[Congressional Record Volume 141, Number 124 (Friday, July 28, 1995)]
[Senate]
[Pages S10876-S10897]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DOLE (for himself, Mr. Pryor, Mr. Roth, Mr. Baucus, Mr. 
        Pressler, Mr. Breaux, Mr. Bond, Mr. Simpson, Mr. Grassley, Mr. 
        Hatch, Mr. D'Amato, Mr. Murkowski, Mr. Nickles, Mr. Helms, Mr. 
        Warner, Mr. Gregg, Mr. Bennett, Mr. Lugar, Ms. Snowe, Mr. 
        Abraham, Mr. Burns, Mr. Lott, Mr. Ashcroft, Mr. Coats, Mr. 
        Inhofe, Mrs. Hutchison, Mr. Stevens, Mrs. Kassebaum, Mr. 
        Kerrey, Mr. Cohen, Mr. Campbell, and Mr. Coverdell):
  S. 1086. A bill to amend the Internal Revenue Code of 1986 to allow a 
family-owned business exclusion from the gross estate subject to estate 
tax, and for other purposes; to the Committee on Finance.


                 the american family-owned business act

  Mr. DOLE. Mr. President, I rise today to introduce the American 
Family-Owned Business Act--a bill that will preserve the American 
family and save jobs across the country.
  I am proud that this bill was developed on a bipartisan basis, led on 
the Democratic side by my colleague from Arkansas, Senator Pryor. We 
are joined by Senators Roth, Baucus, Pressler, Breaux, Simpson, Bond, 
D'Amato, Grassley, Nickles, Helms, Warner, Gregg, Bennett, Lugar, 
Snowe, Abraham, Burns, Lott, Ashcroft, Coats, Inhofe, Hutchison, 
Stevens, Murkowski, Kassebaum, Kerrey, Cohen, and Hatch.
  The current Federal estate tax is just too burdensome on the American 
family. Time and time again, farmers and other business owners across 
the country have told me that estate tax rates are just too high. They 
rise quickly from 18 to 55 percent, effectively making the Government a 
50-50 partner in a family business.
  Even the most sophisticated estate tax planning and the purchase of 
life insurance cannot sufficiently mitigate the effects of these high 
rates, leaving families no recourse but to sell their businesses to pay 
the estate tax. This bill will stop these forced sales from happening 
again.
  I agree with many who say that estate tax rates should be reduced 
across the board, or repealed entirely. And I hope that we do that some 
day. But today we take an important first step with the American 
Family-Owned Business Act.
  This bill cuts estate tax rates in half and also creates a new 
exclusion that completely eliminates the estate tax for small 
businesses.
  Under the new exclusion, family-owned businesses can exempt up to 
$1.5 million of family business assets from their estate. If a family 
business is valued at more than $1.5 million, the excess is taxed at 
one-half of the current rates--thus providing a maximum tax rate of 
27.5 percent.
  My colleagues and I introduce this bill to protect and preserve 
family enterprises. We know too well the adverse impact of an estate 
tax-forced sale. The family loses its livelihood, the family business 
employees lose their jobs, and the community suffers.
  We must do all that we can to help family-owned businesses not only 
survive, but also prosper. They are the job creators in this country. 
In the 1980's alone, family businesses accounted for an increase of 
more than 20 million private-sector jobs.
  By relieving families from the burden of the estate tax and letting 
them keep their business, they can continue to prosper. And when 
families continue to operate their businesses, we all benefit--the 
business employees keep their jobs, the Government receives income 
taxes on business profits, and the families retain their livelihood.
  The estate tax is not a Democratic or a Republican problem, or one 
that affects only rural or urban families. There are farmers, ranchers, 
or other family businesses in each State that would benefit from this 
legislation. That is why this bill is supported by dozens of groups, 
each listed at the conclusion of this statement.
  Many of my colleagues have introduced bills to provide estate tax 
relief in various situations. These bills include important ideas, many 
of which are reflected in the American Family-owned Business Act. As we 
begin the process of providing estate tax relief, we hope to work 
closely with the sponsors of these other bills, and to work toward 
common goals. We encourage those Senators who have sponsored their own 
bills to sign on to this one and work toward a single package of estate 
tax relief.
  As we intend, the American Family-Owned Business Act provides relief 
for family businesses across the country--from the tree farmer in the 
Northeast or the rancher in the Southwest, to the farmer in the Midwest 
or the corner grocery store owner in the South.
  The bill requires heirs to participate in the family business. These 
participation rules are deliberately flexible and recognize that 
different family businesses need differing levels of participation by 
heirs. For example, the bill recognizes that owners of tree farms may 
participate at a level lower than that of owners of other businesses, 
since tree farming often does not require continuous attention as do 
other farming activities.
  This bill provides the critical relief needed for American families' 
businesses. We urge all our colleagues to support this effort.
  Mr. President, I ask unanimous consent that the text of the bill and 
other material be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
       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 ``The American Family-Owned 
     Business Act''.

     SEC. 2. FAMILY-OWNED BUSINESS EXCLUSION.

       (a) In General.--Part III of subchapter A of chapter 11 of 
     the Internal Revenue Code of 1986 (relating to gross estate) 
     is amended by inserting after section 2033 the following new 
     section:

     ``SEC. 2033A. FAMILY-OWNED BUSINESS EXCLUSION.

       ``(a) In General.--In the case of an estate of a decedent 
     to which this section applies, the value of the gross estate 
     shall not include the lesser of--
       ``(1) the adjusted value of the qualified family-owned 
     business interests of the decedent otherwise includible in 
     the estate, or
       ``(2) the sum of--
       ``(A) $1,500,000, plus
       ``(B) 50 percent of the excess (if any) of the adjusted 
     value of such interests over $1,500,000.
       ``(b) Estates to Which Section Applies.--This section shall 
     apply to an estate if--
       ``(1) the decedent was (at the date of the decedent's 
     death) a citizen or resident of the United States,
       ``(2) the excess of--
       ``(A) the sum of--
       ``(i) the adjusted value of the qualified family-owned 
     business interests which--

       ``(I) are included in determining the value of the gross 
     estate (without regard to this section), and
       ``(II) are acquired by a qualified heir from, or passed to 
     a qualified heir from, the decedent (within the meaning of 
     section 2032A(e)(9)), plus

       ``(ii) the amount of the adjusted taxable gifts of such 
     interests from the decedent to members of the decedent's 
     family taken into account under subsection 2001(b)(1)(B), to 
     the extent such interests are continuously held by such 
     members between the date of the 

[[Page S 10877]]
     gift and the date of the decedent's death, over
       ``(B) the amount included in the gross estate under section 
     2035,

     exceeds 50 percent of the adjusted gross estate, and
       ``(3) during the 8-year period ending on the date of the 
     decedent's death there have been periods aggregating 5 years 
     or more during which--
       ``(A) such interests were owned by the decedent or a member 
     of the decedent's family, and
       ``(B) there was material participation (within the meaning 
     of section 2032A(e)(6)) by the decedent or a member of the 
     decedent's family in the operation of the business to which 
     such interests relate.
       ``(c) Adjusted gross estate.--For purposes of this section, 
     the term `adjusted gross estate' means the value of the gross 
     estate (determined without regard to this section)--
       ``(1) reduced by any amount deductible under section 
     2053(a)(4), and
       ``(2) increased by the excess of--
       ``(A) the sum of--
       ``(i) the amount taken into account under subsection 
     (b)(2)(B)), plus
       ``(ii) the amount of other gifts from the decedent to the 
     decedent's spouse (at the time of the gift) within 10 years 
     of the date of the decedent's death, plus
       ``(iii) the amount of other gifts (not included under 
     clause (i) or (ii)) from the decedent within 3 years of such 
     date, over
       ``(B) the amount included in the gross estate under section 
     2035.
       ``(d) Adjusted value of the qualified family-owned business 
     interests.--For purposes of this section, the adjusted value 
     of any qualified family-owned business interest is the value 
     of such interest for purposes of this chapter (determined 
     without regard to this section), reduced by the excess of--
       ``(1) any amount deductible under section 2053(a)(4), over
       ``(2) the sum of--
       ``(A) any indebtedness on any qualified residence of the 
     decedent the interest on which is deductible under section 
     163(h)(3), plus
       ``(B) any indebtedness to the extent the taxpayer 
     establishes that the proceeds of such indebtedness were used 
     for the payment of educational and medical expenses of the 
     decedent, the decedent's spouse, or the decedent's dependents 
     (within the meaning of section 152), plus
       ``(C) any indebtedness not described in subparagraph (A) or 
     (B), to the extent such indebtedness does not exceed $10,000.
       ``(e) Qualified Family-Owned Business Interest.--
       ``(1) In general.--For purposes of this section, the term 
     `qualified family-owned business interest' means--
       ``(A) an interest as a proprietor in a trade or business 
     carried on as a proprietorship, or
       ``(B) an interest as a partner in a partnership, or stock 
     in a corporation, carrying on a trade or business, if--
       ``(i) at least--

       ``(I) 50 percent of such partnership or corporation is 
     owned (directly or indirectly) by the decedent or members of 
     the decedent's family,
       ``(II) 70 percent of such partnership or corporation is so 
     owned by 2 families (including the decedent's family), or
       ``(III) 90 percent of such partnership or corporation is so 
     owned by 3 families (including the decedent's family), and

       ``(ii) at least 30 percent of such partnership or 
     corporation is so owned by each family described in subclause 
     (II) or (III) of clause (i).
       ``(2) Limitation.--Such term shall not include--
       ``(A) any interest in a trade or business the principal 
     place of business of which is not located in the United 
     States,
       ``(B) any interest in--
       ``(i) an entity which had, or
       ``(ii) an entity which is a member of a controlled group 
     (as defined in section 267(f)(1)) which had,

     readily tradable stock or debt on an established securities 
     market or secondary market (as defined by the Secretary) 
     within 3 years of the date of the decedent's death,
       ``(C) any interest in a trade or business not described in 
     section 542(c)(2), if more than 35 percent of the adjusted 
     ordinary gross income of such trade or business for the 
     taxable year which includes the date of the decedent's death 
     would qualify as personal holding company income (as defined 
     in section 543(a)), and
       ``(D) that portion of an interest in a trade or business 
     that is attributable to cash or marketable securities, or 
     both, in excess of the reasonably expected day-to-day working 
     capital needs of such trade or business.
       ``(3) Ownership rules.--
       ``(A) Indirect ownership.--For purposes of determining 
     indirect ownership under paragraph (1), rules similar to the 
     rules of paragraphs (2) and (3) of section 447(e) shall 
     apply.
       ``(B) Tiered entities.--For purposes of this section, if--
       ``(i) a qualified family-owned business holds an interest 
     in another trade or business, and
       ``(ii) such interest would be a qualified family-owned 
     business interest if held directly by the family (or 
     families) holding interests in the qualified family-owned 
     business meeting the requirements of paragraph (1)(B),

     then the value of the qualified family-owned business shall 
     include the portion attributable to the interest in the other 
     trade or business.
       ``(f) Tax Treatment of Failure To Materially Participate in 
     Business or Dispositions of Interests.--
       ``(1) In general.--There is imposed an additional estate 
     tax if, within 10 years after the date of the decedent's 
     death and before the date of the qualified heir's death--
       ``(A) the qualified heir ceases to use for the qualified 
     use (within the meaning of section 2032A(c)(6)(B)) the 
     qualified family-owned business interest which was acquired 
     (or passed) from the decedent, or
       ``(B) the qualified heir disposes of any portion of a 
     qualified family-owned business interest (other than by a 
     disposition to a member of the qualified heir's family or 
     through a qualified conservation contribution under section 
     170(h)).
       ``(2) Additional estate tax.--The amount of the additional 
     estate tax imposed by paragraph (1) shall be equal to--
       ``(A) the adjusted tax difference attributable to the 
     qualified family-owned business interest (as determined under 
     rules similar to the rules of section 2032A(c)(2)(B)), plus
       ``(B) interest on the amount determined under subparagraph 
     (A) at the annual rate of 4 percent for the period beginning 
     on the date the estate tax liability was due under this 
     chapter and ending on the date such additional estate tax is 
     due.
       ``(g) Other Definitions and Applicable Rules.--For purposes 
     of this section--
       ``(1) Qualified heir.--The term `qualified heir'--
       ``(A) has the meaning given to such term by section 
     2032A(e)(1), and
       ``(B) includes any active employee of the trade or business 
     to which the qualified family-owned business interest relates 
     if such employee has been employed by such trade or business 
     for a period of at least 10 years before the date of the 
     decedent's death.
       ``(2) Member of the family.--The term `member of the 
     family' has the meaning given to such term by section 
     2032A(e)(2).
       ``(3) Applicable rules.--Rules similar to the following 
     rules shall apply:
       ``(A) Section 2032A(b)(4) (relating to decedents who are 
     retired or disabled).
       ``(B) Section 2032A(b)(5) (relating to special rules for 
     surviving spouses).
       ``(C) Section 2032A(c)(2)(D) (relating to partial 
     dispositions).
       ``(D) Section 2032A(c)(3) (relating to only 1 additional 
     tax imposed with respect to any 1 portion).
       ``(E) Section 2032A(c)(4) (relating to due date).
       ``(F) Section 2032A(c)(5) (relating to liability for tax; 
     furnishing of bond).
       ``(G) Section 2032A(c)(7) (relating to no tax if use begins 
     within 2 years; active management by eligible qualified heir 
     treatment as material participation).
       ``(H) Section 2032A(e)(10) (relating to community 
     property).
       ``(I) Section 2032A(e)(14) (relating to treatment of 
     replacement property acquired in section 1031 or 1033 
     transactions).
       ``(J) Section 2032A(f) (relating to statute of 
     limitations).
       ``(K) Section 6166(b)(3) (relating to farmhouses and 
     certain other structures taken into account).
       ``(L) Subparagraphs (B), (C), and (D) of section 6166(g)(1) 
     (relating to acceleration of payment).''
       (b) Clerical Amendment.--The table of sections for part III 
     of subchapter A of chapter 11 of the Internal Revenue Code of 
     1986 is amended by inserting after the item relating to 
     section 2033 the following new item:

``Sec. 2033A. Family-owned business exclusion.''

       (c) Effective Date.--The amendments made by this section 
     shall apply to estates of decedents dying after December 31, 
     1995.
                                                                    ____

            Supporters of American Family-Owned Business Act

       Air Conditioning Contractors of America.
       Alliance of Independent Store Owners & Professionals.
       American Alliance of Family Businesses.
       American Association of Nurserymen.
       American Consulting Engineers Council.
       American Electrical Contractors Association.
       American Electrical Contractors Association.
       American Equipment Distributors.
       American Farm Bureau Federation.
       American Horse Council.
       American Road and Transportation Builders Association.
       American Sheep Industry Association.
       American Soybean Association.
       American Subcontractors Association.
       American Trucking Association.
       American Vintners Association.
       Associated Builders and Contractors.
       Associated Equipment Distributors.
       Associated General Contractors of America.
       Building Advertising Council.
       Building Service Contractors Associations International.
       Committee to Preserve the American Family Business.
       Communicating for Agriculture.
       Council of Fleet Specialists.
       Food Marketing Institute.
       Forest Industries Committee on Taxation.
       Independent Bankers Association of America.
       Independent Petroleum Association of America.

[[Page S 10878]]

       Machinery Dealers National Association.
       Marina Operators Association of America.
       Marine Retailers Association of America.
       National-American Wholesale Grocers' Assn./International 
     Foodservice Distributors.
       National Association for the Self-Employed.
       National Association of RV Parks and Campgrounds.
       National Association of Realtors.
       National Association of Retail Druggists.
       National Association of State Departments of Agriculture.
       National Association of Wheat Growers.
       National Automobile Dealers Association.
       National Cattlemen's Association.
       National Corn Growers Association.
       National Cotton Council.
       National Farmers Union.
       National Federation of Independent Business.
       National Food Brokers Association.
       National Home Furnishings Association.
       National Lumber and Building Material Dealers Association.
       National Milk Producers Federation.
       National Pork Producers Council.
       National Restaurant Association.
       National Retail Federation.
       National Roofing Contractors Association.
       National Stripper Well Association.
       National Tire Dealers & Retreaders Association.
       National Tooling & Machining Association.
       Printing Industries of America.
       Promotional Products Association International.
       Retail Bakers of America.
       Sageguard America's Family Enterprises.
       Sheet Metal & Air Conditioning Contractors National 
     Association.
       Small Business Exporters Association.
       Small Business Legislative Council.
       Society of American Florists.
       U.S. Business and Industrial Council.
       U.S. Chamber of Commerce.
       Wine and Spirits Wholesalers of American.
       World Floor Covering Association

  .Mr. ROTH. Mr. President, sometimes it appears that government has 
declared war on the family farm and small business. This is an irony, 
given the fact that these historic American institutions are the 
backbone of our economy. We all know the statistics--how since the 
early 1970's, small businesses have created two out of every three new 
jobs--how our family farms have helped turn America into the most 
productive agricultural provider in the world.
  On previous occasions, I've come to the floor to detail how 
government, time and again, has tried to kill the goose that lays the 
golden egg. Not only are small businesses and our family farms feeling 
the crunch from Federal taxation and over-regulation, but they are 
getting hit on the local level, as well. When Congress increases 
regulations--when Congress hits small business men and women with tax 
increases--rarely are these regulations and increases considered in 
light of the State and local taxes these men and women are paying. 
Fortune magazine reports that the tax liability of small businesses is 
one of the fastest rising, especially through the increases of property 
taxes--taxes which have a profound impact on our farmers.
  On top of this tremendous tax and regulatory load that small business 
owners and family farmers must bear in life, the Federal Government 
even refuses to allow them peace in death. In fact, in many cases the 
way the tax code is written today, the death of a small business man or 
woman in a family-owned enterprise brings about what can only be 
considered a hostile takeover by the government.
  Under current law, when the key member of a family-owned business 
dies, the Federal Government mandates an estate tax that can reach as 
high as 55 percent. Fifty-five percent, Mr. President. Think about 
that. It can make the Federal Government literally the majority owner 
of a business that a family has worked for years to build.
  If a government takeover isn't bad enough, the families involved soon 
realize that Uncle Sam doesn't even want to keep the business. He's not 
interested in a partnership. He just wants his pound of flesh, even if 
it kills the enterprise. Time again, this has happened as wonderful, 
hard-working, risk-taking spouses and children--valiant souls who have 
often sacrificed for the family cause--are forced by old Uncle Sam to 
sell the company or farm just to pay the taxes.
  If all this seems familiar, Mr. President, it is. It's familiar to 
anyone who's ever seen an old Vaudeville melodrama. If you can't pay 
the taxes, you lose the family farm. Well, Mr. President, all that 
changes with this legislation--legislation I have authored with 
Senators Dole and Pryor. And frankly, I don't mind playing the role of 
Dudley Dooright, along with these distinguished colleagues and a host 
of others who have cosponsored this legislation. In fact, I'm pleased 
to be a champion of small business, especially when I hear stories like 
those I shared in our press conference today.
  These are stories about real people--about an elderly woman from 
Delaware who, upon her death, left her family farm to her five 
children. They wanted the farm. They wanted it to remain in the family. 
It was valued at over $2 million. But in came Uncle Sam--just like in 
the melodrama--and demanded estate taxes of almost $1 million. Now Mr. 
President, it's not hard to understand how a hard-working family can 
build a farm that's worth $2 million, especially when you consider 
inflation. For good land and well-kept equipment, that's not an 
exorbitant amount of money.
  But it's almost impossible to see how those who inherit the farm are 
able to keep it when they also inherit a million dollar tax liability.
  In another case, an elderly couple from southern Delaware is 
currently struggling to plan their estate so it adequately provides for 
their handicapped daughter while it also allows their son to continue 
the family farming operation. Unfortunately, with a projected estate 
tax bill of over $500,000, it is most likely that they also will have 
to sell their family farm just to appease Uncle Sam's insatiable 
appetite for taxes.
  Mr. President, it's time for change. And the legislation I've 
authored--legislation to provide estate tax relief--is an important 
measure toward creating the change we need. The Family Business Estate 
Tax Relief Act--completely bipartisan legislation--will exempt from the 
estate tax a full $1.5 million of the value of the deceased 
individual's interest in a family business. If the business or farm is 
worth more than $1.5 million, our legislation cuts the additional tax 
rate in half.
  This exemption and rate cut are in addition to the current law's 
exclusion for up to $600,000 in personal and business assets. In this 
way, a family could protect a business valued up to $4.2 million, if 
that business were owned by a husband and wife. To make certain that 
the tax relief is going to protect family-owned businesses, our 
legislation requires that surviving members keep the business for up to 
ten years. It applies only to businesses that are family owned and that 
are located within the United States.
  Mr. President, this legislation is important not only for our 
families, but for our Nation. It restores proper perspective to what 
this political experiment is all about--encouraging the American Dream. 
There is nothing more important to that dream than the family, its 
business, and its farm. I encourage all my colleagues to join us in 
this bipartisan effort to once again make Uncle Sam a relative that 
folks will want to see come visit.
                                 ______

      By Mr. COHEN:
  S. 1088. A bill to provide for enhanced penalties for health care 
fraud, and for other purposes; to the Committee on Finance.


         the health care fraud and abuse prevention act of 1995

 Mr. COHEN. Mr. President, earlier this year I introduced S. 
245, the Health Care Fraud Prevention Act. This bill, which was 
cosponsored by a bipartisan group of 21 Senators, was similar to 
legislation I introduced last year that ultimately was incorporated 
into a number of the major comprehensive health care reform proposals. 
Unfortunately, hopes for enactment of my fraud and abuse proposal faded 
since comprehensive health care reform was not passed by the Congress 
last year.
  Regardless of whether we enact overall health care reform, it is 
vital that we no longer delay in adopting tough measures to crack down 
on the fraud and abuse that robs billions of dollars from our health 
care system each year. Estimates are that we are losing as much as $100 
billion each year to health care fraud and abuse, with as much as 30 
percent of those losses to the Medicare and Medicaid programs alone. As 
we embark upon the debate on how to achieve savings in, and control the 
growth of, Medicare and Medicaid, we must not overlook the very real 
savings that can be obtained by 

[[Page S 10879]]
closing the doors of these programs to fraud and abuse.
  Since I introduced S. 245 in January of this year, I have solicited 
comments on this legislation from a host of law enforcement agencies, 
health care provider groups, and experts in criminal law and health 
care. My purpose in seeking and reviewing comments on my legislation 
was to ensure that health care fraud legislation be tough on those who 
intentionally scam or defraud the health care system, but also be fair 
and workable in practice, and not inadvertently penalize honest health 
care providers who inadvertently run afoul of complicated 
health care regulations. I strongly believe that it is necessary, and 
possible, to strike the appropriate balance of being very tough on 
health care fraud while not entrapping or unduly burdening health care 
providers and businesses who are simply trying to follow the rules.
  The bill that I am introducing today reflects this delicate balance. 
It is the product of many months of work by my staff on the Senate 
Special Committee on Aging to respond to comments by
 many experts in law enforcement, health care, and the health care 
provider community. The changes made to S. 245 by this legislation I am 
introducing today are both comprehensive in nature and extremely 
workable.

  For example, this bill alters the extension of the Social Security 
Act anti-kickback statute and civil monetary penalties. Under this 
legislation, these penalties would be extended to cover all Federal 
Health Care Programs, not just Medicare and Medicaid.
  Another major change deals with the exclusion of individuals from 
Medicare for certain health care fraud violations. Under the proposal I 
am introducing today, the reach of this exclusion has been refined from 
my previous legislation so that individuals not directly involved in 
the fraudulent activity would not be unduly penalized or discouraged 
from serving on boards of hospitals or other health care organizations. 
This legislation contains many other refinements to S. 245 that will go 
far in achieving coordinated, effective, and fair response to health 
care fraud and abuse.
  Mr. President, the costs of health care fraud and abuse to our health 
care system are staggering: As much as 10 percent of U.S. health care 
spending is lost to fraud and abuse each year. For Medicare and 
Medicaid, the Federal Government pays as much as $27 billion each year 
in fraudulent and abusive claims. Enactment of this legislation 
therefore has the potential to save the taxpayers and American public 
millions, if not billions of dollars each year.
  I would like to thank all those individuals from law enforcement and 
the health care industry who have come forth with pragmatic and 
creative solutions to a growing and pernicious problem, and I ask 
unanimous consent that a section-by-section analysis of the changes 
have been made to S. 245 and a copy of my legislation be included in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                S. 1088

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Health 
     Care Fraud and Abuse Prevention Act of 1995''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                TITLE I--FRAUD AND ABUSE CONTROL PROGRAM

Sec. 101. Fraud and abuse control program.
Sec. 102. Application of certain health anti-fraud and abuse sanctions 
              to all fraud and abuse against any Federal health 
              program.
Sec. 103. Health care fraud and abuse guidance.

      TITLE II--REVISIONS TO CURRENT SANCTIONS FOR FRAUD AND ABUSE

Sec. 201. Mandatory exclusion from participation in medicare and State 
              health care programs.
Sec. 202. Establishment of minimum period of exclusion for certain 
              individuals and entities subject to permissive exclusion 
              from medicare and State health care programs.
Sec. 203. Permissive exclusion of individuals with ownership or control 
              interest in sanctioned entities.
Sec. 204. Sanctions against practitioners and persons for failure to 
              comply with statutory obligations.
Sec. 205. Intermediate sanctions for medicare health maintenance 
              organizations.
Sec. 206. Effective date.

         TITLE III--ADMINISTRATIVE AND MISCELLANEOUS PROVISIONS

Sec. 301. Establishment of the health care fraud and abuse data 
              collection program.

                   TITLE IV--CIVIL MONETARY PENALTIES

Sec. 401. Social Security Act civil monetary penalties.

                  TITLE V--AMENDMENTS TO CRIMINAL LAW

Sec. 501. Health care fraud.
Sec. 502. Forfeitures for Federal health care offenses.
Sec. 503. Injunctive relief relating to Federal health care offenses.
Sec. 504. Grand jury disclosure.
Sec. 505. False Statements.
Sec. 506. Obstruction of criminal investigations of Federal health care 
              offenses.
Sec. 507. Theft or embezzlement.
Sec. 508. Laundering of monetary instruments.
Sec. 509. Authorized investigative demand procedures.

            TITLE VI--STATE HEALTH CARE FRAUD CONTROL UNITS

Sec. 601. State health care fraud control units.

              TITLE VII--MEDICARE BILLING ABUSE PREVENTION

Sec. 701. Implementation of General Accounting Office recommendations 
              regarding medicare claims processing.
Sec. 702. Minimum software requirements.
Sec. 703. Disclosure.
Sec. 704. Review and modification of regulations.
Sec. 705. Definitions.
                TITLE I--FRAUD AND ABUSE CONTROL PROGRAM

     SEC. 101. FRAUD AND ABUSE CONTROL PROGRAM.

       (a) Establishment of Program.--
       (1) In general.--Not later than January 1, 1996, the 
     Secretary of Health and Human Services (in this title 
     referred to as the ``Secretary''), acting through the Office 
     of the Inspector General of the Department of Health and 
     Human Services, and the Attorney General shall establish a 
     program--
       (A) to coordinate Federal, State, and local law enforcement 
     programs to control fraud and abuse with respect to the 
     delivery of and payment for health care in the United States,
       (B) to conduct investigations, audits, evaluations, and 
     inspections relating to the delivery of and payment for 
     health care in the United States,
       (C) to facilitate the enforcement of the provisions of 
     sections 1128, 1128A, and 1128B of the Social Security Act 
     (42 U.S.C. 1320a-7, 1320a-7a, and 1320a-7b) and other 
     statutes applicable to health care fraud and abuse, and
       (D) to provide for the modification and establishment of 
     safe harbors and to issue interpretative rulings and special 
     fraud alerts pursuant to section 103.
       (2) Coordination with health plans.--In carrying out the 
     program established under paragraph (1), the Secretary and 
     the Attorney General shall consult with, and arrange for the 
     sharing of data with representatives of health plans.
       (3) Guidelines.--
       (A) In general.--The Secretary and the Attorney General 
     shall issue guidelines to carry out the program under 
     paragraph (1). The provisions of sections 553, 556, and 557 
     of title 5, United States Code, shall not apply in the 
     issuance of such guidelines.
       (B) Information guidelines.--
       (i) In general.--Such guidelines shall include guidelines 
     relating to the furnishing of information by health plans, 
     providers, and others to enable the Secretary and the 
     Attorney General to carry out the program (including 
     coordination with health plans under paragraph (2)).
       (ii) Confidentiality.--Such guidelines shall include 
     procedures to assure that such information is provided and 
     utilized in a manner that appropriately protects the 
     confidentiality of the information and the privacy of 
     individuals receiving health care services and items.
       (iii) Qualified immunity for providing information.--The 
     provisions of section 1157(a) of the Social Security Act (42 
     U.S.C. 1320c-6(a)) (relating to limitation on liability) 
     shall apply to a person providing information to the 
     Secretary or the Attorney General in conjunction with their 
     performance of duties under this section.
       (4) Investigators and other personnel.--In addition to any 
     other amounts authorized to be appropriated to the Secretary, 
     the Attorney General, the Director of the Federal Bureau of 
     Investigation, and the Inspectors General of the Departments 
     of Health and Human Services, Defense, Labor, and Veterans 
     Affairs, of the Office of Personnel Management, and of the 
     Railroad Retirement Board, for health care anti-fraud and 
     abuse activities for a fiscal year, there are authorized to 
     be appropriated additional amounts, from the Health Care 
     Fraud and Abuse Control described in subsection (b) of this 
     section, as may be necessary to enable the Secretary, the 
     Attorney General, and such Inspectors General to conduct 
     investigations 

[[Page S 10880]]
     and audits of allegations of health care fraud and abuse and otherwise 
     carry out the program established under paragraph (1) in a 
     fiscal year.
       (5) Ensuring access to documentation.--The Inspector 
     General of the Department of Health and Human Services is 
     authorized to exercise such authority described in paragraphs 
     (3) through (9) of section 6 of the Inspector General Act of 
     1978 (5 U.S.C. App.) as necessary with respect to the 
     activities under the fraud and abuse control program 
     established under this subsection.
       (6) Authority of inspector general.--Nothing in this Act 
     shall be construed to diminish the authority of any Inspector 
     General, including such authority as provided in the 
     Inspector General Act of 1978 (5 U.S.C. App.).
       (b) Health Care Fraud and Abuse Control.--
       (1) Establishment.--
       (A) In general.--There is hereby established the Health 
     Care Fraud and Abuse Control. There are hereby appropriated 
     to the Health Care Fraud and Abuse Control--
       (i) such gifts and bequests as may be made as provided in 
     subparagraph (B);
       (ii) such amounts as may be deposited in the Health Care 
     Fraud and Abuse Control as provided in sections 501(b) and 
     502(b), and title XI of the Social Security Act; and
       (iii) such amounts as are transferred to the Health Care 
     Fraud and Abuse Control under subparagraph (C).
       (B) Authorization to accept gifts.--The Health Care Fraud 
     and Abuse Control is authorized to accept on behalf of the 
     United States money gifts and bequests made unconditionally 
     to the Health Care Fraud and Abuse Control, for the benefit 
     of the Health Care Fraud and Abuse Control or any activity 
     financed through the Health Care Fraud and Abuse Control.
       (C) Transfer of amounts.--The Secretary of the Treasury 
     shall transfer to the Health Care Fraud and Abuse Control, 
     under rules similar to the rules in section 9601 of the 
     Internal Revenue Code of 1986, an amount equal to the sum of 
     the following:
       (i) Criminal fines imposed in cases involving a Federal 
     health care offense (as defined in section 982(a)(6)(B) of 
     title 18, United States Code).
       (ii) Administrative penalties and assessments imposed under 
     titles XI, XVIII, and XIX of the Social Security Act (except 
     as otherwise provided by law).
       (iii) Amounts resulting from the forfeiture of property by 
     reason of a Federal health care offense.
       (iv) Penalties and damages imposed under the False Claims 
     Act (31 U.S.C. 3729 et seq.), in cases involving claims 
     related to the provision of health care items and services 
     (other than funds awarded to a relator or for restitution).
       (2) General use of funds.--
       (A) In general.--Amounts in the Health Care Fraud and Abuse 
     Control shall be available, as provided in appropriation 
     Acts, to cover the costs (including equipment, salaries and 
     benefits, and travel and training) of the administration and 
     operation of the health care fraud and abuse control program 
     established under subsection (a), including the costs of--
       (i) prosecuting health care matters (through criminal, 
     civil, and administrative proceedings);
       (ii) investigations;
       (iii) financial and performance audits of health care 
     programs and operations;
       (iv) inspections and other evaluations; and
       (v) provider and consumer education regarding compliance 
     with the provisions of this title.
       (B) Funds used to supplement agency appropriations.--It is 
     intended that disbursements made from the Health Care Fraud 
     and Abuse Control to any Federal agency be used to increase 
     and not supplant the recipient agency's appropriated 
     operating budget.
       (3) Additional use of funds by inspector general.--
       (A) Reimbursements for investigations.--Amounts in the 
     Health Care Fraud and Abuse Control shall be available, as 
     provided in appropriation Acts, to the Inspectors General of 
     the Departments of Health and Human Services, Defense, Labor, 
     and Veterans Affairs, of the Office of Personnel Management, 
     and of the Railroad Retirement Board, to receive and retain 
     for current use reimbursement for the costs of conducting 
     investigations, when such restitution is ordered by a court, 
     voluntarily agreed to by the payer, or otherwise.
       (B) Crediting.--Funds received by any such Inspector 
     General as reimbursement for costs of conducting 
     investigations shall be deposited to the credit of the 
     appropriation from which initially paid, or to appropriations 
     for similar purposes currently available at the time of 
     deposit, and shall remain available for obligation for 1 year 
     from the date of the deposit of such funds.
       (4) Additional use of funds by state medicaid fraud control 
     units for investigation reimbursements.--Amounts in the 
     Health Care Fraud and Abuse Control shall be available, as 
     provided in appropriation Acts, to the various State medicaid 
     fraud control units to reimburse such units upon request to 
     the Secretary for the costs of the activities authorized 
     under section 1903(q) of the Social Security Act (42 U.S.C. 
     1396c(q).
       (5) Annual report.--The Secretary and the Attorney General 
     shall submit jointly an annual report to Congress on the 
     amount of revenue which is generated and disbursed by the 
     Health Care Fraud and Abuse Control in each fiscal year.
       (c) Health Plan Defined.--For purposes of this section, the 
     term ``health plan'' means a plan or program that provides 
     health benefits, whether directly, through insurance, or 
     otherwise, and includes--
       (1) a policy of health insurance;
       (2) a contract of a service benefit organization;
       (3) a membership agreement with a health maintenance 
     organization or other prepaid health plan; and
       (4) an employee welfare benefit plan or a multiple employer 
     welfare plan (as such terms are defined in section 3 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1002).

     SEC. 102. APPLICATION OF CERTAIN HEALTH ANTI-FRAUD AND ABUSE 
                   SANCTIONS TO FRAUD AND ABUSE AGAINST FEDERAL 
                   HEALTH PROGRAMS.

       (a) Crimes.--
       (1) Social security act.--Section 1128B of the Social 
     Security Act (42 U.S.C. 1320a-7b) is amended as follows:
       (A) In the heading, by striking ``medicare or state health 
     care programs'' and inserting ``federal health care 
     programs''.
       (B) In subsection (a)(1), by striking ``a program under 
     title XVIII or a State health care program (as defined in 
     section 1128(h))'' and inserting ``a Federal health care 
     program''.
       (C) In subsection (a)(5), by striking ``a program under 
     title XVIII or a State health care program'' and inserting 
     ``a Federal health care program''.
       (D) In the second sentence of subsection (a)--
       (i) by striking ``a State plan approved under title XIX'' 
     and inserting ``a Federal health care program'', and
       (ii) by striking ``the State may at its option 
     (notwithstanding any other provision of that title or of such 
     plan)'' and inserting ``the administrator of such program may 
     at its option (notwithstanding any other provision of such 
     program)''.
       (E) In subsection (b), by striking ``title XVIII or a State 
     health care program'' each place it appears and inserting ``a 
     Federal health care program''.
       (F) In subsection (c), by inserting ``(as defined in 
     section 1128(h))'' after ``a State health care program''.
       (G) By adding at the end the following new subsection:
       ``(f) For purposes of this section, the term `Federal 
     health care program' means--
       ``(1) any plan or program that provides health benefits, 
     whether directly, through insurance, or otherwise, which is 
     funded, in whole or in part, by the United States Government; 
     or
       ``(2) any State health care program, as defined in section 
     1128(h).''.
       (2) Identification of community service opportunities.--
     Section 1128B of such Act (42 U.S.C. 1320a-7b) is further 
     amended by adding at the end the following new subsection:
       ``(g) The Secretary may--
       ``(1) in consultation with State and local health care 
     officials, identify opportunities for the satisfaction of 
     community service obligations that a court may impose upon 
     the conviction of an offense under this section, and
       ``(2) make information concerning such opportunities 
     available to Federal and State law enforcement officers and 
     State and local health care officials.''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 1996.

     SEC. 103. HEALTH CARE FRAUD AND ABUSE GUIDANCE.

       (a) Solicitation and Publication of Modifications to 
     Existing Safe Harbors and New Safe Harbors.--
       (1) In general.--
       (A) Solicitation of proposals for safe harbors.--Not later 
     than January 1, 1996, and not less than annually thereafter, 
     the Secretary shall publish a notice in the Federal Register 
     soliciting proposals, which will be accepted during a 60-day 
     period, for--
       (i) modifications to existing safe harbors issued pursuant 
     to section 14(a) of the Medicare and Medicaid Patient and 
     Program Protection Act of 1987 (42 U.S.C. 1320a-7b note);
       (ii) additional safe harbors specifying payment practices 
     that shall not be treated as a criminal offense under section 
     1128B(b) of the Social Security Act (42 U.S.C. 1320a-7b(b)) 
     and shall not serve as the basis for an exclusion under 
     section 1128(b)(7) of such Act (42 U.S.C. 1320a-7(b)(7));
       (iii) interpretive rulings to be issued pursuant to 
     subsection (b); and
       (iv) special fraud alerts to be issued pursuant to 
     subsection (c).
       (B) Publication of proposed modifications and proposed 
     additional safe harbors.--After considering the proposals 
     described in clauses (i) and (ii) of subparagraph (A), the 
     Secretary, in consultation with the Attorney General, shall 
     publish in the Federal Register proposed modifications to 
     existing safe harbors and proposed additional safe harbors, 
     if appropriate, with a 60-day comment period. After 
     considering any public comments received during this period, 
     the Secretary shall issue final rules modifying the existing 
     safe harbors and establishing new safe harbors, as 
     appropriate.
       (C) Report.--The Inspector General of the Department of 
     Health and Human Services (in this section referred to as the 
     ``Inspector 

[[Page S 10881]]
     General'') shall, in an annual report to Congress or as part of the 
     year-end semiannual report required by section 5 of the 
     Inspector General Act of 1978 (5 U.S.C. App.), describe the 
     proposals received under clauses (i) and (ii) of subparagraph 
     (A) and explain which proposals were included in the 
     publication described in subparagraph (B), which proposals 
     were not included in that publication, and the reasons for 
     the rejection of the proposals that were not included.
       (2) Criteria for modifying and establishing safe harbors.--
     In modifying and establishing safe harbors under paragraph 
     (1)(B), the Secretary may consider the extent to which 
     providing a safe harbor for the specified payment practice 
     may result in any of the following:
       (A) An increase or decrease in access to health care 
     services.
       (B) An increase or decrease in the quality of health care 
     services.
       (C) An increase or decrease in patient freedom of choice 
     among health care providers.
       (D) An increase or decrease in competition among health 
     care providers.
       (E) An increase or decrease in the ability of health care 
     facilities to provide services in medically underserved areas 
     or to medically underserved populations.
       (F) An increase or decrease in the cost to Federal health 
     care programs (as defined in section 1128B(f) of the Social 
     Security Act (42 U.S.C. 1320a-7b(f)).
       (G) An increase or decrease in the potential 
     overutilization of health care services.
       (H) The existence or nonexistence of any potential 
     financial benefit to a health care professional or provider 
     which may vary based on their decisions of--
       (i) whether to order a health care item or service; or
       (ii) whether to arrange for a referral of health care items 
     or services to a particular practitioner or provider.
       (I) Any other factors the Secretary deems appropriate in 
     the interest of preventing fraud and abuse in Federal health 
     care programs (as so defined).
       (b) Interpretive Rulings.--
       (1) In general.--
       (A) Request for interpretive ruling.--Any person may 
     present, at any time, a request to the Inspector General for 
     a statement of the Inspector General's current interpretation 
     of the meaning of a specific aspect of the application of 
     sections 1128A and 1128B of the Social Security Act (42 
     U.S.C. 1320a-7a and 1320a-7b) (in this section referred to as 
     an ``interpretive ruling'').
       (B) Issuance and effect of interpretive ruling.--
       (i) In general.--If appropriate, the Inspector General 
     shall in consultation with the Attorney General, issue an 
     interpretive ruling not later than 90 days after receiving a 
     request described in subparagraph (A). Interpretive rulings 
     shall not have the force of law and shall be treated as an 
     interpretive rule within the meaning of section 553(b) of 
     title 5, United States Code. All interpretive rulings issued 
     pursuant to this clause shall be published in the Federal 
     Register or otherwise made available for public inspection.
       (ii) Reasons for denial.--If the Inspector General does not 
     issue an interpretive ruling in response to a request 
     described in subparagraph (A), the Inspector General shall 
     notify the requesting party of such decision not later than 
     60 days after receiving such a request and shall identify the 
     reasons for such decision.
       (2) Criteria for interpretive rulings.--
       (A) In general.--In determining whether to issue an 
     interpretive ruling under paragraph (1)(B), the Inspector 
     General may consider--
       (i) whether and to what extent the request identifies an 
     ambiguity within the language of the statute, the existing 
     safe harbors, or previous interpretive rulings; and
       (ii) whether the subject of the requested interpretive 
     ruling can be adequately addressed by interpretation of the 
     language of the statute, the existing safe harbor rules, or 
     previous interpretive rulings, or whether the request would 
     require a substantive ruling (as defined in section 552 of 
     title 5, United States Code) not authorized under this 
     subsection.
       (B) No rulings on factual issues.--The Inspector General 
     shall not give an interpretive ruling on any factual issue, 
     including the intent of the parties or the fair market value 
     of particular leased space or equipment.
       (c) Special Fraud Alerts.--
       (1) In general.--
       (A) Request for special fraud alerts.--Any person may 
     present, at any time, a request to the Inspector General for 
     a notice which informs the public of practices which the 
     Inspector General considers to be suspect or of particular 
     concern under section 1128B(b) of the Social Security Act (42 
     U.S.C. 1320a-7b(b)) (in this subsection referred to as a 
     ``special fraud alert'').
       (B) Issuance and publication of special fraud alerts.--Upon 
     receipt of a request described in subparagraph (A), the 
     Inspector General shall investigate the subject matter of the 
     request to determine whether a special fraud alert should be 
     issued. If appropriate, the Inspector General shall issue a 
     special fraud alert in response to the request. All special 
     fraud alerts issued pursuant to this subparagraph shall be 
     published in the Federal Register.
       (2) Criteria for special fraud alerts.--In determining 
     whether to issue a special fraud alert upon a request 
     described in paragraph (1), the Inspector General may 
     consider--
       (A) whether and to what extent the practices that would be 
     identified in the special fraud alert may result in any of 
     the consequences described in subsection (a)(2); and
       (B) the volume and frequency of the conduct that would be 
     identified in the special fraud alert.
      TITLE II--REVISIONS TO CURRENT SANCTIONS FOR FRAUD AND ABUSE

     SEC. 201. MANDATORY EXCLUSION FROM PARTICIPATION IN MEDICARE 
                   AND STATE HEALTH CARE PROGRAMS.

       (a) Individual Convicted of Felony Relating to Health Care 
     Fraud.--
       (1) In general.--Section 1128(a) of the Social Security Act 
     (42 U.S.C. 1320a-7(a)) is amended by adding at the end the 
     following new paragraph:
       ``(3) Felony conviction relating to health care fraud.--Any 
     individual or entity that has been convicted after the date 
     of the enactment of the Health Care Fraud and Abuse 
     Prevention Act of 1995, under Federal or State law, in 
     connection with the delivery of a health care item or service 
     or with respect to any act or omission in a health care 
     program (other than those specifically described in paragraph 
     (1)) operated by or financed in whole or in part by any 
     Federal, State, or local government agency, of a criminal 
     offense consisting of a felony relating to fraud, theft, 
     embezzlement, breach of fiduciary responsibility, or other 
     financial misconduct.''.
       (2) Conforming amendment.--Paragraph (1) of section 1128(b) 
     of such Act (42 U.S.C. 1320a-7(b)) is amended to read as 
     follows:
       ``(1) Conviction relating to fraud.--Any individual or 
     entity that has been convicted after the date of the 
     enactment of the Health Care Fraud and Abuse Prevention Act 
     of 1995, under Federal or State law--
       ``(A) of a criminal offense consisting of a misdemeanor 
     relating to fraud, theft, embezzlement, breach of fiduciary 
     responsibility, or other financial misconduct--
       ``(i) in connection with the delivery of a health care item 
     or service, or
       ``(ii) with respect to any act or omission in a health care 
     program (other than those specifically described in 
     subsection (a)(1)) operated by or financed in whole or in 
     part by any Federal, State, or local government agency; or
       ``(B) of a criminal offense relating to fraud, theft, 
     embezzlement, breach of fiduciary responsibility, or other 
     financial misconduct with respect to any act or omission in a 
     program (other than a health care program) operated by or 
     financed in whole or in part by any Federal, State, or local 
     government agency.''.
       (b) Individual Convicted of Felony Relating to Controlled 
     Substance.--
       (1) In general.--Section 1128(a) of the Social Security Act 
     (42 U.S.C. 1320a-7(a)), as amended by subsection (a), is 
     amended by adding at the end the following new paragraph:
       ``(4) Felony conviction relating to controlled substance.--
     Any individual or entity that has been convicted after the 
     date of the enactment of the Health Care Fraud and Abuse 
     Prevention Act of 1995, under Federal or State law, of a 
     criminal offense consisting of a felony relating to the 
     unlawful manufacture, distribution, prescription, or 
     dispensing of a controlled substance.''.
       (2) Conforming amendment.--Section 1128(b)(3) of such Act 
     (42 U.S.C. 1320a-7(b)(3)) is amended--
       (A) in the heading, by striking ``Conviction'' and 
     inserting ``Misdemeanor conviction''; and
       (B) by striking ``criminal offense'' and inserting 
     ``criminal offense consisting of a misdemeanor''.

     SEC. 202. ESTABLISHMENT OF MINIMUM PERIOD OF EXCLUSION FOR 
                   CERTAIN INDIVIDUALS AND ENTITIES SUBJECT TO 
                   PERMISSIVE EXCLUSION FROM MEDICARE AND STATE 
                   HEALTH CARE PROGRAMS.

       Section 1128(c)(3) of the Social Security Act (42 U.S.C. 
     1320a-7(c)(3)) is amended by adding at the end the following 
     new subparagraphs:
       ``(D) In the case of an exclusion of an individual or 
     entity under paragraph (1), (2), or (3) of subsection (b), 
     the period of the exclusion shall be 3 years, unless the 
     Secretary determines in accordance with published regulations 
     that a shorter period is appropriate because of mitigating 
     circumstances or that a longer period is appropriate because 
     of aggravating circumstances.
       ``(E) In the case of an exclusion of an individual or 
     entity under subsection (b)(4) or (b)(5), the period of the 
     exclusion shall not be less than the period during which the 
     individual's or entity's license to provide health care is 
     revoked, suspended, or surrendered, or the individual or the 
     entity is excluded or suspended from a Federal or State 
     health care program.
       ``(F) In the case of an exclusion of an individual or 
     entity under subsection (b)(6)(B), the period of the 
     exclusion shall be not less than 1 year.''.

     SEC. 203. PERMISSIVE EXCLUSION OF INDIVIDUALS WITH OWNERSHIP 
                   OR CONTROL INTEREST IN SANCTIONED ENTITIES.

       Section 1128(b) of the Social Security Act (42 U.S.C. 
     1320a-7(b)) is amended by adding at the end the following new 
     paragraph:
       ``(15) Individuals controlling a sanctioned entity.--Any 
     individual who has a direct or indirect ownership or control 
     interest of 5 percent or more, or an ownership or control 
     interest (as defined in section 1124(a)(3)) 

[[Page S 10882]]
     in, or who is an officer or managing employee (as defined in section 
     1126(b)) of, an entity--
       ``(A) that has been convicted of any offense described in 
     subsection (a) or in paragraph (1), (2), or (3) of this 
     subsection; or
       ``(B) that has been excluded from participation under a 
     program under title XVIII or under a State health care 
     program.''.

     SEC. 204. SANCTIONS AGAINST PRACTITIONERS AND PERSONS FOR 
                   FAILURE TO COMPLY WITH STATUTORY OBLIGATIONS.

       (a) Minimum Period of Exclusion for Practitioners and 
     Persons Failing To Meet Statutory Obligations.--
       (1) In general.--The second sentence of section 1156(b)(1) 
     of the Social Security Act (42 U.S.C. 1320c-5(b)(1)) is 
     amended by striking ``may prescribe)'' and inserting ``may 
     prescribe, except that such period may not be less than 1 
     year)''.
       (2) Conforming amendment.--Section 1156(b)(2) of such Act 
     (42 U.S.C. 1320c-5(b)(2)) is amended by striking ``shall 
     remain'' and inserting ``shall (subject to the minimum period 
     specified in the second sentence of paragraph (1)) remain''.
       (b) Repeal of ``Unwilling or Unable'' Condition for 
     Imposition of Sanction.--Section 1156(b)(1) of the Social 
     Security Act (42 U.S.C. 1320c-5(b)(1)) is amended--
       (1) in the second sentence, by striking ``and determines'' 
     and all that follows through ``such obligations,''; and
       (2) by striking the third sentence.
     SEC. 205. INTERMEDIATE SANCTIONS FOR MEDICARE HEALTH 
                   MAINTENANCE ORGANIZATIONS.

       (a) Application of Intermediate Sanctions for Any Program 
     Violations.--
       (1) In general.--Section 1876(i)(1) of the Social Security 
     Act (42 U.S.C. 1395mm(i)(1)) is amended by striking ``the 
     Secretary may terminate'' and all that follows and inserting 
     ``in accordance with procedures established under paragraph 
     (9), the Secretary may at any time terminate any such 
     contract or may impose the intermediate sanctions described 
     in paragraph (6)(B) or (6)(C) (whichever is applicable) on 
     the eligible organization if the Secretary determines that 
     the organization--
       ``(A) has failed substantially to carry out the contract;
       ``(B) is carrying out the contract in a manner 
     substantially inconsistent with the efficient and effective 
     administration of this section; or
       ``(C) no longer substantially meets the applicable 
     conditions of subsections (b), (c), (e), and (f).''.
       (2) Other intermediate sanctions for miscellaneous program 
     violations.--Section 1876(i)(6) of such Act (42 U.S.C. 
     1395mm(i)(6)) is amended by adding at the end the following 
     new subparagraph:
       ``(C) In the case of an eligible organization for which the 
     Secretary makes a determination under paragraph (1) the basis 
     of which is not described in subparagraph (A), the Secretary 
     may apply the following intermediate sanctions:
       ``(i) Civil money penalties of not more than $25,000 for 
     each determination under paragraph (1) if the deficiency that 
     is the basis of the determination has directly adversely 
     affected (or has the substantial likelihood of adversely 
     affecting) an individual covered under the organization's 
     contract.
       ``(ii) Civil money penalties of not more than $10,000 for 
     each week beginning after the initiation of procedures by the 
     Secretary under paragraph (9) during which the deficiency 
     that is the basis of a determination under paragraph (1) 
     exists.
       ``(iii) Suspension of enrollment of individuals under this 
     section after the date the Secretary notifies the 
     organization of a determination under paragraph (1) and until 
     the Secretary is satisfied that the deficiency that is the 
     basis for the determination has been corrected and is not 
     likely to recur.''.
       (3) Procedures for imposing sanctions.--Section 1876(i) of 
     such Act (42 U.S.C. 1395mm(i)) is amended by adding at the 
     end the following new paragraph:
       ``(9) The Secretary may terminate a contract with an 
     eligible organization under this section or may impose the 
     intermediate sanctions described in paragraph (6) on the 
     organization in accordance with formal investigation and 
     compliance procedures established by the Secretary under 
     which--
       ``(A) the Secretary first provides the organization with 
     the reasonable opportunity to develop and implement a 
     corrective action plan to correct the deficiencies that were 
     the basis of the Secretary's determination under paragraph 
     (1) and the organization fails to develop or implement such a 
     plan;
       ``(B) in deciding whether to impose sanctions, the 
     Secretary considers aggravating factors such as whether an 
     entity has a history of deficiencies or has not taken action 
     to correct deficiencies the Secretary has brought to their 
     attention;
       ``(C) there are no unreasonable or unnecessary delays 
     between the finding of a deficiency and the imposition of 
     sanctions; and
       ``(D) the Secretary provides the organization with 
     reasonable notice and opportunity for hearing (including the 
     right to appeal an initial decision) before imposing any 
     sanction or terminating the contract.''.
       (4) Conforming amendments.--Section 1876(i)(6)(B) of such 
     Act (42 U.S.C. 1395mm(i)(6)(B)) is amended by striking the 
     second sentence.
       (b) Agreements With Peer Review Organizations.--
       (1) Requirement for written agreement.--Section 
     1876(i)(7)(A) of the Social Security Act (42 U.S.C. 
     1395mm(i)(7)(A)) is amended by striking ``an agreement'' and 
     inserting ``a written agreement''.
       (2) Development of model agreement.--Not later than July 1, 
     1996, the Secretary shall develop a model of the agreement 
     that an eligible organization with a risk-sharing contract 
     under section 1876 of the Social Security Act must enter into 
     with an entity providing peer review services with respect to 
     services provided by the organization under section 
     1876(i)(7)(A) of such Act.
       (3) Report by gao.--
       (A) Study.--The Comptroller General of the United States 
     shall conduct a study of the costs incurred by eligible 
     organizations with risk-sharing contracts under section 
     1876(b) of such Act of complying with the requirement of 
     entering into a written agreement with an entity providing 
     peer review services with respect to services provided by the 
     organization, together with an analysis of how information 
     generated by such entities is used by the Secretary to assess 
     the quality of services provided by such eligible 
     organizations.
       (B) Report to congress.--Not later than July 1, 1998, the 
     Comptroller General shall submit a report to the Committee on 
     Ways and Means and the Committee on Commerce of the House of 
     Representatives and the Committee on Finance and the Special 
     Committee on Aging of the Senate on the study conducted under 
     subparagraph (A).
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to contract years beginning on or 
     after January 1, 1996.

     SEC. 206. EFFECTIVE DATE.

       The amendments made by this part shall take effect January 
     1, 1996.
         TITLE III--ADMINISTRATIVE AND MISCELLANEOUS PROVISIONS

     SEC. 301. ESTABLISHMENT OF THE HEALTH CARE FRAUD AND ABUSE 
                   DATA COLLECTION PROGRAM.

       (a) General Purpose.--Not later than January 1, 1996, the 
     Secretary (in this title referred to as the ``Secretary'') 
     shall establish a national health care fraud and abuse data 
     collection program for the reporting of final adverse actions 
     (not including settlements in which no findings of liability 
     have been made) against health care providers, suppliers, or 
     practitioners as required by subsection (b), with access as 
     set forth in subsection (c).
       (b) Reporting of Information.--
       (1) In general.--Each government agency and health plan 
     shall report any final adverse action (not including 
     settlements in which no findings of liability have been made) 
     taken against a health care provider, supplier, or 
     practitioner.
       (2) Information to be reported.--The information to be 
     reported under paragraph (1) includes:
       (A) The name and TIN (as defined in section 7701(a)(41)) of 
     any health care provider, supplier, or practitioner who is 
     the subject of a final adverse action.
       (B) The name (if known) of any health care entity with 
     which a health care provider, supplier, or practitioner is 
     affiliated or associated.
       (C) The nature of the final adverse action and whether such 
     action is on appeal.
       (D) A description of the acts or omissions and injuries 
     upon which the final adverse action was based, and such other 
     information as the Secretary determines by regulation is 
     required for appropriate interpretation of information 
     reported under this section.
       (3) Confidentiality.--In determining what information is 
     required, the Secretary shall include procedures to assure 
     that the privacy of individuals receiving health care 
     services is appropriately protected.
       (4) Timing and form of reporting.--The information required 
     to be reported under this subsection shall be reported 
     regularly (but not less often than monthly) and in such form 
     and manner as the Secretary prescribes. Such information 
     shall first be required to be reported on a date specified by 
     the Secretary.
       (5) To whom reported.--The information required to be 
     reported under this subsection shall be reported to the 
     Secretary.
       (c) Disclosure and Correction of Information.--
       (1) Disclosure.--With respect to the information about 
     final adverse actions (not including settlements in which no 
     findings of liability have been made) reported to the 
     Secretary under this section respecting a health care 
     provider, supplier, or practitioner, the Secretary shall, by 
     regulation, provide for--
       (A) disclosure of the information, upon request, to the 
     health care provider, supplier, or licensed practitioner, and
       (B) procedures in the case of disputed accuracy of the 
     information.
       (2) Corrections.--Each Government agency and health plan 
     shall report corrections of information already reported 
     about any final adverse action taken against a health care 
     provider, supplier, or practitioner, in such form and manner 
     that the Secretary prescribes by regulation.
       (d) Access to Reported Information.--
       (1) Availability.--The information in this database shall 
     be available to Federal and State government agencies and 
     health plans pursuant to procedures that the Secretary shall 
     provide by regulation.
       (2) Fees for disclosure.--The Secretary may establish or 
     approve reasonable fees for 

[[Page S 10883]]
     the disclosure of information in this database (other than with respect 
     to requests by Federal agencies). The amount of such a fee 
     may not exceed the costs of processing the requests for 
     disclosure and of providing such information. Such fees shall 
     be available to the Secretary or, in the Secretary's 
     discretion to the agency designated under this section to 
     cover such costs.
       (e) Protection From Liability for Reporting.--No person or 
     entity, including the agency designated by the Secretary in 
     subsection (b)(5) shall be held liable in any civil action 
     with respect to any report made as required by this section, 
     without knowledge of the falsity of the information contained 
     in the report.
       (f) Definitions and Special Rules.--For purposes of this 
     section:
       (1)(A) The term ``final adverse action'' includes:
       (i) Civil judgments against a health care provider in 
     Federal or State court related to the delivery of a health 
     care item or service.
       (ii) Federal or State criminal convictions related to the 
     delivery of a health care item or service.
       (iii) Actions by Federal or State agencies responsible for 
     the licensing and certification of health care providers, 
     suppliers, and licensed health care practitioners, 
     including--
       (I) formal or official actions, such as revocation or 
     suspension of a license (and the length of any such 
     suspension), reprimand, censure or probation,
       (II) any other loss of license of the provider, supplier, 
     or practitioner, by operation of law, or
       (III) any other negative action or finding by such Federal 
     or State agency that is publicly available information.
       (iv) Exclusion from participation in Federal or State 
     health care programs.
       (v) Any other adjudicated actions or decisions that the 
     Secretary shall establish by regulation.
       (B) The term does not include any action with respect to a 
     malpractice claim.
       (2) The terms ``licensed health care practitioner'', 
     ``licensed practitioner'', and ``practitioner'' mean, with 
     respect to a State, an individual who is licensed or 
     otherwise authorized by the State to provide health care 
     services (or any individual who, without authority holds 
     himself or herself out to be so licensed or authorized).
       (3) The term ``health care provider'' means a provider of 
     services as defined in section 1861(u) of the Social Security 
     Act, and any entity, including a health maintenance 
     organization, group medical practice, or any other entity 
     listed by the Secretary in regulation, that provides health 
     care services.
       (4) The term ``supplier'' means a supplier of health care 
     items and services described in section 1819(a) and (b), and 
     section 1861 of the Social Security Act.
       (5) The term ``Government agency'' shall include:
       (A) The Department of Justice.
       (B) The Department of Health and Human Services.
       (C) Any other Federal agency that either administers or 
     provides payment for the delivery of health care services, 
     including, but not limited to the Department of Defense and 
     the Veterans' Administration.
       (D) State law enforcement agencies.
       (E) State medicaid fraud and abuse units.
       (F) Federal or State agencies responsible for the licensing 
     and certification of health care providers and licensed 
     health care practitioners.
       (6) The term ``health plan'' has the meaning given such 
     term by section 101(c).
       (7) For purposes of paragraph (2), the existence of a 
     conviction shall be determined under paragraph (4) of section 
     1128(j) of the Social Security Act.
       (g) Conforming Amendment.--Section 1921(d) of the Social 
     Security Act is amended by inserting ``and section 301 of the 
     Health Care Fraud and Abuse Prevention Act of 1995'' after 
     ``section 422 of the Health Care Quality Improvement Act of 
     1986''.
                   TITLE IV--CIVIL MONETARY PENALTIES

     SEC. 401. SOCIAL SECURITY ACT CIVIL MONETARY PENALTIES.

       (a) General Civil Monetary Penalties.--Section 1128A of the 
     Social Security Act (42 U.S.C. 1320a-7a) is amended as 
     follows:
       (1) In the third sentence of subsection (a), by striking 
     ``programs under title XVIII'' and inserting ``Federal health 
     care programs (as defined in section 1128(f)(1))''.
       (2) In subsection (f)--
       (A) by redesignating paragraph (3) as paragraph (4); and
       (B) by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) With respect to amounts recovered arising out of a 
     claim under a Federal health care program (as defined in 
     section 1128B(f)), the portion of such amounts as is 
     determined to have been paid by the program shall be repaid 
     to the program, and the portion of such amounts attributable 
     to the amounts recovered under this section by reason of the 
     amendments made by the Health Care Fraud and Abuse Prevention 
     Act of 1995 (as estimated by the Secretary) shall be 
     deposited into the Health Care Fraud and Abuse Control 
     established under section 101(b) of such Act.''.
       (3) In subsection (i)--
       (A) in paragraph (2), by striking ``title V, XVIII, XIX, or 
     XX of this Act'' and inserting ``a Federal health care 
     program (as defined in section 1128B(f))'',
       (B) in paragraph (4), by striking ``a health insurance or 
     medical services program under title XVIII or XIX of this 
     Act'' and inserting ``a Federal health care program (as so 
     defined)'', and
       (C) in paragraph (5), by striking ``title V, XVIII, XIX, or 
     XX'' and inserting ``a Federal health care program (as so 
     defined)''.
       (4) By adding at the end the following new subsection:
       ``(m)(1) For purposes of this section, with respect to a 
     Federal health care program not contained in this Act, 
     references to the Secretary in this section shall be deemed 
     to be references to the Secretary or Administrator of the 
     department or agency with jurisdiction over such program and 
     references to the Inspector General of the Department of 
     Health and Human Services in this section shall be deemed to 
     be references to the Inspector General of the applicable 
     department or agency.
       ``(2)(A) The Secretary and Administrator of the departments 
     and agencies referred to in paragraph (1) may include in any 
     action pursuant to this section, claims within the 
     jurisdiction of other Federal departments or agencies as long 
     as the following conditions are satisfied:
       ``(i) The case involves primarily claims submitted to the 
     Federal health care programs of the department or agency 
     initiating the action.
       ``(ii) The Secretary or Administrator of the department or 
     agency initiating the action gives notice and an opportunity 
     to participate in the investigation to the Inspector General 
     of the department or agency with primary jurisdiction over 
     the Federal health care programs to which the claims were 
     submitted.
       ``(B) If the conditions specified in subparagraph (A) are 
     fulfilled, the Inspector General of the department or agency 
     initiating the action is authorized to exercise all powers 
     granted under the Inspector General Act of 1978 with respect 
     to the claims submitted to the other departments or agencies 
     to the same manner and extent as provided in that Act with 
     respect to claims submitted to such departments or 
     agencies.''.
       (b) Excluded Individual Retaining Ownership or Control 
     Interest in Participating Entity.--Section 1128A(a) of the 
     Social Security Act (42 U.S.C. 1320a-7a(a)) is amended--
       (1) by striking ``or'' at the end of paragraph (1)(D);
       (2) by striking ``, or'' at the end of paragraph (2) and 
     inserting a semicolon;
       (3) by striking the semicolon at the end of paragraph (3) 
     and inserting ``; or''; and
       (4) by inserting after paragraph (3) the following new 
     paragraph:
       ``(4) in the case of a person who is not an organization, 
     agency, or other entity, is excluded from participating in a 
     program under title XVIII or a State health care program in 
     accordance with this subsection or under section 1128 and 
     who, at the time of a violation of this subsection, retains a 
     direct or indirect ownership or control interest of 5 percent 
     or more, or an ownership or control interest (as defined in 
     section 1124(a)(3)) in, or who is an officer or managing 
     employee (as defined in section 1126(b)) of, an entity that 
     is participating in a program under title XVIII or a State 
     health care program;''.
       (c) Modifications of Amounts of Penalties and 
     Assessments.--Section 1128A(a) of the Social Security Act (42 
     U.S.C. 1320a-7a(a)), as amended by subsection (b), is amended 
     in the matter following paragraph (4)--
       (1) by striking ``$2,000'' and inserting ``$10,000'';
       (2) by inserting ``; in cases under paragraph (4), $10,000 
     for each day the prohibited relationship occurs'' after 
     ``false or misleading information was given''; and
       (3) by striking ``twice the amount'' and inserting ``3 
     times the amount''.
       (d) Claim for Item or Service Based on Incorrect Coding or 
     Medically Unnecessary Services.--Section 1128A(a)(1) of the 
     Social Security Act (42 U.S.C. 1320a-7a(a)(1)) is amended--
       (1) in subparagraph (A) by striking ``claimed,'' and 
     inserting ``claimed, including any person who engages in a 
     pattern or practice of presenting or causing to be presented 
     a claim for an item or service that is based on a code that 
     the person knows or has reason to know will result in a 
     greater payment to the person than the code the person knows 
     or has reason to know is applicable to the item or service 
     actually provided,'';
       (2) in subparagraph (C), by striking ``or'' at the end;
       (3) in subparagraph (D), by striking ``; or'' and inserting 
     ``, or''; and
       (4) by inserting after subparagraph (D) the following new 
     subparagraph:
       ``(E) is for a medical or other item or service that a 
     person knows or has reason to know is not medically 
     necessary; or''.
       (e) Permitting Secretary To Impose Civil Monetary 
     Penalty.--Section 1128A(b) of the Social Security Act (42 
     U.S.C. 1320a-7a(a)) is amended by adding the following new 
     paragraph:
       ``(3) Any person (including any organization, agency, or 
     other entity, but excluding a beneficiary as defined in 
     subsection (i)(5)) who the Secretary determines has violated 
     section 1128B(b) of this title shall be subject to a civil 
     monetary penalty of not more than $10,000 for each such 
     violation. In addition, such person shall be subject to an 
     assessment of not more than twice the total amount of the 
     remuneration offered, paid, solicited, or received in 
     violation of section 1128B(b). The total amount of 
     remuneration 

[[Page S 10884]]
     subject to an assessment shall be calculated without regard to whether 
     some portion thereof also may have been intended to serve a 
     purpose other than one proscribed by section 1128B(b).''.
       (f) Sanctions Against Practitioners and Persons for Failure 
     To Comply With Statutory Obligations.--Section 1156(b)(3) of 
     the Social Security Act (42 U.S.C. 1320c-5(b)(3)) is amended 
     by striking ``the actual or estimated cost'' and inserting 
     ``up to $10,000 for each instance''.
       (g) Procedural Provisions.--Section 1876(i)(6) of the 
     Social Security Act (42 U.S.C. 1395mm(i)(6)) is further 
     amended by adding at the end the following new subparagraph:
       ``(D) The provisions of section 1128A (other than 
     subsections (a) and (b)) shall apply to a civil money penalty 
     under subparagraph (A) or (B) in the same manner as they 
     apply to a civil money penalty or proceeding under section 
     1128A(a).''.
       (h) Prohibition Against Offering Inducements to Individuals 
     Enrolled Under Programs or Plans.--
       (1) Offer of remuneration.--Section 1128A(a) of the Social 
     Security Act (42 U.S.C. 1320a-7a(a)) is amended--
       (A) by striking ``or'' at the end of paragraph (1)(D);
       (B) by striking ``, or'' at the end of paragraph (2) and 
     inserting a semicolon;
       (C) by striking the semicolon at the end of paragraph (3) 
     and inserting ``; or''; and
       (D) by inserting after paragraph (3) the following new 
     paragraph:
       ``(4) offers to or transfers remuneration to any individual 
     eligible for benefits under title XVIII of this Act, or under 
     a State health care program (as defined in section 1128(h)) 
     that such person knows or should know is likely to influence 
     such individual to order or receive from a particular 
     provider, practitioner, or supplier any item or service for 
     which payment may be made, in whole or in part, under title 
     XVIII, or a State health care program;''.
       (2) Remuneration defined.--Section 1128A(i) of such Act (42 
     U.S.C. 1320a-7a(i)) is amended by adding the following new 
     paragraph:
       ``(6) The term `remuneration' includes the waiver of 
     coinsurance and deductible amounts (or any part thereof), and 
     transfers of items or services for free or for other than 
     fair market value. The term `remuneration' does not include--
       ``(A) the waiver of coinsurance and deductible amounts by a 
     person, if--
       ``(i) the waiver is not offered as part of any 
     advertisement or solicitation;
       ``(ii) the person does not routinely waive coinsurance or 
     deductible amounts; and
       ``(iii) the person--

       ``(I) waives the coinsurance and deductible amounts after 
     determining in good faith that the individual is in financial 
     need;
       ``(II) fails to collect coinsurance or deductible amounts 
     after making reasonable collection efforts; or
       ``(III) provides for any permissible waiver as specified in 
     section 1128B(b)(3) or in regulations issued by the 
     Secretary;

       ``(B) differentials in coinsurance and deductible amounts 
     as part of a benefit plan design as long as the differentials 
     have been disclosed in writing to all beneficiaries, third 
     party payors, and providers, to whom claims are presented and 
     as long as the differentials meet the standards as defined in 
     regulations promulgated by the Secretary not later than 180 
     days after the date of the enactment of the Health Care Fraud 
     and Abuse Prevention Act of 1995; or
       ``(C) incentives given to individuals to promote the 
     delivery of preventive care as determined by the Secretary in 
     regulations so promulgated.''.
       (i) Effective Date.--The amendments made by this section 
     shall take effect January 1, 1996.
                  TITLE V--AMENDMENTS TO CRIMINAL LAW

     SEC. 501. HEALTH CARE FRAUD.

       (a) In General.--
       (1)  Fines and imprisonment for health care fraud 
     violations.--Chapter 63 of title 18, United States Code, is 
     amended by adding at the end the following new section:

     ``Sec. 1347. Health care fraud

       ``(a) Whoever knowingly and willfully executes, or attempts 
     to execute, a scheme or artifice--
       ``(1) to defraud any health plan or other person, in 
     connection with the delivery of or payment for health care 
     benefits, items, or services; or
       ``(2) to obtain, by means of false or fraudulent pretenses, 
     representations, or promises, any of the money or property 
     owned by, or under the custody or control of, any health 
     plan, or person in connection with the delivery of or payment 
     for health care benefits, items, or services;

     shall be fined under this title or imprisoned not more than 
     10 years, or both. If the violation results in serious bodily 
     injury (as defined in section 1365(g)(3) of this title), such 
     person may be imprisoned for any term of years.
       ``(b) For purposes of this section, the term `health plan' 
     has the same meaning given such term in section 101(c) of the 
     Health Care Fraud and Abuse Prevention Act of 1995.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 63 of title 18, United States Code, is 
     amended by adding at the end the following:

``1347. Health care fraud.''.

       (b) Criminal Fines Deposited in the Health Care Fraud and 
     Abuse Control.--The Secretary of the Treasury shall deposit 
     into the Health Care Fraud and Abuse Control established 
     under section 101(b) an amount equal to the criminal fines 
     imposed under section 1347 of title 18, United States Code 
     (relating to health care fraud).

     SEC. 502. FORFEITURES FOR FEDERAL HEALTH CARE OFFENSES.

       (a) In General.--Section 982(a) of title 18, United States 
     Code, is amended by adding after paragraph (5) the following 
     new paragraph:
       ``(6)(A) The court, in imposing sentence on a person 
     convicted of a Federal health care offense, shall order the 
     person to forfeit property, real or personal, that 
     constitutes or is derived, directly or indirectly, from 
     proceeds traceable to the commission of the offense.
       ``(B) For purposes of this paragraph, the term `Federal 
     health care offense' means a violation of, or a criminal 
     conspiracy to violate--
       ``(i) section 1347 of this title;
       ``(ii) section 1128B of the Social Security Act;
       ``(iii) sections 287, 371, 664, 666, 1001, 1027, 1341, 
     1343, 1920, or 1954 of this title if the violation or 
     conspiracy relates to health care fraud; and
       ``(iv) section 501 or 511 of the Employee Retirement Income 
     Security Act of 1974, if the violation or conspiracy relates 
     to health care fraud.''.
       (b) Property Forfeited Deposited in Health Care Fraud and 
     Abuse Control.--The Secretary of the Treasury shall deposit 
     into the Health Care Fraud and Abuse Control established 
     under section 101(b) an amount equal to amounts resulting 
     from forfeiture of property by reason of a Federal health 
     care offense pursuant to section 982(a)(6) of title 18, 
     United States Code.

     SEC. 503. INJUNCTIVE RELIEF RELATING TO FEDERAL HEALTH CARE 
                   OFFENSES.

       (a) In General.--Section 1345(a)(1) of title 18, United 
     States Code, is amended--
       (1) by striking ``or'' at the end of subparagraph (A);
       (2) by inserting ``or'' at the end of subparagraph (B); and
       (3) by adding at the end the following new subparagraph:
       ``(C) committing or about to commit a Federal health care 
     offense (as defined in section 982(a)(6)(B) of this 
     title);''.
       (b) Freezing of Assets.--Section 1345(a)(2) of title 18, 
     United States Code, is amended by inserting ``or a Federal 
     health care offense (as defined in section 982(a)(6)(B))'' 
     after ``title)''.

     SEC. 504. GRAND JURY DISCLOSURE.

       Section 3322 of title 18, United States Code, is amended--
       (1) by redesignating subsections (c) and (d) as subsections 
     (d) and (e), respectively; and
       (2) by inserting after subsection (b) the following new 
     subsection:
       ``(c) A person who is privy to grand jury information 
     concerning a Federal health care offense (as defined in 
     section 982(a)(6)(B))--
       ``(1) received in the course of duty as an attorney for the 
     Government; or
       ``(2) disclosed under rule 6(e)(3)(A)(ii) of the Federal 
     Rules of Criminal Procedure;

     may disclose that information to an attorney for the 
     Government to use in any investigation or civil proceeding 
     relating to health care fraud.''.
     SEC. 505. FALSE STATEMENTS.

       (a) In General.--Chapter 47, of title 18, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 1033. False statements relating to health care matters

       ``(a) Whoever, in any matter involving a health plan, 
     knowingly and willfully falsifies, conceals, or covers up by 
     any trick, scheme, or device a material fact, or makes any 
     false, fictitious, or fraudulent statements or 
     representations, or makes or uses any false writing or 
     document knowing the same to contain any false, fictitious, 
     or fraudulent statement or entry, shall be fined under this 
     title or imprisoned not more than 5 years, or both.
       ``(b) For purposes of this section, the term `health plan' 
     has the same meaning given such term in section 101(c) of the 
     Health Care Fraud and Abuse Prevention Act of 1995.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 47 of title 18, United States Code, in 
     amended by adding at the end the following:

``1033. False statements relating to health care matters.''.
     SEC. 506. OBSTRUCTION OF CRIMINAL INVESTIGATIONS OF FEDERAL 
                   HEALTH CARE OFFENSES.

       (a) In General.--Chapter 73 of title 18, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 1518. Obstruction of Criminal Investigations of 
       Federal Health Care Offenses.

       ``(a) In General.--Whoever willfully prevents, obstructs, 
     misleads, delays or attempts to prevent, obstruct, mislead, 
     or delay the communication of information or records relating 
     to a Federal health care offense to a criminal investigator 
     shall be fined under this title or imprisoned not more than 5 
     years, or both.
       ``(b) Federal Health Care Offense.--As used in this section 
     the term `Federal health care offense' has the same meaning 
     given such term in section 982(a)(6)(B) of this title.
       ``(c) Criminal Investigator.--As used in this section the 
     term `criminal investigator' 

[[Page S 10885]]
     means any individual duly authorized by a department, agency, or armed 
     force of the United States to conduct or engage in 
     investigations for prosecutions for violations of health care 
     offenses.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 73 of title 18, United States Code, in 
     amended by adding at the end the following:

``1518. Obstruction of Criminal Investigations of Federal Health Care 
              Offenses.''.
     SEC. 507. THEFT OR EMBEZZLEMENT.

       (a) In General.--Chapter 31 of title 18, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 669. Theft or Embezzlement in Connection with Health 
       Care.

       ``(a) In General.--Whoever willfully embezzles, steals, or 
     otherwise without authority willfully and unlawfully converts 
     to the use of any person other than the rightful owner, or 
     intentionally misapplies any of the moneys, funds, 
     securities, premiums, credits, property, or other assets of a 
     health plan, shall be fined under this title or imprisoned 
     not more than 10 years, or both.
       ``(b) Health Plan.--As used in this section the term 
     `health plan' has the same meaning given such term in section 
     101(c) of the Health Care Fraud and Abuse Prevention Act of 
     1995.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 31 of title 18, United States Code, is 
     amended by adding at the end the following:

``669. Theft or Embezzlement in Connection with Health Care.''.
     SEC. 508. LAUNDERING OF MONETARY INSTRUMENTS.

       Section 1956(c)(7) of title 18, United States Code, is 
     amended by adding at the end the following new subparagraph:
       ``(F) Any act or activity constituting an offense involving 
     a Federal health care offense as that term is defined in 
     section 982(a)(6)(B) of this title.''.

     SEC. 509. AUTHORIZED INVESTIGATIVE DEMAND PROCEDURES.

       (a) In General.--Chapter 233 of title 18, United States 
     Code, is amended by adding after section 3485 the following 
     new section:

     ``Sec. 3486. Authorized Investigative Demand Procedures

       ``(a) Authorization.--
       ``(1) In any investigation relating to functions set forth 
     in paragraph (2), the Attorney General or designee may issue 
     in writing and cause to be served a subpoena compelling 
     production of any records (including any books, papers, 
     documents, electronic media, or other objects or tangible 
     things), which may be relevant to an authorized law 
     enforcement inquiry, that a person or legal entity may 
     possess or have care, custody, or control. A custodian of 
     records may be required to give testimony concerning the 
     production and authentication of such records. The production 
     of records may be required from any place in any State or in 
     any territory or other place subject to the jurisdiction of 
     the United States at any designated place; except that such 
     production shall not be required more than 500 miles distant 
     from the place where the subpoena is served. Witnesses 
     summoned under this section shall be paid the same fees and 
     mileage that are paid witnesses in the courts of the United 
     States. A subpoena requiring the production of records shall 
     describe the objects required to be produced and prescribe a 
     return date within a reasonable period of time within which 
     the objects can be assembled and made available.
       ``(2) Investigative demands utilizing an administrative 
     subpoena are authorized for any investigation with respect to 
     any act or activity constituting or involving health care 
     fraud, including a scheme or artifice--
       ``(A) to defraud any health plan or other person, in 
     connection with the delivery of or payment for health care 
     benefits, items, or services; or
       ``(B) to obtain, by means of false or fraudulent pretenses, 
     representations, or promises, any of the money or property 
     owned by, or under the custody or control or, any health 
     plan, or person in connection with the delivery of or payment 
     for health care benefits, items, or services.
       ``(b) Service.--A subpoena issued under this section may be 
     served by any person designated in the subpoena to serve it. 
     Service upon a natural person may be made by personal 
     delivery of the subpoena to such person. Service may be made 
     upon a domestic or foreign association which is subject to 
     suit under a common name, by delivering the subpoena to an 
     officer, to a managing or general agent, or to any other 
     agent authorized by appointment or by law to receive service 
     of process. The affidavit of the person serving the subpoena 
     entered on a true copy thereof by the person serving it shall 
     be proof of service.
       ``(c) Enforcement.--In the case of contumacy by or refusal 
     to obey a subpoena issued to any person, the Attorney General 
     may invoke the aid of any court of the United States within 
     the jurisdiction of which the investigation is carried on or 
     of which the subpoenaed person is an inhabitant, or in which 
     such person carries on business or may be found, to compel 
     compliance with the subpoena. The court may issue an order 
     requiring the subpoenaed person to appear before the Attorney 
     General to produce records, if go ordered, or to give 
     testimony touching the matter under investigation. Any 
     failure to obey the order of the court may be punished by the 
     court as a contempt thereof. All process in any such case may 
     be served in any judicial district in which such person may 
     be found.
       ``(d) Immunity From Civil Liability.--Notwithstanding any 
     Federal, State, or local law, any person, including officers, 
     agents, and employees, receiving a subpoena under this 
     section, who complies in good faith with the subpoena and 
     thus produces the materials sought, shall not be liable in 
     any court of any State or the United States to any customer 
     or other person for such production or for nondisclosure of 
     that production to the customer.
       ``(e) Use in Action Against Individuals.--
       ``(1) Health information about an individual that is 
     disclosed under this section may not be used in, or disclosed 
     to any person for use in, any administrative, civil, or 
     criminal action or investigation directed against the 
     individual who is the subject of the information unless the 
     action or investigation arises out of and is directly related 
     to receipt of health care or payment for health care or 
     action involving a fraudulent claim related to health; or if 
     authorized by an appropriate order of a court of competent 
     jurisdiction, granted after application showing good cause 
     therefore.
       ``(2) In assessing good cause, the court shall weigh the 
     public interest and the need for disclosure against the 
     injury to the patient, to the physician-patient relationship, 
     and to the treatment services.
       ``(3) Upon the granting of such order, the court, in 
     determining the extent to which any disclosure of all or any 
     part of any record is necessary, shall impose appropriate 
     safeguards against unauthorized disclosure.
       ``(f) Health Plan.--As used in this section the term 
     `health plan' has the same meaning given such term in section 
     101(c) of the Health Care Fraud and Abuse Prevention Act of 
     1995.''.
       (b) Clerical Amendment.--The table of sections for chapter 
     223 of title 18, United States Code, is amended by inserting 
     after the item relating to section 3405 the following new 
     item:

     ``Sec. 3486. Authorized investigative demand procedures''.

       (c) Conforming Amendment.--Section 1510(b)(3)(B) of title 
     18, United States Code, is amended by inserting ``or a 
     Department of Justice subpoena (issued under section 3486),'' 
     after ``subpoena''.
            TITLE VI--STATE HEALTH CARE FRAUD CONTROL UNITS

     SEC. 601. STATE HEALTH CARE FRAUD CONTROL UNITS.

       (a) Extension of Concurrent Authority To Investigate and 
     Prosecute Fraud in Other Federal Programs.--Paragraph (3) of 
     section 1903(q) of the Social Security Act (42 U.S.C. 
     1396b(q)) is amended--
       (1) by inserting ``(A)'' after ``in connection with''; and
       (2) by striking ``title.'' and inserting ``title; and (B) 
     upon the approval of the relevant Federal agency, any aspect 
     of the provision of health care services and activities of 
     providers of such services under any Federal health care 
     program (as defined in section 1128B(F)(1)).''.
       (b) Extension of Authority To Investigate and Prosecute 
     Patient Abuse in Non-Medicaid Board and Care Facilities.--
     Paragraph (4) of section 1903(q) of the Social Security Act 
     (42 U.S.C. 1396b(q)) is amended to read as follows:
       ``(4)(A) The entity has--
       ``(i) procedures for reviewing complaints of abuse or 
     neglect of patients in health care facilities which receive 
     payments under the State plan under this title;
       ``(ii) at the option of the entity, procedures for 
     reviewing complaints of abuse or neglect of patients residing 
     in board and care facilities; and
       ``(iii) where appropriate, procedures for acting upon such 
     complaints under the criminal laws of the State or for 
     referring such complaints to other State agencies for action.
       ``(B) For purposes of this paragraph, the term `board and 
     care facility' means a residential setting which receives 
     payment from or on behalf of two or more unrelated adults who 
     reside in such facility, and for whom one or both of the 
     following is provided:
       ``(i) Nursing care services provided by, or under the 
     supervision of, a registered nurse, licensed practical nurse, 
     or licensed nursing assistant.
       ``(ii) Personal care services that assist residents with 
     the activities of daily living, including personal hygiene, 
     dressing, bathing, eating, toileting, ambulation, transfer, 
     positioning, self-medication, body care, travel to medical 
     services, essential shopping, meal preparation, laundry, and 
     housework.''.
              TITLE VII--MEDICARE BILLING ABUSE PREVENTION

     SEC. 701. IMPLEMENTATION OF GENERAL ACCOUNTING OFFICE 
                   RECOMMENDATIONS REGARDING MEDICARE CLAIMS 
                   PROCESSING.

       (a) In General.--Not later than 90 days after the date of 
     the enactment of this Act, the Secretary shall, by 
     regulation, contract, change order, or otherwise, require 
     medicare carriers to acquire commercial automatic data 
     processing equipment (in this title referred to as ``ADPE'') 
     meeting the requirements of section 702 to process medicare 
     part B claims for the purpose of identifying billing code 
     abuse.
       (b) Supplementation.--Any ADPE acquired in accordance with 
     subsection (a) 

[[Page S 10886]]
     shall be used as a supplement to any other ADPE used in claims 
     processing by medicare carriers.
       (c) Standardization.--In order to ensure uniformity, the 
     Secretary may require that medicare carriers that use a 
     common claims processing system acquire common ADPE in 
     implementing subsection (a).
       (d) Implementation Date.--Any ADPE acquired in accordance 
     with subsection (a) shall be in use by medicare carriers not 
     later than 180 days after the date of the enactment of this 
     Act.

     SEC. 702. MINIMUM SOFTWARE REQUIREMENTS.

       (a) In General.--The requirements described in this section 
     are as follows:
       (1) The ADPE shall be a commercial item.
       (2) The ADPE shall surpass the capability of ADPE used in 
     the processing of medicare part B claims for identification 
     of code manipulation on the day before the date of the 
     enactment of this Act.
       (3) The ADPE shall be capable of being modified to--
       (A) satisfy pertinent statutory requirements of the 
     medicare program; and
       (B) conform to general policies of the Health Care 
     Financing Administration regarding claims processing.
       (b) Minimum Standards.--Nothing in this title shall be 
     construed as preventing the use of ADPE which exceeds the 
     minimum requirements described in subsection (a).

     SEC. 703. DISCLOSURE.

       (a) In General.--Notwithstanding any other provision of 
     law, and except as provided in subsection (b), any ADPE or 
     data related thereto acquired by medicare carriers in 
     accordance with section 701(a) shall not be subject to public 
     disclosure.
       (b) Exception.--The Secretary may authorize the public 
     disclosure of any ADPE or data related thereto acquired by 
     medicare carriers in accordance with section 701(a) if the 
     Secretary determines that--
       (1) release of such information is in the public interest; 
     and
       (2) the information to be released is not protected from 
     disclosure under section 552(b) of title 5, United States 
     Code.

     SEC. 704. REVIEW AND MODIFICATION OF REGULATIONS.

       Not later than 30 days after the date of the enactment of 
     this Act, the Secretary shall order a review of existing 
     regulations, guidelines, and other guidance governing 
     medicare payment policies and billing code abuse to determine 
     if revision of or addition to those regulations, guidelines, 
     or guidance is necessary to maximize the benefits to the 
     Federal Government of the use of ADPE acquired pursuant to 
     section 701.

     SEC. 705. DEFINITIONS.

       For purposes of this title--
       (1) The term ``automatic data processing equipment'' (ADPE) 
     has the same meaning as in section 111(a)(2) of the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C. 
     759(a)(2)).
       (2) The term ``billing code abuse'' means the submission to 
     medicare carriers of claims for services that include 
     procedure codes that do not appropriately describe the total 
     services provided or otherwise violate medicare payment 
     policies.
       (3) The term ``commercial item'' has the same meaning as in 
     section 4(12) of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 403(12)).
       (4) The term ``medicare part B'' means the supplementary 
     medical insurance program authorized under part B of title 
     XVIII of the Social Security Act (42 U.S.C. 1395j-1395w-4).
       (5) The term ``medicare carrier'' means an entity that has 
     a contract with the Health Care Financing Administration to 
     determine and make medicare payments for medicare part B 
     benefits payable on a charge basis and to perform other 
     related functions.
       (6) The term ``payment policies'' means regulations and 
     other rules that govern billing code abuses such as 
     unbundling, global service violations, double billing, and 
     unnecessary use of assistants at surgery.
       (7) The term ``Secretary'' means the Secretary of Health 
     and Human Services.
                                                                    ____

                Section-by-Section of Changes to S. 245

       Fraud and Abuse Control Program: The All-payer Fraud and 
     Abuse Control Program is now called the Fraud and Abuse 
     Control Program as extensions of certain Social Security Act 
     provisions will be extended to federal programs only.
       The HHS Secretary and the Attorney General will be able to 
     establish the coordinated anti-fraud and abuse control 
     program by guidelines rather than by regulation.
       The section relating to the disclosure of ownership 
     information is deleted as the Inspector General already has 
     standards relating to the disclosure of this information.
       Technical corrections were made to the section on ensuring 
     access to documentation.
       Health Care Fraud and Abuse Control: The provision is 
     clarified so that funds that are dedicated to anti-fraud 
     activities must go through the appropriations process so that 
     there is proper congressional oversight.
       Anti-Kickback Statute: The Social Security Act Anti-
     Kickback statute is extended to all federal health care 
     programs (it currently applies only to the Medicare and 
     Medicaid program). The statute would not be extended to 
     private health care plans.
       Health Care Fraud and Abuse Guidance: In order to give 
     better guidance to the health care industry, the Inspector 
     General is required to issue interpretive rulings within 90 
     days of the date of request. If the Inspector General does 
     not issue an interpretive ruling, it shall notify the 
     requestor within sixty days of the request and give the 
     reasons for denial. Clarifies that a ``substantive ruling'' 
     is defined as it appears in the Administrative Procedure Act.
       Deletes the requirement that, in order to issue a special 
     fraud alert, the Inspector General shall consult the Attorney 
     General.
       Reporting of Fraudulent Activities under Medicare: Deletes 
     the requirement that the HHS Secretary establish a program 
     through which Medicare beneficiaries may report fraud to the 
     Secretary, since such a program has been established.
       Mandatory Exclusion from Participation in Medicare and 
     Medicaid: Clarifies that mandatory exclusion from 
     participation in Medicare and Medicaid is limited
      to those individuals convicted of a felony relating to 
     health care fraud. A permissive exclusion is created for 
     those convicted of other types of government fraud.
       Permissive Exclusion of Individuals with Ownership or 
     Control Interest in Sanctioned Entities: Clarifies that 
     permissive exclusion of individuals with controlling interest 
     in sanctioned entities be limited to those who are either 
     officers of, or managing employees of, the entity and deletes 
     references to those individuals who might sit on the board of 
     directors or who might be an agent of the entity. Deletes the 
     exclusion authority for those convicted of a civil monetary 
     penalty (but retains the conviction and exclusion 
     requirements).
       Intermediate Sanctions for Medicare HMO's: Sets up a 
     requirement that, before the application of intermediate 
     sanctions (civil monetary penalty of up to $10,000 per week) 
     on a Medicare HMO for program violations, the HHS Secretary 
     must determine that the HMO has failed to comply with a 
     corrective action plan within a reasonable amount of time. 
     Also states that the Secretary may impose intermediate 
     sanctions on a Medicare HMO if it is carrying out a contract 
     in a manner that is substantially inconsistent with the 
     efficient and effective administration of the underlying 
     section.
       Health Care Fraud and Abuse Data Collection Program: 
     Requires that final adverse actions that are reported to the 
     fraud and abuse data collection program indicate whether such 
     action is on appeal. Also requires that malpractice decisions 
     not be included in the data collection program and that an 
     identifying number be included along with the names of health 
     care providers, suppliers, or practitioners who are the 
     subject of final adverse actions and who are included in the 
     data collection program. Also exempts federal agencies from 
     paying fees for disclosure of such information.
       Civil Monetary Penalties: The Social Security Act civil 
     monetary penalty provisions are extended to all federal 
     health care programs (it currently applies to only the 
     Medicare and Medicaid programs). Civil monetary penalties 
     would not be extended to all private health care plans.
       Excluded Individual Retaining Ownership Or Control Interest 
     in Participating Entity: Deletes ``director, agent'' and 
     retains ``officer or managing employee.''
       Claim for Item or Service Based on Incorrect Coding or 
     Medically Unnecessary Services: The imposition of a civil 
     monetary penalty for upcoding requires a pattern or practice 
     of presenting claims. It also changes the civil
      monetary penalty standard in the case of upcoding from 
     ``knows or should knows'' to ``knows or has reason to 
     know'' that such action would result in a greater payment. 
     The standard for the imposition of a civil monetary 
     penalty for medically unnecessary services was changed to 
     ``knows or has reason to know'' as well.
       Prohibition Against Offering Inducements to Individuals 
     Enrolled Under Programs or Plans: The term ``remuneration'' 
     does not include differentials in coinsurance and deductible 
     amounts as long as the differentials have been disclosed in 
     writing to all third party payors, beneficiaries and 
     providers. The differentials will meet the standards as 
     defined in regulations which the Secretary must promulgate 
     within 180 days. Remuneration also does not include 
     incentives given to individuals to promote the delivery of 
     preventive care as determined by the Secretary within 180 
     days.
       Health Care Fraud Statute: The ``Willful'' standard was 
     added to the knowledge standard of the Title 18 health care 
     fraud statute. In addition, if violations of the new health 
     care fraud statute result in serious bodily injury, the 
     violator may be subject to as much as a life imprisonment 
     sentence.
       Forfeitures for Federal Health Care Offenses: The 
     forfeiture provision no longer allows the forfeiture of 
     property that is used in the commission of a health care 
     fraud offense but calls for the forfeiture of property that 
     constitutes or is derived (directly or indirectly) from the 
     proceeds traceable to the commission of the offense. Fraud in 
     the federal workmen's compensation program was also added to 
     the list of federal health care offenses.
       False Statements: Technical corrections were made to the 
     false statement section so that a ``health plan'' is defined.
       Voluntary Disclosure: The requirement to establish a 
     voluntary disclosure program is deleted since a similar 
     program was recently created.
       Theft or Embezzlement in Connection with Health Care: 
     Technical corrections were made to the theft or embezzlement 
     section so that ``health plan'' is defined.

[[Page S 10887]]

       Authorized Investigative Demand Procedures: This section 
     gives authority to the Attorney General or a designee to 
     utilize an administrative subpoena for investigations with 
     respect to health care fraud. The Inspectors General 
     currently have this authority and this section gives the 
     Attorney General or a designee similar authority.
       State Health Care Fraud Control Units: The State Medicaid 
     Control Unit authorization language has been changed so that 
     those units will have concurrent authority to investigate and 
     prosecute health care fraud in other Federal programs at the 
     approval of the relevant federal agency. Their authority to 
     investigate and prosecute patient abuse also has been 
     extended into non-Medicaid ``board and care'' facilities.
       Commercial Technology for Medicare Claims Processing: This 
     section requires Medicare carriers to acquire commercial 
     automatic data processing equipment to process Medicare Part 
     B claims for the purpose of identifying billing code 
     abuse.
                                 ______

      By Mr. LEAHY:
  S. 1089. A bill to amend the Nonindigenous Aquatic Nuisance 
Prevention and Control Act of 1990 to prevent and control the 
infestation of Lake Champlain by zebra mussels, and for other purposes; 
to the Committee on Environment and Public Works.


              the lake champlain zebra mussel control act

 Mr. LEAHY. Mr. President, today I am pleased to introduce the 
Lake Champlain Zebra Mussel Control Act of 1995. A year ago, the Senate 
accepted my amendment to address the growing problem of zebra mussels 
and their threat to drinking water systems. Unfortunately, the House 
did not concur, and now the problem has reached epidemic proportions.
  We enter a critical stage in our efforts to preserve Lake Champlain 
and other Vermont lakes from a zebra mussel explosion that could become 
an economic and ecological catastrophe. Vermonters have feared the 
arrival of this dreaded mollusk for a long time. We didn't ask for 
them, and were powerless to prevent them from arriving on our 
lakeshores. But now they are with us--and they are multiplying out of 
control.
  In 1993 the mussel was discovered in the South Lake near Orwell, VT 
by a young boy who had learned how to identify the zebra mussel by a 
wallet-sized identification card distributed by the Lake Champlain 
Basin Program. During the summer of 1994, the zebra mussel larvae 
reached a density of about 1,500 to 3,000 per cubic meter. This year, 
less than 3 years from the mussels' introduction, the Rutland Herald 
reported that zebra mussel larvae densities have been found throughout 
the lake at about 60,000 to 109,000 per cubic meter with some 
concentrations as high as 134,000 per cubic meter--almost as high as 
the worst sites in the Great Lakes.
  The zebra mussels in Lake Champlain deserve immediate and swift 
action. This pest poses a serious risk to the water resources 
throughout Vermont and the health and safety of the people of Vermont.
  Twenty-five percent of Vermont's families rely on Lake Champlain for 
their drinking water. The onslaught of zebra mussels and their 
astonishing ability to establish dense colonies in a matter of weeks, 
jeopardizes the intake pipes for water systems up and down the shore. 
Municipal, residential, industrial, and even the water systems to 
motors on recreation boats are threatened. Furthermore, the mussels 
don't just clog the ends of the pipes. Zebra mussels have been known to 
establish colonies in the piping system causing multiple effects on the 
quality of drinking water. A recent Cornell University report points 
out that

       Once in a water intake line, zebra mussels can colonize any 
     part of the system from the mouth of the intake in the lake 
     or river to the distribution pipes within the residence. 
     Impacts of this colonization include loss of pumping 
     efficiency, obstruction of foot valves, putrefactive decay of 
     mussel flesh, production of obnoxious-tasting and foul-
     smelling methane gas, and increased corrosion of steel, iron, 
     and copper pipes.

  Another potential threat to Vermont is the zebra mussel's impact on 
Vermont's fish stocking program. These mussels, reproducing at 
staggering rates, can close off hatchery piping and are threatening the 
State's multi-million-dollar sport fishing economy. In fact, Vermont's 
largest hatchery in Grand Isle, a $16 million facility, is risking 
total shut down if it loses its ongoing battle with the zebra mussel. 
When zebra mussels infest beaches, summer swimmers are forced to wear 
sneakers or sandals to avoid getting cut from the sharp shells. We can 
only speculate what the impact will be on submerged shipwrecks, real 
estate, summer cottages, and the tourism industry.
  Finally, the zebra mussels have arrived without their natural 
competitors and are spreading through the lake ecosystem unchecked. As 
colonies develop throughout freshwater bodies, they could displace all 
seven native mussel species in the Lake Champlain Basin, including the 
endangered black sandshell mussel. Scientists say all species are at 
risk because zebra mussels are known to colonize right on the backs of 
native mussels and choke them off from food and fresh water. Zebra 
mussels could throw entire aquatic ecosystems out of balance by 
disrupting the food chain, changing water chemistry, and altering 
physical habitat.
  Mr. President, 6 months ago I came to the Senate floor during the 
debate on the unfunded mandates bill to warn people of the real 
unfunded mandates that our States face--zebra mussels is one of them. 
While most of my colleagues supported S. 1 in an attempt to ease 
financial burdens by relaxing national standards and undermine Federal 
regulations, I pointed out that without national standards, States face 
the financial burdens of water pollution from upstream and out-of-State 
polluters, forest decay from acid rain, and flooding from wetland loss. 
Today, my State faces one of the financial burdens that could have been 
controlled with stricter national standards. I have already mentioned 
the $16 million hatchery and the water systems for one-quarter of my 
State. My State of Vermont faces a problem with no known cure and the 
costs could be astronomical. I hope that those who supported S. 1 to 
reduce State costs by limiting Federal standards recognize soon that 
their effort may have had the exact opposite effect.
  My Lake Champlain Zebra Mussel Control Act would do five things to 
address the present threat and prevent further spreading of zebra 
mussels throughout the country.
  The Lake Champlain Zebra Mussel Control Act specifically includes 
Lake Champlain in Federal programs designed to fight the zebra mussel. 
As America's ``sixth Great Lake'' with one of the greatest emerging 
zebra mussel problems and a destination for thousands of boaters, it is 
essential that Lake Champlain be included in any national effort to 
address the problem.
  My bill also establishes national voluntary guidelines for 
recreational boaters who are the chief mechanism for the spread of 
these mussels within New England. These guidelines will help States 
inform boaters of the steps they can take personally to stop the spread 
of zebra mussels into new areas. With 70 million people living within 1 
day's drive of Lake Champlian, the potential for the spread of these 
mussels to other lakes and waterways is great. All boaters will know 
that this is a national concern with clear protocols on how to stop the 
spread, and States can choose to enforce the guidelines as mandatory 
regulations if
 they believe the threat is justified.

  The legislation also allows States to work cooperatively on watershed 
approaches to the prevention and treatment of zebra mussels. If my 
State of Vermont devoted millions of dollars in time and resources to 
fight the mussel and our neighbors on Lake Champlain did nothing, the 
effort would be futile. Section 4 of my bill emphasizes that sometimes 
the watershed-based efforts like those of the Lake Champlain Basin 
Program are the best approaches to complex environmental problems.
  The bill designates the University of Vermont as a Sea Grant College 
eligible for zebra mussel funding. Ironically, the only State in New 
England with a confirmed zebra mussel problem is also the only State in 
New England without a Sea Grant College. My bill changes this. Also, 
recognizing that zebra mussels are not just a coastal problem or a 
Great Lakes problem any more, my bill authorizes land-grant colleges to 
compete for zebra mussel research funding.
  Finally, my legislation reauthorizes the Aquatic Nuisance Species 
Control Act, Public Law 101-646, and extends the appropriations 
authority through the year 2000. To address the current need to find 
control solutions, my bill 

[[Page S 10888]]
doubles the current appropriation of the Army Corps of Engineers to $4 
million. It is crucial that the Army Corps has adequate funding to 
pursue zebra mussel control technology. Since the Army Corps has used 
its full authority in recent years, doubling the authorization will 
assure they have access to the proper resources to do a thorough job.
  There is one further issue that my bill does not address, but 
represents an important piece of the fight to stop the introduction of 
new exotic and harmful species. The lamprey and the zebra mussels were 
both imported through the ballast tanks of international shippers. In 
recent years, the ruffe, a small fish, was introduced the same way and 
while it is not yet in Lake Champlain, its population is expanding in 
the Great Lakes. My colleagues Senator Glenn, the original author of 
the Aquatic Nuisance Species Act, and Senator Sarbanes will introduce a 
bill that addresses the loopholes in current ballast water controls 
that allow shippers to unleash these devastating and costly pests into 
our State waters. I hope to make America's fresh water resources 
completely off limits for expensive and damaging exotic pests. I look 
forward to working with Senators Glenn and Sarbanes to address all of 
these issues comprehensively.
  Mr. President, I present this bill with the hope that the Senate will 
act on it in a timely manner. Every minute that we delay allows the 
zebra mussels to multiply exponentially and risks the physical and 
economic health of Vermont. To turn our backs on this problem of 
national significance only guarantees that it gets much worse. Just ask 
my colleagues who knew little or nothing about zebra mussels as 
recently as a few years ago, and are now plagued by their 
existence.
                                 ______

      By Mr. LEAHY (for himself, Mr. Brown and Mr. Kerry):
  S. 1090. A bill to amend section 552 of title 5, United States Code 
(commonly known as the Freedom of Information Act), to provide for 
public access to information in an electronic format, and for other 
purposes; to the Committee on the Judiciary.


     THE ELECTRONIC FREEDOM OF INFORMATION IMPROVEMENT ACT OF 1995

 Mr. LEAHY. Mr. President, today I am joined by Senators Brown 
and Kerry in introducing the Electronic Freedom of Information 
Improvement Act.
  This bill would increase public access to the electronic records of 
Federal agencies, and take long overdue steps to alleviate the delays 
in processing requests for Government records. In the last Congress, a 
unanimous Judiciary Committee reported the bill, which then passed the 
Senate by voice vote on August 25, 1994.
  The emerging national information infrastructure [NII] will consist 
of interconnected computer networks and databases that can put vast 
amounts of information at users' fingertips. Such an information 
infrastructure will give the public easy access to the immense volumes 
of information generated and held by the Government. Individual Federal 
agencies are already contributing to the development of the NII by 
using technology to make Government information more easily accessible 
to our citizens. For example, the Internet Multicasting Service [IMS] 
now posts massive Government data archives, including the Securities 
and Exchange Commission EDGAR database, and the U.S. Patent and 
Trademark Office database on the Internet free of charge. Similarly, 
FedWorld, a bulletin board available on the Internet, provides a 
gateway to more than 60 Federal agencies.
  The Electronic Freedom of Information Improvement Act would 
contribute to that information flow by increasing online access to 
Government information, including agency regulations, opinions, and 
policy statements, and FOIA-released records that are the subject of 
repeated requests.
  Some agencies are taking important steps in this direction. For 
example, the Department of Energy compiled a database of photographs 
and texts describing federally-sponsored tests of radiation on human 
beings and put made that database available on the World Wide Web. Now, 
instead of responding to multiple requests for the same documents on 
Government human irradiation experiments, DOE has efficiently used 
technology to make this material affirmatively available to interested 
citizens. This bill would require all Federal agencies to make records 
that are the subject of multiple FOIA requests available 
electronically.
  The bill would also require all Federal agencies to use technology to 
make Government more accessible and accountable to its citizens by 
requiring an assessment of how new computer systems will enhance agency 
FOIA operations to avoid erecting barriers that impede public access.
  Federal agencies are increasingly dependent on computers to generate, 
store and retrieve records electronically. This bill would ensure that 
these electronic records are available, in a timely manner, to 
requesters on the same basis as paper records. Specifically, the bill 
would clarify that FOIA covers all agency information in any format and 
would require agencies to release records in requested formats when 
possible.
  The changes proposed in the bill are not just important for broader 
citizen access to Government records. Government information is a 
valuable commodity and a national resource. In fact, the Government is 
the largest single producer and collector of information in the United 
States. It is essential for American competitiveness that easy, fast 
access to that resource be available.
  We have recognized that Government must take advantage of the 
benefits of new technologies to provide easier and broader 
dissemination of information. In 1993, we passed a law requiring that 
people have online access to important Government publications, such as 
the Federal Register, the Congressional Record and other documents put 
out by the Government Printing Office. Earlier this year, House Speaker 
Newt Gingrich unveiled ``Thomas,'' an electronic archive available on 
the Internet that contains bills and congressional speeches. In his 
National Performance Review, the Vice-President has described his 
vision of the electronic Government of the future, where information 
technology will enable people to have access to public information and 
services when and where they want them.
  Making Government information readily available electronically on 
people's computers can help to revitalize citizens' interest in 
learning what their Government is doing and better their understanding 
of the reasons underlying Government actions. This would, I believe, 
help reduce cynicism about Government.
  This electronic FOIA bill is an important step forward in using 
technology to make Government more accessible and accountable to our 
citizens.
  In addition, Federal agencies must work to reduce the long delays, 
which in some agencies stretch to over 2 years, that it takes to give 
responses to FOIA requests. Because of these delays, newspaper 
reporters, students and teachers and others working under time 
deadlines, have been frustrated in using FOIA to meet their research 
needs. This works to the detriment of us all.
  These delays are intolerable. This is not the level of customer 
service the American people deserve from their public servants. The 
American taxpayer has paid for the collection and maintenance of this 
information and should get prompt access to it upon request. That is 
what the law requires and that is the standard of service Government 
agencies should meet. Long delays in access can mean no access at all.
  The bill addresses the delay problem in several ways: first, the bill 
doubles the 10 day statutory time limit to 20 days to give agencies a 
more realistic time period for responding to FOIA requests. Second, the 
bill encourages agencies to implement a two-track processing system for 
simple and complex requests. Third, the bill provides for expedited 
access to requestors who demonstrate a compelling need for a speedy 
response. Finally, the bill gives agencies an incentive to comply with 
statutory time limits by allowing agencies in compliance to retain half 
of their fees, instead of submitting those fees to the general treasury 
as is currently the case. The fees the agencies can keep will be 
directed back to the agency FOIA operation to provide an incentive and 
resources to make these operations better and more efficient. 

[[Page S 10889]]

  I look forward to working constructively with the administration and 
people in the FOIA community to keep FOIA up-to-date with new 
technologies and to ensure FOIA is an effective tool for open 
Government.
  Mr. President, I ask unanimous consent that the bill, a section-by-
section analysis, and a letter of support from 23 organizations 
representing a substantial portion of the FOIA requestor community, be 
inserted in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1090

       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 ``Electronic Freedom of 
     Information Improvement Act of 1995''.
     SEC. 2. FINDINGS AND PURPOSES.

       (a) Findings.--The Congress finds that--
       (1) the purpose of the Freedom of Information Act is to 
     require agencies of the Federal Government to make certain 
     agency information available for public inspection and 
     copying and to establish and enable enforcement of the right 
     of any person to obtain access to the records of such 
     agencies (subject to statutory exemptions) for any public or 
     private purpose;
       (2) since the enactment of the Freedom of Information Act 
     in 1966, and the amendments enacted in 1974 and 1986, the 
     Freedom of Information Act has been a valuable means through 
     which any person can learn how the Federal Government 
     operates;
       (3) the Freedom of Information Act has led to the 
     disclosure of waste, fraud, abuse, and wrongdoing in the 
     Federal Government;
       (4) the Freedom of Information Act has led to the 
     identification of unsafe consumer products harmful drugs, and 
     serious health hazards;
       (5) Government agencies increasingly use computers to 
     conduct agency business and to store publicly valuable agency 
     records and information; and
       (6) Government agencies should use new technology to 
     enhance public access to agency records and information.
       (b) Purpsoes.--The purposes of this Act are to--
       (1) foster democracy by ensuring public access to agency 
     records and information;
       (2) improve public access to agency records and 
     information;
       (3) ensure agency compliance with statutory time limits; 
     and
       (4) maximize the usefulness of agency records and 
     information collected, maintained, used, retained, and 
     disseminated by the Federal Government.

     SEC. 3. PUBLIC INFORMATION AVAILABILITY.

       Section 552(a)(1) of title 5, United States Code, is 
     amended--
       (1) in the matter before subparagraph (A) by inserting ``by 
     computer telecommunications, or if computer 
     telecommunications means are not available, by other 
     electronic means,'' after ``Federal Register'';
       (2) by striking out ``and'' at the end of subparagraph (D);
       (3) by redesignating subparagraph (E) as subparagraph (F); 
     and
       (4) by inserting after subparagraph (D) the following new 
     subparagraph:
       ``(E) a complete list of all statutes that the agency head 
     or general counsel relies upon to authorize the agency to 
     withhold information under subsection (b)(3) of this section, 
     together with a specific description of the scope of the 
     information covered; and''.

     SEC. 4. MATERIALS MADE AVAILABLE IN ELECTRONIC FORMAT AND 
                   INDEX OF RECORDS MADE AVAILABLE TO THE PUBLIC

       Section 552(a)(2) of title 5, United States Code, is 
     amended--
       (1) in the matter before subparagraph (A) by inserting ``, 
     including, within 1 year after the date of the enactment of 
     the Electronic Freedom of Information Improvement Act of 
     1995, by computer telecommunications, or if computer 
     telecommunications means are not available, by other 
     electronic means,'' after ``copying'';
       (2) in subparagraph (B) by striking out ``and'' after the 
     semicolon;
       (3) in subparagraph (C) by inserting ``and'' after the 
     semicolon;
       (4) by adding after subparagraph (C) the following new 
     subparagraphs:
       ``(D) an index of all major information systems containing 
     agency records regardless of form or format unless such an 
     index is provided as otherwise required by law;
       ``(E) a description of any new major information system 
     with a statement of how such system shall enhance agency 
     operations under this section;
       ``(F) an index of all records which are made available to 
     any person under paragraph (3) of this subsection; and
       ``(G) copies of all records, regardless of form or format, 
     which because of the nature of their subject matter, have 
     become or are likely to become the subject of subsequent 
     requests for substantially the same records under paragraph 
     (3) of this subsection;'';
       (5) in the second sentence by striking out ``or staff 
     manual or instruction'' and inserting in lieu thereof ``staff 
     manual, instruction, or index or copies of records, which are 
     made available under paragraph (3) of this subsection''; and
       (6) in the third sentence by inserting ``and the extent of 
     such deletion shall be indicated on the portion of the record 
     which is made available or published at the place in the 
     record where such deletion was made'' after ``explained fully 
     in writing''.

     SEC. 5. HONORING FORMAT REQUESTS.

       Section 552(a)(3) of title 5, United States Code, is 
     amended by--
       (1) inserting ``(A)'' after ``(3)'';
       (2) striking out ``(A) reasonably'' and inserting in lieu 
     thereof ``(i) reasonably'';
       (3) striking out ``(B)'' and inserting in lieu thereof 
     ``(ii)''; and
       (4) adding at the end thereof the following new 
     subparagraphs:
       ``(B) An agency shall, as requested by any person, provide 
     records in any form or format in which such records are 
     maintained by that agency.
       ``(C) An agency shall make reasonable efforts to search for 
     records in electronic form or format and provide records in 
     the form or format requested by any person, including in an 
     electronic form or format, even where such records are not 
     usually maintained but are available in such form or 
     format.''.

     SEC. 6. DELAYS.

       (a) Fees.--Section 552(a)(4)(A) of title 5, United States 
     Code, is amended by adding at the end thereof the following 
     new clause:
       ``(viii) If at an agency's request, the Comptroller General 
     determines that the agency annually has either provided 
     responsible documents or denied requests in substantial 
     compliance with the requirements of paragraph (6)(A), one-
     half of the fees collected under this section shall be 
     credited to the collecting agency and expended to offset the 
     costs of complying with this section through staff 
     development and acquisition of additional request processing 
     resources. The remaining fees collected under this section 
     shall be remitted to the Treasury as general funds or 
     miscellaneous receipts.''.
       (b) Payment of the Expenses of the Person Making a 
     Request.--Section 552(a)(4)(E) of title 5, United States 
     Code, is amended by adding at the end thereof the following: 
     ``The court may assess against the United States all out-of-
     pocket expenses incurred by the person making a request, and 
     reasonable attorney fees incurred in the administrative 
     process, in any case in which the agency has failed to comply 
     with the time limit provisions of paragraph (6) of this 
     subsection. In determining whether to award such fees and 
     expenses, a court should consider whether an agency's failure 
     to comply with statutory time limits was not warranted and 
     demonstrated bad faith or was otherwise unreasonable in the 
     context of the circumstances of the particular request.''.
       (c) Demonstration of Circumstances For Delay.--Section 
     552(a)(4)(E) of title 5, United States Code, is further 
     amended--
       (1) by inserting ``(i)'' after ``(E)''; and
       (2) by adding at the end thereof the following new clause:
       ``(ii) Any agency not in compliance with the time limits 
     set forth in this subsection shall demonstrate to a court 
     that the delay is warranted under the circumstances set forth 
     under paragraph (6) (B) or (C) of this subsection.''.
       (d) Period for Agency Decision To Comply With Request.--
     Section 552(a)(6)(A)(i) is amended by striking out ``ten 
     days'' and inserting in lieu thereof ``twenty days''.
       (e) Agency Backlogs.--Section 552(a)(6)(C) of title 5, 
     United States Code, is amended by inserting after the second 
     sentence the following: ``As used in this subparagraph, the 
     term `exceptional circumstances' means circumstances that are 
     unforeseen and shall not include delays that result from a 
     predictable workload, including any ongoing agency backlog, 
     in the ordinary course of processing requests for records.''.
       (f) Notification of Denial.--The last sentence of section 
     552(a)(6)(C) of title 5, United States Code, is
      amended to read: ``Any notification of any full or partial 
     denial of any request for records under this subsection 
     shall set forth the names and titles or positions of each 
     person responsible for the denial of such request and the 
     total number of denied records and pages considered by the 
     agency to have been responsive to the request.''.
       (g) Multitrack FIFO Processing and Expedited Access.--
     Section 552(a)(6) of title 5, United States Code, is amended 
     by adding at the end thereof the following new subparagraphs:
       ``(D)(i) Each agency shall adopt a first-in, first-out 
     (hereafter in this subparagraph referred to as FIFO) 
     processing policy in determining the order in which requests 
     are processed. The agency may establish separate processing 
     tracks for simple and complex requests using FIFO processing 
     within each track.
       ``(ii) For purposes of such a multitrack system--
       ``(I) a simple request shall be a request requiring 10 days 
     or less to make a determination on whether to comply with 
     such a request; and
       ``(II) a complex request shall be a request requiring more 
     than 10 days to make a determination on whether to comply 
     with such a request.
       ``(iii) A multitrack system shall not negate a claim of due 
     diligence under subparagraph (C), if FIFO processing within 
     each track is maintained and the agency can show that it has 
     reasonably allocated resources to handle the processing for 
     each track.
       ``(E)(i) Each agency shall promulgate regulations, pursuant 
     to notice and receipt of public comment, providing that upon 
     receipt of a request for expedited access to records 

[[Page S 10890]]
     and a showing by the person making such request of a compelling need 
     for expedited access to records, the agency shall determine 
     within 5 days (excepting Saturdays, Sundays, and legal public 
     holidays) after the receipt of such a request, whether to 
     comply with such request. No more than one day after making 
     such determination the agency shall notify the person making 
     a request for expedited access of such determination, the 
     reasons therefor, and of the right to appeal to the head of 
     the agency. A request for records to which the agency has 
     granted expedited access shall be processed as soon as 
     practicable. A request for records to which the agency has 
     denied expedited access shall be processed within the time 
     limits under paragraph (6) of this subsection.
       ``(ii) A person whose request for expedited access has not 
     been decided within 5 days of its receipt by the agency or 
     has been denied shall be required to exhaust administrative 
     remedies. A request for expedited access which has not been 
     decided may be appealed to the head of the agency within 7 
     days (excepting Saturdays, Sundays, and legal public 
     holidays) after its receipt by the agency. A request for 
     expedited access that has been denied by the agency may be 
     appealed to the head of the agency within 2 days (excepting 
     Saturdays, Sundays, and legal public holidays) after the 
     person making such request receives notice of the agency's 
     denial. If an agency head has denied, affirmed a denial, or 
     failed to respond to a timely appeal of a request for 
     expedited access, a court which would have jurisdiction of an 
     action under paragraph (4)(B) of this subsection may, upon 
     complaint, require the agency to show cause why the request 
     for expedited access should not be granted, except that such 
     review shall be limited to the record before the agency.
       ``(iii) The burden of demonstrating a compelling need by a 
     person making a request for expedited access may be met by a 
     showing, which such person certifies under penalty of perjury 
     to be true and correct to the best of such person's knowledge 
     and belief, that failure to obtain the requested records 
     within the timeframe for expedited access under this 
     paragraph would--
       ``(I) threaten an individual's life or safety;
       ``(II) result in the loss of substantial due process rights 
     and the information sought is not otherwise available in a 
     timely fashion; or
       ``(III) affect public assessment of the nature and 
     propriety of actual or alleged governmental actions that are 
     the subject of widespread, contemporaneous media coverage.''.

     SEC. 7. COMPUTER REDACTION.

       Section 552(b) of title 5, United States Code, is amended 
     by inserting before the period in the sentence following 
     paragraph (9) the following: ``, and the extent of such 
     deletion shall be indicated on the released portion of the 
     record at the place in the record where such deletion was 
     made''.

     SEC. 8. DEFINITIONS.

       Section 552(f) of title 5, United States Code, is amended 
     to read as follows:
       ``(f) For purposes of this section--
       ``(1) the term `agency' as defined in section 551(1) of 
     this title includes any executive department, military 
     department, Government corporation, Government controlled 
     corporation, or other establishment in the executive branch 
     of the Government (including the Executive Office of the 
     President), or any independent regulatory agency;
       ``(2) the term `record' means all books, papers, maps, 
     photographs, machine-readable materials, or other information 
     or documentary materials, regardless of physical form or 
     characteristics; and
       ``(3) the term `search' means a manual or automated review 
     of agency records that is conducted for the purpose of 
     locating those records which are responsive to a request 
     under subsection (a)(3)(A) of this section.''.
                                                                    ____

            Electronic FOIA Improvement Act of 1995 Summary


                         Section 1. Short Title

       The Act may be cited as the Electronic Freedom of 
     Information Improvement Act of 1995.


                    Section 2. Findings and Purposes

       This section clarifies that Congress enacted the FOIA to 
     require Federal agencies to make records available to the 
     public through public inspection and upon the request of any 
     person for any public or private use. This section also 
     acknowledges the increase in the government's use of 
     computers and specifies that agencies should use new 
     technology to enhance public access to government 
     information.
       The purposes of this bill are to improve public access to 
     government information and records, and to reduce the delays 
     in agencies' responses to requests for records under the 
     Freedom of Information Act.


               Section 3. Public Information Availability

       This section requires agencies to publish a complete list 
     of statutes that the agency relies upon to withhold 
     information under subsection (b)(3) of the Act. Exemption 
     (b)(3) covers information that is specifically exempted from 
     disclosure by other statutes. These exemptions currently 
     appear in non-FOIA bills and decrease information available 
     to the public without review by the Judiciary Committee. In 
     order to prevent ill-considered exemptions to the access 
     mandate of the FOIA, this section would place specific 
     limitations on an agency's ability to rely on the authority 
     of (b)(3) exemption statutes when they have not passed 
     through prescribed legislative channels and have not been 
     previously brought to public attention through publication in 
     the Federal Register.
       The Office of Management and Budget has directed agencies 
     to use electronic media and formats, including public 
     networks, to make government information more easily 
     accessible and useful to the public. (OMB Circular A-130, 
     Revised, July 1994). To effectuate this goal, section 3 of 
     the bill requires that information, such as agency 
     regulations, which under the FOIA must be published in the 
     Federal Register, should be accessible by computer 
     telecommunications. The Government Printing Office Electronic 
     Information Access Enhancement Act of 1993 (``GPO Act''), 
     Pub. Law 103-40, already requires that the Federal Register 
     and certain other congressional publications, be made 
     available online. If an agency cannot make these materials 
     available online, then the information should be made 
     available in some other electronic form, such as CD-ROM or on 
     disc.


 Section 4. Materials Made Available In Electronic Format and Index of 
                  Records Made Available To The Public

       The first part of this section would require that 
     materials, such as agency opinions and policy statements, 
     which an agency must ``make available for public inspection 
     and copying'' pursuant to paragraph (a)(2) of Section 552, be 
     made available electronically, as well as in hard copy. If an 
     agency cannot make these materials available online, then the 
     information should be made available in some other electronic 
     form, such as CD-ROM or on disc. The bill would thus treat 
     (a)(2) materials in the same manner as it treats (a)(1) 
     materials, which under the GPO Act are required, via the 
     Federal Register, to be made available online.
       The second part of this section would require agencies to 
     publish in the Federal Register an index of all major 
     information systems containing agency records and a 
     description of any new major information system with a 
     statement of how it will enhance agency FOIA operations.
       The third part of this section would require that an index 
     of any records released as the result of ``requests'' for 
     records pursuant to paragraph (a)(3) of Section 552 must be 
     made available for public inspection and copying under 
     paragraph (a)(2). This would assist requesters in determining 
     which records have been the subject of prior FOIA requests. 
     Since requests for records provided in response to prior 
     requests are more readily identified by the agency without 
     the need for new searches, this index will assist agencies in 
     complying with the FOIA time limits.
       Under the fourth part of this section, copies of records 
     disclosed in response to FOIA requests that the agency 
     determines have been or will likely be the subject of 
     additional requests, must be made available for public 
     inspection and copying in basically the same manner as the 
     materials required to made available under paragraph (a)(2). 
     As a practical matter, this would mean that copies of records 
     released in response to FOIA requests on a popular topic, 
     such as the assassinations of public figures, would 
     subsequently be treated as (a)(2) materials, which are made 
     available for public inspection and copying. This would 
     reduce the number of multiple FOIA requests for the same 
     records requiring separate agency responses.
       The fifth part of this section would make clear that to 
     prevent a clearly unwarranted invasion of personal privacy, 
     an agency may delete identifying details when it makes 
     available or publishes the index and copies of records 
     released in response to FIOA requests, as required under the 
     third and fourth parts of section 4 of this bill.
       The final part of this section would, consistent with the 
     ``Computer Redaction'' requirement in Section 7 of the bill, 
     require that any deletions made in electronic records be 
     indicated at the place where such deletion was made.


                  Section 5. Honoring Format Requests

       This section would require agencies to assist requesters by 
     providing information in the form requested, if the agency 
     has the information available in that form. In other words, 
     requests for the electronic format of records, which are 
     usually not maintained or stored in electronic form, should 
     be honored when the records nevertheless exist and are 
     available in the requested electronic form.
       This section would overrule Dismukes v. Department of the 
     Interior, 603 F. Supp. 760, 763 (D.D.C. 1984), which held 
     that an agency ``has no obligation under the FOIA to 
     accommodate plaintiff's preference [but] need only provide 
     responsive, nonexempt information in a reasonably accessible 
     form.''


                           Section 6. Delays

       Fees.--In an effort to decrease the delays experienced by 
     FOIA requesters, the bill would authorize agencies to retain 
     one-half of the fees they collect if the agency complies with 
     the statutory time limits for responding to requests. The fee 
     retention provisions of the bill would reward agencies that 
     meet the statutory time limits and should diminish the 
     burdens on agencies with particularly heavy FOIA workloads. 
     It will be very important to structure the compliance 
     criteria so that the reward system operates effectively and 
     without favoring any class of requesters over other classes.
       Payment of the Expenses of the Person Making A Request.--
     The current statute allows for the award of attorneys' fees 
     and 

[[Page S 10891]]
     other litigation costs in any case in which the complainant has 
     reasonably prevailed. The bill would permit a court to award 
     payment of requesters' litigation expenses and reasonable 
     attorneys' fees incurred in the administrative process in any 
     case in which the agency fails to comply with the time 
     limits. In determining whether to make such an award, the 
     bill directs the court to consider whether an agency's 
     failure to comply with statutory time limits was not 
     warranted and demonstrated bad faith or was otherwise 
     unreasonable under the circumstances of the particular 
     request.
       Demonstration of Circumstances for Delay.--The bill would 
     require agencies not in compliance with the time limits to 
     demonstrate ``that the delay is warranted under the 
     circumstances.'' The bill would clarify the only 
     circumstances that excuse compliance with the time limits are 
     those unusual or exceptional circumstances set forth in 
     paragraphs 6(B) and (C) of Section 552(a).
       Expansion of Agency Response Time.--The bill would expand 
     the time limit for an agency to respond to a request for 
     records under FOIA from ten days to twenty days. Attorney 
     General Janet Reno has acknowledged the inability of most 
     federal agencies to comply with the ten-day rule as ``as a 
     serious problem'' stemming principally from ``too few 
     resources in the face of too heavy a workload.'' A doubling 
     of the time limit will assist federal agencies in reducing 
     their backlogs.
       Agency Backlogs.--The current statute provides that in 
     ``exceptional circumstances,'' the statutory time limits can 
     be extended, but does not define what those circumstances can 
     be. In Open America v. Watergate Special Prosecution Force, 
     547 F.2d 605 (D.C. Cir. 1976), the court held that an 
     unforeseen 3,000 percent increase in FOIA requests in one 
     year, which created a massive backlog in an agency with 
     insufficient resources to process those requests in a timely 
     manner, can constitute ``exceptional circumstances.''
       Routine backlogs of requests for records under the FOIA 
     should not give agencies an automatic excuse to ignore the 
     time limits, since this provides a disincentive for agencies 
     to clear up those backlogs. This section of the bill would 
     clarify the holding in Open America by specifying that 
     routine agency backlogs do not constitute exceptional 
     circumstances for purposes of the Act.
       Multitrack FIFO Processing.--An agency commitment to 
     process requests on a first-come, first-served basis has been 
     held to satisfy the requirement that an agency exercise due 
     diligence in dealing with backlogs of FOIA requests. Some 
     agencies have taken the position that they must process 
     requests on a FIFO basis, even if this procedure may result 
     in lengthy delays for simple requests due to the prior 
     receipt and processing of complex requests. The bill would 
     encourage agencies to implement multi-track processing 
     systems for FOIA requests to reduce backlog.
       Expedited Access.--The bill would authorize expedited 
     access to requesters who demonstrate a ``compelling need'' 
     for a speedy response. The agency would be required to make a 
     determination whether or not to grant the request for 
     expedited access within five days. The requester would bear 
     the burden of showing, under penalty of perjury, that 
     expedition is appropriate and would be required to satisfy 
     strict time limits to obtain administrative and judicial 
     review of an agency's denial of such a request. The bill 
     would permit only limited judicial review based on the same 
     record before the agency.
       A ``compelling need'' warranting expedited access would be 
     demonstrated by showing that failure to obtain the records 
     within an expedited timeframe would: (I) threaten a person's 
     life or safety; (II) result in the loss of substantial due 
     process rights and the information sought is not otherwise 
     available in a timely fashion; or (III) affect public 
     assessment of the nature and propriety of actual or alleged 
     governmental actions that are the subject of widespread, 
     contemporaneous media coverage.


                     Section 7. Computer Redaction

       The ability to redact information on the computer changes 
     the complexion of released documents. At times, determining 
     whether one sentence or 30 pages have been withheld by the 
     agency is impossible. The bill would require agencies to 
     indicate deletions of the released portion of the record at 
     the place where such deletion was made.


                         Section 8. Definitions

       The bill would add definitions of ``record'' and ``search'' 
     to the statute to address electronically stored information. 
     The current FOIA statute does not define either term. The 
     definition of ``record'' in the bill is an expanded version 
     of the definition in the Federal Records Act, 44 U.S.C. 3301. 
     There is little disagreement that the FOIA covers all 
     government records, regardless of the form in which they are 
     stored by the agency. The Department of Justice agrees that 
     computer database records are agency records subject to the 
     FOIA. See ``Department of Justice Report on `Electronic 
     Record' Issues Under the Freedom of Information Act,'' S. 
     Hrg. 102-1098, 102d Cong., 2d Sess. 33 (1992).
       The bill defines ``search'' as ``a manual or automated 
     review''to locate records responsive to a FOIA request. Under 
     the FOIA, an agency is not required to create documents that 
     do not exist. Computer records located in a database rather 
     than in a file cabinet may require the application of codes 
     or some form of programming to retrieve the information. 
     Under the definition of ``search'' in the bill, the search of 
     computerized records would not amount to the creation of 
     records. Otherwise, it would be virtually impossible to get 
     records that are maintained completely in an electronic form, 
     like electronic mail, because some manipulation of the 
     information likely would be necessary to search the records.
                                                    July 27, 1995.
     Hon. Patrick J. Leahy and Hank Brown,
     U.S. Senate, Washington, DC.
       Dear Senators Leahy and Brown: The organizations listed 
     below, representing a substantial portion of the Freedom of 
     Information Act requestor community, wish to express their 
     strong support for the ``Electronic Freedom of Information 
     Improvement Act of 1995.''
       The Freedom of Information Act (FOIA) is a critical tool of 
     our democracy which allows Americans to learn about their 
     government and hold the government accountable for its 
     actions. This legislation ensures that the public will be 
     able to access agency records maintained in electronic form, 
     and also takes steps to alleviate endemic delays in 
     proceeding FOIA requests.
       This legislation is needed to address new issues related to 
     increased use of computers by federal agencies. It clarifies 
     that the FOIA covers agency information in any form, 
     including electronic form, and requires agencies to provide 
     records in a requested form if the records are maintained in 
     that form. The legislation also increases on-line access to 
     government information, including agency regulations, 
     opinions, and policy statements, as well as FOIA-related 
     records that are the subject of repeated requests. This 
     increased on-line accessibility of FOIA-releasable material 
     is a critical step in using technology to make government 
     more accessible and responsible to its citizens.
       The ``Electronic Freedom of Information Act'' also will 
     reduce agency delays in responding to FOIA requests. In 
     recognition of the difficulty faced by some agencies in 
     complying with FOIA time limits, the bill increases agency 
     response time from 10 to 20 days, and allows agencies to 
     retain half of the fees if they comply with statutory time 
     limits. The legislation encourages agencies to implement two-
     track processing systems for simple and complex requests to 
     assist in the reduction of backlogs, and establishes 
     expedited access for requestors who demonstrate a compelling 
     need for a speedy response.
       By keeping the Freedom of Information Act up to date with 
     new technologies and improving the administrative process, 
     this legislation will help ensure that the Act remains an 
     instrument for open and responsive government. We hope that 
     this legislation, which last year passed the Judiciary 
     Committee unanimously and the Senate by voice vote, will be 
     enacted into law.
       American Civil Liberties Union, American Library 
     Association, American Society of Newspaper Editors, 
     Association of American Publishers, Center for Democracy and 
     Technology, Center for National Security Studies, Electronic 
     Privacy Information Center, Federation of American 
     Scientists, Fund for Constitutional Government, Government 
     Accountability Project, Information Trust, and Lawyers 
     Committee for Human Rights.
       National Newspaper Association, National Security Archive, 
     Newspaper Association of America, OMB Watch, People for the 
     American Way Action Fund, Public Citizen, Radio-Television 
     News Directors Association, Society of Professional 
     Journalists, Taxpayer Assets Project, Unison Institute, and 
     Whistleblowers Alliance, Inc.
                                 ______

      By Mr. CRAIG (for himself and Mr. Conrad):
  S. 1091. A bill to finance and implement a program of research, 
promotion, market development, and industry and consumer information to 
enhance demand for and increase the profitability of canola and 
rapeseed products in the United States, and for other purposes; to the 
Committee on Agriculture, Nutrition, and Forestry.


the canola and rapeseed research promotion and consumer information act

 Mr. CRAIG. Mr. President, my purpose here today is to 
introduce the Canola and Rapeseed Research, Promotion, and Consumer 
Information Act. I am pleased to report that this piece of legislation 
is backed by the strong support of those in the canola and rapeseed 
industry.
  Canola and rapeseed products are an important and nutritious part of 
the human diet, and the crops are in all regions of the United States. 
This crop is produced by thousands of growers and consumed by people 
all over the world. A total of 35 states grow over 330,000 acres, and 
that level is rapidly increasing. States such as Idaho see well over 
40,000 acres devoted to this particular crop. As you can see, Mr. 
President, it is important that these readily available commodities are 
marketed efficiently to ensure that consumers have an adequate supply 
at a reasonable price.
  Currently, a number of established State and national organizations 
exist 

[[Page S 10892]]
whose primary goals include the research and promotion of their 
respective commodities. The cooperative development, financing, and 
implementation of a canola and rapeseed research, information, and 
promotion program is necessary to maintain and expand the existing 
markets, and to develop new markets for these important products.
  In addition, this act will establish an orderly procedure for 
financing through assessments on domestically produced canola and 
rapeseed, and the development and implementation of a program of 
research, promotion, consumer and industry information.
  It is the policy of this act to establish a concise and uniform 
method of requesting, issuing and amending orders relative to the 
canola and rapeseed industry. It will provide for a national canola and 
rapeseed board of 15 members who will administer and carry out programs 
and projects which provide maximum benefit to the industry.
  Under this act, assessments will be levied on those products produced 
and marketed in the United States and will be deducted from the payment 
made to a producer for all canola or rapeseed sold to a first 
purchaser. The assessment rate shall be 4 cents per hundredweight of 
canola or rapeseed produced and marketed in a State, or a rate of 2 
cents per hundredweight for States with a State checkoff.
  Essentially, this act will enable the industry to create a commodity 
driven and commodity controlled checkoff program. The idea of a 
checkoff is not new, and generic promotional and research programs 
funded through voluntary checkoff contributions have been working at 
all levels of government for over 50 years. Considering the limited 
resources of the Federal Government in all areas, especially 
agriculture, I believe that programs of this nature will become 
increasingly important. I highly commend everyone involved in the 
canola and rapeseed industry for their efforts in bringing this 
checkoff to the attention of the Congress.
  Mr. President, I urge my colleagues to join me in enabling this 
industry to shape its own future. I ask unanimous consent that a 
section-by-section summary of the bill be placed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

Canola and Rapeseed Research, Promotion, and Consumer Information Act--
                             July 28, 1995


                      section-by-section analysis

       Section 1: Short Title; Table of Contents.
       The short title is the ``Canola and Rapeseed Research, 
     Promotion, and Consumer Information Act.''
       Section 2: Findings and Declaration of Policy.
       Canola and Rapeseed products are important components of 
     the human diet.
       There are several state and national organizations whose 
     primary goal is to promote canola and rapeseed research, 
     consumer information, and industry information which is 
     valuable to the new and existing markets. The cooperative 
     development, financing, and implementation of a coordinated 
     national program is vital to this market.
       Section 3: Definitions.
       This section gives specific definitions for words and 
     phrases used throughout this bill.
       Section 4: Issuance and Amendment of Orders.
       In general, the Secretary shall issue the orders only upon 
     request of the industry. This order shall be national in 
     scope and not more than one order shall be in effect at any 
     one time.
       Section 5: Required Terms in Orders.
       This section gives the specific terms and conditions to be 
     met by any order. It also specifies the organization of the 
     Board and other members, and gives guidelines for day to day 
     operations.
       The Board consists of 15 members. Additionally, there shall 
     be no more than 4 producer members of the Board from any 
     state.
       Section 6: Assessments.
       This section describes the required provisions for 
     collection and refund of assessments.
       The assessment rate shall be 4 cents per hundredweight of 
     canola or rapeseed produced and marketed in a state. The rate 
     is 2 cents per hundredweight for states with an approved 
     checkoff.
       Section 7: Referenda.
       The Secretary shall conduct a referendum among producers 
     during the period ending 30 months after the date the order 
     was issued to determine whether the order should be 
     continued.
       Section 8: Petition and Review.
       Anyone subject to an order may file a petition with the 
     Secretary.
       Section 9: Enforcement.
       This section deals with the jurisdiction, process, and 
     penalties in regards to the enforcement of an order.
       Section 10: Investigations and Power to Subpoena.
       The Secretary may make investigations as he or she sees fit 
     in order to ensure that no violations of specific regulations 
     have occurred and to ensure that there are no abuses of those 
     regulations.
       Section 11: Suspension or Termination of an Order.
       The Secretary has the power to terminate any order that is 
     no longer conducive to the industry.
       Section 12: Regulations.
       The Secretary may issue any regulations necessary to carry 
     out this act.
       Section 13: Authorizations and Appropriations.
       This section deals with the appropriation of funds for this 
     act.
                                 ______

      By Mr. McCONNELL:
  S. 1092. A bill to impose sanctions against Burma, and countries 
assisting Burma, unless Burma observes basic human rights and permits 
political freedoms; to the Committee on Foreign Relations.


                        THE 1995 FREE BURMA ACT

 Mr. McCONNELL. Mr. President, today, I am introducing the 1995 
Free Burma Act. I had planned to introduce the legislation on July 11, 
the date the State Law and Order Restoration Council--SLORC--was to 
reach a determination about the status of Aung San Suu Kyi. Fortunately 
for Suu Kyi, her family and Burma, SLORC decided to release her from 6 
years of house arrest.
  Everyone hoped that her release would mark the beginning of 
significant change in Burma. But, as Suu Kyi recently remarked, ``We 
are nowhere near democracy. I have been released--that is all. The 
situation has not changed in any other way.''
  Two weeks ago, I announced that I would refrain from introducing 
sanctions legislation in the interests of determining just how serious 
the SLORC was about change in Burma. I indicated that I would monitor 
the situation and determine if progress was made in four areas before 
introducing sanctions. Let me review those conditions.
  First, Suu Kyi has called for dialog with the SLORC to negotiate the 
peaceful transfer of power. In her first public statement she took note 
of the fact that a majority of the people in Burma voted for democracy 
and a market economy in 1990. In fact her National League for Democracy 
carried 392 seats in Parliament. A dialog to set Burma on the road to 
economic and political recovery should being immediately and without 
preconditions.
  Second, Suu Kyi must continue to be afforded the opportunity to meet 
with her political supporters. It is essential that she have freedom of 
movement and speech and that her supporters and the press enjoy the 
same rights.
  Third, Suu Kyi urged the SLORC to release all political prisoners, 
including the 16 elected members of Parliament and hundreds of other 
NLD supporters. I hope this occurs promptly, but in the meantime, I 
think it is imperative that the SLORC sign and implement the ICRC 
agreement granting access to political detainees. Last month the ICRC 
announced they intend to withdraw from Burma after 7 years of 
attempting to negotiate an agreement with SLORC. I believe it would 
represent a good faith effort if SLORC now signed that agreement.
  Finally, SLORC's intention to move toward national reconciliation 
could be demonstrated by ceasing attacks on ethnic minorities along the 
Thai border. Over the past year, SLORC has engaged in negotiations to 
reach cease-fire agreements with many of the ethnic groups--agreements 
which explicitly call upon the withdrawal of SLORC forces from various 
regions. In December, SLORC broke off talks and launched attacks 
against the Karen. Nearly 80,000 refugees fled across the border. Over 
the past several weeks several thousand SLORC troop have moved into the
 Kayah state and launched attacks against Karenni camps. News accounts 
report that 20,000 refugees have fled.

  On Monday, this week, I asked Assistant Secretary of State for Asian 
Affairs, Winston Lord, Assistant Secretary for Narcotics, Robert 
Gelbard, to provide the administration's assessment of progress in 
meeting these conditions. I also asked a Burmese student, Omar Khin, 
and representatives from Asia Watch and the AFL-CIO to testify.

[[Page S 10893]]

  Although everyone agreed that Suu Kyi's release was an important 
development and that she was being afforded the opportunity to meet 
with her supporters, every witness expressed disappointment that that 
was all that has happened.
  The war against ethnic groups continue. Political repression and 
human rights violations continue. In fact, just this week, Asia Watch 
released an extensive report detailing how the situation has 
deteriorated.
  The Red Cross still plans to shut down operations because of SLORC's 
refusal to grant access to political prisoners. And, perhaps most 
importantly, no negotiations have been initiated by SLORC to implement 
the 1990 elections. In fact, no efforts have been made to set a date 
for dialog to begin.
  It is pretty obvious that SLORC's decision to release Suu Kyi was a 
calculated move designed to encourage foreign investment and Burma's 
inclusion in ASEAN. Indeed, within 48 hours of her release, several 
governments announced their intention to consider expanding trade and 
assistance. I think it is too early to reward SLORC--these initiatives 
are premature.
  I agree with Suu Kyi who has cautioned all potential investors. A 
recent AP story made clear that she is concerned about a rush to 
embrace SLORC. She has, in fact, welcomed this legislation as a means 
of pressuring SLORC to the table. In an AP story she said, ``These are 
very tough sanctions and I think they have shown they are very 
interested in democracy.''
  The legislation sends the message that Suu Kyi's release is not 
enough--that the Senate expects SLORC to implement the results of the 
1990 election and transfer power to a civilian government.
  Mr. President, some people may wonder why Burma should matter to the 
United States. After all there are certainly other countries with 
comparable human rights records.
  That may well be true. But, there is one compelling reason why we 
have a direct interest in Burma. Today, Burma is the source of 65 
percent of the heroin coming into the United States compared with 15 
percent 10 years ago. More alarming is the fact that purity has shot 
up. Law enforcement officials here in Washington and in Kentucky tell 
me they used to see purity around 2 percent to 3 percent on our
 streets. Now it is not uncommon to find purity levels from 25 percent 
to 65 percent.

  The drug czar has said heroin trafficking represents a serious threat 
to our national interests. I agree. I also agree with Assistant 
Secretary Lord's testimony that the only thing that will solve the 
problem is a change in government.
  Mr. President, we all hope that Suu Kyi's release marks the beginning 
of the end of repression in Burma. However, past experience with this 
military dictatorship suggests caution is the appropriate approach.
  Suu Kyi has issued a statement of remarkable good will toward a 
regime that illegally held her in detention for 6 years. She has 
demonstrated courage and determination, stating immediately after her 
release that her detention has not changed her basic goals to advance 
peace and freedom in Burma.
  I think it is important that we respect and promote that agenda. 
Keeping the pressure on SLORC will assure that her release is 
translated from a symbolic gesture to real progress.
  Mr. President, I ask unanimous consent to include in the Record 
several letters of support for this legislation which have come in from 
around the world. I also ask unanimous consent to include a brief 
summary of the legislation and an article including comments Suu Kyi 
has made about the legislation.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       Senator McConnell, members of the press: My name is Ohmar 
     Khin. I am a Burmese student in exile who participated in the 
     1988 nationwide pro-democracy movement in Burma and 
     experienced first-hand, the brutality of the current military 
     regime. The memories of the events of 1988 are still vivid.
       At that time, I was a senior student at Rangoon Arts and 
     Science University majoring in Chemistry. On March 16, while 
     walking to class with my friends, I saw students banging 
     drums and calling others to gather nearby the Convocation 
     Hall. They were protesting the death of a student who was 
     shot by soldiers dispersing a demonstration three days 
     earlier. My friends and I joined the protesters. As we 
     marched passed Inya Lake we saw troops stationed on the road, 
     blocking our way and riot police trucks rolling down the 
     road.
       Many students ran into nearby streets and some jumped into 
     the lake. Others were beaten and kicked by police then 
     dragged into the trucks. I was separated from my friends and 
     ran into one of the houses in front of the lake. The 
     residents let me and a few others in, locking their gate. 
     From there, I watched the terrifying scene. My heart was 
     pounding with fear. My sarong was torn apart. I was holding a 
     pencil sharpener to defend myself if I were caught. Some 
     troops tried to climb over the gate to catch us but a 
     Japanese diplomat next door let us climb down into his 
     residence and hid us in his house. It was night before I 
     could finally get back home.
       From that time there was a determination to fight for 
     justice in our country. During the next few months students 
     organized quietly. More and more people recognized the need 
     for change in the country and joined this movement which led 
     to the nationwide pro-democracy uprising of August 8, 1988, 
     known as 8-8-88.
       Tens of thousands of people, including monks and children, 
     took to the streets that day, calling for democracy and human 
     rights. I marched along with my colleagues and witnessed the 
     horror of our own military shooting innocent people. One of 
     the students marching next to me was shot to death.
       During those months of struggle in 1988, hundreds of 
     students were arrested, universities and colleges were 
     closed. Thousands of students, like myself, were forced to 
     flee the country.
       I believe that democracy and human rights will truly come 
     to Burma one day, but the help of the international community 
     is critical in bringing about that change. Pressure brought 
     to bear by the international community was instrumental in 
     freeing Daw Aung San Suu Kyi and such pressure must continue 
     until democracy is restored. The legislation planned by 
     Senator McConnell calling for economic sanctions on the 
     military regime is the type of initiative which will sustain 
     such pressure.
       The struggle of 1988 should not be forgotten. The spirit of 
     the people and their desire to live under a just and 
     democratic government remains strong. Senator McConnell's 
     legislation can help the people of Burma achieve that goal.
                                                                    ____

              National Coalition Government of the Union of Burma,


                                 Office of the Prime Minister,

                                   Washington, DC, March 29, 1995.
     Hon. Mitch McConnell,
     U.S. Senate, Washington, DC.
       Dear Senator McConnell: I have recently learned of your 
     intention to introduce a bill to impose US economic sanctions 
     on Burma. On behalf of the democratically elected government 
     of Burma, I am writing to give you my wholehearted support as 
     well as that of my government in your effort.
       The imposition of sanctions should never be taken lightly. 
     Any measure designed to constrict the economy of a country 
     will cause some degree of hardship to the people. However, I 
     believe, and the democratic forces working to liberate our 
     country believe, that foreign investment serves to strengthen 
     the outlaw State Law and Restoration Council (SLORC). It is 
     providing SLORC with the means to finance a massive army and 
     intelligence service whose only job is to crush internal 
     dissent. SLORC controls all foreign investment into Burma and 
     channels contracts to the military and its party officials. 
     Unlike other countries, investment will not serve to create a 
     middle class of entrepreneurs, only reinforce allegiance to a 
     regime that has murdered tens of thousands of people whose 
     crime was the desire for democracy and to live in a free 
     society. SLORC is in desperate need of foreign currency. 
     Cutting off access to US funds will be a severe blow to 
     SLORC.
       Your decision to move forward on this issue will not be 
     popular with the US business community or countries in Europe 
     and Asia. There are many who place trade and money over 
     Burma's deplorable narcotics, political, and human rights 
     record. I applaud your courage and will do everything in my 
     power to see you succeed.
       The United States has a very special place in the hearts of 
     my countrymen. During the massive democracy demonstrations in 
     1988, students could be seen marching in Rangoon carrying 
     American flags and demonstrating in front of the US Embassy. 
     Supporting us in our struggle is the International Republican 
     Institute. This organization funds pro-democracy activities 
     inside Burma. The Burmese people desperately want what 
     Americans have: the ability to live in peace without fear of 
     government persecution, respect for human rights, and social 
     justice. American ideals will always be a symbol for what we 
     can achieve.
       I want to personally thank you for your leadership and 
     raising your voice to support those who are oppressed. I look 
     forward to assisting you in any way possible.
       With my highest consideration,
           Yours sincerely,
                                                         Sein Win,
     Prime Minister.
                                                                    ____


[[Page S 10894]]

                                        The Government of Karenni,


                                 Office of the Prime Minister,

                                                     June 9, 1995.
     Hon. Mitch McConnell,
     U.S. Senate, Washington, DC
       Dear Senator McConnell: The Government and people of 
     Karenni are happy to learn that you have prepared to 
     legislate sanction against SLORC in the U.S. Congress.
       We give all our support to your efforts and we thank the 
     Senators and Congressmen who sponsored this legislation to 
     impose economic sanctions on Burma.
       Meanwhile, the Karenni National Progressive Party (KNPP) 
     has entered a cease fire ``understanding'' with SLORC. This 
     is done on convenience because we are pressured by 
     intimidation from SLORC.
       KNPP wants peace and progress. For this reason it has been 
     fighting the war against SLORC and the Burmese Governments 
     preceeded it. With the cease-fire in place, the KNPP hopes to 
     be able to achieve progress. That was why it has agreed to a 
     cease-fire with SLORC. But contrary to expectation, no 
     progress is possible because the SLORC has reneged on its 
     agreement with KNPP. It has, in the name of existing Burmese 
     laws and regulations, put all kinds of obstacles in the way. 
     Although the KNPP has reminded SLORC of the agreement reached 
     between it and KNPP, the SLORC simply turns a deaf ear to the 
     reminders. On the other hand it continues collecting porter 
     fees--60 kyats per household--in some townships monthly. It 
     is believed that the porter fees collected will be used in 
     areas where cease-fire has not been reached or signed.
       KNPP is of the opinion that only when there is a nation-
     wide cease-fire between SLORC and all armed groups fighting 
     it, will the people be free from being made to contribute 
     porter fees, to serve as porters and to contribute forced 
     labour.
       We, therefore, request the international organizations, 
     like the UN or democratic countries, like the United States 
     to put pressure on SLORC so that a nation-wide cease-fire in 
     Burma can take place.
       The hard-learned fact we now experienced as mentioned above 
     is that the SLORC will continue its formally bullish practice 
     over all the cease-fire signatories.
       We find our national security is still precarious and there 
     is no sign of democratic return in Karenni and also all over 
     Burma itself. For this belief, we send a memorandum to sub-
     committee of House Foreign Affairs Committee, in which we 
     seek U.S. protection and aids. A copy of this memorandum is 
     sent to you by airmail postal service.
       We wish you success in this efforts of yours.
       May God bless you and your sponsorial comrades.
           Your sincerely,
                                                    Aung Than Lay,
     Prime Minister, Government of Karenni.
                                                                    ____

                                          The New Mon State Party,


                                         General Headquarters,

                                                     June 6, 1995.
     Hon. Mitch McConnell,
     U.S. Senate, Washington, DC.
       Your Excellency: Information of your efforts at imposing 
     economic and trade sanctions on Burma under the brutal regime 
     known as the State Law and Order Restoration Council (SLORC) 
     is very encouraging to us. Current situation shows that, only 
     by international economic and diplomatic pressure can 
     liberate Burma from the atrocious control of the ruling 
     military junta.
       It appears that the world business community is now 
     mesmerized by SLORC's promises of the proverbial pot of gold 
     at the end of the rainbow. The economy is only open for the 
     Burmese generals and their associates to line their pockets 
     and they are in complete control of all business contracts 
     and are interested in upfront money in the form of signature 
     bonuses paid in dollars.
       Any evidence offered that the regime is easing its 
     oppression is superficial. What the military leadership is 
     seeking is international legitimacy at the lest cost to 
     itself.
       In spite of no foreign threats whatsoever, SLORC is 
     boosting up its armed forces to over 350,000 heading to 
     500,000 just to rule the country at gun point.
       The best example of the Burmese leadership's political 
     failure is their attitude toward the ethnic minorities. For 
     nearly half a century it has used the bankrupt policy of a 
     military solution to Burma's political problems. It just does 
     not have adequate capacity to realize that Burma's ethnic 
     problems are a political problem that requires a political 
     solution.
       May I urge you as President of the New Mon State Party and 
     Chairman of the National Democratic Front to do everything 
     possible to eliminate U.S. foreign investment in Burma until 
     a legitimate democratic government is in power.
           Yours truly,
                                                    Nai Shwe Kyin,
     President.
                                                                    ____

                                    Kachinland Projects U.S.A.    
                                                  For Human Rights


                                       and Democracy in Burma,

                                                    June 13, 1995.
     Hon. Mitch McConnell,
     U.S. Senate, Washington, DC.
       Dear Senator McConnell: I write on behalf of the Kachin-
     American & Friends USA, Inc., for Democracy and Human Rights 
     in Burma, a US citizens' organization dedicated to the 
     purpose of restoring democracy and human rights in Burma, 
     especially in the Kachin areas. We want to let you know that 
     we support your proposed resolution to impose trade sanctions 
     against Burma most strongly. We are ready to support your 
     leadership through active citizen input to our 
     representatives in the US Congress. If we could be of help in 
     other ways please let us know.
       We have been unspeakably outraged by the severe persecution 
     of our people over the years for no apparent reason than the 
     fact that they are Kachin. We have felt most painful and 
     helpless because the one political movement, the Kachin 
     Independence Organization, has been hand-tied by the cease-
     fire agreement. While Kachin leaders have been honor-bound, 
     SLORC's oppression and predations against our people have 
     continued, as has their despicable hypocrisy about opium 
     production and trading.
       We support in the strongest manner any pressure that could 
     be applied against SLORC, by the US and by the international 
     community. And we will continue our strong protest against 
     SLORC's deadly rule in ethnic minority areas with their 
     occupation army. This pariah regime must be condemned and 
     cast aside.
       We hope that you are determined to exercise your leadership 
     in a manner that will have a strong, effective and lasting 
     impact. We are ready and eager to come to your assistance 
     whenever called.
           Most sincerely yours,
                                               La Raw Maran, Ph.D.
     Executive Director.
                                                                    ____

         American Federation of Labor and Congress and Industrial 
           Organization,
                                 Washington, DC, February 6, 1995.
     Hon. Warren Christopher,
     Secretary of State, U.S. Department of State, Washington, DC
       Dear Mr. Secretary: I write to you to express my strong 
     concerns about the continuing egregious behavior of the State 
     Law and Order Restoration Council (SLORC) regime of Burma. 
     Directly contradicting its claims that it seeks peace and 
     national reconciliation, SLORC sent the Burmese army to 
     viciously attack, capture and sack Manerplaw, the 
     headquarters of the Karen people and key base area for many 
     groups, including the Federation of Trade Unions Burma 
     (FTUB), seeking to restore democracy in Burma.
       We believe that the blatant, unprovoked attack on Manerplaw 
     is a major setback for the cause of democracy in Burma and 
     merits a strong response from the U.S. Government. In the 
     ``two visions'' policy laid out by Deputy Assistant Secretary 
     Hubbard during his visit to Rangoon, the U.S. indicated that, 
     if progress by SLORC on issues of democracy and human rights 
     was not forthcoming, the U.S. would renew its campaign to 
     isolate the regime. In line with this policy, now is the time 
     for the U.S. to show, by actions, that it is serious.
       Accordingly, we urge the U.S. Government to implement a 
     full trade and investment embargo against Burma. Since most 
     U.S. investment enters Burma through joint ventures with 
     SLORC government agencies or entities wholly controlled by 
     the regime, implementing sanctions would have a direct impact 
     on the ability of the SLORC to repress its people and conduct 
     war on groups opposed to this illegitimate government. The 
     withdrawal of the Commercial Officer from the U.S. Embassy in 
     Rangoon would further underscore this message. We also renew 
     our call for the U.S. Government to exert pressure to block 
     development and aid projects of international institutions 
     that benefit the SLORC.
           Sincerely,
                                                    Lane Kirkland,
     President.
                                                                    ____

                                       Democratic Burmese Students


                                           Organization (USA),

                                      Rockville, MD, July 7, 1995.
     Hon. Mitch McConnell,
     U.S. Senate, Washington, DC.
       Dear Senator McConnell: I write this letter on behalf of 
     the Democratic Burmese Students Organization. We are students 
     in exile from Burma who were witnesses to the 1988 massacre 
     of peaceful demonstrators by the Burmese regime. We, the 
     Burmese students, are now living throughout the United 
     States. We are writing in support of your efforts to draft 
     legislation imposing economic and trade measures against the 
     military regime in Burma.
       In view of the lack of freedom and democracy and the 
     persistent refusal on the part of the current SLORC regime to 
     honor the national mandate given in 1990 elections, we 
     commend any measures that the U.S. Congress takes to help the 
     emergence of a legitimate government, which is democratic and 
     responsive to the basic needs of its people.
       We believe that your proposed legislation will set a 
     progressive direction for U.S. policy that promotes democracy 
     in Burma. It will also send a clear signal to the SLORC that 
     the U.S. insists on commitment for the immediate release of 
     all political prisoners including democratic leader Daw Aung 
     San Suu Kyi and the implementation of the full democratic 
     process. We believe that renewed action by the U.S. Congress 
     to increase pressure on Burma will bear critical influence on 


[[Page S 10895]]
     the SLORC. We shall, therefore, support any of your measures to this 
     effect.
           Sincerely yours,
                                                    Shwe Sin Htun,
     Representative, DRSO (East Coast).
                                                                    ____

                   [From the Desk of Betty Williams]

                                                     July 6, 1995.
     Senator Mitch McConnell,
     Russell Office Building,
     Washington, DC.
       Dear Senator McConnell: I wish to take this opportunity to 
     offer my support to the initiative you are preparing to 
     undertake on behalf of my sister laureate Aung San Suu Kyi 
     and the people of Burma. It has been brought to my attention 
     that you intend to introduce legislation on July 11, 1995 
     which will ban all U.S. foreign investment in Burma.
       On June 26, 1995, while commemorating the 50th Anniversary 
     of the United Nations, Bishop Desmond Tutu, Lech Walesa, 
     Oscar Arias Sanchez and myself presented a letter to the 
     United Nations which included the signatures of seven other 
     Laureates asking for the release of Daw Suu. The letter 
     stated, ``She has endured six long years of solitary 
     detention without trial at the hands of the military regime. 
     There is no sign at all of her release. We resolutely oppose 
     political oppression disguised as criminal detention.'' 
     Bishop Tutu, in a statement to a forum at the UN Anniversary 
     called for sanctions to be imposed on Burma.
       This legislative initiative is long overdue and will play a 
     critical role in bringing about a transfer of power to the 
     democratically elected 1990 representatives, allowing them to 
     take their rightful (and legitimate) seats in parliament.
       I offer congratulations for implementing this endeavor and 
     hope that your colleagues in the Senate will join you in this 
     worthy effort which I hope will lead to a political dialogue 
     and settlement of the Burma conflict and, most importantly, 
     democracy in Burma.
           Most sincerely,
                                                   Betty Williams,
     Nobel Laureate 1976.
                                                                    ____

                                      United Front for Democracy &


                                        Human Rights in Burma,

                                 North Potomac, MD, July 25, 1995.
     Hon. Mitch McConnell,
     U.S. Senator, Washington, DC.
       Dear Mr. Senator: The United Front for Democracy and Human 
     Rights in Burma and its affiliated organizations in the 
     United States, Canada, Europe and Asia want to heartily 
     commend you for the hearing on the Trade and Investment 
     Sanction bill held on July 24, 1995.
       On behalf of these organizations, I was present at the 
     hearing and wish to express our views regarding the various 
     statements made there. While we thank Assistant Secretary 
     Winston Lord and Assistant Secretary Gelbard for their 
     perspectives and their views on the counternarcotics issue 
     and your sanction bill, our organizations disagree with their 
     approach. We heartily endorse the views expressed in the 
     opening statement made by you and the statements made by Khin 
     Ohnmar and the representatives of Human Rights Watch/ASIA and 
     the AFL-CIO as well as the statement submitted by Prime 
     Minister Dr. Sein Win of the NCGUB.
       Our organizations, after very careful consideration of the 
     present situation and after hearing the various views at the 
     hearing as well as those of individuals and other 
     organizations closely observing the developments in Burma, 
     feel very strongly that the only language the SLORC, one of 
     the most repressive and regressive regimes in the world, 
     would understand is the comprehensive trade and sanctions 
     legislation against Burma that you propose to introduce. We 
     also believe that this is the right time for the introduction 
     as Daw Aung San Suu Kyi herself has acknowledge publicly as 
     quoted by you, ``We are nowhere near democracy. I have been 
     released, that is all. The situation has not changed in any 
     other way.'' Most prudent Burma observers including 
     Ambassador Lord are of the opinion that the reason for Suu 
     Kyi's release was not out of good intention or desire to 
     change to democracy and national reconciliation in Burma, but 
     due to international pressure including your proposed bill as 
     well as the forthcoming ASEAN meeting in Brunei.
       Enclosed herewith also is the statement made by the United 
     Front on the release of Daw Aung San Suu Kyi.
           Yours sincerely,
                                                      U Ba Thaung,

                                                 Chairman.
                                 ______

      By Mr. REID (for himself and Mr. Bryan):
  S. 1093. A bill to prohibit the application of the Religious Freedom 
Restoration Act of 1993, or any amendment made by such act, to an 
individual who is incarcerated in a Federal, State, or local 
correctional, detention, or penal facility, and for other purposes; to 
the Committee on the Judiciary.

  THE RELIGIOUS FREEDOM RESTORATION ACT OF 1993 AMENDMENT ACT OF 1995

  Mr. REID. Mr. President, I send a bill to the desk in behalf of 
Senators Reid and Bryan.
  Mr. President, the bill that I just introduced is a prison reform 
bill that is designed to close a gaping hole in the current law that 
allows prison inmates to file frivolous lawsuits at will.
  This legislation is necessary, and it is overdue. It addresses and 
remedies a specific ailment plaguing an otherwise solid piece of 
legislation that passed this body in the last Congress. I am referring 
to the Religious Freedom Restoration Act. More specifically, I am 
referring to the application of this law as it relates to prison 
inmates.
  When the Senate passed RFRA, it sought to provide the legal 
protections supporting the right to freely exercise one's religious 
belief. This legislation was a well-intentioned goal which this Senator 
supported.
  The concern I raised when we considered this legislation was the 
abuse that I knew would take place of these new rights by prison 
inmates. In fact, I offered an amendment that would have exempted 
inmates from coverage of this legislation. Unfortunately, my amendment 
was narrowly defeated.
  As the saying goes, Mr. President, you reap what you sow. And because 
the sponsors of this legislation sought to extend this coverage to 
prison inmates, our courts are now being flooded with inmate lawsuits 
alleging discrimination under this act. And the lawsuits are filed 
often for the most spurious of reasons. I said then, and I say now, 
that providing inmates with all those rights and privileges would be a 
recipe for disaster, and I was right.
  (Mr. CRAIG assumed the chair.)
  Mr. REID. Mr. President, word of these new legal rights has spread 
like wildfire. They are in Idaho. We have a letter that we will talk 
about from one of the deputy attorney general of Idaho.
  These taxpayer-supported lawsuits are spreading like wildfire. The 
research for these filings is being conducted in taxpayer-supported law 
libraries containing spades of helpful filing information at the 
disposal of prisoners.
  Mr. President, this is like an alcoholic locked inside a liquor 
store. These inmates cannot get enough.
  What am I talking about? Should I talk specifics? I do not know where 
to start talking specifics. I only brought over a few of the lawsuits.
  In this hand I have the some of the Nevada lawsuits; only some of 
them. Because you see prison litigation in Nevada takes up 40 percent 
of the court's time--40 percent of the litigation in our Federal courts 
in Nevada are a result of prisoner lawsuits.
  Is that what this is all about? Have we become so concerned with 
prisoner rights that we have forgotten the rights of society? Remember, 
these people are in jail because they have been convicted of felonies. 
They are not there because we are trying to check to find out if they 
are good or bad. They are felons. And we are spending 40 percent of the 
court's time on this trash.
  Let me talk about some cases around the country. In California, we 
have an inmate there who wants prison authorities to allow him to 
practice a religion called Wiccan, which is witchcraft. He is upset 
because the prison authorities will not supply him, among other things, 
tarot cards and other paraphernalia that goes with witchcraft.
  We have one lawsuit filed because the satanic group in a prison 
wanted unbaptized baby fat for their candles.
  Mr. President, I wish I were making this up. But a Federal judge, who 
has a lifetime appointment, who is there to decide what is good and bad 
in this country, is being called upon to rule on this trash. And they 
have to do it. They have to go through the process.
  In the State of Connecticut they have allowed Catholics and 
Protestants to have religious services, and Moslems. We have an inmate 
there who was not satisfied with that. What this inmate wanted is a 
certain very refined, defined sect of the Moslem religion because he 
refuses to go to a service for all Moslems. He wants his own.
  We have one who changes his name. This man is in Florida. He keeps 
changing his name, and he sues the prison because they do not give him 
his mail in his right name.
  We have, out of Florida, another case. There, an inmate alleges his 
rights were denied when he was not allowed to see Moslem visitors at a 
time that he wanted them, not when everybody else visits those that are 
confined. He wanted a time convenient to him. So he filed a lawsuit.

[[Page S 10896]]

  One wanted to perform the rite of washing--his definition of washing; 
a religious ceremony.
  Another inmate filed a lawsuit because his hat was confiscated.
  Another inmate filed a lawsuit because he has alleged that the inmate 
barbers are unskilled and are forced to perform the haircuts under too 
much pressure from the clock. This is a lawsuit filed.
  We have another who filed a lawsuit because the diet kitchen in the 
prison did not meet his expectations. He believed that his religion 
entitles him to a healthy lifestyle as defined by what diet he wants.
  We have another out of Nebraska. This man has filed a lawsuit because 
he is a member of the Asatru religion, which is an Islamic word, which 
is a term for an ancient religion of the Teutonic people of northern 
Europe. And the prison authorities had a little trouble finding the 
paraphernalia this gentleman wanted.
  We have another case out in Nebraska where an inmate there thinks he 
is a woman trapped in a man's body, and thus strip searches by male 
prison officials are not allowed by his religion.
  Again, Mr. President, I kind of wish I was making this up. I mean, 
can you imagine. These are real lawsuits that our Attorneys General and 
others are defending on a daily basis taking tremendous amounts of time 
when they should be involved in other important matters.
  We have case after case of this nonsense. I said it would happen and 
I intend to continue to fight to end this problem.
  I am going to push this, Mr. President. We can wait for hearings in 
the Judiciary Committee. We can do all kinds of things. But before this 
year is out, I am going to be offering this as an amendment to a piece 
of legislation moving through here. We cannot allow this kind of stuff 
to go on.
  We have a letter here--I said on the floor, this is going to happen--
from the Attorney General of the United States saying, no, it will not.
  Like an alcoholic locked inside a liquor store, these inmates cannot 
get enough.
  The consequences of these new prisoner rights are many, and an 
overburdened judiciary is forced to allocate its scarce resources to 
considering and processing these frivolous lawsuits. Our Nation's 
attorneys general are being forced to defend inmate lawsuits rather 
than prosecute criminals. And as usual, who is picking up the tab? The 
taxpayers are paying for the libraries that are better than I had when 
I practiced law. Why not? They get anything they want. All they have to 
do is ask for it.
  The American taxpayer, to the delight of these inmates, is left 
holding the tab on all of these legal expenses. And the time and cost 
is only going to continue to escalate unless we exempt inmates from the 
coverage of RFRA.
  At some point we are going to have to answer the question of whether 
crimes are being left unprosecuted because the States' defense of 
prisoner lawsuits is the right thing to do.
  I repeat, have we become more concerned about the rights of the 
criminals than we have the rights of society?
 I asked the attorney general of Nevada, Frankie Sue Del Papa, to keep 
me apprised of these RFRA-related lawsuits they are defending. That was 
quite a task. Just to send me copies of the garbage that is being filed 
has taken a significant amount of time of her staff.

  I have told you about some of the cases around the country. Those in 
Nevada are no different. They are just as ridiculous: A lawsuit filed 
because religious freedom rights have been denied--because they were 
not able to check to see if there was pig fat, hog fat in the 
toothpaste. They wanted scientific tests run on this to find out if 
there were pork products in the toothpaste.
  They wanted meat inspections to find out if the meat was properly 
cared for before it was given to the prisoners. This is, of course, on 
a religious basis.
  They confiscated a necklace that was bulky and large; they thought it 
could cause problems to the rest of the prison populace. Not according 
to this man's religion. According to his claim, the jewelry would 
become defiled if another person touched it.
  We have another man who is suing a prison chaplain for refusing to 
conduct a marriage ceremony between him and his male friend because 
they belong to Universal Life Church, and this church allows people of 
the same sex to marry.
  They cannot get incense; they cannot get jewelry for their religious 
ceremonies; they cannot get the right type of altar; they cannot get 
the right type of nutritious vegetarian diet.
  Skinheads are suing for the right to receive, because of their 
religion, hateful, bigoted, anti-Semitic, racist literature from all 
over the country.
  I have a letter from the deputy attorney general from the State of 
Idaho. She says, besides the cases enclosed--paraphrasing--even though 
we do not have a lot of cases, the flood is beginning. I emphasize 
``yet'' because I know the Department of Corrections has every reason 
to believe it is only a matter of time.
  This woman goes on in her letter to explain the trouble they have 
gone to in Idaho. They have sweat lodges in their prisons, trying to 
make the Indian religions happy. They have problems with the Aryan 
Nation, motorcycle gangs, trying to comply with their wishes of what 
they need in prison. I do not understand why we have to bend over 
backward to protect the rights of people who are locked up in prison.
  Remember, 7 percent of the criminals commit over 75 percent of the 
violent crime in this country. So our job is to get rid of the 7 
percent. But what are we doing? We are trying to determine if the right 
pork products are in toothpaste. I believe that these criminals who are 
convicted felons have forfeited not all their rights but some of their 
rights by committing these acts against society. Rather than providing 
them taxpayer-funded law libraries and better gyms, which most people 
in America do not have the opportunity to see let alone join, and they 
file these lawsuits creating more work, rather than spending the money 
on defending these frivolous lawsuits, I would prefer hiring more 
personnel so they could watch them in chain gangs.
  I think, with some of what we have going on in some States where they 
are going back and looking at chain gangs and having these people do 
work instead of sitting around writing these phony lawsuits, we would 
be better off. They do not deserve the costly luxuries they are 
provided in prison. I believe the more difficult and the more 
unpleasant the present prison setting can be the better off we would 
be.
  Mr. President, I practiced criminal law. When I was a young lawyer, I 
was assigned to represent a criminal defendant. At that time they did 
not have the public defender system. And I went over there as a young 
lawyer all raring to go to defend this man who had been charged with 
stealing a car and taking it across State lines. And I proceeded as a 
young lawyer, wanting to get into that courtroom and help this man. He 
said, ``Young man, just back off.'' He said, ``I committed this crime 
on purpose. I knew what crime I committed. I wanted to be returned to a 
Federal prison because they are nicer than the State prisons.'' I have 
never forgotten that.
  So I am going to push hard for this legislation. Our judges ought to 
be spending more time hearing meritorious cases and our attorneys 
general should be spending more time prosecuting criminals, not 
defending frivolous lawsuits brought by them.
  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. 1093

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

     SECTION 1. APPLICATION TO INCARCERATED INDIVIDUALS.

       The Religious Freedom Restoration Act of 1993 (42 U.S.C. 
     2000bb et seq.) is amended--
       (1) by moving section 5 to the end of the Act;
       (2) by redesignating section 5 as section 8; and
       (3) by inserting after section 4 the following new section:

     ``SEC. 5. APPLICATION TO INCARCERATED INDIVIDUALS.

       ``Notwithstanding any other provision of this Act, nothing 
     in this Act or any amendment made by this Act shall be 
     construed to affect, interpret, or in any way address that 
     portion of the First Amendment regarding laws prohibiting the 
     free exercise of religion, 

[[Page S 10897]]
     with respect to any individual who is incarcerated in a Federal, State, 
     or local correctional, detention, or penal facility 
     (including any correctional, detention, or penal facility 
     that is operated by a private entity under a contract with a 
     government).''.
     

                          ____________________