[Congressional Record Volume 142, Number 34 (Wednesday, March 13, 1996)]
[Senate]
[Pages S1970-S1977]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. BOND (for himself, Mr. Nickles, Mr. Dole, Mr. D'Amato, Mr.
Murkowski, Mr. Inhofe, Mr. Lott, Mr. Gramm, and Mr. Frist):
S. 1610. A bill to amend the Internal Revenue Code of 1986 to clarify
the standards used for determining whether individuals are not
employees; to the Committee on Finance.
The Independent Contractor Tax Simplification Act of 1996
Mr. BOND. Mr. President, determining worker classification is one of
the most important tax issues facing small business today. Indeed, and
in fact, it was rated No. 1 by the delegates to the White House
Conference on Small Business. They said this is something that must be
dealt with because the ambiguity in the current law makes it extremely
difficult for business owners to determine whether a worker is an
independent contractor or an employee. Today I will be introducing the
Independent Contractor Tax Simplification Act on behalf of myself,
Senator Nickles, Senator Dole, Senator D'Amato, Senator Murkowski and
Senator Lott.
For years, now, the Internal Revenue Service has used a 20-factor
common law test to determine worker status. Frankly, the test is a
nightmare of subjectivity and unpredictability for small business
owners who often get their tutorial on the subtleties of the issue
during an IRS audit--certainly an unfortunate time to be learning how
tricky the law is.
IRS agents are required to consider 20 different factors to determine
whether an employer/employee relationship exists. The problem is that
the small business taxpayer is not able to predict which of the 20
factors is going to be more important to a particular IRS agent, and
finding a certain number of these factors present in a case does not
always determine the result.
Inevitably, what has been happening is that agents are resolving far
too many cases in favor of the IRS and its tendency to find the
existence of an employment relationship at the expense and disruption
of bona fide independent contractor arrangements.
Let me make perfectly clear, the IRS has every right to obtain
information on payments, whether they are made to an employee or to an
independent contractor. It is our position that simplifying IRS
collection does not warrant the IRS going beyond tax law to determine
business organization, so long as the organizations are legitimate
structures and the IRS has the information on payments so they may
collect appropriate taxes.
This lack of a clear standard in existing law has made some small
business owners reluctant to hire independent contractors and put
others in great concern and risk of being pursued for back taxes.
In some cases, the concern is so great that it stifles business
expansion. As I indicated earlier, the depth of the problem was made
clear last summer when the White Conference on Small Business, a
nationwide group of almost 2,000 small business delegates, voted the
independent contractor issue first on its list for recommended changes.
Today, together with Senator Nickles and the other Senators whom I
mentioned, Senator Nickles having been a long and consistent supporter
of small business legislation, we introduce a bill that solves this
problem. Our bill provides a short list of simple, clear objective
standards that will allow all taxpayers to understand what the law says
about who is an employee and who is an independent contractor. When
this law is enacted, IRS agents will have clear direction, small
business will have clear direction, but the IRS will no longer have the
upper hand in today's confusing independent contractor law, which gives
the IRS agent, when they deal with our country's small business
taxpayers, advantage in determining their business organization.
I especially thank Senator Nickles for his willingness to allow us to
work on this bill together. Last September at a hearing, I held in the
Small Business Committee, Senator Nickles testified about his personal
experience with this issue dating back to the small business that he
began while he was a college student. For Senator Nickles' company,
like many startup companies and small businesses, it seemed to make
perfect sense to hire independent contractors in certain situations.
More established, larger businesses also need to hire independent
contractors to accomplish specific tasks that may require specialized
skill. In fact, many of America's entrepreneurs are in business as
independent contractors whose livelihood is dependent upon the fact
that other companies need their service and expertise. These
entrepreneurs have no desire, nor do they have any need, to become
employees of the businesses who purchase their services.
Others in our Small Business Committee hearing testified about their
experiences with IRS agents regarding worker status, telling us about
receiving IRS penalties as high as a quarter of a million dollars.
Between these outrageously high penalties and the complexity of the 20-
factor test, this issue, understandably, infuriates many small business
taxpayers.
Mr. President, the Commissioner of Internal Revenue, the Honorable
Margaret Richardson, in a speech to last summer's small business
conference delegates, told them the IRS does not care whether someone
is an employee or independent contractor, as long as they properly
report their income, and that is as it should be. Yet, the IRS
continues to pursue this issue fiercely during its audits. It has been
reported that in a recent 4-year span, the IRS reclassified 338,000
workers as employees. The same report indicates the IRS prevails in 9
out of 10 worker classification audits. Little wonder when they have
the upper hand with a very confusing, very complex 20-factor test.
Just last week, I received a copy of the ``Revised Internal Revenue
Service Worker Classification Training Materials.'' This was
distributed by Commissioner Richardson. In her memo accompanying the
document, she describes the purchase of the document as an attempt to
identify, simplify and clarify the factors that should be applied in
order to accurately determine worker classification.
There could be no more compelling justification for the importance of
our immediate passage of the legislation than this document. We commend
Commissioner Richardson for seeking to simplify, but this document is
over 100 pages long. If it takes that much paper and that much ink to
instruct IRS agents on how to simplify and clarify a small business tax
issue, I think we can be pretty sure how simple and clear it is going
to seem to the taxpayer sitting across the desk from an IRS agent
during an audit.
As those who follow this issue know, what makes this problem
especially frustrating is that unlike most interpretive actions of the
IRS where they must determine the proper amount of income or deductions
so Treasury can collect the amount of tax legally due to it, the
independent contractor issue is not about how much tax the Government
receives. The classification decision does not alter aggregate tax
liability to the Government at all. This problem exists because of
IRS's apparent desire to recast economic relationships between private
parties that these parties have already determined for themselves. The
Independent Contractor Tax Simplification Act will help move the IRS
out of its de facto role of setting employment policy and back into its
role of revenue collection.
Our bill sets out three simple questions to be asked in determining
whether a person providing services is an employee or independent
contractor.
[[Page S1971]]
First, is there a written agreement between the parties?
Second, does it appear the worker has made some investment, such as
incurring substantial unreimbursed expenses or being paid primarily on
a commission basis?
Third, does the worker appear to have some independence, such as
having his or her own place of business?
In other words, under this bill, if there is a written contract
between the parties and if basic investment and independence criteria
are met, then the worker is an independent contractor. Plain, simple,
predictable. Fine. To take advantage of this simple rule, the party
must properly report payments above $600 to the IRS just like under
current law. This ensures all taxes properly due to the Treasury can be
collected.
The legislation is written to provide immediate clarification and
relief to taxpayers undergoing IRS examinations currently. The change,
no doubt, would save many businesses from a protracted and expensive
battle with IRS. For some, it may even save the business.
When we in Congress find an opportunity to take action in a tax area
so strongly supported by many small businesses, and when it is one that
does not involve any loss to the Federal Treasury, we should act
without delay. I am confident the Finance Committee can find an
acceptable revenue offset for this worthy purpose to the extent that
any revenue is lost. The revenue estimate for the bill should be fairly
simple, reflecting the bill's provisions that assure continued
collection of all taxes due the Federal Government.
Small businesses cannot afford to wait any longer for resolution of
this problem, and they should not be expected to do so. They have
waited for decades. We now have a bill that will solve the problem.
The companion bill has been introduced in the other body. I am told
it has over 200 cosponsors. It is time Congress steps up to the plate
and delivers for small business. I urge members of the Finance
Committee to work with Senator Nickles and others to report out a bill
that provides this much-needed change.
Mr. President, I ask unanimous consent to have printed in the Record
a copy of the bill, a section-by-section analysis and copies of some
letters of support for the bill we have received.
I also ask unanimous consent that Senators Dole, D'Amato, Lott,
Murkowski, and Inhofe be shown as original cosponsors.
The PRESIDING OFFICER. Without objection, it is so ordered.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1610
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 ``Independent Contractor Tax
Simplification Act of 1996''.
SEC. 2. FINDINGS.
The Congress finds that:
(1) Simplifying the tax rules with respect to independent
contractors was the top vote-getter at the 1995 White House
Conference on Small Business. Conference delegates
recommended that Congress ``should recognize the legitimacy
of an independent contractor''. The Conference found that the
current common law is ``too subjective'' and called upon the
Congress to establish ``realistic and consistent
guidelines''.
(2) It is in the best interests of taxpayers and the
Federal Government to have fair and objective rules for
determining who is an employee and who is an independent
contractor.
SEC. 3. STANDARDS FOR DETERMINING WHETHER INDIVIDUALS ARE NOT
EMPLOYEES.
(a) In General.--Chapter 25 of the Internal Revenue Code of
1986 (general provisions relating to employment taxes) is
amended by adding after section 3510 the following new
section:
``SEC. 3511. STANDARDS FOR DETERMINING WHETHER INDIVIDUALS
ARE NOT EMPLOYEES.
``(a) General Rule.--For purposes of this title, and
notwithstanding any provision of this title to the contrary,
if the requirements of subsections (b), (c), and (d) are met
with respect to any service performed by any individual, then
with respect to such service--
``(1) the service provider shall not be treated as an
employee,
``(2) the service recipient shall not be treated as an
employer,
``(3) the payor shall not be treated as an employer, and
``(4) compensation paid or received for such service shall
not be treated as paid or received with respect to
employment.
``(b) Service Provider Requirements With Regard to Service
Recipient.--For the purposes of subsection (a), the
requirements of this subsection are met if the service
provider, in connection with performing the service--
``(1) has a significant investment in assets, training, or
both,
``(2) incurs significant unreimbursed expenses,
``(3) agrees to perform the service for a particular amount
of time or to complete a specific result and is liable for
damages for early termination without cause,
``(4) is paid primarily on a commissioned basis or per unit
basis, or
``(5) purchases products for resale.
``(c) Additional Service Provider Requirements With Regard
to Others.--For the purposes of subsection (a), the
requirements of this subsection are met if--
``(1) the service provider--
``(A) has a principal place of business,
``(B) does not primarily provide the service at the service
recipient's facilities,
``(C) pays a fair market rent for use of the service
recipient's facilities, or
``(D) operates primarily from equipment not supplied by the
service recipient; or
``(2) the service provider--
``(A) is not required to perform service exclusively for
the service recipient, and
``(B) in the year involved, or in the preceding or
subsequent year--
``(i) has performed a significant amount of service for
other persons,
``(ii) has offered to perform service for other persons
through--
``(I) advertising,
``(II) individual written or oral solicitations,
``(III) listing with registries, agencies, brokers, and
other persons in the business of providing referrals to other
service recipients, or
``(IV) other similar activities, or
``(iii) provides service under a business name which is
registered with (or for which a license has been obtained
from) a State, a political subdivision of a State, or any
agency or instrumentality of 1 or more States or political
subdivisions.
``(d) Written Document Requirements.--For purposes of
subsection (a), the requirements of this subsection are met
if the services performed by the individual are performed
pursuant to a written contract between such individual and
the person for whom the services are performed, or the payor,
and such contract provides that the individual will not be
treated as an employee with respect to such services for
purposes of this subtitle.
``(e) Special Rules.--For purposes of this section--
``(1) Failure to meet reporting requirements.--If for any
taxable year any service recipient or payor fails to meet the
applicable reporting requirements of section 6041(a),
6041A(a), or 6051 with respect to a service provider, then,
unless such failure is due to reasonable cause and not
willful neglect, this section shall not apply in determining
whether such service provider shall not be treated as an
employee of such serviced recipient or payor for such year.
``(2) Related entities.--If the service provider is
performing services through an entity owned in whole or in
part by such service provider, then the references to
`service provider' in subsections (b) through (d) may include
such entity, provided that the written contract referred to
in paragraph (1) of subsection (d) may be with either the
service provider or such entity and need not be with both.
``(f) Definitions.--For the purposes of this section--
``(1) Service provider.--The term `service provider' means
any individual who performs service for another person.
``(2) Service recipient.--Except as provided in paragraph
(5), the term `service recipient' means the person for whom
the service provider performs such service.
``(3) Payor.--Except as provided in paragraph (5), the term
`payor' means the person who pays the service provider for
the performance of such service in the event that the service
recipients do not pay the service provider.
``(4) In connection with performing the service.--The term
`in connection with performing the service' means in
connection or related to--
``(A) the actual service performed by the service provider
for the service recipients or for other persons for whom the
service provider has performed similar service, or
``(B) the operation of the service provider's trade or
business.
``(5) Exceptions.--The terms `service recipient' and
`payor' do not include any entity which is owned in whole or
in part by the service provider.''
(b) Clerical Amendment.--The table of sections for chapter
25 of such Code is amended by adding at the end the following
new item:
``Sec. 3511. Standards for determining whether individuals are not
employees.''
(c) Effective Date.--The amendments made by this Act shall
apply to services performed before, on, or after the date of
the enactment of this Act.
____
Summary of the Independent Contractor Tax Simplification Act
For too long now, businesses have been forced to rely upon
complicated and ambiguous IRS guidelines for classifying
individual
[[Page S1972]]
workers as employees or independent contractors. IRS audit
determinations of misclassification often result in heavy tax
penalties. Clarifying independent contractor rules was
considered the top small business priority by conference
delegates at the 1995 White House Conference on Small
Business.
Instead of trying to define who is an employee (the common
law 20-point test), this legislation creates a simple
definition of who is not an employee.
General Rule
If this legislation's requirements are met with respect to
any service performed by any individual, then the service
provider shall not be treated as an employee, the service
recipient shall not be treated as an employer, the payor
shall not be treated as an employer, and the compensation
paid shall not be treated as paid with respect to employment.
investment/training/risk
With regard to the service being performed, the service
provider must--
(1) have a significant investment in assets and/or
training, or
(2) incur significant unreimbursed expenses, or
(3) agree to perform the service for a particular amount of
time or to complete a specific result and is liable for
damages for early termination without cause, or
(4) be paid primarily on a commissioned or per-unit basis,
or
(5) purchase products for resale.
principal place of business/advertising
With regard to other parties, the service provider must--
(1) have a principal place of business, or
(2) not primarily provide the service in the recipient's
facilities unless the provider is paying a fair market rent
for this use, or
(3) operate primarily from equipment not supplied by the
service recipient, or
(4) not be required to perform service exclusively for the
service recipient, and
(a) have recently performed a significant amount of service
for other persons, or
(b) have offered to perform service for persons through
advertising, individual solicitations, listing with
registries, etc, or other similar activities, or
(c) have provided service under a registered or licensed
business name.
written document requirements
The services of a provider must be performed pursuant to a
written contract between such individual and the service
recipient stating that the provider will not be treated as an
employee.
special rules
If any service recipient fails to meet the applicable IRS
reporting requirements with respect to a service provider,
then they may not rely upon these simplified independent
contractor guidelines and are subject to the existing 20-
point common law test.
____
National Federation of
Independent Business,
Washington, DC, March 12, 1996.
Hon. Kit Bond,
U.S. Senate,
Washington, DC.
Dear Senator Bond: On behalf of the more than 600,000
members of the National Federation of Independent Business
(NFIB), I am writing to offer our strong support of the
Independent Contractor Simplification Act. The independent
contractor issue has been confusing and burdensome for small
business owners for decades. As you know, the independent
contractor issue was the top recommendation of the 1995 White
House Conference on Small Business.
Small businesses are put in a lose-lose situation with the
Internal Revenue Service. Under the current law, they are
required to classify individuals as independent contractors
or employees based on extremely vague and ambiguous IRS
guidelines. When a small business owner mistakenly
misclassifies a worker based on these vague criteria, the IRS
audits the business and levies back tax penalties. Even if
the employer fully reported all payments to the independent
contractor and the mistake was unintentional, these penalties
are still levied. This misunderstanding can put the employer
out of business. For small businesses, misinterpreting these
nebulous IRS guidelines can be financially devastating.
The Independent Contractor Simplification Act sets forth an
alternate set of clear and distinct criteria for businesses
to follow when classifying their workers. It solves the
independent contractor problem by defining who is not an
employee. Most importantly, the legislation puts forth
safeguards against abusing this classification by prohibiting
both independent contractor and employer from relying on
these new rules if all payments for service are not properly
reported to the IRS.
We commend you on your legislation which sends much needed
relief to our nation's small business owners and the million
of budding entrepreneurs who have an interest in being an
independent contractor. We look forward to working with you
to move the Independent Contractor Simplification Act through
the Senate.
Sincerely,
Donald A. Danner,
Vice President,
Federal Governmental Relations.
____
The Independent
Contractor Coalition,
Washington, DC.
Hon. Kit Bond,
U.S. Senate,
Washington, DC.
Dear Senator Bond: We the undersigned, representing a
cross-section of close to one million businesses and
individuals, are writing to offer our strong support for the
Independent Contractor Tax Simplification Act.
This legislation will bring much needed relief to millions
of businesses and budding entrepreneurs in addressing
ambiguities in the IRS guidelines for determining independent
contractor status.
At a minimum, the current system by which the IRS enforces
laws and regulations governing an individual's employment tax
status promotes uncertainty and inhibits entry of aspiring
entrepreneurs into the free market system as independent
contractors. At its worst, the current system is unfairly
biased against the use of independent contractors and
constrains economic expansion of our nation's free market
system.
The Bond/Nickles bill will settle many of the problems
associated with the current system. By setting forth a clear
set of alternate criteria, this legislation will resolve many
of the long standing complaints businesses and individuals
have had with the vague and often subjective guidelines the
IRS uses to classify workers as employees or independent
contractors.
As the leading coalition of businesses and individuals
working to clarify independent contractor status, we commend
you on your effort and look forward to working with you to
move this legislation through the Senate.
Allow the free enterprise system to work for the benefit of
our economy.
Sincerely,
Nelson Litterst,
NFIB, Co-Chair.
John Satagaj,
SBLC, Co-Chair.
THE BOND/NICKLES INDEPENDENT CONTRACTOR LEGISLATION--Endorsement List
Agricultural & Industrial Manuf. (AIMRA).
Air Courier Conference of America.
Alliance of Independent Store Owners & Professionals.
American Animal Hospital Association.
American Association of Equine Practitioners.
American Association of Meat Processors.
American Association for Medical Transcription.
American Association of Nurserymen.
American Consulting Engineers Councils.
American Council of Independent Laboratories.
American Rental Association.
American Society of Interior Designers.
Associated Builders & Contractors.
Associated Landscape Contractors of America.
American Society of Travel Agents.
American Warehouse Association.
Bureau of Wholesale Sales Representatives.
Business Advertising Council, Inc.
Computer Software Industry Association.
Council of Growing Companies.
Direct Selling Association.
Electronics Representatives Association.
Expedited Package Independent Contractor Council.
FTD Association.
Health Industry Representatives Association.
Helicopter Association International.
Home Food Service of Colorado.
Independent Computer Consultants Association.
Independent Distributors Association.
Independent Medical Distributors Association.
Institute of Electrical and Electronics Engineers-U.S.
Activities.
International Association for Financial Planning.
International Taxi Cab and Livery Association.
International Television Association Inc.
Marine Retailers Association of America.
McNair Law Firm.
Messenger Courier Association of the Americas.
Metal Treating Institute.
National Association of Computer Consultant Businesses.
National Association of Orchestra Leaders.
National Association of the Remodeling Industry.
National Association for the Self-Employed.
National Electrical Manufacturers Representative
Association.
National Federation of Independent Business.
National Fire Sprinkler Association.
National Home Furnishings Association.
National Moving & Storage Association.
National Restaurant Association.
National Tooling & Machining Association.
National Tour Association.
Nurse Brokers and Contractors of America.
Power-Motion Technology Representative Association.
Promotional Products Association International.
Rich Plan Corporation.
Securities Industry Association.
Small Business Legislative Council.
SMC Business Councils.
Society of American Florists.
The Management Association of Illinois.
World Floor Covering Association.
____
[[Page S1973]]
Small Business Legislative Council,
Washington, DC, March 4, 1996.
Hon. Christopher Bond,
Hon. Don Nickles,
U.S. Senate,
Washington, DC.
Dear Senators Bond and Nickles: On behalf of the Small
Business Legislative Council (SBLC), I wish to express our
strong support for your legislation to establish clear and
objective rules for the purposes of determining whether an
individual is an independent contractor or employee.
This is a long-time concern of the SBLC. Indeed, one of the
founding principles of the organization, when it was
established in the mid-1970s, was to work to encourage
individuals to pursue the American Dream--owning and managing
their own business. Becoming an independent contractor is
both the means and the end to that goal.
As you know, the delegates to the 1995 White House
Conference on Small Business made this one of their priority
recommendations. Indeed, while there was no official ranking,
this was the top vote-getter in the final balloting.
Congratulations on this initiative! We look forward to
working with you towards the passage and enactment.
The Small Business Legislative Council (SBLC) is a
permanent, independent coalition of nearly one hundred trade
and professional associations that share a common commitment
to the future of small business. Our members represent the
interests of small businesses in such diverse economic
sectors as manufacturing, retailing, distribution,
professional and technical services, construction,
transportation and agriculture. Our policies are developed
through a consensus among our membership. Individual
associations may express their own views. For your
information, a list of our members is enclosed.
Sincerely,
Gary F. Petty,
Chairman of the Board.
____
members of the small business legislative council
Air Conditioning Contractors of America.
Alliance for Affordable Health Care.
Alliance for American Innovation.
Alliance of Independent Store Owners and Professionals.
American Animal Hospital Association.
American Association of Equine Practitioners.
American Association of Nurserymen.
American Bus Association.
American Consulting Engineers Council.
American Council of Independent Laboratories.
American Gear Manufacturers Association.
American Machine Tool Distributors Association.
American Road & Transportation Builders Association.
American Society of Interior Designers.
American Society of Travel Agents, Inc.
American Subcontractors Association.
American Textile Machinery Association.
American Trucking Associations, Inc.
American Warehouse Association.
AMT-The Association for Manufacturing Technology.
Architectural Precast Association.
Associated Builders & Contractors.
Associated Equipment Distributors.
Associated Landscape Contractors of America.
Association of Small Business Development Centers.
Automotive Service Association.
Automotive Recyclers Association.
Bowling Proprietors Association of America.
Building Service Contractors Association International.
Business Advertising Council.
Christian Booksellers Association.
Council of Fleet Specialists.
Council of Growing Companies.
Direct Selling Association.
Electronics Representatives Association.
Florists' Transworld Delivery Association.
Health Industry Representatives Association.
Helicopter Association International.
Independent Bankers Association of America.
Independent Medical Distributors Association.
International Association of Refrigerated Warehouses.
International Communications Industries Association.
International Formalwear Association.
International Franchise Association.
International Television Association.
Machinery Dealers National Association.
Mail Advertising Service Association.
Manufacturers Agents National Association.
Manufacturers Representatives of America, Inc.
Mechanical Contractors Association of America, Inc.
National Association for the Self-Employed.
National Association of Catalog Showroom Merchandisers.
National Association of Home Builders.
National Association of Investment Companies.
National Association of Plumbing-Heating-Cooling
Contractors.
National Association of Private Enterprise.
National Association of Realtors.
National Association of RV Parks and Campgrounds.
National Association of Small Business Investment
Companies.
National Association of the Remodeling Industry.
National Chimney Sweep Guild.
National Electrical Contractors Association.
National Electrical Manufacturers Representatives
Association.
National Food Brokers Association.
National Independent Flag Dealers Association.
National Knitwear & Sportswear Association.
National Lumber & Building Material Dealers Association.
National Moving and Storage Association.
National Ornamental & Miscellaneous Metals Association.
National Paperbox Association.
National Shoe Retailers Association.
National Society of Public Accountants.
National Tire Dealers & Retreaders Association.
National Tooling and Machining Association.
National Tour Association.
National Wood Flooring Association.
NATSO, Inc.
Opticians Association of America.
Organization for the Protection and Advancement of Small
Telephone Companies.
Petroleum Marketers Association of America.
Power Transmission Representatives Association.
Printing Industries of America, Inc.
Professional Lawn Care Association of America.
Promotional Products Association International.
The Retailer's Bakery Association.
Small Business Council of America, Inc.
Small Business Exporters Association.
SMC Business Councils.
Society of American Florists.
Turfgrass Producers International.
____
National Home
Furnishings Association,
Washington, DC, March 4, 1996.
Hon. Christopher Bond,
Hon. Don Nickles,
U.S. Senate,
Washington, DC.
Dear Senators Bond and Nickles: On behalf of the National
Home Furnishings Association (NHFA), I would like to offer
our endorsement of your bill to establish criteria for the
determination of individuals as independent contractors or
employees for federal employment tax purposes.
Our retailers engage independent contractors to provide a
variety of services including design, installation, and
delivery. This has been a long-standing practice in our
industry.
The unsettled nature of the law in this area has been the
cause for concern in our industry and, therefore, we support
your efforts.
The NHFA represents approximately 2,800 retailers of home
furnishings throughout the United States.
We look forward to working with you towards passage of this
important legislation.
Sincerely,
Patricia Bowling,
Executive Vice President.
____
World Floor Covering Association,
Washington, DC, March 4, 1996.
Hon. Christopher Bond,
Hon. Don Nickles,
U.S. Senate,
Washington, DC.
Dear Senators Bond and Nickles: On behalf of the World
Floor Covering Association (WFCA), and our member
floorcovering retailers, I would like to express our strong
support for your bill to establish realistic criteria for the
classification of individuals as independent contractors or
employees for federal employment tax purposes.
Our retailers engage independent contractors to provide
installation services. This has been a long-standing practice
in our industry and is fundamental to the way we do and have
done business for many years.
Over the years, we and our members have discussed this
matter with the IRS on numerous occasions. The only thing we
can say about the discussions is it is apparent to us that
Congress must step in and establish a clear and objective set
of rules. That is why we support your bill. We also believe
Congress should establish once and for all, that encouraging
individuals to become independent contractors is a good thing
for the nation and the economy.
We look forward to working with you towards passage of this
important legislation.
Sincerely,
D. Christopher Davis,
Chief Executive Officer.
____
Promotional Products
Association International,
Irving, TX, March 4, 1996.
Hon. Christopher Bond,
Hon. Don Nickles,
U.S. Senate,
Washington, DC.
Dear Senators Bond and Nickles: On behalf of the
Promotional Product Association International (PPA), I would
like to offer our support for your bill to establish rules
for the classification of individuals as independent
contractors or employees.
Historically, our industry has engaged independent
contractors to sell its products
[[Page S1974]]
and services. We feel our industry practice is the epitome of
the American tradition of selling products and services
through independent sales representatives.
We strongly believe clear and objective rules that will put
the ongoing battle between the IRS and small business over
this issue behind us are needed and welcomed. Therefore, we
support your efforts.
The promotional products industry is the advertising, sales
promotion, and motivational medium employing useful articles
of merchandise imprinted with an advertiser's name, logo, or
message. Our industry sales are over $6 billion and PPA
members are manufacturers and distributors of such goods and
services.
We look forward to working with you towards passage of this
important legislation.
Sincerely,
G. Stephen Slagle,
President.
Mr. NICKLES. Mr. President, one of the most fundamental concepts in
our free enterprise economy is the ability of any American to use
talent, intelligence, and hard work to start a business. The small,
independent business is the engine which drives innovation, job
creation, and increased economic activity in this country.
For many small, start-up companies, independent contractor status is
the best way, and sometimes the only way, they can do business.
Similarly, many larger, established businesses find that using
independent contractors is the most effective way of handling projects
that require special talents. There are five million independent
contractors in America according to the Small Business Administration,
and almost one-third of all companies use independent contractors to
some degree. Independent contractor status gives both the service
provider and the service recipient the flexibility needed to be
competitive in today's economic environment.
Before coming to the U.S. Senate, I had first hand experience with
these issues; both working as and employing independent contractors.
The janitorial service I began as a student at Oklahoma State
University could not have existed if I had been required to work as an
employee, and it never would have expanded if I could not have hired
other students as independent contractors to handle specific jobs.
Despite the obvious importance of independent contractors to our
economy, Congress has amazingly failed to give workers or businesses
adequate guidance as to who is an employee and who is an independent
contractor. Unfortunately, this lack of decisive congressional action
combined with aggressive dislike of independent contractors by the
Internal Revenue Service has subjected many businesses to abusive
audits and unfair penalties. In effect, our Government is killing the
independent contractor.
Mr. President, I rise today with my colleague from Missouri, Senator
Bond, to introduce the Independent Contractor Tax Simplification Act.
This legislation is the Senate companion of a H.R. 1972, a bill
introduced last year by Congressman Jon Christensen which now has 215
cosponsors. Our bill, which is supported by over 50 trade and industry
associations, cuts through the horrendously complicated and ambiguous
current law rules and provides relief and confidence to independent
contractors and service recipients alike.
Why is congressional action needed, Mr. President? In the mid-1970's,
the IRS undertook a major initiative to reclassify workers as
employees. In response to the tremendous outcry from business owners,
Congress in 1978 enacted what was intended to be a temporary solution,
the section 530 safe harbor provisions. Section 530 prohibited the IRS
from reclassifying workers as employees if the employer had a
reasonable basis for treatment of the workers as independent
contractors, or if a past IRS audit did not dispute the workers'
classification.
So for two decades, independent contractor status has been controlled
by this temporary solution, related IRS rulings, judicial precedent,
and legislation targeted at specific industries. Those contractors and
businesses who are unable to rely upon section 530 are subjected to a
20-point command law test which attempts to define an employer's
control over workers. This common law test is the bane of employers and
workers across the country, and is at the heart of the problems my
legislation intends to address. The General Accounting Office calls the
common law test ``unclear and subject to conflicting interpretations''.
Even the Treasury Department has testified that ``applying the common
law test in employment tax issues does not yield clear, consistent, or
even satisfactory answers, and reasonable persons may differ as to the
correct classification''.
The horror stories surrounding this issue are numerous and
disturbing, Mr. President. Last year, ``NBC Nightly News'' ran a story
on two business owners who are facing hundreds of thousands of dollars
in back taxes and penalties because the IRS decided to reclassify their
independent contractors as employees. One of these citizens, who owns a
travel agency, received a bill for almost $200,000 in back taxes,
penalties, and interest, despite the fact that his independent
contractors had already paid their taxes! Mr. President, a $200,000 tax
bill will close the doors of most small businesses.
According to the NBC report, the IRS has used these worker
classification audits to collect more than three-quarters of a billion
dollars from business owners over the last 7 years in disputed
employment taxes, even though many of the independent contractors had
already paid these taxes.
The Independent Contractor Tax Simplification Act replaces the
complicated and arbitrary common law test with a simple definition of
who is not an employee.
To qualify for independent contractor status, my legislation requires
the service provider to have a significant investment in assets and/or
training, or incur significant unreimbursed expenses, or agree to
perform the service for a particular amount of time or to, complete a
specific result and is liable for damages for early termination without
cause, or be paid primarily on a commissioned or per-unit basis, or
purchase products for resale.
Further, under my legislation the service provider must have a
principal place of business, or not primarily provide the service in
the recipient's facilities unless the provider is paying a fair market
rent for their use, or operate primarily from equipment not supplied by
the service recipient or not be required to perform service exclusively
for the service recipient, and have recently performed a significant
amount of service for other persons, or have offered to perform service
for other persons through advertising, individual solicitations,
listing with registries, et cetera or other similar activities, or have
provided service under a registered or licensed business name.
Finally, Mr. President, my legislation requires businesses and
independent contractors to enter into a written contract and comply
with all applicable IRS reporting requirements to ensure that payments
to independent contractors are properly reported in order to prevent
taxpayer arbitrage.
I would like to stress, Mr. President, that this legislation is not a
comprehensive rewrite of all independent contractor law. It is very
difficult to address all worker classification issues in one bill,
because there is an unlimited number of employment situations and each
one presents different challenges. Further, many individuals,
businesses, and trade associations have resolved their problems with
the IRS, and they fear that a comprehensive change in the law will
force them to renew old arguments with the Government or impose
unwanted conditions on their employment practices, such as tax
withholding. The Independent Contractor Tax Simplification Act will
benefit those businesses and contractors who have not resolved their
status with the IRS, while preserving current law for those who are
satisfied with it.
Mr. President, it is not fair to business, nor is it conducive to the
entrepreneurial spirit of this country, to leave the question of worker
classification up to the whim of the IRS. The importance and timeliness
of this issue was made clear last summer when delegates to the White
House Conference on Small Business made clarifying independent
contractor rules their No. 1 small business priority. I believe
Congress should act decisively to recognize the importance of
independent contractors, and I invite my colleagues to join me in this
initiative.
______
By Mr. McCONNELL:
S. 1611. A bill to establish the Kentucky National Wildlife Refuge,
and for other purposes; to the Committee on Environment and Public
Works.
[[Page S1975]]
the kentucky national wildlife refuge authorization act
Mr. McCONNELL. Mr. President, I introduce a bill to establish
the Kentucky National Wildlife Refuge. The designation will give
Kentucky something that 49 other States have enjoyed for a long time:
its own national wildlife refuge. What this means to my State is new
tourism opportunities and a pristine environmental preserve that will
be part of our legacy to future generations.
Nearly 100 years ago, President Theodore Roosevelt established the
National Wildlife Refuge System to protect our Nation's open lands,
water, and wildlife for the future. It was one of the first Federal
environmental programs in our history.
Today, the National Wildlife Refuge System is made up of 571 refuges
in 49 States and U.S. Territories, totaling nearly 92 million acres of
the Nation's best wildlife habitat. Until now, Kentucky has been the
only State without its own independently managed refuge.
The legislation I am proposing will authorize the U.S. Fish and
Wildlife Service to purchase up to 20,000 acres in western Kentucky
located in the east fork of the Clarks River. This site, located near
Benton, is the only major bottomland hardwood area remaining in western
Kentucky.
Once established, the Kentucky National Wildlife Refuge will showcase
a unique ecosystem, protecting wildlife and offering a variety of
educational opportunities for the public. This refuge will also provide
recreational activities, including bird-watching, hiking, hunting, and
the fishing.
The refuge area is situated on an important migratory fly-way and
breeding area for a variety of waterfowl. A large number of migratory
birds including wood ducks, song birds, and the threatened bald eagle
make their home here. The hardwood forests make an ideal habitat for
numerous woodpeckers, hawks, and the eastern wild turkey. Other
wildlife which would thrive in this area include deer, beavers, otters,
and bobcats.
For visitors, the refuge is conveniently located near Paducah,
Mayfield, Murray, and Benton, and is just 15 miles from Land Between
the Lakes, which draws nearly 2 million visitors a year. This refuge is
ideally suited to serve surrounding schools, recreational hikers, and
hunters. The Clarks River will also appeal to those who enjoy canoeing
and fishing as well.
In addition to the environmental and educational benefits, the
designation of the Kentucky Wildlife Refuge will also provide a
significant economic boost to the area. The creation of Kentucky's
first refuge will help keep tourist dollars in the State. A perfect
example of this is a trip, planned by the Louisville Zoo, to a National
Wildlife Refuge in Tennessee. This trip is for Kentuckians who are
interested in eagle-watching. By creating a Kentucky wildlife refuge,
people who are interested in outdoor activities would have an
opportunity here in Kentucky--something that nature lovers and the
State would benefit from.
I have worked hard to ensure that my proposal is fair in protecting
the rights of individual landowners, while preserving this important
habitat. Contained in my bill is language to ensure that the
acquisition of refuge lands will be from willing sellers, donations, or
exchanges only.
I am sensitive to the property rights and concerns of local
landowners; and for this reason I will closely follow the project to
ensure that their rights are protected.
I have also worked closely with the Kentucky Farm Bureau to guarantee
that the management of the refuge will not impact surrounding farmers
or unduly restrict agricultural activities. I am confident that both
agricultural interests and conservation interests can exist side-by-
side in this region.
Finally, it is deeply gratifying to have such a broad array of
support for my proposal, including State and local public officials,
conservation groups, and sportsmen. I would like to commend Tom
Bennett, commissioner of the Kentucky Department of Fish and Wildlife
Resources, and his staff, for their efforts to establish consensus
among the various groups. This refuge could never have been established
without the strong support of people like Tom, as well as the
cooperation we have received from the surrounding communities.
It has been 92 years since Teddy Roosevelt created the National
Wildlife Refuge System. The time is long overdue for Kentucky to join
that system at last.
Mr. President, I ask unanimous consent that a text of the bill be
printed in the Record and a list of organizations and individuals who
have endorsed the creation of the wildlife refuge also be printed in
the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1611
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 ``Kentucky National Wildlife
Refuge Authorization Act''.
SEC. 2. FINDINGS.
Congress finds that--
(1) the area known as the Clarks River Basin, consisting of
20,000 acres of bottomland hardwood and associated wetlands
along the Clarks River and the East Fork of the Clarks River
in Graves, Marshall, and McCracken Counties, Kentucky, is of
critical importance to a variety of migratory and resident
waterfowl, neotropical migratory birds, forest wildlife, and
riverine species, and a wide array of other species
associated with bottomland communities;
(2) the area is the only major, natural (unchannelized)
bottomland hardwood wetland ecosystem remaining in western
Kentucky and attracts wintering migratory waterfowl,
neotropical migratory birds, and an array of raptors;
(3) the area provides extraordinary recreational, research,
and educational opportunities for students, scientists,
birdwatchers, wildlife observers, hunters, anglers, hikers,
and nature photographers;
(4) the area is an internationally significant
environmental resource that is unprotected and requires
active management to prevent vegetative encroachment and to
otherwise protect and enhance the value of the area as fish
and wildlife habitat;
(5) the Clarks River Basin has been identified in the
preliminary project proposal plan for the establishment of
the Kentucky National Wildlife Refuge, prepared by the United
States Fish and Wildlife Service (Southeast Region), as an
area deserving permanent protection; and
(6) since agriculture and silviculture are essential to the
economies of Graves, Marshall, and McCracken Counties and can
contribute to healthy ecosystems for wildlife, the refuge
should not restrict agricultural and silvicultural activities
on private lands.
SEC. 3. PURPOSE.
The purpose of this Act is to establish the Kentucky
National Wildlife Refuge to be managed--
(1) to conserve fish and wildlife populations and the
habitats of the populations, including habitats of bald
eagles, golden eagles, Indiana bats, wood ducks, neotropical
migratory birds, shorebirds, and other migratory birds;
(2) to preserve and showcase the concepts of biodiversity
and ecosystem management;
(3) to enhance and provide a vital link to public areas
containing habitat managed for waterfowl and other migratory
birds;
(4) to fulfill international treaty obligations of the
United States with regard to fish and wildlife and the
habitats of the fish and wildlife;
(5) to restore and maintain the physical and biological
integrity of wetlands and other waters within the refuge;
(6) to conserve species known to be threatened with
extinction; and
(7) to provide opportunities for scientific research,
environmental education, and fish- and wildlife-associated
recreation (including hunting, trapping, and fishing) and
access to the extent compatible with the management purposes
specified in paragraphs (1) through (6).
SEC. 4. DEFINITIONS.
In this Act:
(1) Land.--The term ``land'' includes an interest in land.
(2) Refuge.--The term ``refuge'' means the Kentucky
National Wildlife Refuge established under section 5.
(3) Secretary.--The term ``Secretary'' means the Secretary
of the Interior, acting through the Director of the United
States Fish and Wildlife Service.
(4) Water.--The term ``water'' includes an interest in
water.
SEC. 5. ESTABLISHMENT OF REFUGE.
(a) Establishment.--In accordance with this Act, the
Secretary shall establish a staffed and fully functional
national wildlife refuge to be known as the ``Kentucky
National Wildlife Refuge''.
(b) Boundary Designation.--The Secretary shall--
(1) consult with appropriate State and local officials,
private conservation organizations, and other interested
parties in designating the boundaries of the refuge, which
shall comprise approximately 20,000 acres;
(2) prepare a detailed map depicting the boundaries
designated under paragraph (1), which shall be on file and
available for public inspection at offices of the United
States Fish and Wildlife Service; and
(3) include in the boundaries of the refuge the lands,
aquatic systems, wetlands, and
[[Page S1976]]
waters depicted on the maps prepared under paragraph (2).
(c) Boundary Revisions.--The Secretary may make such minor
revisions in the boundaries designated under subsection (b)
as are necessary to carry out the purpose of the refuge and
to facilitate the acquisition of property within the refuge.
(d) Acquisition.--To the extent authorized under the Land
and Water Conservation Fund Act of 1965 (16 U.S.C. 460l-4 et
seq.), the Migratory Bird Conservation Act (16 U.S.C. 715 et
seq.), the Fish and Wildlife Act of 1956 (16 U.S.C. 742a et
seq.), the Emergency Wetlands Resources Act of 1986 (16
U.S.C. 3901 et seq.), and other laws, the Secretary may
acquire for inclusion in the refuge, by purchase from willing
sellers, donation, or exchange, lands and waters (including
permanent conservation easements) within the boundaries
designated under subsection (b). All lands and waters so
acquired shall become part of the refuge.
(e) Operation and Maintenance.--The Secretary shall
construct such office, maintenance, and support facilities as
are necessary for the operation and maintenance of the
refuge.
SEC. 6. ADMINISTRATION.
(a) General Administrative Authority.--The Secretary shall
administer all lands and waters acquired under section 5 in
accordance with the National Wildlife Refuge System
Administration Act of 1966 (16 U.S.C. 668dd et seq.).
(b) Other Administrative Authority.--Consistent with
subsection (a) and to carry out the purpose of the refuge,
the Secretary may use such additional authority as is
available to the Secretary for the conservation and
development of fish, wildlife, and natural resources, the
development of outdoor recreational opportunities (including
hunting, trapping, and fishing), and interpretative
education.
(c) Management Plan.--
(1) In general.--Not later than 18 months after the date of
enactment of this Act, the Secretary shall prepare a
comprehensive management plan for the development and
operation of the refuge that shall include--
(A) refuge management priorities and strategies;
(B) the planning and design of observation points, trails,
and access points, including parking and other necessary
facilities; and
(C) such provisions as are necessary to ensure that--
(i) no activity carried out in the refuge will result in
the obstruction of the flow of water so as to affect any
private land adjacent to the refuge; and
(ii) no buffer zone regulating any land use (other than
hunting and fishing) is established.
(2) Public participation.--
(A) In general.--The Secretary shall provide opportunity
for public participation in developing the management plan.
(B) Local entities.--The Secretary shall give special
consideration to means by which the participation and
contributions of local public and private entities in
developing and implementing the management plan can be
encouraged.
(d) Outreach and Education.--The Secretary shall work with,
provide technical assistance to, provide community outreach
and education programs for or with, or enter into cooperative
agreements with private landowners, State and local
governments or agencies, and conservation organizations to
further the purpose for which the refuge is established.
SEC. 7. GIFTS.
As soon as practicable after the date of enactment of this
Act, the Director of the United States Fish and Wildlife
Service shall request that the National Fish and Wildlife
Foundation established under the National Fish and Wildlife
Foundation Establishment Act (16 U.S.C. 3701 et seq.) take
such measures as the Foundation considers appropriate to
encourage, accept, and administer private gifts of property
or funds to further the purpose of this Act.
SEC. 8. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated such sums as are
necessary to carry out this Act.
____
Organizations That Have Endorsed the Creation of the Kentucky National
Wildlife Refuge
Appalachia Science in the Public Interest.
Association of Chenoweth Run Environmentalists.
Audubon Society of Kentucky.
Bell County Beautification Association.
Berea College Biology Club.
Brushy Fork Water Watch.
Community Farm Alliance.
Daviess County Audubon Society & Kentucky Ornithological
Society.
Department of Parks
Eastern KY University Wildlife Society.
Elkhorn Land & Historic Trust Inc.
Floyds Fork Environmental Association.
Friends of Mill Creek.
Gun Powder Creek Water Watch.
Harlan County Clean Community Association.
Hart County Environmental Group.
Highlands Group Cumberland Chapter Sierra Club.
Ky Academy of Science.
Ky Association for Environmental Education.
Ky Audubon Council.
Ky Citizens Accountability Project.
Ky Conservation Committee.
Ky Fish & Wildlife Education & Resource Foundation.
Ky Houndsmen Association.
Ky Native Plant Society.
Ky Society of Natural History.
Ky State Nature Preserve Commission.
Lake Cumberland Water Watch.
Land & Nature Trust of the Bluegrass.
League of Ky Sportsman.
League of Women Voters of Kentucky.
Leslie County KAB System.
Litter River Audubon Society.
Louisville Audubon Society.
Louisville Chapter 476 of Trout Unlimited.
Louisville Nature Center.
Madison County Clean Community Committee.
Madison Environment.
Mall Interiors.
Midway Area Environmental Committee.
National Wild Turkey Federation.
Oldham Community Center & Nature Preserve, Inc.
Petersen's Fault Farm.
Pleasant Hill Recreation Association.
Pride Inc.
Quail Unlimited
Rockcastle River Rebirth.
Rocky Mountain Elk Foundation.
Ruddles Mill Conservation Project.
Scenic Kentucky.
Shelby Clean Community Program.
Shelby County Clean Community Council.
Sierra Club Cumberland Chapter.
Steve & Janet Kistler.
The Nature Conservancy/Kentucky Chapter.
The Wildlife Connection.
Trout Unlimited/KYOUA Chapter.
Mikeal E. Joseph.
Paul Garland.
Paul C. Garland.
Kathy Zajac.
William S. Bryant.
Frances Williams.
The Black Family.
______
By Mr. HELMS (for himself, Mr. Dole, Mr. Hatch, Mr. Thurmond, Mr.
Faircloth, Mr. Gramm, and Mrs. Feinstein):
S. 1612. A bill to provide for increased mandatory minimum sentences
for criminals possessing firearms, and for other purposes; to the
Committee on the Judiciary.
mandatory minimum sentencing legislation
Mr. HELMS. Mr. President, a drug trafficker who in 1992 was convicted
in the U.S. District Court for the Eastern District of North Carolina
was released from prison 2 days ago, Monday, March 11, as the tragic
result of an unfortunate and unwise Supreme Court decision.
Although the drug trafficker had 5 more years to serve, the U.S.
Supreme Court, using the flimsiest of reasoning, set this convicted
drug trafficker free. So, Mr. President, the bill I am introducing
today will prevent future criminals from being set free. I am advised
that my bill is being numbered S. 1612.
Mr. President, S. 1612 provides that a 10-year minimum mandatory
sentence shall be imposed upon any criminal possessing a gun during and
in relation to the commission of a violent or drug trafficking crime.
This, of course, does not apply to lawful possession of a gun.
This bill will obviously crack down on gun-toting thugs who commit
violent felonies and drug trafficking offenses and other felonies.
Moreover, it will ensure that criminals possessing a firearm while
committing a violent or drug trafficking felony shall receive a stiff
punishment.
This is just common sense, Mr. President; violent felons who possess
firearms are more dangerous than those who do not.
Current Federal law provides that a person who, during a Federal
crime of violence or drug trafficking crime, uses or carries a firearm
shall be sentenced to 5 years in prison. That law has been used
effectively by Federal prosecutors across the country to add 5
additional years to the prison sentences of criminals who use or carry
firearms.
However, a recent U.S. Supreme Court decision threatens to undermine
the efforts of prosecutors to use this statute effectively. The Supreme
Court's decision, Bailey versus United States, interpreted the law to
require that a violent felon actively employ a firearm as a
precondition of receiving an additional 5 year sentence. The Court in
Bailey held that the firearm must be brandished, fired or otherwise
actively used before the additional 5 year sentence may be imposed. So
if a criminal merely possesses a firearm, but does not fire or
otherwise use it, he gets off without the additional 5 year penalty.
Mr. President, this Supreme Court decision poses serious problems for
law enforcement. It weakens the Federal
[[Page S1977]]
criminal law; it is leading to the early release of hundreds of violent
criminals. Before this Supreme Court's error of judgment, in the Bailey
versus U.S. decision, armed criminals committing violent or drug
trafficking felonies were jailed for an additional 5 years, regardless
of whether they actively employed their weapons. Now, as a result of
the Court's decision, the prison revolving door is in full swing. Yet
another roadblock has been erected between a savage criminal act and
swift, certain punishment.
Mr. President, now that the word is out, prisoners already are
preparing and filing motions to get out of jail as fast as they can
write. U.S. attorneys are receiving petitions from criminals every
day--for example consider the case of Lancelot Martin, who ran a drug
trafficking operation out of Raleigh, NC: In 1992, Martin had attempted
to use the U.S. Postal Service to receive and sell drugs. Martin was
arrested by a Raleigh crime task force. The authorities obtained a
warrant, searched his apartment, seized his drugs and recovered a 9 mm.
semi-automatic pistol that Martin used to protect his drug business.
Martin was convicted of drug trafficking charges and received a 5
year sentence for using the gun. But Monday, well before his sentence
expired, Martin walked free, simply because his gun and a hefty supply
of drugs were found--but the Court somehow held that the gun was not
actively employed during his drug trafficking crime.
So, Mr. President, my bill will ensure that future criminals
possessing guns, like Lancelot Martin, serve real time when they use a
gun in furtherance of a violent or drug trafficking crime. There are
many other examples similar to the episode involving Lancelot Martin.
As a result of the Court's decision, any thug who hides a gun under
the back seat of his car, or who stashes a gun with his drugs, may now
get off with a slap on the wrist. Or if a criminal stores a sub-
machinegun in a crack-house where he runs a drug trafficking operation,
he can now avoid the additional penalty. The fact is, Mr. President,
that firearms are the tools of the trade of most drug traffickers.
Weapons clearly facilitate the criminal transactions and embolden
violent thugs to commit their crimes.
I believe that mere possession of a firearm, during the commission of
a violent felony--even if the weapon is not actively used--should
nonetheless be punished--because of the heightened risk of violence
when firearms are present. In its opinion, the Supreme Court observed,
``Had Congress intended possession alone to trigger liability . . . it
easily could have so provided.'' That, Mr. President, is precisely the
intent of this legislation--to make clear that ``possession alone''
does indeed ``trigger liability.''
This legislation will increase the mandatory--repeat, mandatory--
sentences for violent armed felons from 5 to 10 years--and if the
firearm is discharged, the term of imprisonment is 20 years. This
legislation also increases to 25 years the mandatory sentences for
second and subsequent offenses.
Mr. President, this bill is a necessary and appropriate response to
the Supreme Court's judicial limitation of the mandatory penalty for
gun-toting criminals. According to Sentencing Commission statistics,
more than 9,000 armed violent felons were convicted from April, 1991,
through October, 1995. In North Carolina alone, this statute was used
to help imprison over 800 violent criminals. We must strengthen law
enforcement's ability to use this strong anticrime provision.
Fighting crime is, and should be, a top concern in America. It has
been estimated that in the United States one violent crime is committed
every 16 seconds. And with youth-related violent crime at an all-time
high, we must fight back with the most severe punishment possible for
those who terrorize law-abiding citizens.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1612
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. INCREASED MANDATORY MINIMUM SENTENCES FOR
CRIMINALS POSSESSING FIREARMS.
Section 924(c)(1) of title 18, United States Code, is
amended to read as follows:
``(c)(1)(A) Except to the extent a greater minimum sentence
is otherwise provided by any other provision of this
subsection or any other law, a person who, during and in
relation to any crime of violence or drug trafficking crime
(including a crime of violence or drug trafficking crime
which provides for an enhanced punishment if committed by the
use of a deadly or dangerous weapon or device) for which a
person may be prosecuted in a court of the United States,
possesses a firearm shall, in addition to the punishment
provided for such crime of violence or drug trafficking
crime--
``(i) be punished by imprisonment for not less than 10
years;
``(ii) if the firearm is discharged, be punished by
imprisonment for not less than 20 years; and
``(iii) if the death of a person results, be punished by
the death penalty or by imprisonment for not less than life.
``(B) If the firearm possessed by a person convicted under
this subsection is a machinegun or a destructive device, or
is equipped with a firearm silencer or firearm muffler, such
person shall be sentenced to imprisonment for not less than
30 years.
``(C) In the case of a second or subsequent conviction
under this subsection, such person shall be sentenced to
imprisonment for not less than 25 years, and if the firearm
is a machinegun or a destructive device, or is equipped with
a firearm silencer or firearm muffler, to life imprisonment
without release.
``(D) Notwithstanding any other provision of law, the court
shall not place on probation or suspend the sentence of any
person convicted of a violation of this subsection, nor shall
the term of imprisonment imposed under this subsection run
concurrently with any other term of imprisonment including
that imposed for the crime of violence or drug trafficking
crime in which the firearm was possessed.''.
____________________