[Congressional Record Volume 143, Number 32 (Thursday, March 13, 1997)]
[Senate]
[Pages S2274-S2284]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. ROTH (for himself, Mr. Moynihan, Mr. Lautenberg, Mr. 
        Wyden, Mr. Jeffords, Mr. Biden, Mr. Kerry, Mr. DeWine, Mr. 
        Leahy, and Mr. Specter):

  S. 436. A bill to amend the Internal Revenue Code of 1986 to provide 
for the establishment of an intercity passenger rail trust fund, and 
for other purposes; to the Committee on Finance.


                     AMTRAK TRUST FUND LEGISLATION

  Mr. ROTH. Mr. President, I rise to introduce legislation that would 
create a dedicated source of capital funding for Amtrak. Joining me as 
cosponsors are Senators Moynihan, Lautenberg, Wyden, Jeffords, Biden, 
Kerry, DeWine, Leahy, and Specter.
  Mr. President, all major modes of transportation have a dedicated 
source of capital funding, except for intercity passenger rail.
  My legislation would correct this inequity and create a secure and 
reliable capital trust fund for Amtrak, no different than what other 
major modes of transportation now have.
  My legislation would transfer one-half cent of the 4.3 cent per 
gallon motor fuels tax currently going to the general fund, to a new 
intercity passenger rail trust fund.
  This rail trust fund would total approximately $3.9 billion dollars 
over 5 years to be used for capital improvement projects. After the 
fifth year, the revenues from the half cent would revert back to the 
general fund. My bill would create contract authority to allow Amtrak 
to enter into contracts necessary for long-term capital projects. For 
States that do not have Amtrak service, it would provide funding for 
qualified transportation expenses.
  This capital funding proposal is critical to Amtrak's future.
  Amtrak needs capital funding to bring it's equipment, facilities, and 
tracks into a state of good repair. Much of Amtrak's equipment and 
infrastructure has exceeded its projected useful life. The costs of 
maintaining this aging fleet and the need to modernize and overhaul 
facilities through capital improvements to the system are serious 
financial challenges for Amtrak. My proposal would help reverse these 
problems and give Amtrak the resources necessary to meet its capital 
investment needs.
  Mr. President, Amtrak, and the National Commission on Intermodal 
Transportation have called for a secure source of capital funding for 
Amtrak. I believe that now is the time for this Congress to reverse our 
current policy that favors building more highways at the expense of 
alternative means of transportation such as intercity passenger rail. 
Despite rail's proven safety, efficiency, and reliability in Europe, 
Japan, and elsewhere, inter-city passenger rail remains severely 
underfunded in the United States. In fact, over half of the Department 
of Transportation's spending authority is devoted to highways and 
another quarter to aviation; rail still ranks last with roughly 3 
percent of total spending authority.
  Last year we spent $20 billion for highways while capital investment 
for Amtrak was less than $450 million.
  In relative terms, between fiscal year 1980 and fiscal year 1994, 
transportation outlays for highways increased 73 percent, aviation 
increased 170 percent, and transportation outlays for rail went down by 
62 percent. In terms of growth, between 1982 and 1992 highway spending 
grew by 5 percent, aviation by 10 percent, while rail decreased by 9 
percent.
  A problem that is going to increase is the congestion on our roads. 
Between 1983 and 1990, Vehicle Miles Traveled increased nationwide by 
41 percent. If current trends continue, delays due to congestion will 
increase by more than 400 percent on our highways and by more than 1000 
percent on urban roads. Highway congestion costs the United States $100 
billion annually, and this figure does not include the economic and 
societal costs of increased pollution and wasted energy resources.
  Air travel is equally congested. Commercial airlines in the U.S. 
presently

[[Page S2275]]

transport over 450 million passengers each year. A recent 
transportation safety board study revealed that 21 of the 26 major 
airports experienced serious delays and it is projected to get worse. 
Again, the costs are enormous. A 1990 DOT study estimated the financial 
cost of air congestion at $5 billion each year, and it expects this 
number to reach $8 billion by 2000.
  Congestion is a problem and it must be addressed. However, the 
current path we are on directs more money for highways and airports. 
For us in the Northeast, building more roads is simply not an option. 
We do not have the land nor the financial resources to build more 
highways or more airports. For these reasons, we must provide more than 
just good roads but a good passenger rail system as well.
  Adequately funded passenger rail can successfully address highway 
gridlock and ease airport congestion. Passenger rail ridership between 
New York and Washington is equal to 7,500 fully booked 757's or 10,000 
DC-9's. Between New York and Washington, Amtrak has over 40 percent of 
the air-rail market.
  Improved Northeast rail service will also have the same positive 
impact on road congestion--5.9 billion passenger miles were taken on 
Amtrak in 1994. These are trips that were not taken on crowded highways 
and airways. Improved rail service in the Northeast is projected to 
eliminate over 300,000 auto trips each year from highways as well as 
reduce auto congestion around the airports.
  Improved rail service will also have a positive affect on rural 
areas. Twenty-two of Amtrak's 55 million passengers depend on Amtrak 
for travel between urban centers and rural locations which have no 
alternative modes of transportation.
  Mr. President, now is the time to invest in our rail system.
  Opponents of my legislation have said that we should not use revenues 
from our motor fuels tax to pay for Amtrak. I disagree. States are 
currently using revenues collected from our motor fuels tax for many 
non-highway uses. For example, Virginia uses its motor fuels tax 
receipts on mass transit and ports; New Hampshire uses its motor fuels 
receipts to bolster their Fish and Game Department; Wyoming uses its 
portion of the motor fuels tax for snowmobile trails and boating 
facilities; Florida and Arkansas use the motor fuels tax for 
environmental protection. Like these States have already done, I 
believe Congress should spend the revenues raised by the motor fuels 
tax on those programs it feels best serve our transportation needs. I 
think passenger rail should be one of those programs.

  Another argument I often hear is that we should stop subsidizing 
Amtrak. Amtrak needs to be self-sufficient.
  I would like to see that happen, but to date, I am not aware of any 
transportation system that supports itself without Federal assistance. 
Further, I am not aware of any transportation system that supports 
itself through user fees. According to the Department of 
Transportation, in fiscal year 1994 nearly $6 billion more was spent on 
highways than was collected in user fees.
  In fiscal year 1995 nearly $8 billion more was spent on highways than 
was collected in user fees. Transit which is exempt from the motor 
fuels tax, received $3 billion in revenues in motor fuels revenues last 
year. I repeat, no mode is self-financed.
  In closing, our national passenger rail system is important.
  My legislation would provide capital funding to help improve and 
maintain the corporation's infrastructure. Amtrak will not be able to 
make it to zero operating subsidies by the year 2002 without it. If we 
are to adequately fund our passenger rail system like we fund our 
highways and other major modes of transportation, Amtrak will need this 
trust fund.
                                 ______
                                 
      By Mr. DOMENICI (for himself, Mr. Inouye, Mr. Campbell, Mr. 
        Johnson, Mr. Murkowski, Mr. Stevens, and Mr. Bingaman):
  S. 437. A bill to improve Indian reservation roads and related 
transportation services, and for other purposes; to the Committee on 
Indian Affairs.


       THE AMERICAN INDIAN TRANSPORTATION IMPROVEMENT ACT OF 1997

  Mr. DOMENICI. Mr. President, I rise to introduce a bill on behalf of 
myself, Senator Inouye, Senator Campbell, Senator Johnson, Senator 
Murkowski, Senator Stevens, and Senator Bingaman.
  Our bill, the American Indian Transportation Improvement Act of 1997, 
says that the U.S. Congress desires to treat the Indian people of the 
United States fairly when we pass a new ISTEA; that is, a new highway 
and transportation and transit bill. As everybody who knows anything 
about our Indian reservations and Indian pueblos knows, the Indian 
people buy gasoline just like average Americans. They have cars and 
pickup trucks. But they have a road system that is maintained for the 
most part by the Bureau of Indian Affairs. Now, if there is not a 
dedicated source of revenue, then obviously you have to take money out 
of the Bureau of Indian Affairs general funding to build roads.
  For a number of years we have decided--and I am pleased that I took 
the leadership--to set aside some significant portion of money out of 
the highway trust fund that should go to Indian roads.
  Today, I am introducing a bill that says to our 557 Indian tribes and 
the Alaskan Native villages, which are served by about 50,000 miles of 
road--about 42 percent of these roads are Bureau of Indian Affairs 
roads, as I indicated--we are going to try to begin a program that will 
not only build some more roads but will maintain them and will give the 
Indian people their share of each category of ISTEA money for their 
road needs, be it construction of bridges, transit programs, highway 
safety, scenic byways, or the like.
  Mr. President, our Nation's 557 Indian tribes and Alaska Native 
villages are served by over 50,000 miles of roads. About 42 percent of 
these roads are Bureau of Indian Affairs [BIA] system roads. Beginning 
in the 1982 Surface Transportation Assistance Act, these BIA system 
roads were included in the national highway trust fund for the first 
time in history. The gasoline tax, paid by every Indian who buys 
gasoline, was invested on Indian reservations through the Indian 
Reservation Roads [IRR] Program. Indian tribes were included in 
subsequent major highway legislation, most recently in the Intermodal 
Surface Transportation Efficiency Act [ISTEA], where annual funding has 
been $191 million for the past 5 years. Prior to ISTEA, annual IRR 
funding was $80 million per year.
  Our best estimates indicate that at least $300 million is needed 
annually to begin to bring the IRR system up to par with the rest of 
American roads and highways. Today, I am proud to be joined by Senators 
Inouye, Campbell, and Johnson in introducing the American Indian 
Transportation Improvement Act of 1997. Our legislation increases the 
Indian Reservation Roads Program from $191 million per year to $250 
million in fiscal year 1998; $275 million in fiscal year 1999; and $300 
million each year for fiscal years 2000 through 2002. These funds are 
primarily used for the design and construction of the BIA road system 
in Indian country. It is significant to most tribes that our bill also 
includes road maintenance as an eligible activity.
  In addition to increasing the planning, design, construction, and 
maintenance money in our bill, we make other significant changes in the 
IRR Program and related ISTEA Programs to improve the transportation 
system on our Nation's Indian reservations. These changes will improve 
the bridge construction program; provide a set-aside for transit 
systems; allow DOT certification to directly operate DOT programs; 
provide a set-aside for highway enhancements like lighting and transfer 
points to buses; create a competitive grant process for scenic byways; 
exclude State roads on tribal lands from the apportionment adjustment 
provisions of ISTEA; and increase funding for Indian Technical Centers 
from $200,000 each to one million dollars each for the six existing 
centers.
  In the ISTEA Bridge Program, which now requires each State to set 
aside 1 percent of its ISTEA Bridge Program funds for Indian tribes, 
our bill would consolidate the 50 separate State set-asides into one 
national pool. This national set-aside is then distributed to all 
tribes using to the BIA National Bridge Inventory Standards Program. 
This BIA Bridge Program rates each Indian bridge and gives it a 
national

[[Page S2276]]

ranking by deficiency. Funding priorities for all tribes would be set 
through the BIA bridge ranking system.
  To encourage and expand transit systems on Indian reservations, The 
American Indian Transportation Improvement Act of 1997 [TAITIA] would 
also establish a 1 percent set-aside from ISTEA--and its successor--
transit programs. While a national formula to allocate transit funds is 
developed in consultation with tribes, the Federal Transit 
Administration of the U.S. Department of Transportation [DOT] would 
allocate the funds. Without the new set-aside, tribes would have to 
continue to compete within each State for transit moneys. Our bill also 
allows the conversion of up to 3 percent of IRR construction and design 
funds for local transit purposes.
  Under current law, tribes are not included as eligible entities for 
direct certification by DOT. This situation is clearly detrimental to 
tribes hoping to directly operate DOT highway programs other than those 
operated by the BIA. While only a handful of tribes, like the Navajo 
Nation, are potentially capable of meeting the DOT certification 
standards, none are allowed to be certified under the terms of current 
law. Without changing any of DOT's certification standards, this bill 
would allow tribes that qualify to become certified by DOT to directly 
operate Federal highway programs.
  In a related certification issue, any tribe certified by DOT, as 
States are now certified, would be allowed direct access to DOT highway 
safety program funds. Other tribes--most tribes--would continue to fund 
their highway safety programs through the BIA-DOT program.
  Indian tribes need better access to the Highway Enhancements Program 
for such improvements as lighting, bike trails, transfer points to 
buses, and other enhancements. States are allowed to use up to 10 
percent of their ISTEA funds for these types of enhancements. Our bill 
creates a national Indian set-aside of 1 percent and would be 
administered through the Federal Highway Administration competitive 
grant process. Each tribe would be eligible to compete for these funds.

  The Scenic Byways Program of ISTEA is essential to many tribes for 
enhanced access to scenic areas for improved economic development 
activities and other purposes. The Jicarilla Apache Tribe in New 
Mexico, for example, has committed $3 million of its IRR funds--about 2 
years of its total allocations--to complete its portion of the narrow 
gauge scenic highway to Colorado. To improve critical roads like this 
one without detracting from the more basic highway needs, our bill 
would create a 1 percent set-aside for Indian scenic byways. The 
Federal Highway Administration would allocate these funds through a 
competitive process with priority consideration given to tribes with 
the greatest potential for tourism and other economic development 
activities for tribal members.
  Many States commit ISTEA resources to public lands highways on Indian 
reservations. Under current law, there are apportionment adjustment 
hold harmless provisions between donor and donee States. If a donee 
State like New Mexico decides to allocate funds for a public land 
highway through an Indian reservation, that donee State's allocation 
for the following year is reduced by the amount of money committed to 
the public land highway through the Indian reservation--as well as 
public land highways elsewhere in the State. To encourage States to 
commit their ISTEA resources to these critical highways on Indian land, 
like New Mexico highway 537 on the Jicarilla Apache Tribe's 
reservation, our bill exempts State commitments to public lands 
highways that are built on Indian land.
  If The American Indian Transportation Improvement Act of 1997 were 
law today, the State of New Mexico and similar donee States would not 
be penalized for committing their resources to State roads like New 
Mexico highway 537. Our bill does not address the more general issue of 
the apportionment adjustment hold harmless provisions in ISTEA, we 
simply exempt Indian land highways from those provisions.
  Finally, The American Indian Transportation Improvement Act of 1997 
increases the allocation of IRR funds to the Indian technical centers 
from $200,000 per center for six centers to $1 million per center for 
the same six centers. These centers provide training to Indian tribes 
in all phases of highway planning, design, construction, maintenance, 
procurement, and related bridge programs. Increasing the ability of 
these centers to train Indian highway administrators, engineers, and 
others involved in the IRR Program will significantly enhance the 
ability of tribes to operate their own programs and improve their 
transportation systems.

  Mr. President, The American Indian Transportation Improvement Act of 
1997, was developed in close consultation with Indian leaders. I would 
like to give special recognition to Paulson Chaco and Sam Johns of the 
Navajo Nation Transportation Department and Arnold Cassador of the 
Jicarilla Apache Tribe and Mark Wright, their tribal roads engineer. 
Their assistance in developing this bill has been essential and their 
knowledge of these highway programs is impressive.
  The American Indian Transportation Improvement Act of 1997 will be a 
considerable improvement in the current way we do business for the BIA 
roads system. This system serves over a million American Indians who 
live on or near a reservation. In my home State of New Mexico, IRR 
funds have made a large difference in the past decade. It is time to 
accelerate this effort for the direct benefit of Indian people in 
America.
  Under the current relative needs formula for distributing the IRR 
money, the Navajo Nation--in New Mexico and Arizona--is now scheduled 
to receive about $55 million annually in IRR funds. New Mexico Pueblos 
receive about $12 million and the Apache Tribes receive about $3 
million in New Mexico. I know from personal observation, that these 
funds are generally well spent and much needed throughout Indian 
country. I believe they are critical funds for improving the poor 
employment opportunities on most Indian reservations. I urge my 
colleagues to study the importance of Indian roads for economic 
development opportunities, and support our effort to greatly improve 
the Indian Reservation Road Program as described in our bill. Our bill 
will go a long way toward helping American Indians make the best use of 
our Nation's highway programs to improve their daily lives.
  We have not heretofore broadly applied this degree of Indian 
participation in the trust fund we set up for highways and mass 
transit. We have, in the past, principally put money in to build roads. 
This year, the new bill that we introduced with the cosponsors that I 
have spoken of, will increase the ISTEA Indian Reservation Road Program 
to $250 million in 1998, to $275 million in 1999, then $300 million in 
each of the years 2000, 2001 and 2002. The ISTEA Indian Reservation 
[IRR] Roads program is currently funded at $191 million per year.
  I want to have a list printed in the Record at this point to show the 
current distribution of IRR funds by the BIA regional offices. Mr. 
President, I ask unanimous consent that this be printed in the Record, 
and I ask that a program activity allocation, showing how this IRR 
money is currently allocated among the participating Federal agencies, 
be printed in the Record at this point.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

        INDIAN RESERVATION ROADS PROGRAM, DESIGN AND CONSTRUCTION       
                          [Dollars in millions]                         
------------------------------------------------------------------------
                                                      RNF               
                                                   (percent)     Amount 
------------------------------------------------------\1\---------------
Bureau of Indian Affairs, Central Office, $191                          
 million:                                                               
  Aberdeen.....................................        9.109      $15.2 
  Anadarko.....................................        2.987        5.0 
  Billings.....................................        6.052       10.1 
  Juneau.......................................        9.460       15.8 
  Minneapolis..................................        5.045        8.4 
  Muskogee.....................................        7.705       12.9 
  Phoenix......................................        9.327       15.6 
  Sacramento...................................        2.863        4.8 
  Albuquerque..................................        7.026       11.8 
  Navajo.......................................       32.752       54.8 
  Portland.....................................        5.700        9.5 
  Eastern......................................        1.974        3.3 
                                                ------------------------
    Total......................................      100       \2\ 167.2
                                                                    5   
------------------------------------------------------------------------
\1\ RNF=Relative Needs Formula (Allocation distribution).               
\2\ Approximate amount available for design and construction after      
  deductions for different categories.                                  


[[Page S2277]]


         INDIAN RESERVATION ROADS [IRR] PROGRAM ALLOCATION PLAN         
------------------------------------------------------------------------
                                                   Allocation           
               IRR Program Activity                 (percent)   Million 
------------------------------------------------------------------------
    Yearly Authorization.........................  ..........    $191.0 
Less FHWA Administration.........................       3.00        5.7 
Less BIA Administration..........................       5.00        9.0 
Less IRR Transportation Planning.................       2.00        3.8 
Less 2 percent Tribal Transportation Planning *..       2.00        3.8 
Less Mapping.....................................        .13         .25
Less LTAP........................................        .63        1.2 
                                                  ----------------------
    Available for design and construction........  ..........     167.25 
------------------------------------------------------------------------
* 23 U.S.C., Section 204(j)(b)-Up to 2% of funds made available for     
  Indian Reservation Roads for each fiscal year shall be allocated to   
  those Indian tribal governments applying for transportation planning  
  pursuant to the provisions of the Indian Self-Determination and       
  Education Assistance Act. The Indian tribal government, in cooperation
  with the Secretary of the Interior, and, as may be appropriate, with a
  State, local government, or metropolitan planning organization, shall 
  develop a transportation improvement program, that includes all Indian
  reservation road projects proposed for funding. Projects shall be     
  selected by the Indian tribal government from the transportation      
  improvement program and shall be subject to the approval of the       
  Secretary of the Interior and the Secretary (of Transportation).      

  Mr. DOMENICI. Mr. President, I send the bill to the desk and ask it 
be referred to the appropriate committee or committees.
  The PRESIDING OFFICER. The bill will be received and appropriately 
referred.
  Mr. DOMENICI. Mr. President, I send a summary of the provisions, the 
purpose and various provisions. This document will show that Indian 
reservation bridges, for example, will be handled in a better way. Our 
bill continues the basic design and construction of Indian roads. We 
also add road maintenance as an eligible activity. We also provide 
transit, scenic byways, highway enhancements, and other Indian set-
asides in our bill.
  We include scenic byways, especially those that will help to develop 
reservation economies. We think if there are byways that are scenic in 
Indian country and can add to the reservation economy, they ought to 
get their share of these highway trust funds. We allow DOT 
certification for tribes who can qualify to directly operate DOT 
programs without going through the Bureau of Indian Affairs. We 
increase funding for Indian technical centers to enhance tribal 
capabilities in the entire range of highway planning, design, 
construction, and maintenance.
  I ask that this bill summary be printed in the Record.
  There being no objection, the summary was ordered to be printed in 
the Record, as follows:

       The American Indian Transportation Improvement Act of 1997


                                Purpose

       To increase the Indian Reservation Roads (IRR) Program of 
     the Intermodal Surface Transportation Improvement Act (ISTEA) 
     from $191,000,000 per year to $300,000,000 per year, and to 
     include Indian tribes in other relevant programs of ISTEA as 
     described below.


                IRR Funding Amounts and Road Maintenance

       IRR Program funding will be increased from $191 million in 
     fiscal year 1997 to $250 million in fiscal year 1998; $275 
     million in FY 1999; and $300 million in fiscal years 2000 
     through 2002. Road maintenance is made an eligible activity.


                       Indian Reservation Bridges

       The current Indian reservation bridge program in ISTEA is 
     operated through the states. Each state has a set-aside of 
     one percent for Indian bridges. The American Indian 
     Transportation Improvement Act of 1997 (TAITIA) creates a 
     single national bridge program from amounts previously 
     allocated to the states. TAITIA allocates one percent to the 
     Secretary of Transportation for Indian bridges. Priorities 
     for distribution among tribes will be determined by the 
     Bureau of Indian Affairs' (BIA) National Bridge Inspection 
     Standards Program which determines deficiency levels for 
     Indian reservation bridges. Priority for TAITIA funds will be 
     given to bridges with the highest level of deficiency.


                        Indian Transit Set-Aside

       In The American Indian Transportation Improvement Act of 
     1997, one percent of the ISTEA Mass Transit funds will be set 
     aside for transportation services to Indian tribes. The 
     Secretary of Transportation will develop an allocation 
     formula in consultation with tribes. Until the allocation 
     formula is formally developed, the Administrator of the 
     Federal Transit Administration of DOT will establish a 
     temporary allocation formula. the funds through a temporary 
     formula.


                         Scenic Byways Program

       One percent of the funds for scenic byways are set-aside 
     for Indian tribes in a competitive grant process for the 
     planning, design, and development of Indian tribe scenic 
     byway programs. These scenic byways are important for tribal 
     economic development programs.


              Certification Acceptance and Highway Safety

       The American Indian Transportation Improvement Act of 1997 
     allows tribes with advanced transportation planning and 
     construction capabilities to be certified by DOT for direct 
     participation in DOT programs in a manner that is now allowed 
     for qualified states. Under current law, even a qualified 
     tribe is not allowed to be certified by DOT. This 
     certification acceptance provision will allow tribes that are 
     able to meet the national standards to be accepted by DOT. 
     TAITIA makes no changes in the certification standards.
       Tribes that are able to achieve certification acceptance by 
     DOT will also be eligible for direct access to DOT highway 
     safety funds, Section 402 of ISTEA. These activities include 
     traffic safety, traffic law education, seatbelt law 
     enforcement, and free infant restraints.


                        Indian Technical Centers

       The six Indian Technical Centers are now funded at a level 
     of $200,000 each. To improve tribal capacity to plan, design, 
     construct, maintain, and otherwise operate their own Indian 
     Reservation Roads Programs, TAITIA will increase each 
     center's amount to one million dollars, adding $4.8 million 
     for this vital function.


                 Transportation Enhancement Activities

       ISTEA allows each state to use up to ten percent of its 
     allocation for transportation enhancements such as bike 
     trails, transfer points to buses, and lighting. Tribes are 
     allowed to compete for these funds in each state. TAITIA sets 
     aside one percent of the national transportation enhancement 
     pool to be used by the Secretary of Transportation to make 
     competitive grants to Indian tribes.


                         Public Lands Highways

       TAITIA exempts states from the apportionment adjustment 
     provisions of ISTEA for Public Lands Highways built on Indian 
     reservations. Although these are not IRR funds, states are 
     currently discouraged from committing their resources to 
     Public Lands Highways in Indian Country due to the hold 
     harmless provisions of the apportionment adjustment 
     requirements. This exemption is intended to encourage states 
     to make commitments of state ISTEA resources to Public Lands 
     Highways on Indian reservations.

  Mr. DOMENICI. Mr. President, I would like to indicate the 
distinguished former chairman of the Indian Affairs Committee, Senator 
McCain, is very interested in the bill, and has indicated his support 
when it reaches his committee.
 Mr. CAMPBELL. Mr. President, as Chairman of the Committee on 
Indian Affairs, I am pleased to join Senator Domenici and Vice Chairman 
Inouye in introducing the American Indian Transportation Improvement 
Act of 1997, to amend the Intermodal Surface Transportation Efficiency 
Act. [ISTEA].
  More than any other communities in the United States, Indian tribes 
and Alaska Native villages suffer from a lack of adequate 
infrastructure, and the necessary tools to build and maintain that 
infrastructure. The United States has a special responsibility to 
Indian tribal governments to help them achieve economic self-
sufficiency and political self-determination.
  Economies today, whether State, tribal, or national, are increasingly 
dependent on interstate and international commerce for their 
livelihoods. Solid physical infrastructure is the foundation for those 
economies.
  Federal ISTEA funding to tribal governments has lagged behind 
spending for States and local governments over the years, despite acute 
and unmet needs in Indian country. Poor and unsafe roads and highways, 
crumbling bridges, and nonexistent transit and transportation systems 
all contribute to and result in tribal economies that are third world 
in nature.
  In addition to facilitating the delivery of basic social services 
such as health, education, and nutrition to tribal members, solid 
physical infrastructures act as an incentive to outside investors to 
invest in tribal economies and to locate their businesses on tribal 
lands.
  The legislation I am cosponsoring today recognizes the special 
Federal obligations, and will assist in the development and maintenance 
of Indian transportation infrastructures and in the process pave the 
way for higher levels of economic growth and job creation.
  By increasing the funds available for the Indian reservation roads 
program, this bill will provide immediate relief to those tribes that 
have a backlog of road development and maintenance. By strengthening 
the capacity of tribes through transportation enhancement activities, 
the reservation bridges programs, and technical centers, this 
legislation will ensure that Indian tribes are not precluded from 
building stronger, more vibrant communities.
  I urge my colleagues to join in enacting this legislation so critical 
to tribal governments and economies across the Nation.

[[Page S2278]]

  Mr. INOUYE. Mr. President, I rise today to join my esteemed 
colleague, Senator Pete V. Domenici of New Mexico, as a cosponsor of 
legislation that he has authored which proposes an increase in the 
funding for the Indian Reservation Roads Program and which would 
improve the quality of Indian roads by directly including Indian tribes 
in Federal transportation service programs.
  Indian reservation roads are the lifeline of tribal economic and 
social wellbeing, with about 50,000 miles of roads serving Indian 
tribes and Alaska Native villages nationwide. Over 90 percent of these 
roads are comprised of State and county roads and roads constructed and 
maintained by the Bureau of Indian Affairs.
  The Bureau of Indian Affairs' road system includes approximately 
21,000 miles of roads which comprise about 42 percent of all roads 
serving Indian country. The overwhelming majority of these Bureau of 
Indian Affairs' roads--about 89 percent--are rated as being in poor 
condition. This is an alarming statistic which this legislation is 
designed to remedy.
  Historically, funding for the construction and maintenance of Bureau 
of Indian Affairs' roads has failed to keep pace with tribal 
transportation needs and the result has been inferior Indian road 
conditions. In the 1950's, BIA funding reached a high of $10 million 
per fiscal year. By 1979, funding levels rose to $80 million per year. 
Thereafter, BIA funding significantly declined.
  The Surface Transportation Assistance Act of 1982 made the Indian 
Reservation Roads Program eligible for support from the Highway Trust 
Fund at $100 million for fiscal years 1984 to 1986. Between 1987 and 
1991, funding from the Highway Trust Fund decreased to $80 million. In 
1992, funding rose to $159 million and from 1993 to 1997, funding for 
Indian roads increased to $191 million.
  Although funding for Indian reservation road construction and 
maintenance improved, the increases were nonetheless woefully 
inadequate to meet tribal construction needs and to improve Indian 
roads so that they might be able to meet national standards. 
Furthermore, the current funding level of $191 million falls well short 
of the estimated national tribal transportation need of $300 million 
annually. Unless funding is increased, tribal roads will continue to 
fall behind national standards to the economic and social detriment of 
Indian tribes.
  The American Indian Transportation Improvement Act of 1997 includes 
necessary funding increases and significant changes to the Indian 
Reservation Roads Program and to relevant Federal transportation 
programs that will provide Indian tribes with greater opportunities to 
meet their transportation needs. The improvements to Indian 
transportation include the following:
  One, funding for the Indian Reservation Roads Program would be 
increased from $191 million annually to $250 million for fiscal year 
1998, $275 million for fiscal year 1999, and $300 million for fiscal 
years 2000 through 2002. Funds are primarily to be used for the design 
and construction of roads in the BIA system.
  Two, identified as high priority by tribes, the bill includes Indian 
reservation road maintenance as an eligible activity for funding under 
the Indian Reservation Roads Program. For BIA roads, Indian Reservation 
Roads Program funds would be used to supplement the nominal funding 
provided for road maintenance.
  Three, to encourage donee States to fund public land highway projects 
that serve Indian country, the bill exempts funds expended on a public 
land highway constructed on an Indian reservation from the 
apportionment adjustment hold harmless requirement which has in the 
past had the effect of decreasing a State's surface transportation 
program allocation by the amount a State expended on a public land 
highway located on or running through an Indian reservation.

  Four, this bill would establish a 1-percent set-aside of funds 
allocated for the National Scenic Byway Program for the development of 
an Indian scenic byway program to enhance access to scenic areas for 
economic development and other purposes with funding to be distributed 
through competitive grants.
  Five, currently, tribes qualified to meet the requirements of direct 
certification in order to operate their own Federal highway programs 
are not eligible to do so. The bill overcomes this impediment by 
authorizing the eligibility of Indian tribes for certification by the 
State or tribal highway department to directly operate Federal highway 
programs. For example, certified tribal governments will have direct 
access to Federal highway safety funds and be able to manage the 
highway safety programs.
  Six, to promote tribal highway enhancement activities on Indian 
roads, including bus transfer points and highway lighting, the bill 
authorizes the transfer of 1 percent of the funds available to States 
for transportation enhancement for competitive grants to Indian tribes.
  Seven, in order to remedy the inefficient distribution of Indian 
bridge funds, the bill would establish a national Indian bridge program 
by consolidating the 1 percent of funds the States set aside for Indian 
bridges. The Secretary of Transportation would distribute the funding 
with priority given to bridges with the highest level of deficiency as 
determined by the BIA National Bridge Inspection Standards. This 
process efficiently allocates Indian bridge funds based on demonstrable 
need.
  Eight, to enhance the capability of Indian tribes to improve their 
transportation systems and qualify for direct certification, $1 million 
per fiscal year is authorized for each of six Indian technical centers 
where tribal members receive training in areas including highway 
planning, construction, and maintenance.
  Nine, finally, to address the inability of Indian tribes to apply 
directly for mass transportation funds and to meet increasing transit 
needs, the bill provides authority for a 1-percent set-aside of mass 
transportation funding for tribes with the allocation formula to be 
established by the Secretary of Transportation following negotiations 
with the tribes. In addition, the bill authorizes the conversion of up 
to 3 percent of Indian reservation road funds to provide mass 
transportation services to Indian tribes.
  The American Indian Transportation Improvement Act of 1997 will 
significantly improve surface transportation service on or near Indian 
Reservations--improvements that will provide greater mobility for 
tribal members, increase economic opportunities for the tribe, 
including much-needed employment, and improve the overall quality of 
life.
  Mr. President, I want to recognize the outstanding leadership 
demonstrated by Senator Pete Domenici in developing this important 
legislation. I urge my colleagues to join the chairman of the Indian 
Affairs Committee, the Honorable Senator Ben Nighthorse Campbell, 
Senator Pete Domenici, and me in acting favorably on this bill when it 
comes before the Senate for consideration.
  Mr. BINGAMAN. Mr. President, I rise to speak briefly about the 
American Indian Transportation Improvement Act of 1997. This is an act 
that is long overdue. It would ensure that the native American 
communities in our country received the necessary funding to keep up 
with their growing infrastructure needs, in this case, roads. This bill 
would also ensure that we continue the Federal responsibility and 
commitment to native Americans. In addition, Mr. President, the 
American Indian Transportation Improvement Act would go a long way 
toward providing native American communities the necessary means toward 
economic and rural development to attract more business enterprises, 
tourism and thereby, job creation.
  As my distinguished colleague from New Mexico, Senator Domenici, has 
aptly described today, Indian tribes and Alaskan communities must 
maintain over 50,000 miles of roadways. Many of our Nation's bridges 
and roadways are in great need of repair and upgrade, and tribal roads 
and bridges are by no means an exception. This year as we work toward 
ISTEA reauthorization, we must address many complicated issues. For 
example, we must determine whether and to what extent distribution 
formulas should be adjusted, whether to provide States added 
flexibility in administering programs, and whether and to what extent 
current environmental protections should be enhanced.

[[Page S2279]]

  But as we toil to address these issues, we must realize that tribal 
communities are facing and must address transportation issues just as 
challenging as those we address on a State and national Level. Tribes 
have the same needs and are just as interested as our Nation's urban 
dwellers in improving roads and bridges. Tribal communities are 
interested in establishing and maintaining mass transit systems 
especially to assist their elderly, disabled, and youth get to and from 
places for goods, services, health care, and after-school activities.
  Mr. President, our investment in city, State, county, and tribal 
transportation systems is an investment from which we will certainly 
reap larger economic benefits and a much greater quality of life for 
communities greatly in need of help.
                                 ______
                                 
      By Mr. GRASSLEY:

  S. 438. A bill to provide for implementation of prohibitions against 
payment of Social Security benefits to prisoners, and for other 
purposes; to the Committee on Finance.


                      THE NO CASH FOR CONVICTS ACT

 Mr. GRASSLEY. Mr. President, today I am introducing 
legislation to prohibit the payment of Social Security benefits to 
convicted criminals who are incarcerated at the expense of hard-working 
taxpayers.
  The fate of the Social Security program has become a major topic of 
debate in Washington and in the homes of the American people. In the 
news, on Capitol Hill, and in the conversations of people all across 
this country the question of how to address the pending financial 
problems of Social Security has caused considerable anxiety. Congress 
must face one of its stiffest challenges in the next couple of years to 
enact legislation that will rescue the Social Security program for the 
long term.
  However, there are other flaws in the Social Security program that we 
must not overlook. Because Social Security provides a lifelong 
entitlement to cash and health care, it is often a target of fraud and 
abuse. In the last couple of years, we have taken action to suspend 
benefits paid to drug addicts and alcoholics and have increased funding 
so the Social Security Administration can perform continuing disability 
reviews which ensure that beneficiaries who may have recovered are no 
longer receiving benefits.
  Just last year, Congress enacted legislation to help SSA identify 
prisoners who received benefits from the Supplemental Security Income 
Program. Unfortunately, Congress was unable to provide similar help to 
the Social Security Disability Insurance Program.
  No one incarcerated for a crime should continue to collect Social 
Security Disability Insurance. Criminals should not be allowed to 
double dip and receive Federal money earmarked for the purchase of food 
and clothing while they are part of a prison system which provides 
these necessities already. The average SSDI payment in January of 1996 
was $682. When an individual's shelter, food, and clothing needs are 
already being paid for at government expense--at least $13,000 a year 
in some States--paying out additional Federal funds is inexcusable.
  Under current law, criminals are prohibited from collecting 
disability insurance benefits if they are incarcerated and if that 
incarceration arises from a conviction punishable by imprisonment of 
more than one year. However, this narrow standard applies to a limited 
number of criminals.
  In order to fully confront this problem we must enact legislation 
that accomplishes two goals. First, the law needs to be expanded to 
close the existing loophole that allows criminals who are serving time 
for misdemeanors or who receive a sentence of less than one year to 
continue to collect benefits. Second, we must amend the law to 
facilitate the flow of information between Federal, State, county and 
local officials.
  Right now, SSA is able to identify only a few of the individuals who 
have been imprisoned to stop their benefits. The Social Security Act 
already requires that any Federal, State, county or local agency send 
the SSA the names and social security numbers of anyone who is confined 
to a penal institution or correctional facility in writing.
  What's needed is an incentive for State and local law enforcement 
authorities to report to the SSA any inmate illegally collecting DI 
benefits. In testimony to the House Ways and Means Oversight Committee 
on March 4, 1996, the General Accounting Office testified that SSA 
lacks timely and accurate information to stop benefit payments to 
prisoners.
  My bill provides State and local law enforcement agencies with a 
financial incentive to report convicted criminals who are receiving 
benefits while serving time in jail. The bill awards $400 for each 
criminal reported to SSA within the first 30 days of confinement, and 
$200 if the required information is reported to SSA after the 30 day 
period ends. If the local authorities do not notify SSA within 90 days 
after confinement begins, no award will be made.
  Last year, as part of welfare reform we took steps to stop the 
flagrant abuse of the Social Security system with respect to SSI 
payments. Now we must finish the job by extending the law to include 
the illegal collection of DI benefits.
  By passing this legislation we will protect the financial soundness 
of Social Security disability insurance and preserve the program for 
the people it is meant to assist. The only way to protect the hard-
earned money of the American taxpayer is to insure that every penny is 
being spent properly. This legislation is projected to save $35 million 
over the next 7 years. In this day of hundreds of billions of dollars 
in deficit this may not seem overwhelming, but it will ease the 
administrative burden on SSA and most importantly, help restore 
confidence in this vital program.
                                 ______
                                 
      By Mr. MURKOWSKI (for himself, Mr. Akaka, Mr. Domenici, and Mr. 
        Kyl):
  S. 439. A bill to provide for Alaska State jurisdiction over small 
hydroelectric projects, to address voluntary licensing of hydroelectric 
projects on fresh waters in the State of Hawaii, to provide an 
exemption for portion of a hydroelectric project located in the State 
of New Mexico, and for other purposes; to the Committee on Energy and 
Natural Resources.


              THE FEDERAL POWER ACT AMENDMENT ACT OF 1997

 Mr. MURKOWSKI. Mr. President, along with Senators Akaka, 
Domenici, and Kyl, I am today introducing legislation to address 
several issues associated with hydroelectric projects.
  Section 1 gives the State of Alaska jurisdiction over small 
hydroelectric projects 5 megawatts or smaller. Section 2 precludes the 
voluntary licensing of hydroelectric projects on fresh waters in the 
State of Hawaii. Section 3 provides an exemption from licensing for the 
transmission line portion of a hydroelectric project located in the 
State of New Mexico. Section 4 gives the FERC the authority to extend 
for up to 10 years the deadline for commencement of construction of 
hydroelectric projects.
  Sections 1, 2, and 3 of this bill are virtually identical to sections 
7, 8, and 9 of S. 737 as reported in the 104th Congress. By unanimous 
vote, S. 737 was ordered reported by the Committee on Energy and 
Natural Resources (Report No. 104-77). On September 27, 1996, the 
Senate unanimously passed S. 737 (Senate Calendar No. 100). 
Unfortunately, just a few days later, on October 6, the House of 
Representatives went out of session not having acted on the Senate-
passed bill.
  Sections 2 and 3 are of direct interest to Senators Akaka and 
Domenici, and they will speak separately on their merits. I will 
discuss sections 1 and 4, which are of direct interest to me.
  Section 1 gives the State of Alaska jurisdiction over hydroelectric 
projects 5 megawatts or smaller. It goes into effect when the Governor 
of Alaska notifies the Secretary of Energy that the State has in place 
a comprehensive process for regulating these facilities. The required 
process is modeled on the one contained in the Federal Power Act for 
the FERC. The authority granted to the State of Alaska would apply only 
to projects that are located entirely within the State. Moreover, these 
projects may not be located on an Indian reservation, a unit of the 
National Park System, a component of the Wild and Scenic Rivers System, 
or a segment of a river designated for study for potential addition to 
such system. In the case of a project that is

[[Page S2280]]

already licensed by the FERC, the project sponsor may elect to make it 
subject to State authority. Projects located on Federal lands are 
subject to the approval of the Secretary of the Federal agency having 
jurisdiction, and that Secretary may include such terms and conditions 
as may be necessary for the protection of the public interest. The 
provisions specifically provide that nothing preempts the application 
of Federal environmental, natural, or cultural resources protection 
laws according to their terms.
  Section 4 amends section 13 of the Federal Power Act to give the FERC 
authority to extend for up to 10 years the deadline for the 
commencement of a hydroelectric project. Under existing law, a project 
must commence construction within 2 years of the date of the issuance 
of the license. That deadline can be extended by the FERC one time for 
as much as 2 additional years, for a total of 4 years. If construction 
has not commenced at the end of the statutory time period, the license 
must be terminated by the FERC. Termination not only results in the 
licensee losing its investment of time and many tens of thousands of 
dollars to obtain the license, it also delays the construction of the 
project by requiring a new licensee to start the licensing process all 
over.
  In the past, 4 years was adequate time to commence construction. 
However, with growing uncertainty in the electric power market, it is 
proving increasingly difficult for licensees to obtain the power 
purchase contract necessary to secure financing so as to permit 
commencement of construction. This has resulted in a number of 
individual requests to Congress to legislatively extend on a case-by-
case basis the commencement of construction deadline. During the 104th 
Congress, for example, 28 bills were introduced in the House and Senate 
to extend the deadline for individual projects. Acting on these 
individual requests proved to be very time consuming for the committee 
and for the Congress. Had this provision been enacted, all of these 
requests could have been accommodated administratively by the FERC. 
Hence, I am introducing this bill to give the FERC the generic 
authority to extend the deadline for the commencement of construction 
for up to 10 years.
  Mr. President, it is for these reasons that I am introducing this 
legislation along with Senators Akaka, Domenici, and Kyl.
 Mr. AKAKA. Mr. President, the State of Hawaii, its delegation 
in Congress, and conservation organizations throughout the State are 
deeply concerned about Federal efforts to regulate hydroelectric power 
projects on State waters. The question of who should have authority for 
hydropower regulation--the State or the Federal Government--is very 
contentious.
  Those who care for Hawaii's rivers and streams recognize that 
continued Federal intervention may have serious repercussions for our 
fresh water resources and the ecosystems that depend upon them. 
Whenever a hydroelectric power project is proposed, a number of 
environmental considerations must be weighed before approval is 
granted. Important issues must be evaluated, such as whether the 
proposed dam or diversion will impair the stream's essential flow 
characteristics, or what effect the hydropower project will have on the 
physical nature of the stream bed or the chemical makeup of the water. 
Will a dam or diversion diminish flow rates and reduce the scenic value 
of one of Hawaii's waterfalls? Will it harm recreational opportunities? 
These, and other questions must be answered.
  The effect of a new dam or diversion on the State's disappearing 
wetlands must be weighed. Wetlands provide vital sanctuary for 
migratory birds, as well as habitat for endangered Hawaiian waterfowl. 
They serve as reservoirs for storm water, filtering water-borne 
pollutants before they reach the fragile coastal habitat, and provide a 
recharge area for groundwater.
  Historic resources may be at risk on streams when hydropower projects 
are proposed. When Polynesians first settled our islands, Hawaiian 
culture was linked to streams as much as it was linked to the sea. The 
remnants of ancient Hawaiian settlements can be found along many State 
rivers. Will the Federal Government give adequate attention to stream 
resources that have unique natural or cultural significance when it 
issues a hydroelectric license or permit?
  Most important of all, hydropower development must be compatible with 
preserving native aquatic resources. Hawaiian streams support many 
species that depend on undisturbed habitat. Perhaps the most remarkable 
of these species is the gobie, which can climb waterfalls and colonize 
stream sections that are inaccessible to other fish. These are some of 
the complex factors that must be considered during Federal hydropower 
decisionmaking.
  Federal agencies that have responsibility for fish, wildlife, and 
natural resource protection have raised questions about the State of 
Hawaii's commitment to protecting stream resources. They assert that 
the Federal Energy Regulatory Commission is better equipped than the 
State to protect environmental values.
  Nothing could be further from truth. The State of Hawaii has 
demonstrated its commitment to protect stream resources by instituting 
a new water code, adopting instream flow standards, launching a 
comprehensive Hawaii stream assessment, and organizing a stream 
protection and management task force.

  Meanwhile, FERC has shown little regard for stream protection and has 
granted a preliminary permit to a hydropower developer on the Hanalei 
River. This is the same river that the Fish and Wildlife Service is 
fighting to preserve. The Hanalei National Wildlife Refuge is the 
largest refuge on the island of Kauai, and is home to four endangered 
water birds. Sixty percent of the State's taro crop is grown in the 
wetlands adjacent to the river. When it comes to protecting 
environmental values, FERC is off to a very poor start.
  The experience with the proposed Hanalei hydropower project raises 
serious questions about appropriateness of the Federal efforts to 
regulate hydropower in Hawaii. Our rivers and streams bear no 
resemblance to the wide, deep, long, and relatively flat rivers of the 
continental United States. Hawaiian streams generally comprise groups 
of short riffles, runs, falls, and deep pools. There are only five 
streams with a length of 40 miles or more. Only two streams have a 
median flow rate greater than 100 cubic feet per second. By comparison, 
the mean discharge of the Mississippi River is nearly 40,000 times the 
annual flow of Hawaii's longest river, the Kiikii River.
  The Federal interest in protecting the vast interconnected river 
systems of North America is misplaced in our isolated mid-Pacific 
location. When it comes to regulating hydropower in Hawaii, FERC is a 
fish out of water.
  Chairman Murkowski has agreed to include the text of my legislation 
to exempt Hawaii from the FERC hydropower jurisdiction in section 2 of 
the hydropower legislation he introduced today. Section 2 would 
terminate FERC's jurisdiction over hydropower projects on the fresh 
water of the State of Hawaii. Section 2 is identical to the legislation 
passed by the Senate during the 103d Congress as part of an omnibus 
hydropower bill, but the House and Senate could not resolve their 
differences on the bill. In the 104th Congress, the Senate Energy and 
Natural Resources Committee again approved the bill. I will continue to 
fight for the passage of this legislation during the 105th 
Congress.
                                 ______
                                 
      By Mr. FEINGOLD (for himself and Mr. Brownback):
  S. 440. A bill to deauthorize the Animas-La Plata Federal reclamation 
project and to direct the Secretary of the Interior to enter into 
negotiations to satisfy, in a manner consistent with all Federal laws, 
the water rights interests of the Ute Mountain Ute Indian Tribe and the 
Southern Ute Indian Tribe; to the Committee on Energy and Natural 
Resources.


                  ANIMAS-LA PLATA PROJECT LEGISLATION

 Mr. FEINGOLD. Mr. President, today I am introducing 
legislation to deauthorize the construction of the Animas-La Plata 
water project in Colorado. I am very pleased to be joined in this 
effort by the Senator from Kansas [Mr. Brownback]. This measure is 
identical to a bipartisan effort in the other body introduced on 
February 13, 1997, by my colleague from Wisconsin [Mr. Petri] and my 
colleague from Oregon [Mr. DeFazio].

[[Page S2281]]

  The Animas-La Plata project is a $744 million water development 
project planned for southwest Colorado and northwest New Mexico that is 
largely taxpayer funded. Designed to supply 191,230 feet of water, it 
will consist of 2 major reservoirs, 7 pumping plants, and 200 miles of 
canals and pipes. The project will pump water over 1,000 feet uphill, 
consuming enough power to run a city of 60,000, to supply municipal, 
industrial, and irrigation interests.
  The legislation I am introducing today deauthorizes the Animas-La 
Plata Federal reclamation project and directs the Secretary of the 
Interior to work with the Southern Ute and Ute Mountain Ute Tribes to 
find an alternative to satisfy their water rights needs. It is 
supported by a broad coalition of taxpayer and environmental groups 
that includes: Taxpayers for Common Sense, Americans for Tax Reform, 
Citizens Against Government Waste, Citizens for a Sound Economy, and 
National Taxpayers Union. This legislation was also profiled in the 
1997 Green Scissors Report, and the Animas project has shown up on a 
number of deficit reduction target lists, including one recently 
proposed by the Chairman of the Budget Committee of the other body [Mr. 
Kasich].
  I believe that Federal legislation to terminate the Animas-La Plata 
project is needed for four reasons. First, as a Senator who is 
extremely concerned about the Federal deficit and debt, this project 
has an extremely high price tag--a projected total cost of $744 million 
in fiscal year 1998. That total projected cost estimate has increased 
$30 million over the fiscal year 1997 estimate of $714 million. The 
Federal share of that cost now exceeds half a billion dollars, $503 
million to be exact, which is nearly 68 percent of the total cost. I 
believe, especially in these times of tight budgets, that commencement 
of significant Federal discretionary spending should be critically 
evaluated.

  By no measure or metric is this project cost effective, Mr. 
President. A July 1995 economic analysis by the Bureau of Reclamation, 
the only analysis that used economic procedures approved for Bureau 
analyses and a current discount rate, reported that the project's 
benefit-cost ratio is 0.36:1. In other words, Mr. President, the 
project will return only 36 cents for every taxpayer dollar invested. I 
am additionally concerned, Mr. President, because recent GAO reports 
have highlighted that Federal water projects, once built, do not recoup 
the costs of the projects from the users, who are supposed to be paying 
the government back for its investment. Municipal and industrial users 
are required under the Water Supply Act of 1958 to fully repay all the 
construction costs and operation and maintenance costs attributable to 
the supply of municipal and industrial water. Those repayment contracts 
are to be in place before construction begins. Currently, the Bureau 
has signed a repayment contract with two non-Indian project 
beneficiaries. Those that have been signed do not cover the 
construction costs of the full project, due to cost increases. It is 
questionable if the project will ever comply with the law and obtain 
full reimbursement of municipal and industrial costs from the project 
beneficiaries.
  Second, I am introducing this legislation because I believe that the 
Congress should support the State of Colorado's ongoing dialog over 
lower cost alternatives rather than proceed to initiate construction. 
The Animas-La Plata project has been the focus of controversy and 
litigation for many years. In response to legislative activities last 
Congress, which I will describe in further detail, Colorado Gov. Roy 
Romer and Lt. Gov. Gail Schoettler convened a discussion process in 
October 1996 with the Bureau of Reclamation, the Southern Ute and Ute 
Mountain Ute Tribes, interested water districts, irrigators, and 
environmentalists in an attempt to resolve disputes among the parties. 
To assist in the success of this process, the Bureau and the other 
parties executed a legal ``stand still'' agreement establishing basic 
ground rules for the dialog and identifying the activities that could 
take place outside the process. While the eventual outcome is not 
known, a recommendation for a different formulation of the project is 
possible.
  Thus far, the Department of the Interior, acting through the Bureau, 
is committed to finding a solution acceptable to the parties in 
general, and to the Colorado Ute Tribes specifically, due to the 
Federal Government's tribal trust responsibility. My legislation will 
codify that direction by specifically directing the Bureau to continue 
with these negotiations, rather than proceed with Animas-La Plata.
  Third, this legislation has been drafted to acknowledge the 
importance of demonstrating support for ensuring that the Federal 
Government's obligations to the Colorado Ute Tribes are fulfilled. 
During debate over the fiscal year 1997 energy and water appropriations 
bill, colleagues will remember that I offered an amendment to terminate 
funding for Animas-La Plata. I believe that amendment was not 
successful last year due to concerns by colleagues that the project is 
necessary to fulfill Ute tribal water rights.
  As I made clear to colleagues during the appropriations debate, 
despite the contention that the project will address the Ute claims, 
Animas-La Plata was not initiated as a way to address these claims. 
This project was authorized in 1968 to supply irrigation water to 
farmers growing forage crops in arid areas. Even back then, in the 
heyday of big water projects, this one was riddled with so many 
problems it couldn't get going. In 1988, nearly 20 years after it was 
authorized, the settlement of the Ute Indian water rights claims became 
an additional justification for pushing this project through.

  Construction of this project has not yet begun because of a variety 
of factors, including concerns raised about the adequacy of the April 
1996 Supplemental Environmental Impact Statement, issues surrounding 
cost-sharing and repayment agreements, and compliance problems with New 
Mexico's water quality standards.
  Both the Ute Mountain Ute and the Southern Ute tribal governments 
formally support construction of Animas-La Plata. The water that the 
Utes will be provided from the project, however, is only a fraction of 
the project's total capacity. Of the 191,230 acre-feet of water the 
project will supply, two-thirds will go to nontribal interests with 
only 62,000 acre feet of the total to be supplied to both tribes. There 
is dissent within the Southern Ute Tribe about the wisdom of this 
project, and I am pleased that this legislation terminating the project 
has received the support of the Southern Ute Grassroots Organization.
  I am concerned that the Animas-La Plata as currently proposed cannot 
meet the needs of the tribes because the initial construction phase of 
the project will neither provide the delivery system nor the quantity 
of water needed to fully honor the Federal Government's commitments. We 
should not spend hundreds of million of dollars and still find the 
tribal needs potentially unmet. Rather, I want to see that the Bureau 
is engaged in actively solving these problems rather than half-
heartedly moving forward with construction and at the negotiating table 
to examine alternatives. The Ute Tribes' water rights settlement says 
that if the project isn't built and fully functional by the year 2000, 
the tribes may void the settlement and go back into negotiations or 
litigation. Last year, the Bureau indicated that it cannot complete the 
project before 2003. It is not unreasonable to expect that the Utes may 
seek to void their settlement, wherein the non-Indian irrigators will 
get their expensive project and Congress in the year 2005 or so will 
have to fund a new water rights settlement.
  Finally, I believe that there needs to be a proactive legislative 
solution put forward to address the Animas-La Plata project because the 
political support for continued appropriations for this project is 
eroding. Last year, during the 104th Congress, the other body voted 221 
to 200 to stop the funding for the Animas-La Plata project as it is 
currently designed. The chairman of the Budget Committee in the other 
body has put Animas-La Plata on a target list of corporate welfare 
cuts. I believe that during the appropriations cycle for fiscal year 
1998, the other body will again vote to terminate funding for this 
project.
  Politically, we may go back and forth for a few years with the other 
body terminating funding and this

[[Page S2282]]

body restoring the money. But eventually, both Houses of Congress will 
resist and we will have wasted millions of dollars.
  My bill seeks to put this project back on a positive track. It 
directs the Bureau of Reclamation to address legitimate water needs and 
explore all the alternatives to meeting those needs, and terminates 
this project that we can no longer afford. I ask unanimous consent that 
this measure be printed in the Record.
  Three being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 440

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

     SECTION 1. DEAUTHORIZATION OF ANIMAS-LA PLATA FEDERAL 
                   RECLAMATION PROJECT.

       (a) Deauthorization.--The Animas-La Plata Project, Colorado 
     and New Mexico (a participating project under the Act of 
     April 11, 1956 (commonly known as the ``Colorado River 
     Storage Project Act'') (70 Stat. 105, chapter 203; 43 U.S.C. 
     620 et seq.), and the Colorado River Basin Project Act (43 
     U.S.C. 1501 et seq.)) is not authorized after the date of 
     enactment of this Act.
       (b) Conforming Amendment.--The first section of the Act of 
     April 11, 1956 (70 Stat. 105, chapter 203; 43 U.S.C. 620), is 
     amended in the proviso by striking ``Animas-La Plata,''.
       (c) Negotiations.--The Secretary of the Interior shall 
     promptly seek to enter into negotiations with the Ute 
     Mountain Ute Indian Tribe and the Southern Ute Indian Tribe 
     to satisfy, in a manner consistent with all Federal laws, the 
     water rights interests of those tribes that were intended to 
     be satisfied with water supplied from the Animas-La Plata 
     Project.
                                 ______
                                 
      By Mr. HARKIN (for himself and Mr. Specter):
  S. 441. A bill to improve health care quality and reduce health care 
costs by establishing a national fund for health research that would 
significantly expand the Nation's investment in medical research; to 
the Committee on Finance.


               the national fund for health research act

  Mr. HARKIN. Mr. President, I rise today with Senator Specter to 
introduce the National Fund for Health Research Act. This legislation 
is similar to legislation I introduced with Senator Hatfield during the 
last Congress which gained broad bipartisan support in both the House 
and Senate.
  Our proposal would establish a national fund for health research to 
provide additional resources for health research over and above those 
provided to the National Institutes of Health [NIH] in the annual 
appropriations process. The fund would greatly enhance the quality of 
health care by investing more in finding preventive measures, cures, 
and cost-effective treatments for the major illnesses and conditions 
that strike Americans.
  To finance the fund, health plans would set aside approximately 1 
percent of all health premiums and transfer the funds to the Department 
of the Treasury. The Department of the Treasury would then transfer the 
money to the national fund for health research.
  Each year under our proposal amounts within the national fund for 
health research would automatically be allocated to each of the NIH 
Institutes and Centers. Each Institute and Center would receive the 
same percentage as they received of the total NIH appropriation for 
that fiscal year. The set aside should generate sufficient funds to 
provide for a nearly 50-percent increase in funding for the NIH.
  In 1994, I argued that any health care reform plan should include 
additional funding for health research. Health care reform has been 
taken off the front burner but the need to increase our Nation's 
commitment to health research has not diminished.
  While health care spending devours nearly $1 trillion annually our 
medical research budget is dying of starvation. The United States 
devotes less than 2 percent of its total health care budget to health 
research. The Defense Department spends 15 percent of its budget on 
research. Does this make sense? The cold war is over but the war 
against disease and disability continues.
  Increased investment in health research is key to reducing health 
costs in the long run. If we can find the cure for a disease like 
Alzheimer's the savings would be enormous. Today, federally supported 
funding for research on Alzheimer's disease totals $300 million yet it 
is estimated that nearly $100 billion is expended annually on caring 
for people with Alzheimer's.
  Gene therapy and treatments for cystic fibrosis and Parkinson's could 
eliminate years of chronic care costs, while saving lives and improving 
patients' quality of life.
  Mr. President, Senator Specter and I do everything we can to increase 
funding for NIH through the appropriations process. But, given the 
current budget situation and freeze in discretionary spending what we 
can do is limited. Without action, our investment in medical research 
through the NIH is likely to continue to decline in real terms.
  The NIH is not able to fund even 25 percent of competing research 
projects or grant applications deemed worthy of funding. This is 
compared to rates of 30 percent or more just a decade ago. Science and 
cutting edge medical research is being put on hold. We may be giving up 
possible cures for diabetes, Alzheimer's, Parkinson's, and countless 
other diseases.
  Our lack of investment in research may also be discouraging our young 
people from pursuing careers in medical research. The number of people 
under the age of 36 even applying for NIH grants dropped by 54 percent 
between 1985 and 1993. This is due to a host of factors but I'm afraid 
that the lower success rates among applicants is making biomedical 
research less and less attractive to young people. If the perception is 
that funding for research is impossible to obtain, young people that 
may have chosen medical research 10 years ago will choose other career 
paths.
  Mr. President, I am pleased that over 130 groups representing 
patients, hospitals, medical schools, researchers, and millions of 
Americans have already endorsed our proposal.
  Mr. President, health research is an investment in our future--it is 
an investment in our children and grandchildren. It holds the promise 
of cure or treatment for millions of Americans.
                                 ______
                                 
      By Mr. WYDEN (for himself and Mr. Kerry):
  S. 442. A bill to establish a national policy against State and local 
government interference with interstate commerce on the Internet or 
interactive computer services, and to exercise Congressional 
jurisdiction over interstate commerce by establishing a moratorium on 
the imposition of exactions that would interfere with the free flow of 
commerce via the Internet, and for other purposes; to the Committee on 
Commerce, Science, and Transportation.


                      the INTERNET TAX FREEDOM ACT

 Mr. WYDEN. Mr. President, a few weeks ago, I met with a group 
of small business folks at an Internet cafe in Portland. We talked 
about the promise electronic commerce holds for businesses and 
consumers. The Internet can give a small businessperson in Astoria, OR 
access to the entire global marketplace. It can give consumers, 
especially in rural areas, entry to a supernational shopping mall.
  For governments, the Internet offers a different type of promise--the 
chance to be a new cash cow. As Federal funds decrease, States and 
local governments are looking to the Internet as a new source of 
revenue. Some have already begun building tollbooths on the information 
superhighway. For sales taxes alone, there are nearly 6,500 different 
taxing authorities in this country. One businessman at the Internet 
cafe told me he is wary of getting into electronic commerce because of 
the prospect of as many as 30,000 different pairs of hands reaching 
into his pockets to collect taxes. If current trends continue, State 
and local levies will transform the Internet from a bright and exciting 
new frontier for commerce into a dark jungle of foreboding taxes.
  Under today's mishmash of State and local Internet taxes, everyone is 
puzzled. Take a customer at his home computer who purchases an item 
from a virtual catalogue. With the click of his mouse, the purchase is 
logged, his account billed and payment made by wire transfer and the 
order sent. The vendor is in another State, or even another country. 
His bank is in a third State and the purchase is a gift being sent to a 
relative in another State. Where did this transaction take place?

[[Page S2283]]

 Where was there nexus for tax purposes--the vendor State? The 
customer's State? The bank's location? Or the State where the gift is 
being sent? Is the answer all of the above, some of the above, or none 
of the above?
  The enormity of the problem is underscored by the fact that the 
hottest selling software today is software to help entrepreneurs and 
companies figure out various State tax policies.
  When a consumer in Corvallis, OR uses an Internet search engine in 
California, is that search a taxable service? When a housewife in 
Houston uses Virginia-based America Online to make a virtual purchase 
from a furniture company in North Carolina, what gets taxed where? Is 
an Internet service provider a public utility, as one State has ruled? 
Even if a State has enacted an online tax law, collection and 
enforcement are often haphazard. This system rewards ignorance and 
punishes the boy scout businesses that play by the rules.
  The purpose of the bill I am introducing today with Congressman Chris 
Cox is to allow everyone to step back and take a deep breath. It says 
let's suspend this crazy tax quilting bee so that everyone can come 
together in a rational way to figure out what policy makes the most 
sense.
  The Internet Tax Freedom Act has three parts. First, it would impose 
an indefinite moratorium on subnational taxes on electronic commerce. 
Where States and local governments have already imposed taxes on 
electronic commerce, their taxes would be grand fathered to the extent 
that they are net income taxes, fairly apportioned business license 
taxes or where the tax is collected in an identical way for mail or 
telephone orders. This will assure uniformity and fairness, while 
targeting inequitable technology taxes. Our intent is that the new tax 
moratorium apply to all Internet and interactive computer services, 
regardless of the technology--such as cable systems and wireless 
networks--being used to deliver those services. It will give us a 
functionally equivalent and technologically equitable tax policy. It 
will assure equity and fairness among all business entities and across 
technologies.

  Second, the bill would call upon the administration to bring together 
State and local governments, businesses and consumers, and any others 
with a stake in the Internet and online commerce to develop policy 
recommendations on taxation of the Internet and use of the Internet to 
deliver products and services. The Executive would have 2 years in 
which to prepare policy recommendations on taxation of the Internet.
  Third, the bill directs the executive branch to seek an international 
agreement making the Internet a duty-free zone. Just as we seek a 
rational policy on electronic commerce taxation here in the United 
States, our businesses cannot be expected to compete overseas if they 
faced more than 160 different foreign tariff policies covering global 
electronic commerce. Although about 75 percent of Web users live in 
North America, most electronic commerce is between companies, rather 
than companies and consumers. Forrester Research of Massachusetts 
predicts business-to-business commerce will soon be worth $67 billion a 
year.
  Trying to find out exactly which States and local authorities are 
imposing taxes on electronic commerce and what types of taxes they are 
imposing is a daunting--if not outright impossible--task in itself. The 
Vice President for a good-sized Internet service provider in California 
said he would need a whole department to untangle the various Internet 
tax laws around the country, ``It's in my nightmare pile,'' he 
observed. If this has stumped some of the best accounting firms in the 
country, how in the world can a small business that wants to sell over 
the Internet figure out its various tax liabilities? The difference 
between States in electronic commerce tax policy is mind-numbing.
  Twenty States and the District of Columbia impose one or more taxes 
on electronic commerce. New York levies taxes on gross receipts on the 
``furnishing of information,'' but not on personal or individual 
information. Ohio taxes electronic transmissions and real estate data 
bases because they provide objective data but exempts news services 
because they provide analysis. Texas taxes the transmission of 
electronic information and software in whatever form, but does not tax 
software sent out of State on a disk. Alabama's Revenue Department 
ruled last fall that a utility tax applies to Internet service 
providers, forcing them to pay a 4-percent public utilities tax.
  Last year in Florida a small Internet service provider asked the 
State's Department of Revenue whether he should add a sales tax to his 
customers' monthly bills. He was certain he wouldn't have to since all 
net surfers there already pay 10 percent or more in taxes for the 
telephone service they use to link to the Internet. To his surprise, 
the Revenue Department said his customers should have been paying a 7-
percent service tax under a decade-old telecommunications law. Then, 
adding shock to surprise, the Department told him his company was 
subject to an additional 2.5-percent tax on its gross annual receipts. 
The uproar from users and providers led the Governor to suspend the 
taxes until a panel could study the implications.
  The legislation is constructed in such a way as to set up a dynamic 
and productive tension. It gives those that seek revenue from 
electronic commerce--the States and local governments--an incentive to 
work with the administration in developing policy recommendations on 
Internet taxation. Indeed, the National Conference of State 
Legislatures wrote me on February 21 that they have been ``working with 
a number of other State organizations as well as the impacted private 
sector industries to find the common ground which will lead to the 
coordination and uniformity of State tax structures which the draft 
legislation desires.'' And an official with the Federal of Tax 
Administrators observed last summer that ``States need to figure out 
how to tax it [the Internet] and to make it a level playing field with 
other services.'' I will also continue to work with the Multistate Tax 
Commission to assure their efforts move forward.
  But the question remains: Will the simple imperative for good public 
policy outweigh the desire of cash-strapped States to tap a new source 
of revenue? Without a moratorium, as proposed in this legislation, I 
fear those State and local governments hungry for new sources of 
revenue have little, if any, incentive to work for a fair and equitable 
Internet tax policy.
  I want to thank a number of groups that have helped us craft this 
legislation, and which have indicated their support for this bill: the 
American Electronics Association, the Software Publishers Association, 
the Association of Online Professionals, the Committee on State 
Taxation, the Direct Marketing Association, the Business Software 
Alliance, the Information Technology Association of America, the U.S. 
Telephone Association, the California State Board of Taxation, the 
Massachusetts High Tech Council, CommerceNet, the Silicon Valley 
Software Industry Coalition, IBM, AT&T, and other companies.
  I view the legislation being introduced today as the beginning of a 
process, not the end. It remains a work in progress and will hopefully 
continue to be refined throughout the congressional hearing process.
  There is a great deal to learn in these unchartered waters. All of 
us--Congress, State and local governments, businesses and consumers--
must educate each other about how this new electronic medium works. We 
must all work together to help it achieve its full potential as a 
marketplace of ideas, products, and services.
  I ask unanimous consent that the text of the bill and a section-by-
section analysis be printed in the Record.
  Thee being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 442

       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 ``Internet Tax Freedom Act''.

     SEC. 2. FINDINGS.

       The Congress finds the following:
       (1) As a massive global network spanning not only State but 
     international borders, the Internet is inherently a matter of 
     interstate and foreign commerce within the jurisdiction of 
     the United States Congress under Article I, Section 8 of the 
     United States Constitution.

[[Page S2284]]

       (2) Even within the United States, the Internet does not 
     respect State lines and operates independently of State 
     boundaries. Addresses on the Internet are designed to be 
     geographically indifferent. Internet transmissions are 
     insensitive to physical distance and can have multiple 
     geographical addresses.
       (3) Because transmissions over the Internet are made 
     through packet-switching it is impossible to determine with 
     any degree of certainty the precise geographic route or 
     endpoints of specific Internet transmissions and infeasible 
     to separate intrastate from interstate, and domestic from 
     foreign, Internet transmissions.
       (4) Inconsistent and inadministrable taxes imposed on 
     Internet activity by State and local governments threaten not 
     only to subject consumers, businesses, and other users 
     engaged in interstate and foreign commerce to multiply, 
     confusing, and burdensome taxation, but also to restrict the 
     growth and continued technological maturation of the Internet 
     itself, and to call into question the continued viability of 
     this dynamic medium.
       (5) Because the tax laws and regulations of so many 
     jurisdictions were established before the Internet or 
     interactive computer services, their application to this new 
     medium in unintended and unpredictable ways threatens every 
     Internet user, access provider, vendor, and interactive 
     computer service provider.
       (6) The electronic marketplace of services, products, and 
     ideas available through the Internet or interactive computer 
     services can be especially beneficial to senior citizens, the 
     physically challenged, citizens in rural areas, and small 
     businesses. It also offers a variety of uses and benefits for 
     educational institutions and charitable organizations.
       (7) Consumers, businesses, and others engaging in 
     interstate and foreign commerce through the Internet or 
     interactive computer services could become subject to more 
     than 30,000 separate taxing jurisdictions in the United 
     States alone.
       (8) The consistent and coherent national policy regarding 
     taxation of Internet activity, and the concomitant 
     uniformity, simplicity, and fairness that is needed to avoid 
     burdening this evolving form of interstate and foreign 
     commerce can best be achieved by the United States exercising 
     its authority under Article I, Section 8, Clause 3 of the 
     United States Constitution.

     SEC. 3. MORATORIUM ON IMPOSITION OF TAXES ON INTERNET OR 
                   INTERACTIVE COMPUTER SERVICES.

       (a) Moratorium.--Except as otherwise provided in this 
     section, no State or political subdivision thereof may 
     impose, assess, or attempt to collect a tax directly or 
     indirectly on--
       (1) the Internet or interactive computer services; or
       (2) the use of the Internet or interactive computer 
     services.
       (b) Preservation of State and Local Taxing Authority.--
     Subsection (a)--
       (1) does not apply to taxes imposed on or measured by net 
     income derived from the Internet or interactive computer 
     services;
       (2) does not apply to fairly apportioned business license 
     taxes applied to businesses having a business location in the 
     taxing jurisdiction; and
       (3) does not affect a State or political subdivision 
     thereof of authority to impose a sales or use tax on sales or 
     other transactions effected by the use of the Internet or 
     interactive computer services if--
       (A) the tax is the same as the tax generally imposed and 
     collected by that State or political subdivision thereof on 
     interstate sales or transactions effected by mail order, 
     telephone, or other remote means within its taxing 
     jurisdiction; and
       (B) the obligation to collect the tax from sales or other 
     transactions effected by the use of the Internet or 
     interactive computer services is imposed on the same person 
     or entity as in the case of sales or transactions effected by 
     mail order, telephone, or other remote means.

     SEC. 4. ADMINISTRATION POLICY RECOMMENDATIONS TO CONGRESS.

       (a) Consultative Group.--The Secretaries of the Treasury, 
     Commerce, and State, in consultation with appropriate 
     committees of the Congress, consumer and business groups, 
     States and political subdivisions thereof, and other 
     appropriate groups, shall--
       (1) undertake an examination of United States and 
     international taxation of the Internet and interactive 
     computer services, as well as commerce conducted thereon; and
       (2) jointly submit appropriate policy recommendations 
     concerning United States domestic and foreign policies toward 
     taxation of the Internet and interactive computer services, 
     if any, to the President within 18 months after the date of 
     enactment of this Act.
       (b) President.--Not later than 2 years after the date of 
     enactment of this Act, the President shall transmit to the 
     appropriate committees of Congress policy recommendations on 
     the taxation of sales and other transactions affected on the 
     Internet or through interactive computer services.
       (c) Recommendations To Be Consistent With 
     Telecommunications Act of 1996 Policy Statement.--The 
     Secretaries and the President shall take care to ensure that 
     any policy recommendations are fully consistent with the 
     policy set forth in paragraphs (1) and (2) of section 230(b) 
     of the Communications Act of 1934 (47 U.S.C. 230(b)).

     SEC. 5. DECLARATION THAT THE INTERNET BE FREE OF FOREIGN 
                   TARIFFS, TRADE BARRIERS, AND OTHER 
                   RESTRICTIONS.

       It is the sense of the Congress that the President should 
     seek bilateral and multilateral agreements through the World 
     Trade Organization, the Organization for Economic Cooperation 
     Council, or other appropriate international fora to establish 
     that activity on the Internet and interactive computer 
     services is free from tariff and taxation.

     SEC. 6. DEFINITIONS.

       For purposes of this Act--
       (1) Internet; interactive computer service.--The terms 
     ``Internet'' and ``interactive computer service'' have the 
     meaning given such terms by paragraphs (1) and (2), 
     respectively, of section 230(e) of the Communications Act of 
     1934 (47 U.S.C. 230(e)).
       (2) Tax.--The term ``tax'' includes any tax, license, or 
     fee that is imposed by any governmental entity, and includes 
     the imposition of the seller of an obligation to collect and 
     remit a tax imposed on the buyer.
                                                                    ____


       The Internet Tax Freedom Act--Section-by-Section Analysis

       Section 1: Short title: ``The Internet Tax Freedom Act''
       Section 2: Findings. Sets forth a series of findings, 
     including that the Internet is inherently a matter of 
     interstate commerce; that the Internet operates independently 
     of State lines; that inconsistent and unadministrable taxes 
     imposed on Internet activity by State and local governments 
     subject consumers and businesses to multiple, confusing and 
     burdensome taxation and are creating compliance problems for 
     Internet access providers, vendors and interactive computer 
     service providers; that consumers, businesses and others 
     engaging in interstate commerce through the Internet or 
     interactive computer services could become subject to some 
     30,000 separate taxing jurisdictions in the United States; 
     and that uniformity, simplicity and fairness are needed 
     regarding taxation of Internet activity to avoid burdening 
     this evolving form of interstate commerce.
       Section 3: Moratorium on Imposition of Taxes on Internet or 
     Interactive Computer Services--
       Subsection (a), establishes a moratorium on direct and 
     indirect state or local taxes on the Internet or interactive 
     computer services or the use of those services.
       Subsection (b), preserves state and local authority for 
     taxes for the following types of taxes:
       (1) taxes on or measured by net income derived from these 
     services,
       (2) fairly apportioned business license taxes, and
       (3) sales and use taxes on interstate electronic 
     transactions that are consistent with taxes on mail order and 
     telephone transactions.
       Section 4: Administration Policy Recommendations to 
     Congress.
       Subsection (a), Establishes a consultative group of the 
     Secretaries of the Treasury, Commerce and State that will 
     work with State and local governments, consumer and business 
     groups and others to examine U.S. and international taxation 
     of Internet and interactive computer services and submit 
     policy recommendations to the President within 18 months of 
     enactment.
       Subsection (b), directs the President to transmit to 
     Congress any policy recommendations within two years of 
     enactment.
       Subsection (c), seeks to ensure that any policy 
     recommendations are consistent with the 1996 
     Telecommunications Act policy statement regarding promotion 
     of the Internet and interactive computer services.
       Section 5: Declaration that the Internet Be Free of Foreign 
     Tariffs, Trade Barriers, and Other Restrictions
       Sets forth the sense of the Congress that the President 
     should seek bilateral and multinational agreements through 
     various international trade organizations to keep the 
     Internet and interactive computer services free from tariffs 
     and taxation.
       Section 6: Definitions
       (1) Internet and interactive computer service terms are 
     defined as they are in the Communications Act of 1934, as 
     amended by the 1996 Telecommunications Act.
       (2) Defines tax to include any tax, license or fee imposed 
     by any governmental entity and includes the imposition on the 
     seller of an obligation to collect and remit a tax imposed on 
     the buyer.

                          ____________________