[Congressional Record Volume 141, Number 97 (Wednesday, June 14, 1995)]
[Senate]
[Pages S8305-S8310]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         TELECOMMUNICATIONS COMPETI- TION AND DEREGULATION ACT

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
resume consideration of S. 652, which the clerk will report.
  The bill clerk read as follows:

       A bill (S. 652) to provide for a procompetitive, 
     deregulatory national policy framework designed to accelerate 
     rapidly private sector deployment of advanced 
     telecommunications and information technologies, and services 
     to all Americans by opening all telecommunications markets to 
     competition, and for other purposes.

  The Senate resumed consideration of the bill.

       Pending:
       Feinstein/Kempthorne amendment No. 1270, to strike the 
     authority of the Federal Communications Commission to preempt 
     State or local regulations that establish barriers to entry 
     for interstate or intrastate telecommunications services.
       Gorton amendment No. 1277 (to the language proposed to be 
     stricken by amendment No. 1270), to limit, rather than 
     strike, the preemption language.

  The PRESIDING OFFICER. There will now be 20 minutes debate on the 
Feinstein amendment No. 1270, to be equally divided in the usual form, 
with the vote on or in relation to the amendment to follow immediately.
  Mrs. FEINSTEIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Madam President, the amendment that is the subject of 
discussion is one presented by Senator Kempthorne and me. There is a 
section in this bill entitled ``Removal of Entry to Barriers.'' It is a 
section about which the cities, the counties and the States are very 
concerned because it is a section that giveth and a section that taketh 
away.
  Why do I say that? I say it because in section 254, the States and 
local governments are given certain authority to maintain their 
jurisdiction and their control over what are called rights-of-way.
  Rights-of-way are streets and roads under which cable television 
companies put lines. How they do it, where they do it and with what 
they do it is all a matter for local jurisdiction. Both subsections (b) 
and (c) maintain this regulatory authority of local jurisdictions, but 
subsection (d) preempts that authority, and this is what is of vital 
concern to the cities, the counties and the States.
  Senator Kempthorne and I have a simple amendment. That amendment, 
quite simply stated, strikes the preemption and takes away the part of 
this bill that takes away local government and State governments' 
jurisdiction and authority over the rights-of-way.
  We are very grateful to Senator Gorton who has presented a 
substitute, which will be voted on following our amendment. However, we 
must, quite frankly, say this substitute is inadequate.
  Why is it inadequate? It is inadequate because cities and counties 
will continue to face preemption if they take actions which a cable 
operator asserts constitutes a barrier to entry and is prohibited under 
section (a) of the bill. As city attorneys state, is a city insurance 
or bonding requirement a barrier to entry? Is a city requirement that a 
company pay fees prior to installing any facilities to cover the costs 
of reviewing plans and inspecting excavation work a barrier to entry? 
Is the city requirement that a company use a particular type of 
excavation equipment or a different and specific technique suited to 
certain local circumstances to minimize the risk of major public health 
and safety hazards a barrier to entry? Is a city requirement that a 
cable operator move a cable trunk line away from a public park or place 
cables underground rather than overhead in order to protect public 
health a barrier to entry?
  These are, we contend, intensely local decisions which could be 
brought before the FCC in Washington. The Gorton substitute continues 
to permit cable operators to challenge local government decisions 
before the FCC.
  Why is this objectionable to local jurisdictions? It is objectionable 
to local jurisdictions because they believe if they are a small city, 
for example, they would be faced with bringing a team back to 
Washington, going before a highly specialized telecommunications-
oriented Federal Communications Commission and plighting their troth. 
Then they would be forced to go to court in Washington, DC, rather than 
Federal district court back where they live.
  This constitutes a major financial impediment for small cities. For 
big cities also, they would much prefer to have the issue settled in 
their district court rather than having to come back to Washington.
  The cable operators are big time in this country. They maintain 
Washington offices, they maintain special staff, they maintain a bevy 
of skilled telecommunications attorneys. Cities do not. Cities have a 
city attorney, period. It is a very different subject.
  Suppose a city makes a determination in the case that they wish to 
have [[Page S8306]] wiring done evenly throughout their city--I know, 
and I said this on the floor before, when I was mayor, the local cable 
operator wanted only to wire the affluent areas of our city.
  We wanted some of the less affluent areas wired; we demanded it, and 
we were able to achieve it. Is this a barrier to entry? Could the cable 
company then appeal this and bring it back to Washington, meaning that 
a bevy of attorneys would have to come back, appear before the FCC, go 
to Federal court here or with the local jurisdiction, and maintain its 
authority, as it would under the Kempthorne-Feinstein amendment. And 
then the cable operators, if they did not like it, could take the item 
to Federal court.
  We believe to leave in the preemption is, in effect, to create a 
Federal mandate without funding. So we ask that subsection (d) be 
struck and have put forward this amendment to do so.
  I yield now to the Senator from Idaho.
  Mr. KEMPTHORNE. Madam President, how much time do we have remaining?
  The PRESIDING OFFICER. There are 3 minutes 21 seconds remaining.
  Mr. KEMPTHORNE. Madam President, I will reserve my time and ask if 
the Senator from Washington would like to speak at this point.
  I yield the floor and reserve the remainder of my time.
  Mr. GORTON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Washington is recognized.
  Mr. GORTON. Madam President, the section at issue here is a section 
entitled ``Removal of Barriers to Entry.'' And the substance of that 
section is that ``No State or local statute or regulation may prohibit 
or have the effect of prohibiting the ability of any entity to provide 
any interstate or intrastate telecommunications services.''
  Madam President, this is not about cable companies, although cable 
companies are one of the subjects of the section. This is about all of 
the telecommunications providers that are the subject of this bill. And 
it is the goal of this bill to see to it that the maximum degree of 
competition is available. And in doing so, these fundamental decisions 
about whether or not an action of the State or local government is an 
inhibition or a barrier to entry almost certainly must be decided in 
one central place.
  The amendment to strike the preemption section does not change the 
substance. What it does change is the forum in which any disputes will 
be conducted. And if this amendment--the Feinstein amendment--in its 
original form is adopted, that will be some 150 or 160 different 
district courts with different attitudes. We will have no national 
uniformity with respect to the very goals of this bill, what 
constitutes a serious barrier to entry.
  This will say that if a State or some local community decides that it 
does not like the bill and that there should be only one telephone 
company in its jurisdiction or one cable television provider in its 
jurisdiction, no national organization, no Federal Communications 
Commission will have the right to preempt and to frustrate that 
monopolistic purpose. It will have to be done in a local district 
court. And then if another community in another part of the country 
does the same thing, that will be decided in that district court.
  So, Madam President, this amendment--the Feinstein amendment--goes 
far beyond its legitimate scope. But it does have a legitimate scope. I 
join with the two sponsors of the Feinstein amendment in agreeing that 
the rules that a city or a county imposes on how its street rights of 
way are going to be utilized, whether there are above-ground wires or 
underground wires, what kind of equipment ought to be used in 
excavations, what hours the excavations should take place, are a matter 
of primarily local concern and, of course, they are exempted by 
subsection (c) of this section.
  So my modification to the Feinstein amendment says that in the case 
of these purely local matters dealing with rights of way, there will 
not be a jurisdiction on the part of the FCC immediately to enjoin the 
enforcement of those local ordinances. But if, under section (b), a 
city or county makes quite different rules relating to universal 
service or the quality of telecommunications services--the very heart 
of this bill--then there should be a central agency at Washington, DC, 
which determines whether or not that inhibits the competition and the 
very goals of this bill.
  So, Madam President, I am convinced that Senators Feinstein and 
Kempthorne are right in the examples that they give, the examples that 
have to do with local rights of way. And the amendment that I propose 
to substitute for their amendment will leave that where it is at the 
present time and will leave disputes in Federal courts in the 
jurisdictions which are affected.
  But if we adopt their amendment, we have destroyed the ability of the 
very commission which has been in existence for decades to seek 
uniformity, to promote competition, effectively to do so; and we will 
have a balkanized situation in every Federal judicial district in the 
United States. So their amendment simply goes too far.
  Now, Madam President, I can see some, including some of the sponsors 
of the bill, who feel that this preemption ought to be total. And those 
who feel it ought to be total should vote ``no'' on the Feinstein 
amendment and ``no'' on mine as well. Those who feel that there should 
be no national policy, that local control and State control of 
telecommunications is so important that the national policy should not 
be enforced by any central agency, should vote for the Feinstein 
amendment. But those who believe in balance, those who believe that 
there should be one central entity to make these decisions, subject to 
judicial review when they have to do with whether or not there is going 
to be competition, when they have to do with the nature of universal 
service, when they have to do with the quality of telecommunications 
service or the protection of consumers, but believe that local 
government should retain their traditional local control over their 
rights of way, should vote against the Feinstein amendment and should 
vote for mine. It is the balance. It meets the goals that they propose 
their amendment to meet without being overly broad and without 
destroying the national system of telecommunications competition, which 
is the goal of this bill.
  Mr. KEMPTHORNE. Madam President, I am proud to join Senator Feinstein 
in this amendment. I also wish to acknowledge the efforts of the 
Senator from Washington, Senator Gorton, because all of us are trying 
to correct what is a flaw in this bill. I find it ironic that the title 
of this bill, the Telecommunications Competition and Deregulation Act 
of 1995, this flaw that is in this bill smacks right at this whole 
aspect of deregulation, which this Congress has been very good about 
reestablishing the rights of States and local units of government.
  Madam President, this amendment is not about guaranteeing access to 
the public right of way. As the Senator from Washington just pointed 
out, that language is in there. That is section (a). This amendment is 
not about preserving the ability of a State to advance universal 
service and to ensure quality in telecommunications services, because, 
Madam President, that is right here in section (b) of the bill. This 
amendment is not about ensuring that local governments manage their 
rights of way in a competitively neutral and nondiscriminatory basis, 
because that is in section (c) of this bill.
  In fact, the Senator from Texas, the Presiding Officer, was 
instrumental in having section (c) put into this act. It was very 
helpful. The whole problem is, Madam President, section (d) then 
preempts all of that. In section (d), it states--and I will summarize--
that the commission shall immediately preempt the enforcement of such 
statute, regulation, or legal requirement to the extent necessary to 
correct such violation or inconsistency.
  I think it is a shame that your good, hard work, Madam President, now 
has section (d) that preempts it and pulls the plug on that. There are 
those that would say the reason you have to have that particular 
section is because there may be instances in local government that may 
compel a cable company to give what they call extractions. We asked our 
cable company in Idaho: Can you give us some examples of where a local 
community has sought extractions, where you might have to go in trees 
and do something special? We do not have any examples. I find it ironic 
[[Page S8307]] that because there are some who believe that these 
extractions could take place, the remedy is to say that we will now 
have a Federal commission of nonelected people preempt what local or 
State governments do.
 That is backsliding from what we have been trying to do with this 
Congress.

  The Senator from Washington said that we must decide these cases in 
one place. That message is very clear, Madam President. If there is a 
problem, then we are now going to say with this legislation, if we 
leave section (d) in there, they must come to Washington, DC. You must 
come to Washington, DC.
  What has happened to federalism, to States rights and local rights? 
It was brought to my attention that in the State of Arizona they have 
pointed out that this, in fact, could preempt the Constitution of the 
State of Arizona.
  This is a flaw in this legislation, Madam President, that, again, a 
nonelected Commission--which I have a great respect for that 
Commission--could, in essence, preempt the Constitution of the State.
  I ask unanimous consent to have printed in the Record a letter from 
the National Governors' Association, National Conference of State 
Legislatures, National Association of Counties, National League of 
Cities, U.S. Conference of Mayors, all in support of this amendment. 
They point out that this will not be the impediment to the barrier, but 
it is the right amendment to correct this flaw.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

         National Governors' Association, National Conference of 
           State Legislatures, National Association of Counties, 
           National League of Cities, and United States Conference 
           of Mayors,
                                                     June 6, 1995.
     Hon. Robert Dole,
     Majority Leader, U.S. Senate,
     Hon. Tom Daschle,
     Minority Leader, U.S. Senate,
     Washington, DC.
       Dear Senator Dole and Senator Daschle: On behalf of state 
     and local governments throughout the nation, we are writing 
     to strongly urge your support for two amendments to S. 652, 
     the Telecommunications Competition and Deregulation Act of 
     1995. Together these amendments would prevent an unwarranted 
     preemption of state and local government authority and speed 
     the transition to a competitive telecommunications 
     environment. The first amendment achieves the appropriate 
     balance between the needed preemption of barriers to entry 
     and the legitimate authority of states and localities, and 
     the second permits states to continue efforts already 
     underway to promote competition.
       First, Senator Feinstein will offer an amendment to delete 
     a broad and ambiguous preemption section (section 254(d) of 
     Title II). The Senate's bill's proposal under Section 254(d) 
     for Federal Communications Commission (FCC) review and 
     preemption of state and local government authority is totally 
     inappropriate. Section 254 (a) and (c) provide the necessary 
     safeguard against any possible entry barriers or impediments 
     by state and local governments in the development of the 
     information superhighway. In particular we are concerned that 
     Section 254(d) would preempt local government authority over 
     the management of public rights-of-way and local government's 
     ability to receive fair and reasonable compensation for use 
     of the right-of-way. We strongly opposed any preemption which 
     would have the impact of imposing new unfunded costs upon our 
     states, local governments, and taxpayers.
       Second, Senator Leahy will offer an amendment to strike 
     language preempting states from requiring intraLATA toll 
     dialing parity. Ten states have already established this 
     requirement as a means of increasing competition; thirteen 
     more states are considering its adoption. If the goal of S. 
     652 is to increase competition, the legislation should not 
     take existing authority from states that is already being 
     used to further compensation. We strongly oppose this 
     preemption and urge your support for Senator Leahy's 
     amendment.
       Again, we urge you to join Senator Feinstein and Senator 
     Leahy in their efforts to eliminate these two provisions from 
     the bill and avoid unwarranted preemption of state and local 
     government in this critical area.
           Sincerely,
     Terry Branstad,
         Co-Lead Governor on Telecommunications.
     Jane L. Campbell,
         President, National Conference of State Legislatures.
     Randall Franke,
         President, National Association of Counties.
     Carolyn Long Banks,
         President, National League of Cities.
     Victor Ashe,
         President, U.S. Conference of Mayors.
                                                                    ____

                               National Governors Association,

                                     Washington, DC, June 8, 1995.

State Preemption in Federal Telecommunications Deregulation Legislation


                                summary

       The U.S. Senate has begun consideration of S. 652, a bill 
     to rewrite the Federal Communications Act of 1934 to promote 
     competition. Several provisions in the bill and certain 
     proposed amendments would adversely affect states, and 
     Governors need to communicate their concerns to their 
     senators to:
       Support the Feinstein/Kempthorne amendment to strike 
     section 254(d) on FCC preemption;
       Support the Leahy/Simpson amendment to protect the state 
     option to require intraLATA toll dialing parity (open, 
     competitive markets for regional phone service); and
       Oppose the Packwood/McCain amendment to preempt local and 
     state authority to tax direct broadcast satellite services 
     (DBS).


                               background

       Both the House and the Senate have reported legislation to 
     reform the Federal Communications Act of 1934. The Senate 
     bill, S. 652, would require local phone companies to open 
     their networks to competitors while also permitting those 
     companies to offer video services in competition with local 
     cable television franchises. Once the regional Bell telephone 
     companies open their networks, they can apply to the Federal 
     Communications Commission (FCC) for permission to offer long-
     distance service.
       During the debate over telecommunications in 1994, states 
     and localities banded together to promote three principles 
     for inclusion in federal legislation: strong universal 
     service protections, regulatory flexibility that would retain 
     an effective role for states to manage the transition to a 
     procompetitive environment rather than federal agency 
     preemption, and authority for states and localities to manage 
     the public rights-of-way. At a June 6 meeting of the State 
     and Local Coalition, chaired by Governor George V. Voinovich, 
     the attached letter was signed by local officials and Iowa 
     Governor Terry E. Branstad, NGA co-lead Governor on 
     Telecommunications. The letter calls for the support of two 
     amendments.
       Feinstein/Kempthorne Amendment: Deleting Section 254(d). 
     Senator Dianne Feinstein (D-Calif.) and Senator Dirk 
     Kempthorne (R-Idaho) are offering an amendment that would 
     strip broad and
      ambiguous FCC preemption language from section 254(d) of the 
     bill. Section 254(a) preempts states and localities from 
     erecting barriers to entry, and this preemption is 
     supported by NGA policy. Section 254(b) permits states to 
     set terms and conditions for doing business within a 
     state, including consumer protections and quality of 
     services; section 254(c) ensures the authority of states 
     and local government to manage the public rights-of-way.
       Paragraph (c) was inserted in the bill in committee by 
     Senator Kay Bailey Hutchison (R-Tex.), and includes a 
     requirement that any such fees and charges be 
     nondiscriminatory. Paragraph (d) states that if the FCC 
     ``determines that a state or local government has permitted 
     or imposed any statute, regulation, or legal requirement that 
     violates or is inconsistent with this section, the FCC shall 
     immediately preempt the enforcement of such statute, 
     regulation, or legal requirement to the extent necessary to 
     correct such violation or inconsistency.'' Because small 
     telephone or cable companies are unlikely to have a presence 
     in Washington, D.C., this provision would result in a bias 
     toward major competitors. Striking paragraph (d) leaves 
     adequate protections for a competitive market.
       Leahy/Simpson Amendment: Deleting Preemption of State 
     Authority to Require IntraLATA Toll Dialing Parity. One major 
     reason that competition in long distance service has 
     increased is the requirement that local phone companies 
     permit long-distance carriers dialing parity (i.e., consumers 
     no longer have to dial additional numbers to utilize an 
     alternative long-distance carrier service). Customers choose 
     a carrier, and all interLATA calls are billed through that 
     company. However, calls within a local access and transport 
     area (intraLATA), or so-called short-haul or regional long-
     distance calls, are under state jurisdiction and not subject 
     to this FCC rule. To date, ten states have required toll 
     dialing parity, and twelve states are currently considering 
     its adoption. Paragraph 255(B)(ii) of S. 652 would preempt 
     the authority of states to order intraLATA toll dialing 
     parity; Senator Patrick S. Leahy (D-Vt.) and Senator Alan K. 
     Simpson (R-Wyo.) are offering an amendment that would remove 
     this preemptive language.
       State and Local Taxing Authority. As reported by the Senate 
     Commerce, Science, and Transportation Committee, S. 652 
     includes language ensuring that state and local government 
     taxation authority is not affected by the bill. Senator Bob 
     Packwood (R-Ore.) and Senator John McCain (R-Ariz.) may offer 
     an amendment exempting the DBS industry from any local 
     taxation, even taxes administered by states. This language is 
     taken from H.R. 1555, recently approved by the House Commerce 
     Committee. States must ensure that the Senate bill avoids the 
     preemption of state and local taxing authority.


                             Actions Needed

       Governors need to contact their senator to urge support for 
     both the Feinstein/ [[Page S8308]] Kempthorne amendment and 
     the Leahy/Simpson amendment, and to urge opposition to the 
     Packwood/McCain amendment.

  Mr. LEVIN. Madam President, I support the Feinstein amendment to 
remove the provision in S. 652 which would preempt local control of the 
public rights-of-way.
  The Feinstein amendment would remove section 254(d) of the 
telecommunications bill currently being considered by the Senate which 
directs the FCC to examine and preempt any State and local laws or 
regulations which might prohibit a company from providing 
telecommunications services.
  As a former local official I have always felt it was important that 
we in Congress pay proper recognition to the rights of local 
government.
  Section 254(d) is the type of legislating that we in Washington 
should not be doing--preempting State and local decisions in areas 
where local government has the responsibility and specified knowledge 
to act in the best interest of their local communities. Washington 
should not micromanage how local government administers its streets, 
highways, and other public rights-of-way.
  I will vote in favor of the Feinstein amendment and in favor of the 
right of local governments to retain control over their streets, 
highways, and rights-of-way.
  Mr. KEMPTHORNE. Madam President, how much time do I have remaining?
  The PRESIDING OFFICER. The Senator's time is expired.
  Mr. GORTON. Madam President, how much time is remaining?
  The PRESIDING OFFICER. Three minutes, 38 seconds.
  Mr. GORTON. Madam President, once again, the alternative proposal, 
which will be voted on only if this amendment is defeated, retains not 
only the right of local communities to deal with their rights of way, 
but their right to meet any challenge on home ground in their local 
district courts.
  The Feinstein amendment itself, Madam President, would deprive the 
FCC of any jurisdiction over a State law which deliberately prohibited 
or frustrated the ability of any telecommunications entity to provide 
competitive service.
  It would simply take that right away from the FCC, and each such 
challenge would have to be decided in each of the various Federal 
district courts around the country.
  The States retain the right under subsection (d) to pass all kinds of 
legislation that deals with telecommunications providers, subject to 
the provision that they cannot impede competition.
  The determination of whether they have impeded competition, not by 
the way they manage trees or rights of way, but by the way they deal 
with substantive law dealing with telecommunications entities. That 
conflict should be decided in one central place, by the FCC.
  The appropriate balance is to leave purely local concerns to local 
entities, but to make decisions on the natural concerns which are at 
the heart of this bill in one central place so they can be consistent 
across the country.
  Madam President, the purposes of this bill will be best served by 
defeating this amendment and adopting the subsequent amendment. I yield 
back the balance of my time.
  Mrs. FEINSTEIN. Madam President, I ask for the yeas and nays.
  The PRESIDING OFFICER (Mr. Campbell). Is there a sufficient second? 
There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to the Feinstein 
amendment No. 1270.
  The clerk will call the roll.
  The bill clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced-- yeas 44, nays 56, as follows:
                      [Rollcall Vote No. 258 Leg.]

                                YEAS--44

     Abraham
     Akaka
     Baucus
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Burns
     Byrd
     Campbell
     Cohen
     Conrad
     DeWine
     Dodd
     Faircloth
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Hatfield
     Hutchison
     Inhofe
     Kempthorne
     Kennedy
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Mack
     McCain
     Mikulski
     Moseley-Braun
     Murray
     Pell
     Pryor
     Robb
     Roth
     Sarbanes
     Simpson
     Thomas
     Wellstone

                                NAYS--56

     Ashcroft
     Bennett
     Breaux
     Brown
     Bryan
     Bumpers
     Chafee
     Coats
     Cochran
     Coverdell
     Craig
     D'Amato
     Daschle
     Dole
     Domenici
     Dorgan
     Exon
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Heflin
     Helms
     Hollings
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kerrey
     Kyl
     Lieberman
     Lott
     Lugar
     McConnell
     Moynihan
     Murkowski
     Nickles
     Nunn
     Packwood
     Pressler
     Reid
     Rockefeller
     Santorum
     Shelby
     Simon
     Smith
     Snowe
     Specter
     Stevens
     Thompson
     Thurmond
     Warner
  So the amendment (No. 1270) was rejected.
  Mr. GORTON. Mr. President, I move to reconsider the vote.
  Mr. PRESSLER. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. PRESSLER. I ask unanimous consent that the Gorton amendment now 
be adopted by voice vote.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  Without objection, the amendment is agreed to.
  So the amendment (No. 1277) was agreed to.
  Mr. GORTON. Mr. President, I move to reconsider the vote.
  Mr. PRESSLER. I move to lay that motion on the table.


   Amendments Nos. 1284, as modified, and 1282, as modified, en bloc

(Purpose: To require audits to ensure that the Bell operating companies 
       meet the separate subsidiary requirements and safeguards)

   (Purpose: To recognize the National Education Technology Funding 
Corporation as a nonprofit corporation operating under the laws of the 
District of Columbia, to provide authority for Federal departments and 
   agencies to provide assistance to such corporation, and for other 
                               purposes)

  Mr. PRESSLER. Mr. President, I send two amendments to the desk and 
ask for their immediate consideration en bloc. The amendments are 
modified versions of the amendments Nos. 1284 and 1282 by Senators 
Simon and Moseley-Braun. They are acceptable to the bill managers and 
have been cleared on both sides of the aisle.
  Mr. FORD. Mr. President, he may be giving away the dome on the 
Capitol Building. We want to know.
  The PRESIDING OFFICER. The Senate will be in order. Senators wishing 
to hold conversations will retire to the cloakroom.
  Will the Senator from South Dakota repeat his request.
  Mr. PRESSLER. I ask adoption of the Simon amendment and the Moseley-
Braun amendment.
  The PRESIDING OFFICER. Without objection, the amendments may be 
considered en bloc at this time. The clerk will report the amendments.
  The legislative clerk read as follows:

       The Senator from South Dakota [Mr. Pressler], for Mr. 
     Simon, proposes amendment numbered 1284, as modified; and, 
     for Ms. Moseley-Braun, amendment numbered 1282, as modified.

  The amendments (Nos. 1284 and 1282), as modified, are as follows:
                           Amendment No. 1284

       On page 31, insert at the appreciate place the following:
       ``(d) Biennial Audit.--
       ``(1) General requirement.--A company required to operate a 
     separate affiliate under this section shall obtain and pay 
     for a joint Federal/State audit every 2 years conducted by an 
     independent auditor selected by the Commission, and working 
     at the direction of, the Commission and the State commission 
     of each State in which such company provides service, to 
     determine whether such company has complied with this section 
     and the regulations promulgated under this section, and 
     particularly whether such company has complied with the 
     separate accounting requirements under subsection (b).
       ``(2) Results submitted to commission; state commissions.--
     The auditor described in paragraph (1) shall submit the 
     results of the audit to the Commission and to the State 
     commission of each State in which the company audited 
     provides service, which shall make such results available for 
     public inspection. Any party may submit comments on the final 
     audit report.
       ``(3) Access to documents.--For purposes of conducting 
     audits and reviews under this subsection--
       ``(A) the independent auditor, the Commission, and the 
     State commission shall have [[Page S8309]] access to the 
     final accounts and records of each company and of its 
     affiliates necessary to verify transactions conducted with 
     that company that are relevant to the specific activities 
     permitted under this section and that are necessary for the 
     regulation of rates;
       ``(B) the Commission and the State commission shall have 
     access to the working papers and supporting materials of any 
     auditor who performs an audit under this section; and
       ``(C) the State commission shall implement appropriate 
     procedures to ensure the protection of any proprietary 
     information submitted to it under this section.
                                                                    ____

                           Amendment No. 1282

       At the end of the bill, insert the following:

      TITLE   --NATIONAL EDUCATION TECHNOLOGY FUNDING CORPORATION

     SEC.   01. SHORT TITLE.

       This title may be cited as the ``National Education 
     Technology Funding Corporation Act of 1995''.

     SEC.   02. FINDINGS; PURPOSE.

       (a) Findings.--The Congress finds as follows:
       (1) Corporation.--There has been established in the 
     District of Columbia a private, nonprofit corporation known 
     as the National Education Technology Funding Corporation 
     which is not an agency or independent establishment of the 
     Federal Government.
       (2) Board of Directors.--The Corporation is governed by a 
     Board of Directors, as prescribed in the Corporation's 
     articles of incorporation, consisting of 15 members, of 
     which--
       (A) five members are representative of public agencies 
     representative of schools and public libraries;
       (B) five members are representative of State government, 
     including persons knowledgeable about State finance, 
     technology and education; and
       (C) five members are representative of the private sector, 
     with expertise in network technology, finance and management.
       (3) Corporate purposes.--The purposes of the Corporation, 
     as set forth in its articles of incorporation, are--
       (A) to leverage resources and stimulate private investment 
     in education technology infrastructure;
       (B) to designate State education technology agencies to 
     receive loans, grants or other forms of assistance from the 
     Corporation;
       (C) to establish criteria for encouraging States to--
       (i) create, maintain, utilize and upgrade interactive high 
     capacity networks capable of providing audio, visual and data 
     communications for elementary schools, secondary schools and 
     public libraries;
       (ii) distribute resources to assure equitable aid to all 
     elementary schools and secondary schools in the State and 
     achieve universal access to network technology; and
       (iii) upgrade the delivery and development of learning 
     through innovative technology-based instructional tools and 
     applications;
       (D) to provide loans, grants and other forms of assistance 
     to State education technology agencies, with due regard for 
     providing a fair balance among types of school districts and 
     public libraries assisted and the disparate needs of such 
     districts and libraries;
       (E) to leverage resources to provide maximum aid to 
     elementary schools, secondary schools and public libraries; 
     and
       (F) to encourage the development of education 
     telecommunications and information technologies through 
     public-private ventures, by serving as a clearinghouse for 
     information on new education technologies, and by providing 
     technical assistance, including assistance to States, if 
     needed, to establish State education technology agencies.
       (b) Purpose.--The purpose of this title is to recognize the 
     Corporation as a nonprofit corporation operating under the 
     laws of the District of Columbia, and to provide authority 
     for Federal departments and agencies to provide assistance to 
     the Corporation.

     SEC.   03. DEFINITIONS.

       For the purpose of this title--
       (1) the term ``Corporation'' means the National Education 
     Technology Funding Corporation described in section   
     02(a)(1);
       (2) the terms ``elementary school'' and ``secondary 
     school'' have the same meanings given such terms in section 
     14101 of the Elementary and Secondary Education Act of 1965; 
     and
       (3) the term ``public library'' has the same meaning given 
     such term in section 3 of the Library Services and 
     Construction Act.

     SEC.   04. ASSISTANCE FOR EDUCATION TECHNOLOGY PURPOSES.

       (a) Receipt by Corporation.--Notwithstanding any other 
     provision of law, in order to carry out the corporate 
     purposes described in section   02(a)(3), the Corporation 
     shall be eligible to receive discretionary grants, contracts, 
     gifts, contributions, or technical assistance from any 
     federal department or agency, to the extent otherwise 
     permitted by law.
       (b) Agreement.--In order to receive any assistance 
     described in subsection (a) the Corporation shall enter into 
     an agreement with the Federal department or agency providing 
     such assistance, under which the Corporation agrees--
       (1) to use such assistance to provide funding and technical 
     assistance only for activities which the Board of Directors 
     of the Corporation determines are consistent with the 
     corporate purposes described in section   02(a)(3);
       (2) to review the activities of State education technology 
     agencies and other entities receiving assistance from the 
     Corporation to assure that the corporate purposes described 
     in section   02(a)(3) are carried out;
       (3) that no part of the assets of the Corporation shall 
     accrue to the benefit of any member of the Board of Directors 
     of the Corporation, any officer or employee of the 
     Corporation, or any other individual, except as salary or 
     reasonable compensation for services;
       (4) that the Board of Directors of the Corporation will 
     adopt policies and procedures to prevent conflicts of 
     interest;
       (5) to maintain a Board of Directors of the Corporation 
     consistent with section   02(a)(2);
       (6) that the Corporation, and any entity receiving the 
     assistance from the Corporation, are subject to the 
     appropriate oversight procedures of the Congress; and
       (7) to comply with--
       (A) the audit requirements described in section   05; and
       (B) the reporting and testimony requirements described in 
     section   06.
       (c) Construction.--Nothing in this title shall be construed 
     to establish the Corporation as an agency or independent 
     establishment of the Federal Government, or to establish the 
     members of the Board of Directors of the Corporation, or the 
     officers and employees of the Corporation, as officers or 
     employees of the Federal Government.

     SEC.   05. AUDITS.

       (a) Audits by Independent Certified Public Accountants.--
       (2) Reporting requirements.--The report of each annual 
     audit described in paragraph (1) shall be included in the 
     annual report required by section   06(a).
       (b) Recordkeeping Requirements; Audit and Examination of 
     Books.--
       (1) Recordkeeping requirements.--The Corporation shall 
     ensure that each recipient of assistance from the Corporation 
     keeps--
       (A) separate accounts with respect to such assistance;
       (B) such records as may be reasonably necessary to fully 
     disclose--
       (i) the amount and the disposition by such recipient of the 
     proceeds of such assistance;
       (ii) the total cost of the project or undertaking in 
     connection with which such assistance is given or used; and
       (iii) the amount and nature of that portion of the cost of 
     the project or undertaking supplied by other sources; and
       (C) such other records as will facilitate an effective 
     audit.
       (2) Audit and examination of books.--The Corporation shall 
     ensure that the Corporation, or any of the Corporation's duly 
     authorized representatives, shall have access for the purpose 
     of audit and examination to any books, documents, papers, and 
     records of any recipient of assistance from the Corporation 
     that are pertinent to such assistance. Representatives of the 
     Comptroller General shall also have such access for such 
     purpose.

     SEC.   06. ANNUAL REPORT; TESTIMONY TO THE CONGRESS.

       (a) Annual Report.--Not later than April 30 of each year, 
     the Corporation shall publish an annual report for the 
     preceding fiscal year and submit that report to the President 
     and the Congress. The report shall include a comprehensive 
     and detailed evaluation of the Corporation's operations, 
     activities, financial condition, and accomplishments under 
     this title and may include such recommendations as the 
     Corporation deems appropriate.
       (b) Testimony Before Congress.--The members of the Board of 
     Directors, and officers, of the Corporation shall be 
     available to testify before appropriate committees of the 
     Congress with respect to the report described in subsection 
     (a), the report of any audit made by the Comptroller General 
     pursuant to this title, or any other matter which any such 
     committee may determine appropriate.
  Ms. MOSELEY-BRAUN. Mr. President, this amendment is identical to S. 
792, legislation designed to connect public schools and public 
libraries to the information superhighway, which I introduced earlier 
this year.
  If there is any objective that should command complete American 
consensus, it is to ensure that every American has a chance to succeed. 
That is the core concept of the American dream--the chance to achieve 
as much and to go as far as your ability and talent will take you. 
Public education has always been a part of that core concept. In this 
country, the chance to be educated has always gone hand in hand with 
the chance to succeed.


                               technology

  Nonetheless, I am convinced that it will be difficult if not 
impossible for us to prepare all of our children to compete in the 
emerging global economy 
[[Page S8310]] unless they all have access to the technology available 
on the information superhighway. Technology can help teachers and 
students play the new roles that are being required of them in the 
emerging global economy. It can help teachers use resources from across 
the globe or across the street to create different learning 
environments for their students without ever leaving the classroom. 
Technology can also allow students to access the vast array of 
material, available electronically, necessary to engage in the analysis 
of real world problems and questions.


                              gao reports

  Last year, I asked the General Accounting Office to conduct a 
comprehensive, nationwide study of our Nation's education 
infrastructure. The GAO decided to meet my request with five separate 
reports. The first report entitled--``The Condition of America's 
Schools''--concluded that our Nation's public schools need $112 billion 
to restore their facilities to good overall condition.
  The most recent GAO report entitled--``America's Schools Not Designed 
or Equipped for the 21st Century''--concluded that more than half of 
our Nation's public schools lack six or more of the technology elements 
necessary to reform the way teachers teach and students learn 
including: computers, printers, modems, cable TV, laser disc players, 
VCR's, and TV's. The report states that: 86.8 percent of all public 
schools lack fiber-optic cable; 46.1 percent lack sufficient electrical 
wiring; 34.6 percent lack sufficient electrical power for computers; 
51.8 percent lack sufficient computer networks; 61.2 percent lack 
sufficient phone lines for instructional use; 60.6 percent lack 
sufficient conduits and raceways; and 55.5 percent lack sufficient 
phone lines for modems.


                          local property taxes

  The most recent GAO report did find that students in some schools are 
taking advantage of the benefits associated with education technology. 
The bottom line, however, is that we are still failing to provide all 
of our Nation's children with the best technology resources in the 
world because the American system of public education has forced local 
school districts to maintain our public schools primarily with local 
property taxes.
  In Illinois, the local share of public education funding increased 
from 48 percent during the 1980-81 school year to 58 percent during the 
1992-93 school year, while the State share fell from 43 to 34 percent 
during this same period. The Federal Government's share of public 
education funding has also fallen from 9.1 percent during the 1980-81 
school year to 5.6 percent during the 1993-94 school year.
                        information superhighway

  These statistics as well as the results of the second GAO report 
suggest to me that the Federal Government must do more to help build 
the education portion of the information superhighway. Federal support 
for the acquisition and use of technology in elementary and secondary 
schools is currently fragmented, coming from a diverse group of 
programs and departments. Although the full extent to which the Federal 
Government currently supports investments in education technology at 
the precollegiate level is not known, the Office of Technology 
Assessment estimated in its report--``Power On!''--that the programs 
administered by the Department of Education provided $208 million for 
education technology in 1988.
  There is little doubt that substantial costs will accompany efforts 
to bring education technologies into public schools in any 
comprehensive fashion. In his written testimony before the House 
Telecommunications and Finance Subcommittee on September 30, 1994, 
Secretary of Education Richard Riley estimated that it will cost 
anywhere from $3 to $8 billion annually to build the education portion 
of the national information infrastructure.


           National Education Technology Funding Corporation

  Mr. President, three leaders in the areas of education and finance 
came together recently to help public schools and public libraries meet 
these costs. On April 4, John Danforth, former U.S. Senator from 
Missouri, Jim Murray, former president of Fannie Mae, and Dr. Mary 
Hatwood Futrell, former president of the National Education 
Association, created the National Education Technology Funding Corp.
  As outlined in its articles of incorporation, the National Education 
Technology Funding Corp. will stimulate public and private investment 
in our Nation's education technology infrastructure by providing States 
with loans, loan guarantees, grants, and other forms of assistance.


                               amendment

  Mr. President, I introduced S. 792, the National Education Technology 
Funding Corporation Act, on May 11, 1995, to help provide the seed 
money necessary to get this exciting private sector initiative off the 
ground. Rather than supporting our Nation's education technology 
infrastructure by creating another Federal program, this legislation 
would simply authorize Federal departments and agencies to make grants 
to the NETFC.
  The amendment I am introducing today would not create the NETFC or 
recognize it as an agency or establishment of the U.S. Government; it 
would only recognize its incorporation as a private, nonprofit 
organization by private citizens. However, since NETFC would be using 
public funds to connect public schools and public libraries to the 
information superhighway, my amendment would require the corporation to 
submit itself and its grantees to appropriate congressional oversight 
procedures and annual audits.
  This amendment will not infringe on local control over public 
education in any way. Rather, it will supplement, augment, and assist 
local efforts to support education technology in the least intrusive 
way possible by helping local school districts build their own on-ramps 
to the information superhighway.
  S. 792 has been cosponsored by Senators Burns, Campbell, Kerry, and 
Robb and endorsed by the National Education Association, the National 
School Boards Association, the American Library Association, the 
Council for Education Development and Research, and organizations 
concerned about rural education.


                               conclusion

  Mr. President, I urge my colleagues to take this important step to 
help connect public schools and public libraries to the information 
superhighway by quickly enacting my amendment into law.
  The PRESIDING OFFICER. The question is on agreeing to the amendments 
en bloc.
  Without objection, the amendments are agreed to.
  So the amendments (Nos. 1282 and 1284), as modified, were agreed to.
  Mr. SIMON. I move to reconsider the vote.
  Mr. PRESSLER. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.

                          ____________________