[Congressional Record Volume 142, Number 33 (Tuesday, March 12, 1996)]
[House]
[Pages H2050-H2053]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      SECURITIES AND EXCHANGE COMMISSION AUTHORIZATION ACT OF 1996

  Mr. OXLEY. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 2972) To authorize appropriations for the Securities and Exchange 
Commission, to reduce the fees collected under the Federal securities 
laws, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 2972

       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 ``Securities and Exchange 
     Commission Authorization Act of 1996''.

     SEC. 2. PURPOSES.

       The purposes of this Act are--
       (1) to authorize appropriations for the Securities and 
     Exchange Commission for fiscal year 1997; and
       (2) to reduce over time the rates of fees charged under the 
     Federal securities laws.

     SEC. 3. AUTHORIZATION OF APPROPRIATIONS.

       Section 35 of the Securities Exchange Act of 1934 is 
     amended to read as follows:

     ``SEC. 35. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out the 
     functions, powers, and duties of the Commission $317,000,000 
     for fiscal year 1997.''.

     SEC. 4. REGISTRATION FEES.

       Section 6(b) of the Securities Act of 1933 (15 U.S.C. 
     77f(b)) is amended to read as follows:
       ``(b) Registration Fee.--
       ``(1) Recovery of cost of services.--The Commission shall, 
     in accordance with this subsection, collect registration fees 
     that are designed to recover the costs to the government of 
     the securities registration process, and costs related to 
     such process, including enforcement activities, policy and 
     rulemaking activities, administration, legal services, and 
     international regulatory activities.
       ``(2) Fee payment required.--At the time of filing a 
     registration statement, the applicant shall pay to the 
     Commission a fee that shall be equal to the sum of the 
     amounts (if any) determined under the rates established by 
     paragraphs (3) and (4). The Commission shall publish in the 
     Federal Register notices of the fee rates applicable under 
     this section for each fiscal year. In no case shall the fee 
     required by this subsection be less than $200, except that 
     during fiscal year 2002 or any succeeding fiscal year such 
     minimum fee shall be $182.
       ``(3) General revenue fees.--The rate determined under this 
     paragraph is a rate equal to $200 for each $1,000,000 of the 
     maximum aggregate price at which such securities are proposed 
     to be offered, except that during fiscal year 2002 and any 
     succeeding fiscal year such rate is equal to $182 for each 
     $1,000,000 of the maximum aggregate price at which such 
     securities are proposed to be offered. Fees collected during 
     any fiscal year pursuant to this paragraph shall be deposited 
     and credited as general revenues of the Treasury.
       ``(4) Offsetting collection fees.--
       ``(A) In general.--Except as provided in subparagraphs (B) 
     and (C), the rate determined under this paragraph is a rate 
     equal to the following amount for each $1,000,000 of the 
     maximum aggregate price at which such securities are proposed 
     to be offered:
       ``(i) $103 during fiscal year 1997;
       ``(ii) $70 during fiscal year 1998;
       ``(iii) $38 during fiscal year 1999;
       ``(iv) $17 during fiscal year 2000; and
       ``(v) $0 during fiscal year 2001 or any succeeding fiscal 
     year.
       ``(B) Limitation; deposit.--Except as provided in 
     subparagraph (C), no amounts shall be collected pursuant to 
     this paragraph (4) for any fiscal year except to the extent 
     provided in advance in appropriations acts. Fees collected 
     during any fiscal year pursuant to this paragraph shall be 
     deposited and credited as offsetting collections in 
     accordance with appropriations Acts.
       ``(C) Lapse of appropriations.--If on the first day of a 
     fiscal year a regular appropriation to the Commission has not 
     been enacted, the Commission shall continue to collect fees 
     (as offsetting collections) under this paragraph at the rate 
     in effect during the preceding fiscal year, until such a 
     regular appropriation is enacted.''.

     SEC. 5. TRANSACTION FEES.

       (a) Amendment.--Section 31 of the Securities Exchange Act 
     of 1934 (15 U.S.C. 78ee) is amended to read as follows:

     ``SEC. 31. TRANSACTION FEES.

       ``(a) Recovery of Cost of Services.--The Commission shall, 
     in accordance with this subsection, collect transaction fees 
     that are designed to recover the costs to the Government of 
     the supervision and regulation of securities markets and 
     securities professionals, and costs related to such 
     supervision and regulation, including enforcement activities, 
     policy and rulemaking activities, administration, legal 
     services, and international regulatory activities.
       ``(b) Exchange-Traded Securities.--Every national 
     securities exchange shall pay to the Commission a fee at a 
     rate equal to $33 for each $1,000,000 of the aggregate dollar 
     amount of sales of securities (other than bonds, debentures, 
     and other evidences of indebtedness) transacted on such 
     national securities exchange, except that for fiscal year 
     2002 or any succeeding fiscal year such rate shall be equal 
     to $25 for each $1,000,000 of such aggregate dollar amount of 
     sales. Fees collected pursuant to this subsection shall be 
     deposited and collected as general revenue of the Treasury.
       ``(c) Off-Exchange-Trades of Exchange-Registered 
     Securities.--Every national securities association shall pay 
     to the Commission a fee at a rate equal $33 for each 
     $1,000,000 of the aggregate dollar amount of sales transacted 
     by or through any member of such association otherwise than 
     on a national securities exchange of securities registered on 
     such an exchange (other than bonds, debentures, and other 
     evidences of indebtedness), except that for fiscal year 2002 
     or any succeeding fiscal year such rate shall be equal to $25 
     for each $1,000,000 of such aggregate dollar amount of sales. 
     Fees collected pursuant to this subsection shall be deposited 
     and collected as general revenue of the Treasury.
       ``(d) Off-Exchange-Trades of Last-Sale-Reported 
     Securities.--
       ``(1) Covered transactions.--Every national securities 
     association shall pay to the Commission a fee at a rate equal 
     to the dollar amount determined under paragraph (2) for each 
     $1,000,000 of the aggregate dollar amount of sales transacted 
     by or through any member of such association otherwise than 
     on a national securities exchange of securities (other than 
     bonds, debentures, and other evidences of indebtedness) 
     subject to prompt last sale reporting pursuant to the rules 
     of the Commission or a registered national securities 
     association, excluding any sales for which a fee is paid 
     under subsection (c).
       ``(2) Fee rates.--Except as provided in paragraph (4), the 
     dollar amount determined under this paragraph is--
       ``(A) $12 for fiscal year 1997;
       ``(B) $14 for fiscal year 1998;
       ``(C) $17 for fiscal year 1999;
       ``(D) $18 for fiscal year 2000;
       ``(E) $20 for fiscal year 2001; and
       ``(F) $25 for fiscal year 2002 or for any succeeding fiscal 
     year.
       ``(3) Limitation; deposit of fees.--Except as provided in 
     paragraph (4), no amounts shall be collected pursuant to this 
     subsection (d) for any fiscal year beginning before October 
     1, 2001, except to the extent provided in advance in 
     appropriations Acts. Fees collected during any such fiscal 
     year pursuant to this subsection shall be deposited and 
     credited as offsetting collections to the account providing 
     appropriations to the Commission, except that any amounts in 
     excess of the following amounts (and any amount collected for 
     fiscal years beginning on or after October 1, 2001) shall be 
     deposited and credited as general revenues of the Treasury:
       ``(A) $20,000,000 for fiscal year 1997;
       ``(B) $26,000,000 for fiscal year 1998;
       ``(C) $32,000,000 for fiscal year 1999;
       ``(D) $32,000,000 for fiscal year 2000;
       ``(E) $32,000,000 for fiscal year 2001; and
       ``(F) $0 for fiscal year 2002 and any succeeding fiscal 
     year.
       ``(4) Lapse of appropriations.--If on the first day of a 
     fiscal year a regular appropriation to the Commission has not 
     been enacted, the Commission shall continue to collect fees 
     (as offsetting collections) under this subsection at the rate 
     in effect during the preceding fiscal year, until such a 
     regular appropriation is enacted.
       ``(e) Dates for Payment of Fees.--The fees required by 
     subsections (b), (c), and (d) of this section shall be paid--
       ``(1) on or before March 15, with respect to transactions 
     and sales occurring during the period beginning on the 
     preceding September 1 and ending at the close of the 
     preceding December 31; and

[[Page H2051]]

       ``(2) on or before September 30, with respect to 
     transactions and sales occurring during the period beginning 
     on the preceding January 1 and ending at the close of the 
     preceding August 31.
       ``(f) Exemptions.--The Commission, by rule, may exempt any 
     sale of securities or any class of sales of securities from 
     any fee imposed by this section, if the Commission finds that 
     such exemption is consistent with the public interest, the 
     equal regulation of markets and brokers and dealers, and the 
     development of a national market system.
       ``(g) Publication.--The Commission shall publish in the 
     Federal Register notices of the fee rates applicable under 
     this section for each fiscal year.''.
       (b) Effective Dates; Transition.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendment made by subsection (a) shall apply with respect to 
     transactions in securities that occur on or after January 1, 
     1997.
       (2) Off-exchange trades of last sale reported 
     transactions.--The amendment made by subsection (a) shall 
     apply with respect to transactions described in section 
     31(d)(1) of the Securities Exchange Act of 1934 (as amended 
     by subsection (a) of this section) that occur on or after 
     September 1, 1996.
       (3) Rule of construction.--Nothing in this subsection shall 
     be construed to affect the obligation of national securities 
     exchanges and registered brokers and dealers under section 31 
     of the Securities Exchange Act of 1934 (15 U.S.C. 78ee) as in 
     effect prior to the amendment made by subsection (a) to make 
     the payments required by such section on March 15, 1997.

     SEC. 6. TIME FOR PAYMENT.

       Section 4(e) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78d(e)) is amended by inserting before the period at 
     the end thereof the following: ``and the Commission may also 
     specify the time that such fee shall be determined and paid 
     relative to the filing of any statement or document with the 
     Commission''.

     SEC. 7. SENSE OF THE CONGRESS CONCERNING FEES.

       It is the sense of the Congress that--
       (1) the fees authorized by the amendments made by this Act 
     are in lieu of, and not in addition to, any fees that the 
     Securities and Exchange Commission is authorized to impose or 
     collect pursuant to section 9701 of title 31, United States 
     Code; and
       (2) in order to maintain the competitiveness of United 
     States securities markets relative to foreign markets, no fee 
     should be assessed on transactions involving portfolios of 
     equity securities taking place at times of day characterized 
     by low volume and during non-traditional trading hours.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Ohio [Mr. Oxley] and the gentleman from Massachusetts [Mr. Markey] will 
each be recognized for 20 minutes.
  The Chair recognizes the gentleman from Ohio [Mr. Oxley].
  Mr. OXLEY. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. OXLEY asked and was given permission to include extraneous 
material.)
  Mr. OXLEY. Mr. Speaker, today I am pleased to rise in support of H.R. 
2972, the SEC Reauthorization Act of 1996. This legislation provides a 
long-term mechanism for funding the SEC. In addition, it reduces the 
fees charged by the SEC by over $751 million dollars through 2002. 
Members of both parties have expressed concern with the amount of fee 
revenue collected by the SEC, which currently is more than double the 
cost of running the agency.
  Currently the SEC takes in over $600 million in fees annually, and 
costs approximately $300 million to run. This surplus in fee revenue 
over the cost of running the agency amounts to a tax on capital paid by 
all investors--including small investors investing in individual 
retirement accounts for their retirement. Members of both parties are 
rightly concerned with promoting savings and growth, and this tax on 
capital represents an impediment to that growth. With the cooperation 
of Chairman Rogers of the Commerce, Justice, State, and Judiciary 
Subcommittee of the Appropriations Committee, and Chairman Archer of 
the Ways and Means Committee, we have been able to work out a sensible 
plan to reduce these fees. We also have agreed on a procedure for more 
orderly and certain funding of the SEC. I am pleased that the 
legislation has the support and cosponsorship of my friends, John 
Dingell, ranking member of the Commerce Committee, and Ed Markey, 
ranking member of the Telecommunications and Finance Subcommittee of 
the Commerce Committee. Additionally, I have received a letter from 
Chairman Levitt of the SEC endorsing the legislation.
  Mr. Speaker, I include for the Record this letter from Chairman 
Levitt, and letters addressed to the chairman of the committee, the 
gentleman from Virginia [Mr. Bliley].

                                               U.S. Securities and


                                          Exchange Commission,

                                Washington, DC, February 27, 1996.
     Hon. Thomas J. Bliley, Jr.,
     Chairman, Committee on Commerce,
     Washington, DC.
       Dear Tom: I write to offer my support and endorsement of 
     the ``Securities and Exchange Commission Authorization Act of 
     1996.'' Thank you for your strong leadership and the support 
     of Chairman Fields, Rogers and Archer in designing a creative 
     approach to the SEC's funding both on a short-term and long 
     term basis.
       Your proposed resolution to the perennial problem of SEC 
     funding and fees is perhaps the most important aspect of the 
     ``Securities and Exchange Commission Authorization Act of 
     1996.'' The funding mechanism for the SEC would reduce 
     Section 6(b) fees over a five-year period and expand existing 
     securities transaction fees to the over-the-counter market, 
     recognizing that the Commission also oversees those markets. 
     Under your proposal, the SEC also has agreed to act to 
     eliminate fees that it collects pursuant to the Independent 
     Offices Appropriation Act of 1952 (``IOAA fees''), which 
     include a fee of $250 that must be paid in connection with 
     filings of annual reports and certain periodic filings. 
     Finally, the SEC would gradually move from reliance on 
     increased offsetting fees towards full appropriation status. 
     The Commission believes that adoption of this approach 
     provides a long-term solution to the SEC's funding problems.
       Finally, the premier aspects of the SEC Authorization Bill 
     is that it enables us to maintain our vigorous programs to 
     both protect investors and ensure that the capital formation 
     system in the U.S. markets is efficient. This legislation 
     will help the agency avoid the funding problems it has had in 
     the past, and enable the SEC to be funded entirely through 
     appropriations by the year 2001.
       David Cavicke has been extremely helpful in this important 
     initiative. We look forward to working with you and your 
     staff toward final passage of this authorization legislation.
           Sincerely,
     Arthur Levitt.
                                                                    ____

                                         House of Representatives,


                                  Committee on Ways and Means,

                                    Washington, DC, March 8, 1996.
     Hon. Thomas J. Bliley, Jr.,
     Chairman, Committee on Commerce,
     Washington, DC.
       Dear Mr. Chairman: I am writing to you today to thank you 
     for working with me on issues of jurisdictional concern to 
     the Committee on Ways and Means regarding H.R. 2972, the 
     Securities and Exchange Commission Authorization Act of 1996. 
     In light of the agreement reached between you, Chairman 
     Rogers, and me to phase down the rate of certain SEC fees, I 
     am proud to cosponsor this legislation with you.
       As you know, I am strongly committed to protecting the 
     jurisdictional interests of the Committee on Ways and Means 
     and to ensuring that all revenue measures are properly 
     referred to this Committee. To this end, the Committee on 
     Ways and Means relies upon the statement issued by Speaker 
     Foley in January 1991 (and reiterated by Speaker Gingrich on 
     January 4, 1995) regarding the jurisdiction of the House 
     Committees with respect to fees and revenue measures. 
     Pursuant to that statement, the Committee on Ways and Means 
     generally will not assert jurisdiction over ``true'' 
     regulatory fees that met the following requirements:
       (i) The fees are assessed and collected solely to cover the 
     costs of specified regulatory activities (not including 
     public information activities and other activities benefiting 
     the public in general);
       (ii) The fees are assessed and collected only in such 
     manner as may reasonably be expected to result in an 
     aggregate amount collected during any fiscal year which does 
     not exceed the aggregate amount of the regulatory costs 
     referred to in (i) above;
       (iii) The only persons subject to the fees are those who 
     directly avail themselves of, or are directly subject to, the 
     regulatory activities referred to in (i) above; and
       (iv) The amounts of the fees (a) are structured such that 
     any person's liability for such fees is reasonably based on 
     the proportion of the regulatory activities which relate to 
     such person, and (b) are nondiscriminatory between foreign 
     and domestic entities.
       Additionally, pursuant to the Speaker's statement, the mere 
     reauthorization of a preexisting fee that had not 
     historically been considered a tax would not necessarily 
     require a sequential referral to the Committee on Ways and 
     Means. However, if such a preexisting fee were fundamentally 
     changed, it properly should be referred to the Committee on 
     Ways and Means.
       The fees described in H.R. 2972 clearly do not meet all 
     four requirements set forth above. If they were being newly 
     created or were fundamentally different from existing fees, 
     the Committee on Ways and Means would ask that they be 
     referred to it, in accordance with its jurisdictional 
     prerogative. However, the Committee on Ways and Means 
     understands that these fees have been in place for many 
     decades and are not being fundamentally changed by H.R. 2972. 
     Further, H.R. 2972 provides that the fee structure eventually 
     will reflect the four requirements set forth above. 
     Therefore, it is not necessary for the Committee on Ways and 
     Means to assert its jurisdictional interest at this time.
       However, I would emphasize that, if the fee structure set 
     forth in H.R. 2972 is modified in

[[Page H2052]]

     the future, the Committee on Ways and Means will take all 
     action necessary to protect its proper jurisdictional 
     interest. For example, the Committee on Ways and Means will 
     view any modification as falling within its jurisdiction if 
     such modification would result in fee collections in excess 
     of the amount required to fund the relevant regulatory 
     activities of the Securities and Exchange Commission.
       With regard to budgetary issues, I am concerned about any 
     legislation that may worsen the pay-as-you-go accounts, thus 
     threatening a sequester. I understand that the Congressional 
     Budget Office believes that H.R. 2972 will not create a debit 
     on the pay-go accounts or a potential sequester of 
     entitlement programs. I also understand that H.R. 2972 will 
     not increase the deficit within the current budget window. I 
     very much appreciate your cooperation in solving these 
     budgetary problems for purposes of House consideration of 
     H.R. 2972.
       Finally, I would respectfully request that you include a 
     copy of this letter in the Record during consideration of 
     H.R. 2972 on the Floor. I wish to thank you again, Mr. 
     Chairman, for your full cooperation and the cooperation of 
     your staff. With best personal regards,
           Sincerely,
                                                      Bill Archer,
     Chairman.
                                                                    ____

                                         House of Representatives,


                                  Committee on Appropriations,

                                   Washington, DC, March 12, 1996.
     Hon. Thomas J. Bliley, Jr.,
     Chairman, Committee on Commerce,
     Washington, DC.
       Dear Mr. Chairman. As you know, I am a cosponsor of H.R. 
     2972, the Securities and Exchange Commission Authorization 
     Act of 1996. I believe it is important that, working 
     together, we find a way to end the uncertainty about the 
     SEC's funding that has been a continuing problem in the past 
     several years.
       H.R. 2972 provides for a gradual reduction in the amount of 
     SEC fees that will be available to support the SEC's 
     operating budget over a six year period. This will require 
     that the amount of discretionary funds required just to 
     support the SEC's budget at its current level will have to be 
     increased by an estimated $25-35 million each year.
       This amount of an increase each year will be a challenge, 
     during an era when the amount of overall discretionary funds 
     available to the Appropriations Committee will be declining, 
     as we seek to balance the budget in seven years. Nonetheless, 
     the Committee is prepared to try to the best of our ability 
     to make that happen, in the interest of bringing to a closure 
     the past years of uncertainty about how the SEC will be 
     funded.
       However, I believe that this is the maximum amount we will 
     be in a position to attempt to accomplish. As this bill moves 
     forward, in working with the Senate, I would simply make the 
     point that a more rapid phase-out in the amount of fees 
     available to support the SEC budget would probably be 
     unworkable.
       I appreciate the opportunity to work with you and Chairman 
     Archer, and I congratulate you on bringing this bill to the 
     floor. I would respectfully request that you include a copy 
     of this letter in the Record during consideration of H.R. 
     2972 on the Floor.
       With best regards,
           Sincerely,
     Harold Rogers,
       Chairman, Subcommittee on the Departments of Commerce, 
     Justice, and State, the Judiciary, and Related Agencies.

  Mr. OXLEY. Mr. Speaker, I also want to pay special tribute to 
Chairman Levitt for his leadership on this very important issue. 
Without his help and guidance, Mr. Speaker, we would not be here today 
with this I think very historic legislation.
  Mr. Speaker, pursuant to this legislation, SEC fees are reduced by 
$751 million between fiscal years 1997 to 2002. Thereafter, SEC fees 
will be at least $256 million lower per annum than they would be under 
current law.
  Of equal importance is the fact that Chairman Rogers has agreed to 
work with us to provide a more stable funding mechanism for the SEC, so 
the Commission can focus on doing its important work rather than 
devoting time to the problems of funding its operations. As SEC fees 
are reduced, the SEC will be increasingly funded by an appropriation. 
By 2002, the SEC will be entirely funded by means of an appropriation. 
Fees collected by the SEC will approximately equal the cost of running 
the agency, and will be deposited in the Treasury as general revenue.
  This legislation will begin to solve the problems associated with 
funding the SEC. It will also eliminate the surplus in SEC fees which 
constitutes a tax on our capital markets. I urge its support by the 
House.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MARKEY. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I am pleased to rise this afternoon to join with 
Commerce Committee Chairman Bliley, Subcommittee Chairman Jack Fields, 
and the ranking Democrat on the Commerce Committee, John Dingell, in 
support of the Securities and Exchange Commission's authorization for 
fiscal year 1997. Each of them deserve praise for their efforts to 
develop a solution to the persistent problem of how to provide a stable 
funding mechanism for the SEC--an agency long recognized by Members of 
both parties as one of the most effective, efficient and essential 
anywhere in Government.
  The funding mechanism contemplated by the bill is workable and 
responsible, and deserves broad bipartisan support. Most significantly, 
it removes the temptation that has seduced administrations, past and 
present, to view securities registration fees as a source of general 
revenues. Especially during the bull market of the last 6 years, these 
fees have greatly exceeded the size of the SEC's overall budget.
  I am, of course, reluctant to see revenues cut at a time when some 
are seeking to slash the resources made available to support our 
children's education, our elderly's right to retire with dignity, and 
every person's right to a clean environment. At the same time however, 
we must be certain that the gamesmanship that has surrounded SEC budget 
deliberations for the last several years is ended permanently.
  Notwithstanding my support for the bill coming before us today, I 
continue to believe that the mission of the Securities and Exchange 
Commission--to protect the Nation's 100 million investors and to ensure 
fair and orderly markets--is so vital to our national interests that 
the Commission should be self-funded, subject to annual Congressional 
approval of its budget. Although I will continue to support the self-
funding concept, I am satisfied that the proposal before us today is a 
significant step in the right direction, and I am pleased to endorse 
it.
  I am somewhat less sanguine about the size of the SEC budget as 
contemplated by the legislation. In light of the record levels of 
investment in our markets, the unprecedented number of new investors 
attracted to them, the complexity of many of the securities that are 
sold, the increasingly sophisticated marketing techniques used to sell 
them, and the growing volatility the market is experiencing as we 
attempt to adjust to the remarkable altitudes we have recently reached, 
the commitment of additional resources to this remarkable agency would 
certainly be justified.
  Here are some facts and figures worth keeping in mind when thinking 
about the SEC's budget. In 1940, the SEC had 1,400 full-time staff. 
Fifty-six years later, the SEC has 2,800 full-time staff. In 1940, the 
typical daily trading volume on the New York Stock Exchange could be 
counted in the thousands. Today, an average day involves 400 million 
shares, and the New York Stock Exchange has increased its capacity to 
handle well over a billion shares a day. Another 450 million shares are 
traded on the NASDAQ, representing interests in more than 5,000 
companies.
  Of course the NASDAQ didn't even exist in 1940--it was invented in 
1972. Derivatives didn't exist in 1940 either--nor did money market 
funds, mortgage-backed securities, bond funds, hedge funds, junk bonds, 
penny stocks, stock options, program trading, financial futures, poison 
pills, or triple witching hours.
  I've addressed the funding mechanism in the bill as well as my 
concern about the SEC budget. Let me briefly touch upon why the 
soundness of our system of securities regulation is so important, and 
why trendy proposals to sweep away important aspects of securities laws 
need to be considered carefully, lest they lead to unintended and 
possibly devastating consequences.
  For a rapidly growing number of Americans, and a vastly higher 
percentage of the population than in 1940, hopes for the future--dreams 
of being able to send a child to college, to buy a new home, or to 
retire in dignity--are increasingly dependent on the stability, 
integrity, and success of our financial markets. Indeed, this growing 
dependence by individuals on the success of the market may be a stealth 
contributor to middle class Americans' growing anxiety about the 
future.
  For tens of millions of Americans with stakes in the market through a

[[Page H2053]]

pension plan or mutual fund, the effectiveness and safety of our 
markets, and the existence of a vital and vigorous SEC, is neither an 
abstract nor an ideological issue.
  The important bill brought before us today recognizes the crucial 
role that the SEC plays in promoting fair, honest, and successful 
capital markets.

                              {time}  1530

  Again, I applaud the work of the gentleman from Virginia [Mr. 
Bliley], chairman, the gentleman from Texas [Mr. Fields], chairman, and 
all on the majority side who worked in a bipartisan fashion, especially 
the gentleman from Ohio [Mr. Oxley], so that we could bring this bill 
out here today. I speak for the gentleman from Michigan [Mr. Dingell], 
the distinguished ranking member, in extending our plaudits to the 
majority for their work.
  This has been done in a bipartisan fashion, working in close 
cooperation with Chairman Levitt of the Securities and Exchange 
Commission and their staff to ensure that we could produce a budget 
that would give predictable sources of revenue to the SEC for their 
very important mission, especially in these coming months and years 
when the aerodynamics of the existing market may in fact come into 
question and we have to ensure that we have got an agency there that 
can manage the consequences at that time.
  Mr. Speaker, I reserve the balance of my time.
  Mr. OXLEY. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Washington [Mr. White].
  Mr. WHITE. Mr. Speaker, I thank the gentleman for yielding me the 
time.
  Mr. Speaker, this House and in particular our committee this year has 
seen many hard bills but I am happy to say that this is an easy bill. 
It is easy because it eliminates a surplus that the SEC is collecting, 
saves a little money for the taxpayers. It makes sure that the SEC is 
included under the appropriations process, as it ought to be and as I 
think is appropriate.
  It is a bipartisan bill which we have been able to work on with our 
Democratic colleagues, and that is always a step in the right direction 
and, last but not least, it does some great things for my district. We 
consider ourselves in the Seattle area to be the capital formation 
capital of the Pacific Northwest and of the entire Northwest United 
States. This will help us do in Seattle what we need to do to make sure 
we prosper and keep those capital markets running.
  I was very happy to support this bill in committee, and I am 
delighted to support it here on the floor. I would urge all my 
colleagues to do the same.
  Mr. RICHARDSON. Mr. Speaker, I rise in support of H.R. 2972, the 
Securities and Exchange Commission Reauthorization Act of 1996. I would 
like to commend Commerce Chairman Bliley, Telecommunications and 
Finance Subcommittee Chairman Fields, Ranking Member Dingell and Mr. 
Markey of Massachusetts for their work on this piece of legislation 
that meets this Congress' objectives of proper market oversight and 
fiscal prudence.
  H.R. 2972 is an excellent example of good government crafted with 
bipartisan interests taken into account. I would like to commend SEC 
Chairman Arthur Levitt for accepting the challenges that this tight 
budget will impose upon an agency that watches over a larger herd than 
ever.
  As more and more Americans choose the securities markets to augment 
their incomes, it is necessary to maintain the safeguards that make 
U.S. markets the best.
  This bill ensures that our regulatory structure remains sensible, 
reasonable and cost-effective so that the U.S. marketplace remains 
vigorous, efficient and attractive to capital formation. I am confident 
that the SEC will maintain a regulatory environment that encourages 
capital formation for small entrepreneurial businesses, which drive the 
U.S. economy in most states like New Mexico.
  Finally, the reliance on U.S. equity markets to play a role in the 
income of average Americans requires vigilant enforcement of sound 
rules that ensure investor protection and the maintenance of the 
integrity and honesty of the U.S. capital markets.
  In July of 1993, Chairman Levitt requested approximately $317 million 
for fiscal year 1995. It is noteworthy and, indeed, a credit to the 
Chairman and the administration's efforts to ``reinvent'' government 
that we sit here today and request the same amount of money for fiscal 
year 1997. Clearly, this stands as evidence that we can get better 
government for less money.
  The SEC has prepared itself for difficult fiscal times ahead by 
doubling its commitment to working with industry to provide cost-
effective, efficient regulation in partnership with the private sector. 
Despite tight budgetary limits, the Commission has focused on the 
essentials by fostering small businesses who need capital formation to 
survive and grow.
  Our actions today signal to the American people that periodic review 
of agency operations like that of the SEC can yield efficiency without 
drastic overhauls designed for political appeal. The leadership of the 
subcommittee and committee deserve our sport for endeavors of this 
nature.
  Mr. OXLEY. Mr. Speaker, as an original cosponsor of the bill, I rise 
in support of this reauthorization. I'm pleased to be considering it on 
today's suspension calendar.
  This bipartisan measure is a credit to its author, Chairman Tom 
Bliley, and the subcommittee chairman, Jack Fields. It brings coherence 
and stability to the issue of Securities and Exchange Commission 
funding, while at the same time providing well-deserved tax relief to 
investors. It has the support of SEC Chairman Arthur Levitt.
  Currently, the SEC has a budget of approximately $300 million, but it 
collects nearly twice that in fees annually. These are filing fees paid 
by pension funds, start-up companies, and individual investors. The 
excess fees amount to a tax on capital formation.
  This reauthorization puts the Commission on-budget and phases out the 
surplus fees, saving investors more than $750 million over the next 5 
years. In so doing, it will promote investment, capital formation, and 
job creation.
  Again, Mr. Speaker, I urge support for the bill, and I yield back the 
balance of my time.
  Mr. MARKEY. Mr. Speaker, I have no other requests for time, and I 
yield back the balance of my time.
  Mr. OXLEY. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Camp). The question is on the motion 
offered by the gentleman from Ohio [Mr. Oxley] that the House suspend 
the rules and pass the bill. H.R. 2972, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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