grantee and the grantor in the following ratios: twenty-five/
     seventy-five percent for the first year, fifty/fifty percent 
     for the second year, seventy-five/twenty-five percent for the 
     third year; Provided further, That funding for capital 
     infrastructure for the Commonwealth of the Northern Mariana 
     Islands shall not exceed $3,000,000 annually during the 
     period of such extension.

     SEC. 6. REPEAL.

       Effective after September 30, 1995, no additional funds 
     shall be made available under subsection (b) of section 4 of 
     Public Law 94-241 (90 Stat. 263, 48 U.S.C. 1681 note), and 
     such subsection is repealed.
                                                                    ____

                      Section-by-Section Analysis

       Section 1 states the short title of the Act to be the 
     ``Insular Development Act of 1995.''
       Section 2 authorizes a full faith and credit appropriation 
     in an annual amount of $6.14 million for fiscal years 1996 
     through 2001 to the Secretary of the Interior for 
     Commonwealth of the Northern Mariana Islands (CNMI) devoted 
     to the following purposes: (1) capital improvement projects 
     in environmental, health, and public safety areas, (2) 
     administration and enforcement of immigration and labor laws, 
     and (3) contribution toward costs of the compacts of free 
     association incurred by the CNMI.
       Section 3 amends the law authorizing payments to United 
     States Pacific jurisdictions for costs associated with the 
     compacts of free association to provide a specific $4.58 
     million annual full faith and credit payment to Guam as a 
     contribution toward such costs incurred by Guam.
       Section 4 authorizes a full faith and credit appropriation 
     in the annual amount of $17 million for fiscal years 1996 
     through 2001 to the Secretary of the Interior for capital 
     infrastructure construction in American Samoa, Guam, and the 
     Virgin Islands. The insular area with the greatest need, 
     American Samoa, would receive annual grants of between $11 
     million and $15 million; Guam and the Virgin Islands would 
     each receive annual grants of up to $3 million.
       Section 5(a) provides that capital infrastructure funds 
     granted under sections 2, 4, and 5 of the bill would be 
     subject to master plans developed by the respective 
     government that rank projects in priority order. The plans 
     would be subject to review and approval by the Department of 
     the Interior and United States Army Corps of Engineers.
       Section 5(b) provides that five percent of each Interior 
     grant for capital infrastructure and a matching amount by the 
     respective insular government be paid into trust funds solely 
     for expenditure on maintenance of each project, according to 
     a maintenance plan approved by Interior. The respective 
     insular governor would be the trustee.
       Section 5(c) provides for extension of only the capital 
     infrastructure program, authorized in section 4, for an 
     additional three-year phase-out period. The federal share of 
     construction grants would decrease to seventy-five percent in 
     the first year, fifty percent in the second year, and twenty-
     five percent in the third year, before termination of the 
     program.
       Section 6, repeals subsection (b) of section 4 of Public 
     Law 94-241 (which mandates continuing payments of $27.7 
     million to the Commonwealth of the Northern Mariana Islands 
     until otherwise provided by law). The provision explicitly 
     states that no additional funds shall be made available under 
     this subsection of the 1976 law after fiscal year 1995.
     
                                                                    ____

[[Page S4728]]

                              U.S. Department of the Interior,

                                Washington, DC, February 27, 1995.
     Hon. Albert Gore,
     President, U.S. Senate, Washington, DC.
       Dear Mr. President: Enclosed is a draft bill ``(t)o 
     authorize appropriations for United States insular areas, and 
     for other purposes.''
       The Department of the Interior recommends that the bill be 
     introduced, referred to the appropriate committee, and 
     enacted.
       The bill would terminate the mandatory financial assistance 
     paid to the Commonwealth of the Northern Mariana Islands 
     (CNMI) and shift such mandatory assistance to more pressing 
     territorial needs, i.e., contribution to Guam and the CNMI 
     for impact of immigration caused by the Compacts of Free 
     Association, and capital infrastructure construction. The 
     bill would follow-through on a commitment by the Congress to 
     contribute to the defraying of impact costs incurred by Guam 
     and the CNMI, and would represent a commitment to the 
     territories by President Clinton and the Congress to address 
     the territories' most pressing capital infrastructure needs. 
     The draft bill is consistent with the budgetary requirements 
     under ``Paygo.''
       The Covenant to Establish the Commonwealth of the Northern 
     Mariana Islands in Political Union with the United States of 
     America (Covenant) committed the federal government to 
     mandatory funding for the CNMI for a period of seven years--
     1979 through 1985. A total of $228 million in full faith and 
     credit funding for a subsequent seven-year period was 
     approved by the Congress in legislation (Pub. L. 99-396, 100 
     Stat. 840) that provided--
       ``(u)pon the expiration of the period of Federal financial 
     assistance . . ., payments of direct grant assistance shall 
     continue at the annual level provided for the last fiscal 
     year of the additional period of seven fiscal years until 
     Congress otherwise provides by law.''
       Congress has not over the last two years approved a third 
     and final financial assistance agreement, nor acted on 
     Administration proposals transmitted with the 1994 and 1995 
     budgets.
       With no additional provisions of law by the Congress, 
     however, the CNMI continues to receive $27.7 million annually 
     as it did in fiscal year 1992, the final year of the second 
     seven-year period.


                      provisions of the draft bill

       The draft bill addresses specific concerns shared by the 
     Congress, the Administration and the insular areas.
     CNMI
       The bill would authorize $6,140,000 a year for the 
     Commonwealth of the Northern Mariana Islands through the year 
     2001 for the purposes of capital improvement projects, 
     administration and enforcement of immigration and labor laws, 
     and contribution to costs of the compacts of free 
     association. Flexibility would be accorded the CNMI in 
     allocating the funding among such purposes. If authorized, 
     the CNMI will have received a total of $120 million during 
     the period of fiscal years 1993 through 2001--the equivalent 
     of the 1992 agreement reached with the CNMI representatives.
       The bill would shift remaining mandatory funding to other 
     priority insular needs, i.e., territorial infrastructure 
     needs, and the congressional commitment to reimburse United 
     States jurisdictions for the impact of the compacts of free 
     association.
     Guam
       When the Compact of Free Association for the Marshall 
     Islands and the Federated States of Micronesia was approved 
     by the Congress, section 104(e)(6) of the Public Law 99-239 
     authorized the payment of impact of the Compact costs 
     incurred by United States Pacific island jurisdictions due to 
     the extension of education and social services to immigrants 
     from the freely associated states. The Palau Compact 
     legislation (Public Law 99-658) included Palau by reference. 
     The Governments of Guam and the CNMI contend that they have 
     incurred costs in excess of $75 million. While definitions of 
     eligible costs and the magnitude of the costs may be in 
     question, all agree that Guam and the CNMI have sustained 
     substantial expenses due to the Compact. With the 
     implementation of the Palau Compact, which occurred on 
     October 1, 1994, we anticipate that the problem will be 
     compounded. Under the draft bill, funds to defray costs for 
     the CNMI would be a part of the CNMI authorization contained 
     in section 2 of the draft bill. Annual payments of $4.58 
     million for Guam would help defray Guam's expenses. The 
     contributions would cease at the end of the Compact period, 
     September 30, 2001.
     Capital infrastructure
       The remaining $17 million in mandatory funding would be 
     redirected to pressing capital infrastructure needs in 
     American Samoa, Guam and the Virgin Islands for a minimum 
     period of six years. American Samoa has unfunded capital 
     infrastructure needs well in excess of $100 million. Guam and 
     the Virgin Islands have substantial needs in the 
     environmental, health, and public safety areas.
       The draft bill would give recognition to the fact that of 
     the four small United States territories, American Samoa has 
     the greatest need for capital infrastructure, but lacks 
     resources for financing construction.
       The bill would allow American Samoa to receive up to $15 
     million annually for capital infrastructure projects. Guam 
     and the United States Virgin Islands would receive up to $3 
     million annually for capital infrastructure projects related 
     to the environment, health, and public safety.
       Capital infrastructure funds would be released only after 
     an insular area--
       Develops a capital infrastructure master plan approved by 
     the Department of the Interior and the United States Army 
     Corps of Engineers, and
       Contributes five percent of the project cost to a 
     maintenance fund for the project to be expended according to 
     the project's maintenance plan.
     Phase out
       After the initial six years of mandatory funding, the 
     program may be extended for an additional three-year, phase-
     out period, with grantee/federal sharing as follows: 25/75 
     percent in the first year, 50/50 percent in the second year, 
     and 75/25 percent in the third year. Because section 2 of the 
     draft bill which includes capital infrastructure funding for 
     the Northern Mariana Islands will terminate at the end of the 
     fiscal year 2001, the Northern Mariana Islands would 
     participate in the phase-out years of the capital 
     infrastructure program in annual amounts up to $3 million, 
     like Guam and the Virgin Islands.
       The proposed bill would have no negative effect on the 
     Federal budget and meets ``Paygo'' requirements by shifting 
     the purpose of existing mandatory funding. Discretionary 
     savings would result by shifting existing discretionary 
     infrastructure funding for the purposes identified in the 
     bill to this proposed replacement program.
       The Office of Management and Budget advises that there is 
     no objection to presentation of this draft bill from the 
     standpoint of the Administration's program.
           Sincerely,
                                                 Leslie M. Turner,
               Assistant Secretary, Territorial and International 
                                                  Affairs.
                                 ______

      By Mr. CAMPBELL (for himself and Mr. Johnston):
  S. 639. A bill to provide for the disposition of locatable minerals 
on Federal lands, and for other purposes; to the Committee on Energy 
and Natural Resources.


            the locatable mineral mining reform act of 1995

 Mr. JOHNSTON. Mr. President, I am pleased to join my colleague 
from Colorado, Senator Campbell, as a cosponsor of this legislation and 
I commend him for his leadership in this area. As a member of the 
Energy and Natural Resources Committee, the Senator has been very 
active in working for a mining law reform bill that will make needed 
reforms, get this issue behind us, and give the mining industry some 
certainty.
  The bill we are introducing today, with one exception, is very 
similar to the so-called 8-2 chairman's mark which we crafted last 
summer during the House-Senate conference on mining law reform. While 
we were not able to enact this proposal, I think it embodied a balanced 
and middle ground approach to most of the key issues involved in this 
controversy. Frankly, I believe this bill represents a better starting 
point for our deliberations this year than either of the other 
proposals currently before the committee. Some may feel this bill goes 
too far in some areas; others may think it does not go far enough in 
addressing certain issues. While I am certain that this bill will 
undergo some changes, I think the measure Senator Campbell and I are 
proposing will provide a vehicle which will facilitate the enactment of 
a mining law reform bill this year.
  The one significant difference between this bill and last year's 
chairman's mark is in the area of State water rights. Senator Campbell 
has replaced the water provisions of last summer's bill with language 
which protects the ability of the States to make decisions regarding 
water quality and quantity consistent with existing State and Federal 
law. Certainly the water issue was one of the most contentious issues 
we dealt with last year, and I am sure it will be again.
  Mr. President, I look forward to working with Senator Campbell, as 
well as Senator Craig and Senator Bumpers, to confect a bill that can 
pass both the Senate and the House and that the President will 
sign.
                                 ______

      By Mr. WARNER (for himself, Mr. Chafee, Mr. Reid, Mr. Bond, Mr. 
        Graham, and Mr. McConnell):
  S. 640. A bill to provide for the conservation and development of 
water and related resources, to authorize the Secretary of the Army to 
construct 
[[Page S4729]] various projects for improvements to rivers and harbors 
of the United States, and for other purposes; to the Committee on 
Environment and Public Works.


              the water resources development act of 1995

  Mr. WARNER. Mr. President, I am pleased to introduce today, along 
with my colleagues, Senator Chafee, Senator Reid, Senator McConnell, 
Senator Bond, and Senator Graham, the Water Resources Development Act 
of 1995.
  This legislation authorizes civil works programs for the U.S. Army 
Corps of Engineers which preserves the navigation of our harbors and 
channels so critical to the shipping of agricultural products and 
industrial goods. It also provides for flood control and storm damage 
reduction essential to protecting lives and property.
  Mr. President, since 1986, when the Congress established the landmark 
principles for non-Federal cost-sharing of water resource projects, the 
authorization of the Corps of Engineers civil works programs has 
occurred on a biennial basis.
  This 2-year authorization cycle has provided our local partners in 
water resources development a level of continuity which has aided their 
planning and budgeting needs.
  Unfortunately, this 2-year cycle was broken by Congress last year 
when we failed to enact this legislation.
  I believe my colleagues will find this bill to be a modest 
reauthorization proposal that maintains the uniform requirements of 
cost-sharing between the Federal Government and non-Federal project 
sponsors.
  This legislation responds to water resource needs that are in the 
Federal interest and meet the benefit to cost ratio of 1 to 1. This 
means that for every Federal dollar invested in a project, the taxpayer 
receives more than a dollar in benefits in return.
  Mr. President, this legislation also funds projects consistent with 
the requirements of current law. I must state that I do not support the 
recommendations contained in the President's fiscal year 1996 budget 
submittal to terminate Federal participation in local flood control and 
hurricane protection because I believe that there is significant 
justification for continuing an appropriate level of Federal funding 
for these projects.
  Yes, the Corps of Engineers, like all Federal agencies, must achieve 
significant reductions in its budget. In Congress, we must give close 
scrutiny to water resource needs to determine if Federal funding is 
warranted under severe budget constraints. We must not, however, 
unwisely and abruptly abandon the corps' central mission: to protect 
lives and property.
  Such a policy may only serve to shift costs to other Federal agencies 
and departments. We must recognize that there will always be unforeseen 
circumstances, times of national emergency, or situations too costly 
for economically strapped communities to handle expensive projects by 
themselves.
  Mr. President, since I was first elected to the Senate in 1979, and 
for the following 7 years, I sponsored legislation in each Congress to 
provide for the deepening and maintenance of our deep-draft ports. 
Developing a strong partnership with our non-Federal sponsors through 
cost-sharing was the cornerstone of my legislation.
  During the years, since 1976, the Congress and the executive branch 
had been gridlocked over the financing of water resource projects. Also 
at that time, global demand for steam coal skyrocketed. But, our ports 
could not respond to this world demand. In Hampton Roads Harbor, 
colliers were lined up in the Chesapeake Bay to enter the coal 
terminals. Upon loading, they would wait for high tide to leave the 
harbor.
  The 1986 Water Resources Development Act [WRDA] was the culmination 
of our efforts to resolve many contentious issues--including cost-
sharing.
  I remain committed to the principle of cost-sharing which has become 
the cornerstone of a successful corps program. As intended, it has 
ensured that only those projects with strong local support are funded 
and it has leveraged substantial non-Federal money. Since the enactment 
of WRDA 1986, funding for Virginia projects has totalled $590 million 
in Federal funds which has stimulated more than $343 million in non-
Federal money.
  It was no easy task to devise reasonably fair cost-sharing formulas 
which were mindful of the difficulty of small communities to contribute 
to the costs of constructing flood control projects, of our coastal 
communities to receive credit for the value of property to be protected 
from hurricanes and of our commercial ports and inland waterways to 
remain competitive in a shrinking global marketplace.
  WRDA 1986 has worked well in three major respects. First, by 
requiring our local partners to share these costs, it has succeeded in 
ensuring that the most worthy projects receive Federal funding. Second, 
it has ensured that our commercial ports and inland waterways remain 
open for commercial traffic and are now able to serve the larger bulk 
cargo ships, including the super coal colliers. Third, it has allowed 
the United States to meet our national security commitments abroad.
  Mr. President, these principles remain valid today as we judge those 
projects which will provide the greatest return for our investment of 
limited Federal dollars. For these reasons, it is appropriate that 
Congress continue the Corps' fundamental missions of navigation, flood 
control, floodplain management, and storm damage reduction.
  Mr. CHAFEE. Mr. President, I am pleased to join with Senator John 
Warner and others in cosponsoring legislation to reauthorize the civil 
works program at the U.S. Army Corps of Engineers. With the exception 
of 1994, the Congress has authorized this necessary infrastructure 
program on a biennial basis since 1986.


                               WRDA 1986

  As many in the Senate are aware, the 1970's and early 1980's brought 
a departure from the previous practice of approving omnibus 
authorization bills and predictable appropriations for the construction 
of water resources projects. In 1986, however, we broke the logjam. 
After years of legislative and executive policy confrontations over the 
role of the Federal Government in water policy, Congress approved the 
Water Resources Development Act of 1986. The legislation is often 
referred to as WRDA.
  The 1986 Act was landmark legislation because we finally instituted a 
reasonable framework for local cost-sharing of Army Corps' projects and 
feasibility studies. This was a huge step in the right direction. I 
helped author those cost-sharing provisions because there was a real 
need to recognize our limited Federal resources and the financial 
responsibility of local project sponsors.


                              cost sharing

  In establishing cost-sharing formulas for these projects and studies, 
the Congress accomplished at least two important objectives. First, by 
reducing the Federal contribution toward individual projects, we have 
been able to use roughly the same level of total Federal funding for 
many additional proposals which, despite their particular merit, had 
previously gone by the wayside without full Federal funding.
  Second, by requiring a local match, we have brought the locally 
affected parties into the decisionmaking process. Even though 
improvements are still necessary on that score, I think it is fair to 
say that our State and local partners have much greater input than they 
once did.


                            Budget reduction

  Now we face a period of even greater fiscal austerity. In an effort 
to find spending reductions in the out years, the administration has 
proposed to significantly reduce Federal involvement in the 
construction of new flood control and coastal storm protection 
projects. Also being discussed are plans to phase out the Federal 
maintenance of harbors and ports which do not contribute to the harbor 
maintenance trust fund.
  Perhaps such dramatic change is necessary if we are to reverse the 
trend of debt spending in Washington. Perhaps this sort of reduction in 
Federal involvement is exactly what the voters called for last 
November. I happen to believe that a need still exists for Federal 
involvement in some of these areas. The interstate nature of flooding 
warrants Federal coordination and assistance.
  [[Page S4730]] Yet, spending reductions must be made. As in 1986, we 
are being called upon to make tough choices in the effort to define the 
appropriate Federal role for construction and management of water-
related resources.


                               wrda 1995

  I believe that Senator Warner has struck a careful balance in the 
legislation he is proposing today. This bill is cost conscious. 
Preliminary estimates conducted by the Congressional Budget Office 
score the authorization level of this measure at less than 50 percent 
of the nearly $3 billion authorized by WRDA 1992. Even though 
significant cost and scope reductions are made here--we still authorize 
a broad mix of navigation, flood control, shoreline protection, and 
environmental restoration projects and studies.
  While the administration has every right to propose long-term savings 
through broad, overarching policy shifts and program phase-outs, I am 
convinced that we can achieve more significant and equitable spending 
reductions through the authorization process.
  I am grateful that Senator Warner has taken the lead this year on 
water resources reauthorization. Mr. President, with his direction and 
with the cooperation of colleagues, I am confident that we will see 
passage of this bill this year.
                                 ______

      By Mrs. KASSEBAUM (for herself, Mr. Kennedy, Mr. Hatch, Mr. 
        Jeffords, Mr. Frist, Mr. Pell, Mr. Dodd, Mr. Coats, and Mr. 
        Simon):
  S. 641. A bill to reauthorize the Ryan White CARE Act of 1990, and 
for other purposes; to the Committee on Labor and Human Resources.


            the ryan white care reauthorization act of 1995

 Mrs. KASSEBAUM. Mr. President, on behalf of myself and 
Senators Kennedy, Hatch, Pell, Jeffords, Frist, Dodd, Coats, and Simon, 
I introduce the Ryan White CARE Reauthorization Act of 1995.
  The CARE Act has played a critical role in improving the quality and 
availability of medical and support services for individuals with HIV 
disease and AIDS. The most significant assistance under this act is 
provided through titles I and II. Title I provides emergency relief 
grants to cities disproportionately affected by the HIV epidemic. Title 
II provides formula grants to States and territories to improve the 
quality, availability, and organization of health care and support 
services.
  As the HIV epidemic continues, the need for this important 
legislation remains. There is a need as well to modify its provisions 
to take into account the changing face of the HIV epidemic since the 
CARE Act was first enacted in 1990. Once primarily a coastal urban area 
problem, the HIV epidemic now reaches the smallest and most rural areas 
of this country. In addition, minorities, women, and children are 
increasingly affected.
  This reauthorization bill builds on the successful four-title 
structure of the current CARE Act and includes many important 
improvements. Chief among these are changes in the funding formulas 
which would ensure greater funding equity and which provide a single 
appropriation for titles I and II.
  The General Accounting Office [GAO] has identified large disparities 
and inequities in the current distribution of CARE Act funding. This 
legislation, developed with GAO input, authorizes equity formulas for 
titles I and II based on an estimation of the number of individuals 
currently living with AIDS and the costs of providing services. In 
addition, the new title II formula includes an adjustment to offset the 
double-counting of individuals by States, when such States also include 
title I cities.
  The purpose of these changes is to assure a more equitable allocation 
of funding, based on where people with the illness are currently 
living. With any formula change, there is always the concern about the 
potential for disruption of services to individuals now receiving them. 
To address this concern, the bill maintains home-harmless floors 
designed to assure that no entity receives less than 92.5 percent of 
its 1995 allocation over the next 5 years.
  In an effort to target resources to the areas in greatest need of 
assistance, the bill also limits the addition of new title I cities to 
the program. Beginning in fiscal year 1998, current provisions which 
establish eligibility for areas with a cumulative AIDS caseload in 
excess of 2,000 will be replaced with provisions offering eligibility 
only when over 2,000 cases emerge within a 5-year period.
  The legislation makes a number of other important modifications:
  First, it moves the Special Projects of National Significance Program 
to a new title V, funded by a 3-percent set-aside from each of the 
other four titles. In addition, it adds Native American communities to 
the current list of entities eligible for projects of national 
significance.
  Second, it creates a statewide coordination and planning process to 
improve coordination of services, including services in title I cities 
and title II States.
  Third, it extends the administrative expense caps for title I and II 
to subcontractors.
  Fourth, it authorizes guidelines for a minimum State drug formulary.
  Fifth, it modifies representation on the title I planning councils to 
more accurately reflect the demographics of the HIV epidemic in the 
eligible area.
  Sixth, for the title I supplemental grants, a priority is established 
for eligible areas with the greatest prevalence of comorbid conditions, 
such as tuberculosis, which indicate a more severe need.
  I believe that the changes proposed by this legislation will assure 
the continued effectiveness of the Ryan White CARE Act by maintaining 
its successful components and by strengthening its ability to meet 
emerging challenges. Putting together this legislation has involved the 
time and commitment of a wide variety of individuals and organizations. 
I want to acknowledge all of their efforts, and I particularly 
appreciate the constructive and cooperative approach which Senator 
Kennedy has lent to the development of this legislation. It is my hope 
that the Senate can act promptly in approving this measure. I ask 
unanimous consent a summary of this bill be made a part of the Record.
  There being no objection, the summary was ordered to be printed in 
the Record, as follows:
                   Summary of the Reauthorization Act

       1. The current four-title structure of the Ryan White CARE 
     Act is maintained.
       Title I: Provides emergency relief grants to eligible 
     metropolitan areas (EMAs) disproportionately affected by the 
     HIV epidemic. One-half of the Title I funds are distributed 
     by formula; the remaining one-half is distributed 
     competitively.
       Title II: Provides grants to states and territories to 
     improve the quality, availability, and organization of health 
     care and support services for individuals with HIV disease 
     and their families. The funds are used: to provide medical 
     support services for individuals who are not included in the 
     Title I areas; to continue insurance payments; to provide 
     home care services; and to purchase medications necessary for 
     the care of these individuals. Funding for Title II is 
     distributed by formula.
       Title III(b): Supports early intervention services on an 
     out-patient basis--including counseling, testing, referrals, 
     and clinical, diagnostic, and other therapeutic services. 
     This funding is distributed by competitive grants.
       Title IV: Provides grants for research and services for 
     pediatric patients.
       2. A single appropriation for Title I grants to eligible 
     metropolitan areas and Title II grants to states is 
     authorized for fiscal year 1996.
       A single appropriation should help unify the interest of 
     grantees in assuring funding for all individuals living with 
     AIDS, regardless of whether they live in EMAs or states.
       The appropriation is divided between the two titles based 
     on the ratio of fiscal year 1995 appropriations for each 
     title. Sixty-four percent is designated for Title I. The 
     Secretary is authorized to develop and implement a method to 
     adjust the distribution of funding for Title I and Title II 
     to account for new Title I cities and other relevant factors 
     for fiscal year 1997 through fiscal year 2000. If the 
     Secretary does not implement such a method, separate 
     appropriations for titles I and II are authorized, beginning 
     in fiscal year 1997 and extending through fiscal year 2000.
       3. Equity formulas are authorized for Titles I and II based 
     on an estimation of the number of individuals living with 
     AIDS and the costs of providing services.
       The present distribution formulas have led to disparity in 
     funding for individuals living with AIDS based on where they 
     live. This is due to: a caseload measure which is cumulative, 
     the absence of any measure of service costs, and the counting 
     of EMA cases by both the Titles I and II formulas.
       The equity formulas will include an estimate of living 
     cases of AIDS. This estimate is calculated by applying a 
     different weight 
     [[Page S4731]] to each year of cases reported to the Centers 
     for Disease Control and Prevention over the most recent ten-
     year period. A cost index is determined by using the average 
     Medicare hospital wage index for the three-year period 
     immediately preceding the grant award. Over a five-year 
     period, hold-harmless floors for the formulas are provided in 
     order to assure that no entity receives less than 92.5 
     percent of its 1995 allocation. The phase-in is provided to 
     avoid disruption of services to beneficiaries, while still 
     allowing for the redistribution of funds.
       4. The addition of new Title I cities will be limited.
       The current designation criteria for Title I cities was 
     developed to target emergency areas. Five years after the 
     initial enactment of the Ryan White CARE Act, the epidemic 
     persists. However, the needs have changed from emergency 
     relief to maintenance of existing efforts. In addition, Title 
     II funding has been used to develop infrastructure in large 
     metropolitan areas, decreasing the relative need for 
     emergency Title I funding.
       However, to allow for true future emergencies, the Title I 
     definition is refined to include only those areas which have 
     a population of at least 500,000 individuals and a cumulative 
     total of more than 2,000 cases of AIDS in the preceding five 
     years. This requirement will not apply to any area that is 
     deemed eligible before fiscal year 1998.
       5. A priority for the Title I supplementary grants is 
     established.
       The severity of illness has a major impact on the delivery 
     of services. The reauthorization establishes a priority for 
     the distribution of funds which accounts for co-morbid 
     conditions as indicators of more severe HIV-disease. Such 
     conditions include sexually transmitted diseases, substance 
     abuse, tuberculosis, severe mental illness, and homelessness.
       6. The Special Projects of National Significance (SPNS) and 
     the AIDS Education and Training Centers are included in a new 
     Title V.
       Currently, SPNS is part of Title II and is funded by a 10 
     percent Title II set-aside. The reauthorization bill provides 
     that the SPNS program will receive a 3 percent set-aside from 
     each of the other four titles. The SPNS project will address 
     the needs of special populations, assist in the development 
     of essential community-based service infrastructure, and 
     ensure the availability of services for Native American 
     communities.
       The AIDS Education and Training Centers program is 
     transferred from federal health professions education 
     legislation. This program provides funding for the training 
     of health personnel in the diagnosis, treatment, and 
     prevention of HIV disease. Its purpose is to assure the 
     availability of a cadre of trained individuals for the CARE 
     Act programs.
       7. A statewide coordination and planning process is created 
     to improve coordination of services, including services in 
     Title I cities and Title II states.
       8. Representation on the Title I planning councils is 
     changed to more accurately reflect the demographics of the 
     HIV epidemic.
       9. Guidelines for a minimum state drug formulary are 
     authorized.
       Therapeutics improve the quality of life of patients with 
     HIV disease and minimize the need for costly inpatient 
     medical care. The medical state of the art is constantly 
     changing. The guidelines will help states to keep abreast of 
     these changes and to develop a drug formulary which is 
     composed of available Food and Drug Administration approved 
     therapies.
       10. Administrative caps for Titles I and II are extended to 
     contractors and subcontractors.
       Administrative costs for grantees and subcontractors are 
     tightly defined and limited. This limitation will ensure 
     monies are utilized to provide services for people living 
     with AIDS rather than subsidizing excessive administrative 
     expenses.
                    background on the aids epidemic

       1. The HIV epidemic continues to be a national problem:
       The number of AIDS cases has increased to 441,000; one-
     fifth of the new cases occurred in 1994.
       AIDS is now the leading cause of death for all Americans 
     between the ages of 25 to 44.
       Cases are distributed across the United States--with only 
     relative sparing of a few Northern Plains and Mountain 
     states.
       2. Trends:
       The Northeast incidence is higher for the injecting drug 
     user than for other populations.
       The Southern region cases remain primarily among the gay 
     male population.
       The proportion of the epidemic among gay males in the 
     Midwest and the West has stabilized.
       The heterosexual AIDS epidemic is increasing dramatically.
       Heterosexual transmission is now the leading cause of AIDS 
     in women.
       The highest concentration of infected women is in the 
     coastal Northeast, the mid-atlantic, and the Southeast.
       Cases in the Northeast remain primarily within urban 
     centers, while cases in the Southeast are more likely to be 
     located in small towns and cities.
       3. Minorities:
       Blacks and latinos comprise nearly 75 percent of all women 
     infected.
       The rates of infection for black women range from 7 to 27 
     times higher than the rates for caucasian women.
       4. Adolescents:
       Adolescents have the fastest growing rate of infection.
       The rates of infection among adolescents are similar among 
     women and men, but the rates are the highest among 
     blacks.

  Mr. KENNEDY. Mr. President, it is a privilege to join Senator 
Kassebaum in introducing the Ryan White CARE Reauthorization Act of 
1995.
  For 15 years, America has been struggling with the devastating 
effects of AIDS. More than a million citizens are infected with the 
AIDS virus. AIDS itself has now become the leading killer of young 
Americans ages 25 to 44. AIDS is killing brothers and sisters, children 
and parents, friends and loved ones--all in the prime of their lives.
  More than 400,000 Americans have been diagnosed with AIDS. Over half 
have already died--and yet the epidemic marches on unabated.
  As the crisis continues year after year, it has become more and more 
difficult for anyone to claim that AIDS is someone else's problem.
  The epidemic has cost the Nation immeasurable talent and energy in 
young and promising lives struck down long before their time. We must 
do better to provide care and support for those caught in the 
epidemic's path. And with this legislation, we will.
  Five years ago, in the name of Ryan White and all the other Americans 
who had lost their battle against AIDS, Congress passed and President 
Bush signed into law the Comprehensive AIDS Resources Emergency Act.
  Since then, the CARE Act has been a model of bipartisan cooperation 
and effective Federal leadership. Today that bipartisan tradition 
continues.
  The CARE Act provides emergency relief for cities hardest hit by the 
AIDS epidemic, and additional funding for all States to provide health 
care, early intervention, and support services for individuals and 
families with HIV disease in both urban and rural areas.
  In Boston, the CARE Act has led to dramatically increased access to 
essential services. This year, because of Ryan White, 15,000 
individuals are receiving primary care, 8,000 are receiving dental 
care, and 9,000 are receiving mental health services. An additional 700 
are receiving case management services and nutrition supplements. This 
assistance is reducing hospitalizations, and is making an extraordinary 
difference in people's lives.
  While much has changed since 1990, the brutality of the epidemic 
remains the same. When the act first took effect, only 16 cities 
qualified for ``emergency relief.'' In the past 5 years, that number 
has more than tripled--and by next year it will have quadrupled.
  This crisis is not limited to major urban centers. Caseloads are now 
growing in small towns and rural communities, along the coasts and in 
America's heartland. From Weymouth to Wichita, no community will avoid 
the epidemic's reach.
  We are literally fighting for the lives of hundreds of thousands of 
our fellow citizens. These realities challenge us to move forward 
together in the best interest of all people living with HIV. And that 
is what Senator Kassebaum and I have attempted to do.
  The compromise in this legislation acknowledges that the HIV epidemic 
has expanded its reach but we have not forgotten its roots. While new 
faces and new places are now affected, the epidemic rages on in the 
areas of the country hit hardest and longest.
  The pain and suffering of individuals and families with HIV is real, 
widespread, and growing. All community-based organizations, cities, and 
States need additional support from the Federal Government to meet the 
needs of those they serve.
  The revised formulas in this legislation will make these desperately 
needed resources available based on the relative number of people 
living with HIV disease--and the relative cost of providing these 
essential services.
  The new formula will increase the medical care and the support 
services available to individuals with HIV in many cities, including 
Boston, Los Angeles, Philadelphia, and Seattle, and in many States.
  Equally important, the compromise will ensure the ongoing stability 
of the existing AIDS care system in areas of the country with the 
greatest incidence of AIDS. The HIV epidemic in New York, San 
Francisco, Miami, and Newark is far from over--and in many ways, the 
worst is yet to come.
  [[Page S4732]] This legislation represents a compromise, and like 
most compromises, it is not perfect and it will not please everyone. 
But on balance--it is a good bill--and its enactment will benefit all 
people living with HIV everywhere in the Nation. We have sought common 
ground. We have listened to those on the frontlines. We have attempted 
to support their efforts, not tie their hands.
  Congress and the AIDS community must put aside political, geographic, 
and institutional differences to face this important challenge squarely 
and successfully. The structure of the CARE Act--affirmed in this 
reauthorization--provides a sound and solid foundation on which to 
build that unity.
  Hundreds of health, social service, labor, and religious 
organizations helped to shape the act's provisions and have made its 
promise a reality. The act has been praised by Governors, mayors, 
county executives, and local and State AIDS directors and health 
officers. It has required all levels of government to join together in 
providing services and resources. And success stories of this 
coordination are now plentiful.
  Community-based AIDS service organizations and people living with HIV 
have had critically important roles in the development and 
implementation of humane and cost-effective service delivery networks 
responsive to local needs.
  Although the resources fall far short of meeting the growing need, 
the act is working. It has provided life-saving care and support for 
hundreds of thousands of individuals and families affected by HIV and 
AIDS. Through its unique structure, it has quickly and efficiently 
directed assistance to those who need it most.
  The Ryan White CARE Reauthorization Act, however, is about more than 
Federal funds and health care services. It is also about caring and the 
American tradition of reaching out to people who are suffering and in 
need of help. Ryan White would be proud of what has happened in his 
name. His example, and the hard work of so many others, are bringing 
help and hope to our American family with AIDS. I urge my colleagues to 
support this vital initiative.
                                 ______

      By Mr. DODD (for himself and Mr. Rockefeller):
  S. 642. A bill to provide for demonstration projects in six States to 
establish or improve a system of assured minimum child support 
payments, and for other purposes; to the Committee on Finance.


                the child support assurance act of 1995

 Mr. DODD. Mr. President, I reintroduce a piece of legislation 
whose subject should be central to our debate over welfare reform. I 
say this because the Child Support Assurance Act of 1995 promotes work, 
family, self-sufficiency, and personal responsibility. At the same 
time, it seeks to put a stop to one of the principal causes of child 
poverty in this country, lack of financial support from absent parents. 
I am delighted to be joined in this effort by my colleague from West 
Virginia, Senator Rockefeller, who has long been a champion of 
children's causes and this concept in particular.


                   welfare reform, welfare prevention

  I firmly believe we will not succeed in reforming welfare until we 
succeed in reforming child support. Of course, we need welfare reform 
that will encourage people to become self-sufficient and leave 
Government assistance. But just as important, we need welfare 
prevention policies to allow people to avoid welfare in the first 
place. We need to seriously ask ourselves, what can we as a nation do 
to support families in danger of sliding into poverty?
  At or near the top of our list of answers should be putting some 
teeth and some assurances into our child support system. Lack of child 
support is one of the principal causes of poverty for one-parent 
families. The Census Bureau illustrated this fact when it estimated 
that between 1984 and 1986 approximately half a million children fell 
into poverty after their father left home.
  In 1989 alone, the children and single parents of America were owed 
$5.1 billion in unpaid child support. If every single-parent family had 
an award and the awards were paid in full, it would mean $30 billion a 
year for the children of America. Can you imagine the difference it 
would make if our kids received the sums they are being cheated out of 
annually?
  Connecticut is no different from any other State. Despite a child 
support enforcement system that ranks among the best in the Nation, its 
child support delinquencies now total nearly half a billion dollars. 
That is half a billion dollars in a State of only 3\1/2\ million 
people.
  The clear connection between child support and welfare was 
illustrated during a hearing of the Subcommittee on Children I chaired 
in the last Congress. Geraldine Jensen testified about struggling as a 
single mother and receiving no help from her exhusband. She had to work 
60 hours a week just to make ends meet. One day she realized her kids 
had gone from two parents to one parent when her husband left, and then 
from one parent to none when she had to take her second job. She was 
working so much that she had no time for her children.
  So Ms. Jensen quit her jobs and went on AFDC. She finally collected 
the child support owed her 7 years later, and she was able to get back 
on her feet.


                       child support and poverty

  Unfortunately, the reality today is that there are far too many 
families out there like Ms. Jensen's. And far too many children are 
plunged into poverty when their parents do not live up to their 
responsibilities. The poverty rate for single-parent families headed by 
women is nearly 33 percent. This compares to a poverty rate of under 8 
percent for two-parent families.
  Why is the poverty rate so high for households led by single women? 
The primary reason is a lack of support from absent fathers--42 percent 
of single mothers do not even have child support orders for their 
children. For poor women, this figure is 57 percent. And even a child 
support order is no guarantee of support. In 1989, half of all mother-
led families with child support orders received no support at all or 
less than the amount due.
  We have known for some time now that our child support system needs a 
major overhaul. The Child Support Amendments of 1984 and the Family 
Support Act of 1988 made modest improvements. For every 100 child 
support cases in 1983, there were 15 in which there was a collection. 
In 1990, there were 18. Out of 100, 15 to 18 is a step in the right 
direction, but we clearly have a long, long way to go.


                   enforcement and assurance critical

  As the Senate considers proposals for welfare reform, I suggest that 
putting teeth into our child support enforcement system is absolutely 
critical to the goal of moving people off welfare and into self-
sufficiency.
  It is time for us to stop this slide toward public assistance by 
insisting that parents meet the responsibilities they have for the 
children they bring into the world. The children of America will be the 
true winners of such a policy, but the taxpayers will also come out 
ahead because of reduced welfare expenditures. Toward this end, Senator 
Bradley, myself, and others have introduced a tough enforcement bill, 
supported by Members on both sides of the aisle.
  The bill I am introducing today would take us further down the road 
toward an effective child support system. It would create incentives 
for responsible behavior: incentives for custodial parents to seek 
child support orders, incentives for noncustodial parents to follow 
those orders, and incentives for States to make sure this whole process 
works. As a last resort, it would provide a minimum level of support 
for all children not living with both parents.
  Right now, the poor children of America are the ones paying for the 
failings of our families and the failings of our child support system. 
It is my view that the welfare reform bill passed by the House of 
Representatives last week takes us further in the direction of 
punishing children. I strongly believe that welfare reform that does 
not try to prevent families from slipping into welfare dependency is 
doomed to failure.


                         rigorous requirements

  The child support assurance bill would authorize demonstration grants 
to six States for use in guaranteeing child support benefits. 
Participating States would have to meet a rigorous set of requirements. 
To qualify, States 
[[Page S4733]] would already have to be doing a good job of collecting 
child support and would have to be at, or above, the national median 
for paternity establishment. And during the course of the grant, the 
State would have to show real, measurable improvement in paternity 
establishment, child support orders, and collections.
  Just as the Child Support Assurance Act calls on participating States 
to meet their obligations, it would do the same for participating 
families. To qualify, the custodial parent would have to possess, or be 
seeking, a child support award or have a good reason not to.
  We hope that this approach will serve as a model for the country. To 
test this proposition, the Department of Health and Human Services 
would conduct 3- and 5-year evaluations of the demonstration programs 
to gauge the effectiveness of the approach.
  I hope my colleagues will join Senator Rockefeller and me in 
supporting this legislation and demanding that we all meet our 
responsibilities to America's children.
  Mr. President, I ask unanimous consent that the full text of this 
bill be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                 S. 642

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Support Assurance Act 
     of 1995''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--The Congress finds that--
       (1) the number of single-parent households has increased 
     significantly;
       (2) there is a high correlation between childhood poverty 
     and growing up in a single-parent household;
       (3) family dissolution often brings the economic 
     consequence of a lower standard of living for the custodian 
     and children;
       (4) children are nearly twice as likely to be in poverty 
     after a family dissolution as before a family dissolution;
       (5) one-fourth of the single mothers who are owed child 
     support receive none and another one-fourth of such mothers 
     receive only partial child support payments;
       (6) single mothers above and below the poverty line are 
     equally likely to receive none of the child support they are 
     owed; and
       (7) the failure of children to receive an adequate level of 
     child support limits the ability of such children to thrive 
     and to develop their potential and leads to long-term 
     societal costs in terms of health care, welfare, and loss in 
     labor force productivity.
       (b) Purpose.--It is the purpose of this Act to enable 
     participating States to establish child support assurance 
     systems in order to improve the economic circumstances of 
     children who do not receive a minimum level of child support 
     from the noncustodial parents of such children and to 
     strengthen the establishment and enforcement of child support 
     awards. The child support assurance approach is structured on 
     a demonstration basis in order to implement and evaluate 
     different options with respect to the provision of intensive 
     support services and mechanisms for administering the program 
     on a national basis.

     SEC. 3. ESTABLISHMENT OF CHILD SUPPORT ASSURANCE 
                   DEMONSTRATION PROJECTS.

       (a) In General.--In order to encourage States to provide a 
     guaranteed minimum level of child support for every eligible 
     child not receiving such support, the Secretary of Health and 
     Human Services (hereafter in this section referred to as the 
     ``Secretary'') shall make grants to not more than 6 States to 
     conduct demonstration projects for the purpose of 
     establishing or improving a system of assured minimum child 
     support payments in accordance with this section.
       (b) Contents of Application.--An application for a grant 
     under this section shall be submitted by the Chief Executive 
     Officer of a State and shall--
       (1) contain a description of the proposed child support 
     assurance project to be established, implemented, or improved 
     using amounts provided under this section, including the 
     level of the assured benefit to be provided, the specific 
     activities to be undertaken, and the agencies that will be 
     involved;
       (2) specify whether the project will be carried out 
     throughout the State or in limited areas of the State;
       (3) estimate the number of children who will be eligible 
     for assured minimum child support payments under the project, 
     and the amounts to which they will be entitled on average as 
     individuals and in the aggregate;
       (4) describe the child support guidelines and review 
     procedures which are in use in the State and any expected 
     modifications;
       (5) contain a commitment by the State to carry out the 
     project during a period of not less than 3 and not more than 
     5 consecutive fiscal years beginning with fiscal year 1997;
       (6) contain assurances that the State--
       (A) is currently at or above the national median paternity 
     establishment percentage (as defined in section 452(g)(2) of 
     the Social Security Act (42 U.S.C. 652(g)(2));
       (B) will improve the performance of the agency designated 
     by the State to carry out the requirements under part D of 
     title IV of the Social Security Act by at least 4 percent 
     each year in which the State operates a child support 
     assurance project under this section in--
       (i) the number of cases in which paternity is established 
     when required;
       (ii) the number of cases in which child support orders are 
     obtained; and
       (iii) the number of cases with child support orders in 
     which collections are made; and
       (C) to the maximum extent possible under current law, will 
     use Federal, State, and local job training assistance to 
     assist individuals who have been determined to be unable to 
     meet such individuals' child support obligations;
       (7) describe the extent to which multiple agencies, 
     including those responsible for administering the Aid to 
     Families With Dependent Children Program under part A of 
     title IV of the Social Security Act and child support 
     collection, enforcement, and payment under part D of such 
     title, will be involved in the design and operation of the 
     child support assurance project; and
       (8) contain such other information as the Secretary may 
     require by regulation.
       (c) Use of Funds.--A State shall use amounts provided under 
     a grant awarded under this section to carry out a child 
     support assurance project designed to provide a minimum 
     monthly child support benefit for each eligible child in the 
     State to the extent that such minimum child support is not 
     paid in a month by the noncustodial parent.
       (d) Requirements.--
       (1) In general.--A child support assurance project funded 
     under this section shall provide that--
       (A) any child (as defined in paragraph (2)) with a living 
     noncustodial parent for whom a child support order has been 
     sought (as defined in paragraph (3)) or obtained and any 
     child who meets ``good cause'' criteria for not seeking or 
     enforcing a support order is eligible for the assured child 
     support benefit;
       (B) the assured child support benefit shall be paid 
     promptly to the custodial parent at least once a month and 
     shall be--
       (i) an amount determined by the State which is--

       (I) not less than $1,500 per year for the first child, 
     $1,000 per year for the second child, and $500 per year for 
     the third and each subsequent child; and
       (II) not more than $3,000 per year for the first child and 
     $1,000 per year for the second and each subsequent child;

       (ii) offset and reduced to the extent that the custodial 
     parent receives child support in a month from the 
     noncustodial parent;
       (iii) indexed and adjusted for inflation; and
       (iv) in the case of a family of children with multiple 
     noncustodial parents, calculated in the same manner as if all 
     such children were full siblings, but any child support 
     payment from a particular noncustodial parent shall only be 
     applied against the assured child support benefit for the 
     child or children of that particular noncustodial parent;
       (C) for purposes of determining the need of a child or 
     relative and the level of assistance, one-half of the amount 
     received as a child support payment shall be disregarded from 
     income until the total amount of child support and Aid to 
     Families With Dependent Children benefit received under part 
     A of title IV of the Social Security Act equals the income 
     official poverty line (as defined by the Office of Management 
     and Budget, and revised annually in accordance with section 
     673(2) of the Omnibus Budget Reconciliation Act of 1981) that 
     is applicable to a family of the size involved;
       (D) in the event that the family as a whole becomes 
     ineligible for aid to families with dependent children under 
     part A of title IV of the Social Security Act due to 
     consideration of assured child support benefits, the 
     continuing eligibility of the caretaker for aid to families 
     with dependent children under such title shall be calculated 
     without consideration of the assured child support benefit; 
     and
       (E) in order to participate in the child support assurance 
     project, the child's caretaker shall apply for services of 
     the State's child support enforcement program under part D of 
     title IV of the Social Security Act.
       (2) Definition of child.--For purposes of this section, the 
     term ``child'' means an individual who is of such an age, 
     disability, or educational status as to be eligible for child 
     support as provided for by the law of the State in which such 
     individual resides.
       (3) Determination of seeking a child support order.--For 
     purposes of this section, a child support order shall be 
     deemed to have been ``sought'' where an individual has 
     applied for services from the State agency designated by the 
     State to carry out the requirements of part D of title IV of 
     the Social Security Act or has sought a child support order 
     through representation by private or public counsel or pro 
     se.
       (e) Consideration and Priority of Applications.--
       (1) Selection criteria.--The Secretary shall consider all 
     applications received from States desiring to conduct 
     demonstration projects under this section and shall approve 
     not more than 6 applications which appear likely to 
     contribute significantly to the achievement of the purpose of 
     this section. In selecting States to conduct demonstration 
     projects under this section, the Secretary shall--
     [[Page S4734]]   (A) ensure that the applications selected 
     represent a diversity of minimum benefits distributed 
     throughout the range specified in subsection (d)(1)(B)(i);
       (B) consider the geographic dispersion and variation in 
     population of the applicants;
       (C) give priority to States with applications that 
     demonstrate--
       (i) significant recent improvements in--

       (I) establishing paternity and child support awards;
       (II) enforcement of child support awards; and
       (III) collection of child support payments;

       (ii) a record of effective automation; and
       (iii) that efforts will be made to link child support 
     systems with other service delivery systems;
       (D) ensure that the proposed projects will be of a size 
     sufficient to obtain a meaningful measure of the effects of 
     child support assurance;
       (E) give priority, first, to States intending to operate a 
     child support assurance project on a statewide basis, and, 
     second, to States that are committed to phasing in an 
     expansion of such project to the entire State, if interim 
     evaluations suggest such expansion is warranted; and
       (F) ensure that, if feasible, the States selected use a 
     variety of approaches for child support guidelines.
       (2) Requirements for grantees.--Of the States selected to 
     participate in the demonstration projects conducted under 
     this section, the Secretary shall require, if feasible--
       (A) that at least 2 provide intensive integrated social 
     services for low-income participants in the child support 
     assurance project, for the purpose of assisting such 
     participants in improving their employment, housing, health, 
     and educational status; and
       (B) that at least 2 have adopted the Uniform Interstate 
     Family Support Act.
       (f) Duration.--During fiscal year 1996, the Secretary shall 
     develop criteria, select the States to participate in the 
     demonstration, and plan for the evaluation required under 
     subsection (h). The demonstration projects conducted under 
     this section shall commence on October 1, 1996, and shall be 
     conducted for not less than 3 and not more than 5 consecutive 
     fiscal years, except that the Secretary may terminate a 
     project before the end of such period if the Secretary 
     determines that the State conducting the project is not in 
     substantial compliance with the terms of the application 
     approved by the Secretary under this section.
       (g) Cost Savings Recovery.--The Secretary shall develop a 
     methodology to identify any State cost savings realized in 
     connection with the implementation of a child support 
     assurance project conducted under this Act. Any such savings 
     realized as a result of the implementation of a child support 
     assurance project shall be utilized for child support 
     enforcement improvements or expansions and improvements in 
     the Aid to Families With Dependent Children Program conducted 
     under part A of title IV of the Social Security Act within 
     the participating State.
       (h) Evaluation and Report to Congress.--
       (1) Evaluation.--The Secretary shall conduct an evaluation 
     of the effectiveness of the demonstration projects funded 
     under this section. The evaluation shall include an 
     assessment of the effect of an assured benefit on--
       (A) income from nongovernment sources and the number of 
     hours worked;
       (B) the use and amount of government supports;
       (C) the ability to accumulate resources;
       (D) the well-being of the children, including educational 
     attainment and school behavior; and
       (E) the State's rates of establishing paternity and support 
     orders and of collecting support.
       (2) Reports.--Three and 5 years after commencement of the 
     demonstration projects, the Secretary shall submit an interim 
     and final report based on the evaluation to the Committee on 
     Finance and the Committee on Labor and Human Resources of the 
     Senate, and the Committee on Ways and Means and the Committee 
     on Economic and Educational Opportunities of the House of 
     Representatives concerning the effectiveness of the child 
     support assurance projects funded under this section.
       (i) State Reports.--The Secretary shall require each State 
     that conducts a demonstration project under this section to 
     annually report such information on the project's operation 
     as the Secretary may require, except that all such 
     information shall be reported according to a uniform format 
     prescribed by the Secretary.
       (j) Restrictions on Matching and Use of Funds.--
       (1) In general.--A State conducting a demonstration project 
     under this section shall be required--
       (A) except as provided in paragraph (2), to provide not 
     less than 20 percent of the total amounts expended in each 
     calendar year of the project to pay the costs associated with 
     the project funded under this section;
       (B) to maintain its level of expenditures for child support 
     collection, enforcement, and payment at the same level, or at 
     a higher level, than such expenditures were prior to such 
     State's participation in a demonstration project provided by 
     this section; and
       (C) to maintain the Aid to Families With Dependent Children 
     benefits provided under part A of title IV of the Social 
     Security Act at the same level, or at a higher level, as the 
     level of such benefits on the date of the enactment of this 
     Act.
       (2) Exception.--A State participating in a demonstration 
     project under this section may provide not less than 10 
     percent of the total amounts expended to pay the costs 
     associated with the project funded under this section in 
     years after the first year such project is conducted in a 
     State if the State meets the improvements specified in 
     subsection (b)(6)(B).
       (k) Coordination With Certain Means-Tested Programs.--For 
     purposes of--
       (1) the United States Housing Act of 1937 (42 U.S.C. 1437 
     et seq.);
       (2) title V of the Housing Act of 1949 (42 U.S.C. 1471 et 
     seq.);
       (3) section 101 of the Housing and Urban Development Act of 
     1965 (12 U.S.C. 1701s);
       (4) sections 221(d)(3), 235, and 236 of the National 
     Housing Act (12 U.S.C. 1715l(d)(3), 1715z, 1715z-1);
       (5) the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.);
       (6) title XIX of the Social Security Act (42 U.S.C. 1396 et 
     seq.); and
       (7) child care assistance provided through--
       (A) part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.);
       (B) the Child Care and Development Block Grant Act of 1990 
     (42 U.S.C. 9858 et seq.); or
       (C) title XX of the Social Security Act (42 U.S.C. 1397 et 
     seq.),
     any payment made to an individual within the demonstration 
     project area for child support up to the amount which an 
     assured child support benefit would provide shall not be 
     treated as income and shall not be taken into account in 
     determining resources for the month of its receipt and the 
     following month.
       (l) Treatment of Child Support Benefit.--Any assured child 
     support benefit received by an individual under this Act 
     shall be considered child support for purposes of the 
     Internal Revenue Code of 1986.
       (m) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as may be necessary in each of 
     fiscal years 1996, 1997, 1998, 1999, 2000, and 2001 to carry 
     out the purposes of this Act.

 Mr. ROCKEFELLER. Mr. President, as we focus on the issues of 
welfare reform and child support enforcement, I am proud to join my 
distinguished colleague from Connecticut, Senator Chris Dodd, in 
introducing a demonstration project to explore the merits of child 
support assurance. This is a bipartisan idea to ensure minimum support 
to single parents as a way to promote work and responsibility.
  I first became interested in the innovative idea of child support 
assurance as Chairman of the bipartisan National Commission on Children 
which endorsed a demonstration of child support assurance in its 
unanimous 1991 report, ``Beyond Rhetoric, a New American Agenda for 
Children and Families.''
  The Commission urged the Federal Government, in partnership with 
several States, to undertake a demonstration to design and test the 
effects of an assured child support plan that combines enhanced child 
support enforcement with a Government-insured minimum benefit for 
children.
  Under our demonstration, eligible parents would have to have a child 
support award in place or be fully cooperating in establishing 
paternity which would create a real incentive for parents to get a 
child support award. Once such an award is established, the Federal and 
State Government can aggressively seek to collect the payments from 
absent parents. But the minimum assured benefit will protect the 
innocent child from hardship and economic uncertainty when one parent 
is shirking his/her obligation.
  Such stable, consistent support is vital for children. A 1994 study 
by the National Institute of Child Health and Human Development noted 
that children of single-parent families are at increased risk. It notes 
that the single most important factor in accounting for the lower 
achievement of children in single-parent families is poverty and 
economic insecurity. Income differences account for half of the 
increased risk for disadvantages. The researchers noted that because 
income is such an important factor in the increased risk for 
disadvantages among children in single-parent families, policies that 
serve to minimize the negative economic impact on children may help 
reduce their difficulties.
  The National Child Support Assurance Consortium issued a compelling 
report called ``Childhood's End'' in January 1993 that outlined what 
happens to children when child support
 payments are missing, or just plain late. Let me share just a few of 
the report's significant findings about what 
[[Page S4735]] happens to children when child support is not paid.
  Fifty-five percent of mothers reported that their children missed 
regular health check-ups;
  Thirty-six percent of mothers reported that their children did not 
get medical care when they became ill; and
  Fifty-seven percent of the mothers reported that their children lost 
their regular child care.
  The list goes and on, and it is tragic that absent parents are not 
living up to their financial obligations and placing their own children 
at risk. President Clinton estimates that 800,000 people could leave 
the welfare system and dependency if they were paid the child support 
that they are owed. It is wrong to penalize these families and push 
them into dependency. Rather we must aggressively move on child support 
enforcement and explore the benefits of providing a minimum Government 
benefit in cases where our State enforcement efforts fail to timely 
collect child support owed to children.
  As Chairman of the National Commission on Children, I want to put 
this child support assurance demonstration project into perspective. 
Our bipartisan commission report clearly stated that children do best 
in stable, two-percent families. I wish that every child could grow up 
in a caring home with both parents and financial security.
  But in reality, over 15.7 million children are living in a single-
parent household and in need of child support. Demographers warn us 
that 1 out of every 2 children growing up today will spend some time 
living with only one parent; and, therefore, half of children today 
will depend on child support at some point.
  I strongly believe that both parents--mothers and fathers--have a 
moral obligation to financially and emotionally support their children.
  The Government has a role to play in ensuring that parents accept 
their financial obligations to support their children. This does not 
ignore or discount the importance of emotional support from both 
parents. But realistically, the Federal Government is limited in its 
ability to address parental involvement and emotional support. I 
support other legislation to encourage demonstrations projects to 
improve meditation and visitation issues among parents as way to 
respond to this other key facet.
  But the Federal Government can have a major effect on child support 
enforcement and child support assurance. It must be involved because 
families that do not get the child support payments they deserve, often 
turn to Federal assistance programs including Aid to Families with 
Dependent Children [AFDC] and food stamps to make ends meet. Instead of 
allowing families to slip into dependency, I believe it would be better 
to invest in systems and incentives to collect the more than $30 
billion in unpaid child support.
  I want to emphasize that this is a bipartisan idea intended to 
promote work and independence. In its 1991 report, ``Moving Ahead: 
Initiatives for Expanding Opportunity in America,'' the House Wednesday 
Group recommended Federal funding for large-scale demonstrations of 
child support assurance and time-limited welfare. The report notes 
that:

       Child support assurance has several attractive features. 
     First it is not welfare. The benefit would be universal; all 
     single-parent families would be eligible for the assured 
     benefit. For most families, the absent parent would pay more 
     than the assured benefit; the government would then recapture 
     its expenditure and the rest would be forwarded to the child. 
     For families in which the absent parent did not pay at least 
     the amount of the assured benefit, the government would pay 
     the amount guaranteed to the child and then attempt to recoup 
     its outlays by vigorous child support enforcement. One way to 
     think of the assured benefit, then, is government's 
     commitment to guarantee at least a given level of cash 
     support to all custodial parents.
       The assured benefit can also be seen as a program that 
     encourages independence . . . The assured benefit is a 
     blanket of insulation between a single mother and dependency 
     on welfare. Equally important, unlike welfare payments, the 
     assured benefit may have the attractive feature of minimizing 
     work disincentive.

  While noting some questions about child support assurance, the House 
Wednesday Group did support a demonstration project to test the 
potential of this innovative concept. Other groups supporting our 
proposal include: the Center for Law and Social Policy, the Women's 
Legal Defense Fund, and the Children's Defense Fund.
  Mr. President, as we consider dramatic reform of our welfare system, 
we also should focus on child support enforcement and child support 
assurance as promising alternatives to promote responsibility and work 
over welfare and dependence.
                                 ______

      By Mr. JEFFORDS (for himself and Mrs. Murray):
  S. 643. A bill to assist in implementing the plan of action adopted 
by the World Summit for Children; to the Committee on Foreign 
Relations.


              WORLD SUMMIT FOR CHILDREN IMPLEMENTATION ACT

  Mr. JEFFORDS. Mr. President, I rise today to introduce, on behalf of 
myself and Senator Murray, the James P. Grant World Summit for Children 
Implementation Act of 1995.
  This is a bill designed to help the United States implement its 
commitment to our children and to children at risk throughout the 
world.
  In 1990, the United States and 158 other nations participated in the 
World Summit for Children at which they signed a plan of action setting 
goals to be reached by the year 2000. Those goals were: To reduce child 
death rates by at least one-third; to reduce maternal deaths and child 
malnutrition by one-half; to provide all children access to basic 
education; to provide all families access to clean water, safe 
sanitation, and family planning information; and to reduce medical 
costs for children.
  Our legislation also urges full funding by the year 2001 for Head 
Start, a program that dramatically improves the performance of children 
in their early years in school.
  Internationally, this bill would shift funds within the U.S. foreign 
assistance budget to meet the urgent needs of children. Specifically, 
it would increase allocations in foreign assistance for a few cost-
effective programs: Child survival, basic education, nutrition 
programs, UNICEF, AIDS prevention, CARE, refugee assistance, and family 
planning.
  If we are truly concerned about the kind of future we leave for our 
children, we must look beyond our borders to the world they will 
inherit as they come of age. If we want our Nation to be prosperous, we 
must invest in our future. In times of fiscal restraint, it is more 
important than ever we clearly focus on our top priorities. Children, 
both here and throughout the world, are the top priority.
  Mrs. MURRAY. Mr. President, I am proud to join my colleague from 
Vermont, Senator Jeffords, in introducing the James P. Grant World 
Summit for Children Implementation Act of 1995. I take this opportunity 
to commend Senator Jeffords for his leadership on this issue, and I am 
proud to be associated with this effort.
  Because the nations of the world have become so interdependent, there 
can be no doubt that the well-being of children around the globe 
affects us here in the United States. Children are the foundation of 
our society, of our economy, of our future.
  It seems obvious, then, that we would provide adequately for the 
world's children, but sadly we do not.
  According to UNICEF, every week, more than 250,000 children die of 
easily preventable illness and malnutrition.
  Every day, measles, whooping cough, and tetanus--all of which can be 
prevented by an inexpensive course of vaccines--kill nearly 8,000 
children.
  Every day, diarrheal dehydration--preventable at almost no cost--
kills almost 7,000 children.
  Every day, pneumonia--fully treatable by low-cost antibiotics--kills 
more than 6,000 children.
  And for every child that dies, several more live on with poor growth, 
ill health, and diminished potential.
  The world's political leadership can ill-afford to ignore these 
statistics. We are all in this together. The success or failure of 
economies thousands of miles away can directly affect us here at home. 
This is especially true in my trade-dependent home State of Washington.
  As the old saying goes, we are only as strong as our weakest link. If 
our trading partners in Asia or Latin America cannot provide the 
necessary education or health care for their children, we will not have 
strong partners to trade 
[[Page S4736]] with in the next generation. And in the end, alleviating 
poverty promotes economic development, which serves us all.
  So it is extremely important that we continue to work to implement 
the plan of action adopted at the 1990 U.N. World Summit for Children, 
which rightly placed the needs of children at the top of the world's 
development agenda.
  That is why Senator Jeffords and I are introducing the James P. Grant 
World Summit for Children Implementation Act of 1995, legislation that 
supports life-saving, cost-effective programs to protect the health and 
well-being of children worldwide.
  The world's children have a right to adequate nutrition, full 
immunization, education, and health care. The United States must 
continue to lead the world in promoting that message.
  To reach children, of course, we must reach out to the world's 
women--who are often overlooked in traditional development programs. 
Fortunately, the World Summit for Children recognized that to improve 
the lot of the world's children, the status of the world's women also 
had to improve.
  For example, recognizing the important link between child survival 
and family planning, the world summit for children called for universal 
access to family planning education and services by the end of this 
decade.
  Family planning saves the lives of both women and children. We know 
that babies born in quick succession, to a mother whose body has not 
yet recovered from a previous birth, are the least likely to survive. 
Increasing funds in this area has been a top priority for me in my work 
in the U.S. Senate, and is addressed in the legislation we are 
introducing today.
  I realize that in this current political climate, foreign aid is 
often under attack and misunderstood. While foreign aid has never been 
popular, it has always served our Nation well. The money needed to 
support the kinds of programs we are concerned about in this bill is 
not large in the scope of our budget--indeed, our total foreign aid 
program represents less than 1 percent of our entire Federal budget. In 
my view, our foreign aid dollars are best spent when we are investing 
in programs that strengthen families around the globe, and give a 
special helping hand to women and children.
  For these reasons, I urge my colleagues to join Senator Jeffords and 
me in support of this important legislation.


                          ____________________