[Congressional Record Volume 143, Number 79 (Monday, June 9, 1997)]
[Senate]
[Pages S5413-S5424]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. FAIRCLOTH (for himself and Mr. Helms):
  S. 849. A bill to amend the Internal Revenue Code of 1986 to increase 
the unified estate and gift tax credit to exempt farms and small 
businesses from estate taxes, and for other purposes; to the Committee 
on Finance.


     the American Farm Heritage and Small Business Preservation Act

  Mr. FAIRCLOTH. Mr. President, I rise to introduce the American Farm 
Heritage and Small Business Preservation Act, and I am joined by the 
senior Senator from North Carolina. The act excludes the first $1.5 
million of estate and gift assets from taxation, and it carries an 
effective date of January 1, 1998.
  The act will relieve the tax burden that befalls farmers and small 
businessmen upon the death of the proprietor. There is truth in the old 
axiom that farmers ``live like paupers and die like kings,'' and, in 
fact, the IRS reports that farmers face estate taxes six times more 
often than other Americans.
  There are numerous estate and gift tax relief bills in the 
congressional hopper. However, I favor a straightforward approach, and, 
rather than require some form of participation in the business 
operation for a fixed period of time--and thus permit the IRS to 
establish nebulous and complicated regulations--the American Farm 
Heritage and Small Business Preservation Act proposes a simple $1.5 
million exclusion for all estates.
  The estate tax encourages the demise of the family farm and forces 
heirs to mortgage their agricultural heritage to the IRS. The estate 
tax is not a threat to just large farmers: some 20 percent of farms 
that report annual sales over $50,000 will trigger inheritance taxes. 
Indeed, the nature of a farm operation--75 percent of farm assets are 
nonliquid--complicates the difficulties inherent in the payment of 
estate taxes for farm families, and the financial structure of a farm 
thus further contributes to this erosion of our agricultural heritage. 
The average annual return on farm assets is just 4 percent, and the 
addition of mortgage obligations reduces the return to a mere 0.5 
percent, so it is almost impossible for the next generation to continue 
to farm the family land.
  As metropolitan areas continue to grow and encroach upon the farms 
that sit outside these areas, the value of the farms increases, and it 
drives up the estate tax burden. This pattern forces heirs to sell the 
farmland to developers rather than continue their agricultural 
heritage. Further, the Agriculture Department estimates that 500,000 
farmers will retire over the next two decades. The failure of the 
Congress to reduce the impact of estate taxes thus threatens the 
continued operation of almost one-quarter of the farms in the United 
States.
  I am thus committed to estate tax relief for American families. The 
IRS is a tax collection agency, not a board of directors, and 
Washington does not deserve a windfall from every funeral.
                                 ______
                                 
      By Mr. AKAKA (for himself, Mr. Smith of New Hampshire, Mr. Reid, 
        and Mr. Torricelli):
  S. 850. A bill to amend the Packers and Stockyards Act, 1921, to make 
it unlawful for any stockyard owner, market agency, or dealer to 
transfer or market nonambulatory livestock, and for other purposes.


                The Downed Animal Protection Act of 1997

   Mr. AKAKA. Mr. President, today I am introducing the Downed 
Animal Protection Act, a bill to eliminate inhumane and improper 
treatment of downed animals at stockyards. Senators Smith, Reid, and 
Torricelli have joined me in sponsoring this bill. The legislation 
prohibits the sale or transfer of downed animals unless they have been 
humanely euthanized.
  Downed animals are severely distressed recumbent animals that are so 
sick they cannot rise or move on their own. Once an animal becomes 
immobile and cannot stand, it must lie where it falls, often without 
receiving basic assistance. Downed animals that survive the stockyard 
are slaughtered for human consumption.
  These animals are extremely difficult, if not impossible, to handle 
humanely. They have very demanding needs, and must be fed and watered 
individually. The suffering of downed animals is so severe that the 
only humane solution is immediate euthanasia.
  Mr. President, the bill I have introduced requires that these 
hopelessly sick and injured animals be euthanized by humane methods 
that rapidly and

[[Page S5414]]

effectively render animals insensitive to pain. Humane euthanasia of 
downed animals will limit animal suffering and will encourage the 
livestock industry to concentrate on improved management and handling 
practices to avoid this problem in the first place.
  Downed animals comprise a tiny fraction, less than one-tenth of 1 
percent, of animals at stockyards. Banning their sale or transfer would 
cause no economic hardship. The Downed Animal Protection Act will 
prompt stockyards to refuse crippled and distressed animals and will 
make the prevention of downed animals a priority for the livestock 
industry. The bill will reinforce the industry's commitment to humane 
handling of animals.
  The downed animal problem has been addressed by major livestock 
organizations such as the United Stockyards Corp., the Minnesota 
Livestock Marketing Association, the National Pork Producers Council, 
the Colorado Cattlemen's Association, and the Independent Cattlemen's 
Association of Texas. All these organizations have taken strong stands 
against improper treatment of animals by adopting ``no-downer'' 
policies. I want to commend these and other organizations, as well as 
responsible and conscientious livestock producers throughout the 
country, for their efforts to end an appalling problem that erodes 
consumer confidence.
  Despite a strong consensus within industry, the animal welfare 
movement, consumers, and Government that downed animals should not be 
sent to stockyards, this sad problem continues, causing animal 
suffering and an erosion of confidence in the industry.
  Mr. President, this legislation will complement industry efforts to 
address this problem by encouraging better care of animals at farms and 
ranches. Animals with impaired mobility will receive better treatment 
in order to prevent them from becoming incapacitated. The bill will 
remove the incentive for sending downed animals to stockyards in the 
hope of receiving some salvage value for the animals and would 
encourage greater care during loading and transport. The bill will also 
discourage improper breeding practices that account for most downed 
animals.
  My legislation would set a uniform national standard, thereby 
removing any unfair advantages that might result from differing 
standards throughout the industry. Furthermore, no additional 
bureaucracy will be needed as a consequence of my bill because 
inspectors of the Packers and Stockyards Administration regularly visit 
stockyards to enforce existing regulations. Thus, the additional 
regulatory burden on the agency and stockyard operators will be 
insignificant.
  I ask unanimous consent that a copy of the Downed Animal Protection 
Act be printed in the Record. I urge all of my colleagues to join in 
supporting this legislation.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 850

       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 ``Downed Animal Protection 
     Act''.

     SEC. 2. UNLAWFUL STOCKYARD PRACTICES INVOLVING NONAMBULATORY 
                   LIVESTOCK.

       (a) In General.--Title III of the Packers and Stockyards 
     Act, 1921, is amended by inserting after section 317 (7 
     U.S.C. 217a) the following:

     ``SEC. 318. UNLAWFUL STOCKYARD PRACTICES INVOLVING 
                   NONAMBULATORY LIVESTOCK.

       ``(a) Definitions.--In this section:
       ``(1) Humanely euthanized.--The term `humanely euthanized' 
     means to kill an animal by mechanical, chemical, or other 
     means that immediately render the animal unconscious, with 
     this state remaining until the animal's death.
       ``(2) Nonambulatory livestock.--The term `nonambulatory 
     livestock' means any livestock that is unable to stand and 
     walk unassisted.
       ``(b) Unlawful Practices.--It shall be unlawful for any 
     stockyard owner, market agency, or dealer to buy, sell, give, 
     receive, transfer, market, hold, or drag any nonambulatory 
     livestock unless the nonambulatory livestock has been 
     humanely euthanized.''.
       (b) Effective Date.--
       (1) In general.--The amendment made by subsection (a) takes 
     effect 1 year after the date of the enactment of this Act.
       (2) Regulations.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     issue regulations to carry out the amendment.
                                 ______
                                 
      By Mr. LOTT (for himself and Mr. Ford):
  S. 852. A bill to establish nationally uniform requirements regarding 
the titling and registration of salvage, nonrepairable, and rebuilt 
vehicles; to the Committee on Commerce, Science, and Transportation.


 NATIONAL MOTOR VEHICLE SAFETY, ANTI-THEFT, TITLE REFORM, AND CONSUMER 
                         PROTECTION ACT OF 1997

  Mr. LOTT. Mr. President, today I am here to talk to my colleagues 
about used cars. No, not to sell you one, but more importantly, to 
protect Americans who buy used cars. I am joined by my friend and 
colleague Senator Ford in introducing legislation which will require 
that the title of a vehicle, at the time of resale, indicate that it 
has been significantly damaged. This bill is about safety. This bill is 
about consumer protection.
  We believe America's policy must protect used car consumers from 
unknowingly purchasing automobiles which have been totaled and rebuilt, 
but sold as undamaged vehicles. Often these vehicles have serious 
safety problems. We want you to join us in helping to protect the 
public. In the last Congress, I worked with Senator Exon to advance 
similar legislation. We need to complete the job this Congress.
  According to the U.S. Department of Transportation's automobile 
auction figures, the practice of selling rebuilt salvage vehicles as 
undamaged used cars costs consumers and the auto industry nearly $4 
billion annually. In some States, as many as 70 percent of all totaled 
vehicles may return to the roads after being purchased by unsuspecting 
buyers. This is dangerous to everyone on America's highways.
  While most States require some type of disclosure on the title 
indicating a vehicle's history, the requirements vary from State to 
State. Some rebuilders take advantage of these inconsistencies in State 
titling procedures to obtain clean titles that bear no indication of 
previous vehicle damage. Not only does this type of fraud affect the 
consumer's wallet, it also threatens the consumer's safety.
  Several years ago, Congress established a Federal task force to study 
this issue. This consumer friendly bill stems from the recommendations 
of that task force.
  Our bill requires that any vehicle with damage exceeding 75 percent 
of its preaccident value be designated as a salvage vehicle. If the 
salvage vehicle is rebuilt and placed back on the road, the title to 
the vehicle must be branded as a rebuilt salvage vehicle and it must 
have an inspection to assure that stolen parts were not used in the 
repair. In addition, all rebuilt salvage vehicles must have a decal 
permanently affixed to the driver's side door jamb indicating that the 
vehicle has been rebuilt. It will also specify whether the vehicle has 
passed an approved safety inspection.
  Mr. President, the number of victims in the rebuilt salvage vehicle 
industry is growing, and it must be stopped. We need to establish 
policies to stop these illegal practices and protect American drivers. 
Along with Mr. Ford, I urge you to join us as a cosponsor of this 
common sense legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 852

       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 ``National Motor Vehicle 
     Safety, Anti-theft, Title Reform, and Consumer Protection Act 
     of 1997''.

     SEC. 2. MOTOR VEHICLE TITLING AND DISCLOSURE REQUIREMENTS.

       (a) In General.--Subtitle VI of title 49, United States 
     Code, is amended by adding at the end the following new 
     chapter:

  ``CHAPTER 333--AUTOMOBILE SAFETY, ANTI-THEFT, AND TITLE DISCLOSURE 
                              REQUIREMENTS

``Sec.
``33301. Definitions.
``33302. Passenger motor vehicle titling.
``33303. Label requirement.
``33304. Petition for extensions of time.
``33305. Effect on State law.
``33306. Civil and criminal penalties.

     ``Sec. 33301. Definitions

       ``For the purposes of this chapter the following 
     definitions and requirements shall apply:

[[Page S5415]]

       ``(1) Passenger motor vehicle.--The term `passenger motor 
     vehicle' means a motor vehicle as defined in section 32101(7) 
     that is rated by the manufacturer at not more than 10,000 
     pounds gross vehicle weight and that is either--
       ``(A) a passenger motor vehicle as defined in section 
     32101(10), including a multipurpose passenger vehicle as 
     defined in section 32101(9); or
       ``(B) a truck (other than a truck referred to in section 
     32101(10)(B)).
       ``(2) Salvage vehicle.--
       ``(A) In general.--Subjet to subparagraph (E), the term 
     `salvage vehicle' means any passenger motor vehicle that has 
     been wrecked, destroyed, or damaged to the extent that--
       ``(i) if the vehicle is not rebuilt or reconstructed, the 
     total estimated cost; or
       ``(ii) if the vehicle is rebuilt or reconstructed, the 
     total actual cost

     of parts and labor to rebuild or reconstruct the passenger 
     motor vehicle to its preaccident condition for legal 
     operation on the roads or highways exceeds 75 percent of the 
     retail value of the passenger motor vehicle, immediately 
     before it was wrecked, damaged, or destroyed, as set forth in 
     the most recent edition of any nationally recognized 
     compilation (including automated databases) of current retail 
     values that is approved by the Secretary.
       ``(B) Vehicles excluded.--Such term does not include any 
     passenger motor vehicle that--
       ``(i) has a model year designation of the year in which the 
     vehicle was wrecked, destroyed, or damaged, or one of the 6 
     immediately preceding model years; or
       ``(ii) had a retail value, immediately before it was 
     wrecked, destroyed, or damaged, of more than $10,000.

     Beginning with the second calendar year beginning after the 
     date of enactment of the National Motor Vehicle Safety, Anti-
     theft, Title Reform, and Consumer Protection Act of 1997, the 
     Secretary shall adjust the dollar figure in clause (ii) of 
     this subparagraph to reflect the change, if any, in the 
     average consumer price index for the preceding year from the 
     average consumer price index for 1997.
       ``(C) Determination of value of repair parts.--For purposes 
     of subparagraph (A), the value of repair parts shall be 
     determined by using--
       ``(i) the published retail cost of the original equipment 
     manufacturer parts; or
       ``(ii) the actual retail cost of the repair parts to be 
     used in the repair.
       ``(D) Determination of labor costs.--For purposes of 
     subparagraph (A), the labor cost of repairs shall be computed 
     by using the hourly labor rate and time allocations that are 
     reasonable and customary in the automobile repair industry in 
     the community in which the repairs are performed.
       ``(E) Certain vehicles included.--The term `salvage 
     vehicle' includes, without regard to whether the passenger 
     motor vehicle meets the 75 percent threshold specified in 
     subparagraph (A)--
       ``(i) any passenger motor vehicle with respect to which an 
     insurance company acquires ownership under a damage 
     settlement (except for a settlement in connection with a 
     recovered theft vehicle that did not sustain a sufficient 
     degree of damage to meet the 75 percent threshold specified 
     in subparagraph (A)); or
       ``(ii) any passenger motor vehicle that an owner may wish 
     to designate as a salvage vehicle by obtaining a salvage 
     title, without regard to the extent of the damage and 
     repairs.
       ``(F) Special rule.--A designation of a passenger motor 
     vehicle by an owner under subparagraph (E)(ii) shall not 
     impose any obligation on--
       ``(i) the insurer of the passenger motor vehicle; or
       ``(ii) an insurer processing a claim made by or on behalf 
     of the owner of the passenger motor vehicle.
       ``(3) Salvage title.--
       ``(A) In general.--The term `salvage title' means a 
     passenger motor vehicle ownership document issued by a State 
     to the owner of a salvage vehicle.
       ``(B) Transfer of ownership.--Ownership of a salvage 
     vehicle may be transferred on a salvage title.
       ``(C) Prohibition.--The salvage vehicle may not be 
     registered for use on the roads or highways unless the 
     salvage vehicle has been issued a rebuilt salvage title.
       ``(D) Requirement for a salvage title.--A salvage title 
     shall be conspicuously labeled with the word `salvage' across 
     the front of the document.
       ``(4) Rebuilt salvage vehicle.--The term `rebuilt salvage 
     vehicle' means--
       ``(A) For passenger motor vehicles subject to a safety 
     inspection in a State that requires such an inspection under 
     section 33302(b)(2)(H), any passenger motor vehicle that 
     has--
       ``(i) been issued previously a salvage title;
       ``(ii) passed applicable State antitheft inspection;
       ``(iii) been issued a certificate indicating that the 
     passenger motor vehicle has--
       ``(I) passed the antitheft inspection referred to in clause 
     (ii); and
       ``(II) been issued a certificate indicating that the 
     passenger motor vehicle has passed a required safety 
     inspection under section 33302(b)(2)(H); and
       ``(iv) affixed to the door jamb adjacent to the driver's 
     seat a decal stating `Rebuilt Salvage Vehicle--Antitheft and 
     Safety Inspections Passed'; or
       ``(B) for passenger motor vehicles in a State other than a 
     State referred to in subparagraph (A), any passenger motor 
     vehicle that has--
       ``(i) been issued previously a salvage title;
       ``(ii) passed an applicable State antitheft inspection;
       ``(iii) been issued a certificate indicating that the 
     passenger motor vehicle has passed the required antitheft 
     inspection referred to in clause (ii); and
       ``(iv) affixed to the door jamb adjacent to the driver's 
     seat, a decal stating `Rebuilt Salvage Vehicle--Antitheft 
     Inspection Passed/No Safety Inspection Pursuant to National 
     Criteria'.
       ``(5) Rebuilt salvage title.--
       ``(A) In general.--The term `rebuilt salvage title' means 
     the passanger motor vehicle ownership document issued by a 
     State to the owner of a rebuilt salvage vehicle.
       ``(B) Transfer of ownership.--Ownership of a rebuilt 
     salvage vehicle may be transferred on a rebuilt salvage 
     title.
       ``(C) Registration for use.--A passenger motor vehicle for 
     which a rebuilt salvage title has been issued may be 
     registered for use on the roads and highways.
       ``(D) Requirement for a rebuilt salvage title.--A rebuilt 
     salvage title shall be conspicuously labeled, either with 
     `rebuilt salvage vehicle--antitheft and safety inspections 
     passed' or `rebuilt salvage vehicle--antitheft inspection 
     passed/no safety inspection pursuant to national criteria', 
     as appropriate, across the front of the document.
       ``(6) Nonrepairable vehicle.--
       ``(A) In general.--The term `nonrepairable vehicle' means 
     any passenger motor vehicle that--
       ``(i)(I) is incapable of safe operation for use on roads or 
     highways; and
       ``(II) has no resale value, except as a source of parts or 
     scrap only; or
       ``(ii) the owner irreversibly designatges as a source of 
     parts or scrap.
       ``(B) Certificate.--Each nonrepairable vehicle shall be 
     issued a nonrepairable vehicle certificate.
       ``(7) Nonrepairable vehicle certificate.--
       ``(A) In general.--The term `nonrepairable vehicle 
     certificate' means a passenger motor vehicle ownership 
     document issued by the State to the owner of a nonrepairable 
     vehicle.
       ``(B) Transfer of ownership.--Ownership of the passenger 
     motor vehicle may be transferred not more than 2 times on a 
     nonrepairable vehicle certificate.
       ``(C) Prohibition.--A nonrepairable vehicle that is issued 
     a nonrepairable vehicle certificate may not be titled or 
     registered for use on roads or highways at any time after the 
     issuance of the certificate.
       ``(D) Requirement for nonrepairable vehicle certificate.--A 
     nonrepairable vehicle certificate shall be conspicuously 
     labeled with the term `nonrepairable' across the front of the 
     document.
       ``(8) Flood vehicle.--
       ``(A) In general.--The term `flood vehicle' means any 
     passenger motor vehicle that has been submerged in water to 
     the point that rising water has reached over the door sill of 
     the motor vehicle and has entered the passenger or truck 
     compartment.
       ``(B) Requirement for disclosure.--Disclosure that a 
     passenger motor vehicle has become a flood vehicle shall be 
     made by the person transferring ownership at the time of 
     transfer of ownership. After such transfer is completed, the 
     certificate of title shall be conspicuously labeled with the 
     term `flood' across the front of the document.
       ``(9) Secretary.--The term `Secretary' means the Secretary 
     of Transportation.

     ``Sec. 33302. Passenger motor vehicle titling

       ``(a) Carryforward of Certain Title Information If a 
     Previous Title Was Not Issued in Accordance with Certain 
     Nationally Uniform Standards.--
       ``(1) In general.--If--
       ``(A) records that are readily accessible to a State 
     indicate that a passenger motor vehicle with respect to which 
     the ownership is transferred on or after the date that is 1 
     year after the date of enactment of the National Motor 
     Vehicle Safety, Anti-theft, Title Reform, and Consumer 
     Protection Act of 1997, has been issued previously a title 
     that bore a term or symbol described in paragraph (2); and
       ``(B) the State licenses that vehicle for use, the State 
     shall disclose that fact on a certificate of title issued by 
     the State.
       ``(2) Terms and symbols.--
       ``(A) In general.--A State shall be subject to the 
     requirements of paragraph (1) with respect to the following 
     terms on a title that has been issued previously to a 
     passenger motor vehicle (or symbols indicating the meanings 
     of those terms):
       ``(i) salvage.
       ``(ii) unrebuildable.
       ``(iii) parts only.
       ``(iv) scrap.
       ``(v) junk.
       ``(vi) nonrepairable.
       ``(vii) reconstructed.
       ``(viii) rebuilt.
       ``(ix) any other similar term, as determined by the 
     Secretary.
       ``(B) Flood damage.--A State shall be subject to the 
     requirements of paragraph (1) if a term or symbol on a title 
     issued previously for a passenger vehicle indicates that the 
     vehicle has been damaged by flood.
       ``(b) Nationally Uniform Title Standards and Control 
     Methods.--
       ``(1) In general.--Not later than 18 months after the date 
     of the enactment of the National Motor Vehicle Safety, Anti-
     theft,

[[Page S5416]]

     Title Reform, and Consumer Protection Act of 1997, the 
     Secretary shall issue regulations that require each State 
     that licenses passenger motor vehicles with respect to which 
     the ownership is transferred on or after the date that is 2 
     years after the issuance of final regulations, to apply with 
     respect to the issuance of the title for any such motor 
     vehicle uniform standards, procedures, and methods for--
       ``(A) the issuance and control of that title; and
       ``(B) information to be contained on such title.
       ``(2) Contents of regulations.--The titling standards, 
     control procedures, methods, and information covered under 
     the regulations issued under this subsection shall include 
     the following:
       ``(A) Indication of status.--Each State shall indicate on 
     the face of a title or certificate for a passenger motor 
     vehicle, as applicable, if the passenger motor vehicle is a 
     salvage vehicle, a nonrepairable vehicle, a rebuilt salvage 
     vehicle, or a flood vehicle.
       ``(B) Subsequent titles.--The information referred to in 
     subparagraph (A) concerning the status of the passenger 
     vehicle shall be conveyed on any subsequent title, including 
     a duplicate or replacement title, for the passenger motor 
     vehicle issued by the original titling State or any other 
     State.
       ``(C) Security standards.--The title documents, the 
     certificates and decals required by section 33301(4), and the 
     system for issuing those documents, certificates, and decals 
     shall meet security standards that minimize opportunities for 
     fraud.
       ``(D) Identifying information.--Each certificate of title 
     referred to in subparagraph (A) shall include the passenger 
     motor vehicle make, model, body type, year, odometer 
     disclosure, and vehicle identification number.
       ``(E) Uniform layout.--The title documents covered under 
     the regulations shall maintain a uniform layout, that shall 
     be established by the Secretary, in consultation with each 
     State or an organization that represents States.
       ``(F) Nonrepairable vehicles.--A passenger motor vehicle 
     designated as nonrepairable--
       ``(i) shall be issued a nonrepairable vehicle certificate; 
     and
       ``(ii) may not be retitled.
       ``(G) Rebuilt salvage title.--No rebuilt salvage title may 
     be issued to a salvage vehicle unless, after the salvage 
     vehicle is repaired or rebuilt, the salvage vehicle complies 
     with the requirements for a rebuilt salvage vehicle under 
     section 33301(4).
       ``(H) Inspection programs.--Each State inspection program 
     shall be designed to comply with the requirements of this 
     subparagraph and shall be subject to approval and periodic 
     review by the Secretary. Each such inspection program shall 
     include the following:
       ``(i) Each owner of a passenger motor vehicle that submits 
     a vehicle for an antitheft inspection shall be required to 
     provide--
       ``(I) a completed document identifying the damage that 
     occurred to the vehicle before being repaired;
       ``(II) a list of replacement parts used to repair the 
     vehicle;
       ``(III) proof of ownership of the replacement parts 
     referred to in subclause (II) (as evidenced by bills of 
     sales, invoices or, if such documents are not available, 
     other proof of ownership for the replacement parts); and
       ``(IV) an affirmation by the owner that--
       ``(a) the information required to be submitted under this 
     subparagraph is complete and accurate; and
       ``(b) to the knowledge of the declarant, no stolen parts 
     were used during the rebuilding of the repaired vehicle.
       ``(ii) Any passenger motor vehicle or any major part or 
     major replacement part required to be marked under this 
     section that--
       ``(I) has a mark or vehicle identification number that has 
     been illegally altered, defaced, or falsified; and
       ``(II) cannot be identified as having been legally obtained 
     (through evidence described in clause (i)(III)),

     shall be contraband and subject to seizure.
       ``(iii) To avoid confiscation of parts that have been 
     legally rebuilt or remanufactured, the regulations issued 
     under this subsection shall include procedures that the 
     Secretary, in consultation with the Attorney General of the 
     United States, shall establish--
       ``(I) for dealing with parts with a mark or vehicle 
     identification number that is normally removed during 
     remanufacturing or rebuilding practices that are considered 
     acceptable by the automotive industry; and
       ``(II) deeming any part referred to in subclause (I) to 
     meet the identification requirements under the regulations if 
     the part bears a conspicuous mark of such type, and is 
     applied in such manner, as may be determined by the Secretary 
     to indicate that the part has been rebuilt or 
     remanufactured.
       ``(iv) With respect to any vehicle part, the regulations 
     issued under this subsection shall--
       ``(I) acknowledge that a mark or vehicle identification 
     number on such part may be legally removed or altered, as 
     provided under section 511 of title 18, United States Code; 
     and
       ``(II) direct inspectors to adopt such procedures as may be 
     necessary to prevent the seizure of a part from which the 
     mark or vehicle identification number has been legally 
     removed or altered.
       ``(v) The Secretary shall establish nationally uniform 
     safety inspection criteria to be used in States that require 
     such a safety inspection. A State may determine whether to 
     conduct such safety inspection, contract with a third party, 
     or permit self-inspection. Any inspection conducted under 
     this clause shall be subject to criteria established by the 
     Secretary. A State that requires a safety inspection under 
     this clause may require the payment of a fee for such 
     inspection or the processing of such inspection.
       ``(I) Duplicate titles.--No duplicate or replacement title 
     may be issued by a State unless--
       ``(i) the term `duplicate' is clearly marked on the face of 
     the duplicate or replacement title; and
       ``(ii) the procedures issued are substantially consistent 
     with the recommendation designated as recommendation 3 in the 
     report issued on February 10, 1994, under section 140 of the 
     Anti Car Theft Act of 1992 (15 U.S.C. 2041 note) by the task 
     force established under such section.
       ``(J) Titling and control methods.--Each State shall employ 
     the following titling and control methods:
       ``(i) If an insurance company is not involved in a damage 
     settlement involving a salvage vehicle or a nonrepairable 
     vehicle, the passenger motor vehicle owner shall be required 
     to apply for a salvage title or nonrepairable vehicle 
     certificate, whichever is applicable, before the earlier of 
     the date--
       ``(I) on which the passenger motor vehicle is repaired or 
     the ownership of the passenger motor vehicle is transferred; 
     or
       ``(II) that is 30 days after the passenger motor vehicle is 
     damaged.
       ``(ii) If an insurance company, under a damage settlement, 
     acquires ownership of a passenger motor vehicle that has 
     incurred damage requiring the vehicle to be titled as a 
     salvage vehicle or nonrepairable vehicle, the insurance 
     company shall be required to apply for a salvage title or 
     nonrepairable vehicle certificate not later than 15 days 
     after the title to the motor vehicle is--
       ``(I) properly assigned by the owner to the insurance 
     company; and
       ``(II) delivered to the insurance company with all liens 
     released.
       ``(iii) If an insurance company does not assume ownership 
     of an insured person's or claimant's passenger motor vehicle 
     that has incurred damage requiring the vehicle to be titled 
     as a salvage vehicle or nonrepairable vehicle, the insurance 
     company shall, as required by the applicable State--
       ``(I) notify--
       ``(I) the owner of the owner's obligation to apply for a 
     salvage title or nonrepairable vehicle certificate for the 
     passenger motor vehicle; and
       ``(II) the State passenger motor vehicle titling office 
     that a salvage title or nonrepairable vehicle certificate 
     should be issued for the vehicle.
       ``(iv) If a leased passenger motor vehicle incurs damage 
     requiring the vehicle to be titled as a salvage vehicle or 
     nonrepairable vehicle, the lessor shall be required to apply 
     for a salvage title or nonrepairable vehicle certificate not 
     later than 21 days after being notified by the lessee that 
     the vehicle has been so damaged, except in any case in which 
     an insurance company, under a damage settlement, acquires 
     ownership of the vehicle. The lessee of such vehicle shall be 
     required to inform the lessor that the leased vehicle has 
     been so damaged not later than 30 days after the occurrence 
     of the damage.
       ``(v)(I) any person who requires ownership of a damaged 
     passenger motor vehicle that meets the definition of a 
     salvage or nonrepairable vehicle for which a salvage title or 
     nonrepairable vehicle certificate has not been issued, shall 
     be required to apply for a salvage title or nonrepairable 
     vehicle certificate, whichever is applicable.
       ``(II) An application under subclause (I) shall be made the 
     earlier of--
       ``(a) the date on which the vehicle is further transferred; 
     or
       ``(b) 30 days after ownership is acquired.
       ``(III) The requirements of this clause shall not apply to 
     any scrap metal processor that--
       ``(a) acquires a passenger motor vehicle for the sole 
     purpose of processing the motor vehicle into prepared grades 
     of scrap; and
       ``(b) carries out that processing.
       ``(vi) State records shall note when a nonrepairable 
     vehicle certificate is issued. No State shall issue a 
     nonrepairable vehicle certificate after 2 transfers of 
     ownership in violation of section 33301(b)(7)(B).
       ``(vii)(I) In any case in which a passenger motor vehicle 
     has been flattened, baled, or shredded, whichever occurs 
     first, the title or nonrepairable vehicle certificate for the 
     vehicle shall be surrendered to the State not later than 30 
     days after that occurrence.
       ``(II) If the second transferee on a nonrepairable vehicle 
     certificate is unequipped to flatten, bale, or shred the 
     vehicle, such transferee shall be required, at the time of 
     final disposal of the vehicle, to use the services of a 
     professional automotive recycler or professional scrap 
     processor. That recycler or reprocessor shall have the 
     authority to--
       ``(a) flatten, bale, or shred the vehicle; and
       ``(b) effect the surrender of the nonrepairable vehicle 
     certificate to the State on behalf of the second transferee.
       ``(III) State records shall be updated to indicate the 
     destruction of a vehicle under this clause and no further 
     ownership transactions for the vehicle shall be permitted 
     after the vehicle is so destroyed.
       ``(IV) If different from the State of origin of the title 
     or nonrepairable vehicle certificate, the State of surrender 
     shall notify the

[[Page S5417]]

     State of origin of the surrender of the title or 
     nonrepairable vehicle certificate and of the destruction of 
     such vehicle.
       ``(viii)(I) In any case in which a salvage title is issued, 
     the State records shall note that issuance. No State may 
     permit the retitling for registration purposes or issuance of 
     a rebuilt salvage title for a passenger motor vehicle with 
     a salvage title without a certificate of inspection that--
       ``(a) complies with the security and guideline standards 
     established by the Secretary under subparagraphs (C) and (G), 
     as applicable; and
       ``(b) indicates that the vehicle has passed the inspections 
     required by the State under subparagraph (H).
       ``(II) Nothing is this clause shall preclude the issuance 
     of a new salvage title for a salvage vehicle after a transfer 
     of ownership.
       ``(ix) After a passenger motor vehicle titled with a 
     salvage title has passed the inspections required by the 
     State, the inspection official shall--
       ``(I) affix a secure decal required under section 33301(4) 
     (that meets permanency requirements that the Secretary shall 
     establish by regulation) to the door jamb on the driver's 
     side of the vehicle; and
       ``(II) issue to the owner of the vehicle a certificate 
     indicating that the passenger motor vehicle has passed the 
     inspections required by the State.
       ``(x)(I) The owner of a passenger motor vehicle titled with 
     a salvage title may obtain a rebuilt salvage title and 
     vehicle registration by presenting to the State the salvage 
     title, properly assigned, if applicable, along with the 
     certificate that the vehicle has passed the inspections 
     required by the State.
       ``(II) If the owner of a rebuilt salvage vehicle submits 
     the documentation referred to in subclause (I), the State 
     shall issue upon the request of the owner a rebuilt salvage 
     title and registration to the owner. When a rebuilt salvage 
     title is issued, the State records shall so note.
       ``(K) Flood vehicles.--
       ``(i) In general.--A seller of a passenger motor vehicle 
     that becomes a flood vehicle shall, at or before the time of 
     transfer of ownership, provide a written notice to the 
     purchaser that the vehicle is a flood vehicle. At the time of 
     the next title application for the vehicle--
       ``(I) the applicant shall disclose the flood status to the 
     applicable State with the properly assigned title; and
       ``(II) the term `flood' shall be conspicuously labeled 
     across the front of the new title document.
       ``(ii) Leased vehicles.--In the case of a leased passenger 
     motor vehicle, the lessee, within 15 days after the 
     occurrence of the event that caused the vehicle to become a 
     flood vehicle, shall give the lessor written disclosure that 
     the vehicle is a flood vehicle.
       ``(c) Electronic Procedures.--A State may employ electronic 
     procedures in lieu of paper documents in any case in which 
     such electronic procedures provided levels of information, 
     function, and security required by this section that are at 
     least equivalent to the levels otherwise provided by paper 
     documents.

     ``Sec. 33303. Label requirement

       ``(a) In General.--The Secretary shall by regulation 
     require that a label be affixed to the windshield or window 
     of a rebuilt or remanufactured salvage vehicle before its 
     first sale at retail containing such information regarding 
     that vehicle as the Secretary may require. The requirements 
     prescribed by the Secretary under this subsection shall be 
     similar to the requirements of section 3 of the Automobile 
     Information Disclosure Act (15 U.S.C. 1232). The label shall 
     be affixed by the individual who conducts the applicable 
     State antitheft inspection.
       ``(b) Removal, Alteration, or Illegibility of Required 
     Label.--No person shall willfully remove, alter, or render 
     illegible any label required by subsection (a) affixed to a 
     rebuilt or remanufactured salvage vehicle before the vehicle 
     is delivered to the actual custody and possession of the 
     ultimate purchaser of the vehicle.

     ``Sec. 33304. Petition for extensions of time

       ``(a) In General.--Subject to subsection (b), if a State 
     demonstrates to the satisfaction of the Secretary, a valid 
     reason for needing an extension of a deadline for compliance 
     with requirements under section 33302(a), the Secretary may 
     extend, for a period determined by the Secretary, an 
     otherwise applicable deadline with respect to that State.
       ``(b) Limitation.--No extension made under subsection (a) 
     shall remain in effect on or after the applicable compliance 
     date established under section 33302(b).

     ``Sec. 33305. Effect on State law

       ``(a) In General.--Beginning on the effective date of the 
     regulations issued under section 33302, this chapter shall 
     preempt any State law, to the extent that State law is 
     inconsistent with this chapter or the regulations issued 
     under this chapter that--
       ``(1) establish the form of the passenger motor vehicle 
     title;
       ``(2)(A) define, in connection with a passenger motor 
     vehicle (but not in connection with a passenger motor vehicle 
     part or part assembly separate from a passenger motor 
     vehicle)--
       ``(i) any term defined in section 33301;
       ``(ii) the term `salvage', `junk', `reconstructed', 
     `nonrepairable', `unrebuildable', `scrap', `parts only', 
     `rebuilt', `flood', or any other similar symbol or term; or
       ``(B) apply any of the terms referred to in subparagraph 
     (A) to any passenger motor vehicle (but not in connection 
     with a passenger motor vehicle part or part assembly separate 
     from a passenger motor vehicle); or
       ``(3) establish titling, recordkeeping, antitheft 
     inspection, or control procedures in connection with any 
     salvage vehicle, rebuilt salvage vehicle, nonrepairable 
     vehicle, or flood vehicle.
       ``(b) Additional Disclosures.--Additional disclosures of 
     the title status or history of a motor vehicle, in addition 
     to disclosures made concerning the applicability of terms 
     defined in section 33301, may not be considered to be 
     inconsistent with this chapter.
       ``(c) Disclosure of Safety Inspection.--Nothing in this 
     chapter shall preclude a State from disclosing on a rebuilt 
     salvage title that a rebuilt salvage vehicle has passed a 
     State safety inspection that differed from the nationally 
     uniform criteria promulgated under section 33302(b)(2)(H)(v).
       ``(d) State Enforcement.--Subsection (a) does not preclude 
     a State from enforcing the provisions of this chapter by 
     injunction or otherwise, or by establishing State civil or 
     criminal penalties for violations of the provisions of this 
     chapter.

     ``Sec. 33306. Civil and criminal penalties

       ``(a) Prohibited Acts.--It shall be unlawful for any person 
     knowingly and willfully to--
       ``(1) make or cause to be made any false statement on an 
     application for a title (or duplicate title) for a passenger 
     motor vehicle;
       ``(2) fail to apply for a salvage title in any case in 
     which such an application is required;
       ``(3) alter, forge, or counterfeit--
       ``(A) A certificate of title (or an assignment thereof);
       ``(B) a nonrepairable vehicle certificate;
       ``(C) a certificate verifying an antitheft inspection or an 
     antitheft and safety inspection; or
       ``(D) a decal affixed to a passenger motor vehicle under 
     section 33302(b)(2)(J)(ix);
       ``(4) falsify the results of, or provide false information 
     in the course of, an inspection conducted under section 
     33302(b)(2)(H);
       ``(5) offer to sell any salvage vehicle or non-repairable 
     vehicle as a rebuilt salvage vehicle; or
       ``(6) conspire to commit any act under paragraph (1), (2), 
     (3), (4), or (5).
       ``(b) Civil Penalty.--Any person who commits an unlawful 
     act under subsection (a) shall be subject to a civil penalty 
     in an amount not to exceed $2,000.
       ``(c) Criminal Penalty.--Any person who knowingly commits 
     an unlawful act under subsection (a) shall, upon conviction, 
     be--
       ``(1) subject to a fine in an amount not to exceed $50,000;
       ``(2) imprisoned for a term not to exceed 3 years; or
       ``(3) subject to both fine under paragraph (1) and 
     imprisonment under paragraph (2).''.
       (b) Conforming Amendment.--The analysis for subtitle VI of 
     Title 49, United States Code, is amended by adding at the end 
     the following new item:

``Automobile safety, antitheft, and title disclosure requirements 
              33301''.
                                 ______
                                 
      By Mr. D'AMATO (by request):
  S. 853. A bill to protect the financial interests of the Federal 
Government through debt restructuring and subsidy reduction in 
connection with multifamily housing; to enhance the effectiveness of 
enforcement provisions relating to single family and multifamily 
housing (including amendments to the Bankruptcy Code); to consolidate 
and reform the management of multifamily housing programs; and for 
other purposes; to the Committee on Banking, Housing, and Urban 
Affairs.


          the housing 2020: multifamily management reform act

 Mr. D'AMATO. Mr. President, as chairman of the Committee on 
Banking, Housing, and Urban Affairs, I introduce the Housing 2020: 
Multifamiy Management Reform Act at the request of the Secretary of the 
Department of Housing and Urban Development [HUD], the Honorable Andrew 
M. Cuomo.
  I am a cosponsor of separate legislation to reform HUD's multifamily 
housing inventory, the Multifamily Assisted Housing Reform and 
Affordability Act of 1997 (S. 513). While the Senate and the 
administration bills share the same objectives, some policy differences 
exist. Specifically, each bill takes a significantly different approach 
to the following key issues: project-basing versus tenant-basing; tax 
implications of debt restructuring; and use of third parties to 
administer the restructuring program.
  I look forward to working with my colleagues in the Senate and 
Secretary Cuomo to resolve HUD's multifamily housing crisis as 
expeditiously as possible.
                                 ______
                                 
      By Mr. GREGG (for himself, Mr. Ford, Mr. Graham, and Mr. Hagel):

[[Page S5418]]

  S. 854. A bill to amend the Internal Revenue Code of 1986 to provide 
a reduction in the capital gains tax for assets held more than 2 years, 
and for other purposes; to the Committee on Finance.


                  The Long-Term Investment Act of 1997

  Mr. GREGG. Mr. President, I introduce, with Senators Ford, Hagel, and 
Graham a sliding-scale capital gains proposal, the Long-Term Investment 
Act of 1997. Given the sobering demographics associated with the 
impending aging of the baby-boom generation, it is more important than 
ever that laws enacted by Congress promote long-term capital investment 
and savings by all Americans.
  Central to this objective is a reduction in the current capital gains 
tax rate on long-term investments. A capital gains reduction was agreed 
to in principle in the budget agreement. We have a proposal that we 
believe embodies a fundamental change in tax policy at less cost. Over 
the next 10 years, S. 2 will cost $129 billion, while Gregg/Ford will 
cost $45 billion.
  We have developed a plan that would encourage long-term investments 
through a sliding-scale capital gains rate reduction. The plan would 
encourage individuals to hold assets over a number of years, allowing 
no reduction in the current rate on assets held for less than 1 year, 
with increasingly larger deductions to a maximum 50 percent reduction 
for investments held more than 8 years.
  This sliding-scale plan encourages investments that will benefit 
long-term savings and capital--such as providing for a child's 
education or retirement income. The bill also rewards the small 
business owner and entrepreneurs as it will allow for a significant 
reduction in capital gains taxation that benefits those individuals who 
invest in the economy through the creation of small businesses and 
jobs. By rewarding long-term investment in businesses and job creation 
and discouraging the quick fix that so often is associated with 
speculation on Wall Street, we will be placing our Tax Code and job 
base on a more solid ground.
  The Gregg/Ford sliding-scale reduction on capital gains taxation 
hinges on balancing two important goals--the promotion of savings and 
long-term investment through a significant capital gains cut, while 
also recognizing our current fiscal restraints.
  The recent budget agreement reached between the President and 
Congress calls for a net tax cut of $85 billion and a gross tax cut of 
$135 billion over 5 years. The details of how this tax package should 
be put together will be worked out by the appropriate committees in the 
House of Representatives and the Senate.
  The Clinton administration has indicated that it is for a capital 
gains rate reduction, but not in favor of a rate that dips below 20 
percent. I believe that this bill is a consensus building bill that 
both sides can and will agree upon in the not-too-distant future.
  I ask unanimous consent that the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 854

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

     SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

       (a) Short Title.--This Act may be cited as the ``Long-Term 
     Investment Incentive Act of 1997''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of the Internal 
     Revenue Code of 1986.

     SEC. 2. REDUCTION OF TAX ON LONG-TERM CAPITAL GAINS ON ASSETS 
                   HELD MORE THAN 2 YEARS.

       (a) In General.--Part I of subchapter P of chapter 1 
     (relating to treatment of capital gains) is amended by 
     redesignating section 1202 as section 1203 and by inserting 
     after section 1201 the following new section:

     ``SEC. 1202. CAPITAL GAINS DEDUCTION FOR ASSETS HELD BY 
                   NONCORPORATE TAXPAYERS MORE THAN 2 YEARS.

       ``(a) General Rule.--If a taxpayer other than a corporation 
     has a net capital gain for any taxable year, there shall be 
     allowed as a deduction an amount equal to the sum of the 
     applicable percentages of the classes of net capital gain 
     described in the table under subsection (b).
       ``(b) Applicable Percentage.--For purposes of this 
     subsection, the applicable percentage shall be the percentage 
     determined in accordance with the following table:

                                                         The applicable
                                                      ``Ipercentage is:
      2-year gain..............................................7.145   
      3-year gain............................................  14.29   
      4-year gain..............................................21.45   
      5-year gain..............................................28.57   
      6-year gain..............................................35.71   
      7-year gain..............................................42.86   
      8-year gain..............................................50.00.  

       ``(c) Gain to Which Deduction Applies.--For purposes of 
     this section--
       ``(1) 2-year gain.--The term `2-year gain' means the lesser 
     of--
       ``(A) the net capital gain for the taxable year, or
       ``(B) the amount of long-term capital gain which would be 
     computed for the taxable year if only gain from the sale or 
     exchange of property held by the taxpayer for more than 2 
     years but not more than 3 years were taken into account.
       ``(2) 3-year gain, etc.--The terms `3-, 4-, 5-, 6-, or 7-
     year gain' mean the amounts determined under paragraph (1)--
       ``(A) by reducing the amount of the net capital gain under 
     subparagraph (A) thereof by an amount equal to the long-term 
     capital gain from the sale or exchange of property with a 
     holding period less than the minimum holding period for any 
     such category, and
       ``(B) by substituting 3, 4, 5, 6, or 7 years for 2 years 
     and 4, 5, 6, 7, or 8 years for 3 years, respectively, in 
     subparagraph (B) thereof.
       ``(3) 8-year gain.--The term `8-year gain' means the lesser 
     of--
       ``(A) the net capital gain for the taxable year, reduced by 
     in the same manner as under paragraph (2)(A), or
       ``(B) the amount of the long-term capital gain which would 
     be computed for the taxable year if only gain from the sale 
     or exchange of property held by the taxpayer for more than 8 
     years were taken into account.
       ``(d) Estates and Trusts.--In the case of an estate or 
     trust, the deduction under subsection (a) shall be computed 
     by excluding the portion (if any) of the gains for the 
     taxable year from sales or exchanges of capital assets which, 
     under sections 652 and 662 (relating to inclusions of amounts 
     in gross income of beneficiaries of trusts), is includible by 
     the income beneficiaries as gain derived from the sale or 
     exchange of capital assets.
       ``(e) Coordination With Treatment of Capital Gain Under 
     Limitation on Investment Interest.--For purposes of this 
     section, the net capital gain for any taxable year shall be 
     reduced (but not below zero) by the amount which the taxpayer 
     takes into account as investment income under section 
     163(d)(4)(B)(iii).
       ``(f) Treatment of Collectibles.--
       ``(1) In general.--Solely for purposes of this section, any 
     gain or loss from the sale or exchange of a collectible shall 
     be treated as a short-term capital gain or loss (as the case 
     may be), without regard to the period such asset was held. 
     The preceding sentence shall apply only to the extent the 
     gain or loss is taken into account in computing taxable 
     income.
       ``(2) Treatment of certain sales of interest in 
     partnership, etc.--For purposes of paragraph (1), any gain 
     from the sale or exchange of an interest in a partnership, S 
     corporation, or trust which is attributable to unrealized 
     appreciation in the value of collectibles held by such entity 
     shall be treated as gain from the sale or exchange of a 
     collectible. Rules similar to the rules of section 751(f) 
     shall apply for purposes of the preceding sentence.
       ``(3) Collectible.--For purposes of this subsection, the 
     term `collectible' means any capital asset which is a 
     collectible (as defined in section 408(m) without regard to 
     paragraph (3) thereof).
       ``(g) Transitional Rule.--
       ``(1) In general.--Gain may be taken into account under 
     subsection (c) only if such gain is properly taken into 
     account on or after May 7, 1997.
       ``(2) Special rules for pass-thru entities.--
       ``(A) In general.--In applying paragraph (1) with respect 
     to any pass-thru entity, the determination of when gains and 
     losses are properly taken into account shall be made at the 
     entity level.
       ``(B) Pass-thru entity defined.--For purposes of 
     subparagraph (A), the term `pass-thru entity' means--
       ``(i) a regulated investment company,
       ``(ii) a real estate investment trust,
       ``(iii) an S corporation,
       ``(iv) a partnership,
       ``(v) an estate or trust, and
       ``(vi) a common trust fund.''
       (b) Deduction Allowable in Computing Adjusted Gross 
     Income.--Subsection (a) of section 62 is amended by inserting 
     after paragraph (16) the following new paragraph:
       ``(17) Long-term capital gains.--The deduction allowed by 
     section 1202.''
       (c) Maximum Capital Gains Rate.--Section 1(h) is amended by 
     adding at the end the following new sentence: ``For purposes 
     of this subsection, taxable income shall be computed without 
     regard to the deduction allowed under section 1202.''
       (d) Treatment of Certain Pass-Thru Entities.--
       (1) Capital gain dividends of regulated investment 
     companies.--
       (A) Subparagraph (B) of section 852(b)(3) is amended to 
     read as follows:
       ``(B) Treatment of capital gain dividends by 
     shareholders.--A capital gain dividend shall be treated by 
     the shareholders as gain from the sale or exchange of a 
     capital asset held for more than 1 year but not more than

[[Page S5419]]

     2 years; except that the portion of any such dividend 
     designated by the company as allocable to 2-, 3-, 4-, 5-, 6-, 
     7-, or 8-year gain of the company shall be treated as gain 
     from the sale or exchange of a capital asset held for the 
     amount of years in such class for purposes of section 1202. 
     Rules similar to the rules of subparagraph (C) shall apply to 
     any designation under the preceding sentence.''
       (B) Clause (i) of section 852(b)(3)(D) is amended by adding 
     at the end the following new sentence: ``Rules similar to the 
     rules of subparagraph (B) shall apply in determining 
     character of the amount to be so included by any such 
     shareholder.''
       (2) Capital gain dividends of real estate investment 
     trusts.--Subparagraph (B) of section 857(b)(3) is amended to 
     read as follows:
       ``(B) Treatment of capital gain dividends by 
     shareholders.--A capital gain dividend shall be treated by 
     the shareholders or holders of beneficial interests as gain 
     from the sale or exchange of a capital asset held for more 
     than 1 year but not more than 2 years; except that the 
     portion of any such dividend designated by the company as 
     allocable to 2-, 3-, 4-, 5-, 6-, 7-, or 8-year gain of the 
     company shall be treated as gain from the sale or exchange of 
     a capital asset held for the amount of years in such class 
     for purposes of section 1202. Rules similar to the rules of 
     subparagraph (C) shall apply to any designation under the 
     preceding sentence.''
       (3) Common trust funds.--Subsection (c) of section 584 is 
     amended--
       (A) by inserting ``and not more than 2 years'' after ``1 
     year'' each place it appears in paragraph (2),
       (B) by striking ``and'' at the end of paragraph (2), and
       (C) by redesignating paragraph (3) as paragraph (4) and 
     inserting after paragraph (2) the following new paragraph:
       ``(3) as part of its gains from sales or exchanges of 
     capital assets held for periods described in the classes of 
     gains under section 1202(c), its proportionate share of the 
     gains of the common trust fund from sales or exchanges of 
     capital assets held for such periods, and''.
       (e) Technical and Conforming Changes.--
       (1) Subparagraph (B) of section 170(e)(1) is amended by 
     inserting ``(or, in the case of a taxpayer other than a 
     corporation, the percentage of such gain equal to 100 percent 
     minus the percentage applicable to such gain under section 
     1202(a))'' after ``the amount of gain''.
       (2) Subparagraph (B) of section 172(d)(2) is amended to 
     read as follows:
       ``(B) the deduction under section 1202 and the exclusion 
     under section 1203 shall not be allowed.''
       (3)(A) Section 221 (relating to cross reference) is amended 
     to read as follows:

     ``SEC. 221. CROSS REFERENCES.

       ``(1) For deduction for net capital gains in the case of a 
     taxpayer other than a corporation, see section 1202.
       ``(2) For deductions in respect of a decedent, see section 
     691.''
       (B) The table of sections for part VII of subchapter B of 
     chapter 1 is amended by striking ``reference'' in the item 
     relating to section 221 and inserting ``references''.
       (4) The last sentence of section 453A(c)(3) is amended by 
     striking all that follows ``long-term capital gain,'' and 
     inserting ``the maximum rate on net capital gain under 
     section 1(h) or 1201 or the deduction under section 1202 
     (whichever is appropriate) shall be taken into account.''
       (5) Paragraph (4) of section 642(c) is amended to read as 
     follows:
       ``(4) Adjustments.--To the extent that the amount otherwise 
     allowable as a deduction under this subsection consists of 
     gain from the sale or exchange of capital assets held for 
     more than 1 year, proper adjustment shall be made for any 
     deduction allowable to the estate or trust under section 1202 
     or any exclusion allowable to the estate or trust under 
     section 1203(a). In the case of a trust, the deduction 
     allowed by this subsection shall be subject to section 681 
     (relating to unrelated business income).''
       (6) The last sentence of paragraph (3) of section 643(a) is 
     amended to read as follows: ``The deduction under section 
     1202 and the exclusion under section 1203 shall not be taken 
     into account.''
       (7) Subparagraph (C) of section 643(a)(6) is amended by 
     inserting ``(i)'' before ``there shall'' and by inserting 
     before the period ``, and (ii) the deduction under section 
     1202 (relating to capital gains deduction) shall not be taken 
     into account''.
       (8) Paragraph (4) of section 691(c) is amended by striking 
     ``sections 1(h), 1201, and 1211'' and inserting ``sections 
     1(h), 1201, 1202, and 1211''.
       (9) The second sentence of section 871(a)(2) is amended by 
     inserting ``or 1203'' after ``1202''.
       (10) Subsection (d) of section 1044 is amended by striking 
     ``1202'' and inserting ``1203''.
       (11) Paragraph (1) of section 1402(i) is amended by 
     inserting ``, and the deduction provided by section 1202 
     shall not apply'' before the period at the end thereof.
       (f) Clerical Amendment.--The table of sections for part I 
     of subchapter P of chapter 1 is amended by inserting after 
     the item relating to section 1201 the following new item:

``Sec. 1202. Capital gains deduction for assets held by noncorporate 
              taxpayers more than 2 years.''

       (g) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to taxable years ending on and after May 7, 1997.
       (2) Contributions.--The amendment made by subsection (e)(1) 
     shall apply to contributions on or after May 7, 1997.

  Mr. FORD. Madam President, we are all familiar with the parameters of 
the upcoming tax debate. The budget deal provides for $85 billion in 
net tax cuts over 5 years, and $250 billion in net tax cuts over 10 
years.
  Within those dollar limits, there's a strong desire to provide tax 
cuts in four areas: first, capital gains relief, second, estate tax 
relief, third, a $500-per-child tax credit, and fourth, education tax 
initiatives. But if you add up all the current proposals in each of 
these areas, you go way over the $250 billion mark set by the budget 
deal. Cheaper alternatives must be found.
  I have had an interest for several years in providing capital gains 
relief for family farmers and small family businesses where the parents 
wish to pass along to their children the operation of the farm or the 
business.
  Earlier this year, Senator Gregg and I each introduced capital gains 
tax reduction legislation which was based on a similar objective: The 
longer you have held an asset, the lower your capital gains rate will 
be. We call this the sliding scale capital gains tax reduction. Since 
then, we have gotten together, and produced a product which we believe 
combines the vest features of both of our bills. And we're introducing 
that legislation today.
  The Ford-Gregg approach is a bipartisan compromise that will allow 
the tax cut package to move forward consistent with the budget deal.
  The Ford-Gregg bill achieves the following objectives shared by all 
capital gains cut advocates:
  First, it cuts the capital gains rate in half for individuals; 
second, it does not discriminate among types of assets; and third, it 
keeps things relatively simple.
  In addition, the Ford-Gregg bill meets the following additional 
objectives:
  First, it costs less than half as much as the major capital gains 
proposals; second, it rewards long-term investment over short-term 
speculation; and third, it's bipartisan.
  Remember, the budget agreement calls for $250 billion in net tax cuts 
over 10 years. According to the Joint Tax Committee, the major capital 
gains proposal pending in the Senate (S. 2) would cost $129 billion 
over 10 years--eating up more than one-half of the net tax cut amount. 
On the other hand, the Joint Tax Committee estimates that the Ford-
Gregg sliding scale proposal would cost only $45.2 billion over 10 
years.
  This is a better approach. It is a bipartisan approach. It's better 
public policy because it rewards long-term investment. It costs less 
than half as much. And it will make life a whole lot easier for the tax 
writing committees in the weeks ahead. And that is the message we will 
be delivering as the final tax package is being written.
                                                                    ____

      By Mr. FAIRCLOTH (for himself, Mr. Hagel, Mr. Shelby, and Mr. 
        Hutchinson):
  S. 855. A bill to provide for greater responsiveness by Federal 
agencies in contracts with the public, and for other purposes; to the 
Committee on Governmental Affairs.


                     the Responsive Government Act

  Mr. FAIRCLOTH. Mr. President, I rise to introduce the Responsive 
Government Act, and I am joined by the junior Senator from Nebraska, 
the senior Senator from Alabama, and the junior Senator from Arkansas.
  The Responsive Government Act proposes six simple, but important, 
reforms to make the Federal work force more responsive to the American 
people and their concerns.
  First, the Responsive Government Act will require all Federal 
agencies to include the telephone number of the writer on all official 
correspondence.
  Too often, people receive letters from Federal agencies that have a 
return address, but no telephone number. In today's busy world, not 
everyone has time to write a letter to respond to the reams of mail 
from Federal bureaucrats.
  Mr. President, there are few businesses that would send out a letter 
without a telephone number, and the Government should not be 
unaccountable to its customers.

[[Page S5420]]

  The act also requires Federal offices to provide a person--not an 
automated computer system--to answer the main telephone number at 
service-oriented offices.
  The Federal Government is here to serve the taxpayers. These Federal 
agencies should not greet taxpayers with a voice-mail system to screen 
their calls.
  Mr. President, the taxpayers are entitled to a voice on the other end 
of the line to assist them, not a machine that tells them to leave a 
message.
  The Responsive Government Act also requires Federal agencies to 
answer the telephones until 5 p.m. Too often, Mr. President, I hear 
constituents tell me that they just can't get Federal agencies to pick 
up the phone after 4. This just is not right. The Federal Government is 
too large, and, unfortunately, that means that citizens are forced into 
frequent contacts with Federal agencies. It should not be impossible to 
get in touch with Federal employees.
  It should be as easy to get in touch with them as with businesses. 
The Act also requires Federal agencies to publish their principal 
telephone numbers in the local directories.
  Of course, the blue pages list many Federal agencies, but not all of 
them. This is an important distinction. We need complete disclosure, 
Mr. President, and all agencies need to publish their numbers for the 
benefit of the public.
  These agencies also need to attempt to locate service-oriented 
offices in areas with sufficient parking.
  Too often, new agency offices are located in areas with limited 
public parking. There is often room for employee parking, but not for 
the public, and that cannot continue.
  Finally, Mr. President, the Responsive Government Act requires all 
Federal agencies to remove computer games from all Federal Government 
computers.
  These computers are for work, not fun, and the taxpayers are footing 
the bill for fun on the job.
  The Federal Government spent close to $20 billion last year on 
computer equipment and support services. These systems increase 
productivity in most cases.
  However, many of these computers are delivered already equipped with 
game programs, which reduce workers' efficiency and productivity.
  This legislation will prohibit the Federal Government from purchasing 
computers with preloaded game programs.
  These games, of course, decrease the productivity of Federal 
employees.
  In fact, a private-sector survey found that workers spent an average 
of 5.1 hours per week playing games and other non-job-related tasks on 
their computers. This translates into an annual $10 billion loss in 
productivity.
  Clearly, then, these games do not go unused.
  In fact, many of these games now come equipped with a boss key.
  This device lets the worker strike a single keystroke and transform 
the computer screen from the game to a false spreadsheet. The sole 
purpose of this device is to hide unproductive behavior from 
supervisors.
  Mr. President, there is no reason for the Federal Government to buy 
computers with programs designed to divert employees' attention from 
their jobs.
  This is a commonsense reform.
  Governor George Allen of Virginia and former Labor Secretary Robert 
Reich ordered workers to delete these game programs. I commend them for 
their actions.
  I ran for the Senate in 1992 because I wanted to bring some common 
sense--and private-sector experience--to Washington.
  I want to see a Federal Government that is responsive to the 
citizens. This bill addresses practices that would ruin private-sector 
businesses.
  There is no reason that Government should be less accountable to its 
customers.
  Mr. HAGEL. Mr. President, I rise today in support of the Responsive 
Government Act. I am proud to be the principal cosponsor of this 
legislation, and I commend my colleague from North Carolina, Senator 
Faircloth, for his leadership in introducing this bill.
  This bill would make Government agencies more responsive to the 
people who use their services. It is a narrow and targeted approach 
that addresses several of the most common complaints that Americans 
have about the service they receive from Government agencies.
  This bill would make the Federal Government more user-friendly by 
requiring all Federal agencies to:
  Include the telephone number of the author on all official 
correspondence so citizens know whom to contact and how to reach that 
person if there are questions;
  Provide a person, not an automated system, to answer the main 
telephone number at service-oriented Federal agencies so citizens do 
not have to talk to a machine;
  Ensure that telephones are answered until 5 p.m. so citizens can get 
assistance by phone during normal business hours;
  Publish principal telephone numbers in the local directories so 
citizens can readily find how to reach the agency;
  Attempt to locate service-oriented offices in areas with sufficient 
parking so citizens can come and go easily when doing business; and
  Remove computer games from all Federal Government computers so 
Federal employees are not distracted from their jobs.
  Mr. President, I ran for the U.S. Senate because I believe we need 
less Government. I also believe that we must make our Government better 
and more efficient. Federal agencies must always--always--be as user-
friendly as possible for our citizens. Government agencies must always 
treat taxpayers with courtesy and respect.
  This bill is a small but important step toward creating a service-
oriented climate in the Federal Government. Americans deserve no less.
  I urge my colleagues to support this legislation.
                                 ______
                                 
      By Mr. ROBB:
  S. 856. A bill to provide for the adjudication and payment of certain 
claims against the Government of Iraq; to the Committee on Foreign 
Relations.


                      THE IRAQI CLAIMS ACT OF 1997

  Mr. ROBB. Mr. President, nearly 7 years ago President Bush invoked 
emergency economic sanctions against Iraq for its invasion of Kuwait. 
Freezing Iraqi financial assets made sense at the time because it 
prevented Saddam Hussein from funding his war campaign. Now, we need to 
take steps to unwind the sanctions regime to permit payment to United 
States businesses who sold products to Iraq but have never been paid.
  Four years ago this month I introduced legislation--S. 1119, the 
Secured Payment Act of 1993--with 13 bipartisan cosponsors achieving 
that purpose. The bill clarified that certain moneys on deposit in 
United States banks belong to United States companies, not Iraq, and 
therefore should not be subject to the Iraqi assets freeze. Amendment 
language similar to S. 1119 was appended to the last State Department 
Authorization bill following a rollcall vote in the Foreign Relations 
Committee and approved by the full Senate. Unfortunately, the language 
was dropped in conference, leaving this matter unresolved.
  The legislation I am introducing today represents a compromise on 
creating a settlement process for private preinvasion claims. The Iraq 
Claims Act of 1997 I believe takes a progressive step forward in 
disseminating the $1.2 billion in frozen assets.
  First, it vests currently blocked assets in the President. Second, an 
Iraq Claims Fund will be created by the Treasury Department where those 
assets will be deposited. Third, within 2 years of enactment of the 
legislation, payment on private claims--certified by the Foreign Claims 
Settlement Commission--will be made out of the fund. Fourth, after 
payment has been made in full on all private claims, any funds 
remaining shall be made available to satisfy claims of the U.S. 
Government.
  Mr. President, although much of the debate over my previous 
legislation concerned the minutiae of letter of credit law, 
international business transactions, and economic emergency powers, the 
Iraq Claims Act of 1997 lays aside those issues and establishes an 
equitable procedure for considering claims on a prioritized basis. 
While I understand that the administration is working on a proposal for 
similar legislation on Iraq claims, I would encourage the State and 
Treasury Departments to reevaluate their concerns

[[Page S5421]]

about the approach I am proposing. I would submit that this legislation 
is the most suitable, and politically viable, compromise available to 
come to closure on this issue.
  Mr. President, these frozen assets were blocked to prevent Iraq from 
using the funds to support its aggression against Kuwait and its 
allies. That freeze--designed to hurt Iraq--is now hurting American 
companies. Some of those firms were a mere electronic transfer, a 
keystroke on a computer, away from receiving their payments when the 
emergency freeze was imposed. After 7 years, it is time to act 
expeditiously in their favor.
                                 ______
                                 
      By Mr. SHELBY:
  S. 858. An original bill to authorize appropriations for fiscal year 
1998 for intelligence and intelligence-related activities of the United 
States Government, and Community Management Account, and the Central 
Intelligence Agency Retirement and Disability System, and for other 
purposes; from the Select Committee on Intelligence; placed on the 
calendar.


        the intelligence authorization act for fiscal year 1998

  Mr. SHELBY. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 858

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the 
     ``Intelligence Authorization Act for Fiscal Year 1998''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                    TITLE I--INTELLIGENCE ACTIVITIES

Sec. 101. Authorization of appropriations.
Sec. 102. Classified schedule of authorizations.
Sec. 103. Personnel ceiling adjustments.
Sec. 104. Community Management Account.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

Sec. 201. Authorization of appropriations.

                     TITLE III--GENERAL PROVISIONS

Sec. 301. Increase in employee compensation and benefits authorized by 
              law.
Sec. 302. Restriction on conduct of intelligence activities.
Sec. 303. Detail of intelligence community personnel.
Sec. 304. Extension of application of sanctions laws to intelligence 
              activities.
Sec. 305. Administrative location of the Office of the Director of 
              Central Intelligence.
Sec. 306. Encouragement of disclosure of certain information to 
              Congress.
Sec. 307. Provision of information on violent crimes against United 
              States citizens abroad to victims and victims' families.
Sec. 308. Standards for spelling of foreign names and places and for 
              use of geographic coordinates.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

Sec. 401. Multiyear leasing authority.
Sec. 402. Subpoena authority for the Inspector General of the Central 
              Intelligence Agency.

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

Sec. 501. Academic degrees in intelligence.
Sec. 502. Funding for infrastructure and quality of life improvements 
              at Menwith Hill and Bad Aibling stations.
Sec. 503. Misuse of National Reconnaissance Office name, initials, or 
              seal.
                    TITLE I--INTELLIGENCE ACTIVITIES

     SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

       Funds are hereby authorized to be appropriated for fiscal 
     year 1998 for the conduct of the intelligence and 
     intelligence-related activities of the following elements of 
     the United States Government:
       (1) The Central Intelligence Agency.
       (2) The Department of Defense.
       (3) The Defense Intelligence Agency.
       (4) The National Security Agency.
       (5) The Department of the Army, the Department of the Navy, 
     and the Department of the Air Force.
       (6) The Department of State.
       (7) The Department of the Treasury.
       (8) The Department of Energy.
       (9) The Federal Bureau of Investigation.
       (10) The Drug Enforcement Administration.
       (11) The National Reconnaissance Office.
       (12) The National Imagery and Mapping Agency.

      SEC. 102. CLASSIFIED SCHEDULE OF AUTHORIZATIONS.

       (a) Specifications of Amounts and Personnel Ceilings.--The 
     amounts authorized to be appropriated under section 101, and 
     the authorized personnel ceilings as of September 30, 1998, 
     for the conduct of the intelligence and intelligence-related 
     activities of the elements listed in such section, are those 
     specified in the classified Schedule of Authorizations 
     prepared to accompany the conference report on the bill ____ 
     of the One Hundred Fifth Congress.
       (b) Availability of Classified Schedule of 
     Authorizations.--The Schedule of Authorizations shall be made 
     available to the Committees on Appropriations of the Senate 
     and House of Representatives and to the President. The 
     President shall provide for suitable distribution of the 
     Schedule, or of appropriate portions of the Schedule, within 
     the Executive Branch.

     SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

       (a) Authority for Adjustments.--With the approval of the 
     Director of the Office of Management and Budget, the Director 
     of Central Intelligence may authorize employment of civilian 
     personnel in excess of the number authorized for fiscal year 
     1998 under section 102 when the Director of Central 
     Intelligence determines that such action is necessary to the 
     performance of important intelligence functions, except that 
     the number of personnel employed in excess of the number 
     authorized under such section may not, for any element of the 
     intelligence community, exceed two percent of the number of 
     civilian personnel authorized under such section for such 
     element.
       (b) Notice to Intelligence Committees.--The Director of 
     Central Intelligence shall promptly notify the Permanent 
     Select Committee on Intelligence of the House of 
     Representatives and the Select Committee on Intelligence of 
     the Senate whenever the Director exercises the authority 
     granted by this section.

     SEC. 104. COMMUNITY MANAGEMENT ACCOUNT.

       (a) Authorization of Appropriations.--
       (1) Authorization.--There is authorized to be appropriated 
     for the Community Management Account of the Director of 
     Central Intelligence for fiscal year 1998 the sum of 
     $90,580,000.
       (2) Availability of certain funds.--Within such amount, 
     funds identified in the classified Schedule of Authorizations 
     referred to in section 102(a) for the Advanced Research and 
     Development Committee and the Environmental Intelligence and 
     Applications Program shall remain available until September 
     30, 1999.
       (b) Authorized Personnel Levels.--The elements within the 
     Community Management Account of the Director of Central 
     Intelligence are authorized a total of 278 full-time 
     personnel as of September 30, 1998. Personnel serving in such 
     elements may be permanent employees of the Community 
     Management Account element or personnel detailed from other 
     elements of the United States Government.
       (c) Classified Authorizations.--
       (1) Authorization of appropriations.--In addition to 
     amounts authorized to be appropriated for the Community 
     Management Account by subsection (a), there is also 
     authorized to be appropriated for the Community Management 
     Account for fiscal year 1998 such additional amounts as are 
     specified in the classified Schedule of Authorizations 
     referred to in section 102(a).
       (2) Authorization of personnel.--In addition to the 
     personnel authorized by subsection (b) for elements of the 
     Community Management Account as of September 30, 1998, there 
     is hereby authorized such additional personnel for such 
     elements as of that date as is specified in the classified 
     Schedule of Authorizations.
       (3) Construction.--Authorizations in the classified 
     Schedule of Authorizations may not be construed to increase 
     authorizations of appropriations or personnel for the 
     Community Management Account except to the extent specified 
     in the applicable paragraph of this subsection.
       (d) Reimbursement.--During fiscal year 1998, any officer or 
     employee of the United States or member of the Armed Forces 
     who is detailed to the staff of an element within the 
     Community Management Account from another element of the 
     United States Government shall be detailed on a reimbursable 
     basis, except that any such officer, employee, or member may 
     be detailed on a non-reimbursable basis for a period of less 
     than one year for the performance of temporary functions as 
     required by the Director of Central Intelligence.
 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

     SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated for the Central 
     Intelligence Agency Retirement and Disability Fund for fiscal 
     year 1998 the sum of $196,900,000.
                     TITLE III--GENERAL PROVISIONS

     SEC. 301. INCREASE IN EMPLOYEE COMPENSATION AND BENEFITS 
                   AUTHORIZED BY LAW.

       Appropriations authorized by this Act for salary, pay, 
     retirement, and other benefits for Federal employees may be 
     increased by such additional or supplemental amounts as may 
     be necessary for increases in such compensation or benefits 
     authorized by law.

     SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.

       The authorization of appropriations by this Act shall not 
     be deemed to constitute authority for the conduct of any 
     intelligence activity which is not otherwise authorized by 
     the Constitution or the laws of the United States.

[[Page S5422]]

     SEC. 303. DETAIL OF INTELLIGENCE COMMUNITY PERSONNEL.

       (a) Detail.--
       (1) In general.--Notwithstanding any other provision of 
     law, the head of a department or agency having jurisdiction 
     over an element in the intelligence community or the head of 
     an element of the intelligence community may detail any 
     employee of the department, agency, or element to serve in 
     any position in the Intelligence Community Assignment 
     Program.
       (2) Basis of detail.--
       (A) In general.--Personnel may be detailed under paragraph 
     (1) on a reimbursable or nonreimbursable basis.
       (B) Period of nonreimbursable detail.--Personnel detailed 
     on a nonreimbursable basis shall be detailed for such periods 
     not to exceed three years as are agreed upon between the 
     heads of the departments or agencies concerned. However, the 
     heads of the departments or agencies may provide for the 
     extension of a detail for not to exceed one year if the 
     extension is in the public interest.
       (b) Benefits, Allowances, and Incentives.--The department, 
     agency, or element detailing personnel to the Intelligence 
     Community Assignment Program under subsection (a) on a non-
     reimbursable basis may provide such personnel any salary, 
     pay, retirement, or other benefits, allowances (including 
     travel allowances), or incentives as are provided to other 
     personnel of the department, agency, or element.
       (c) Effective Date.--This section shall take effect on June 
     1, 1997.

     SEC. 304. EXTENSION OF APPLICATION OF SANCTIONS LAWS TO 
                   INTELLIGENCE ACTIVITIES.

       Section 905 of the National Security Act of 1947 (50 U.S.C. 
     441d) is amended by striking out ``January 6, 1998'' and 
     inserting in lieu thereof ``January 6, 2001''.

     SEC. 305. ADMINISTRATIVE LOCATION OF THE OFFICE OF THE 
                   DIRECTOR OF CENTRAL INTELLIGENCE.

       Section 102(e) of the National Security Act of 1947 (50 
     U.S.C. 403(e)) is amended by adding at the end the following:
       ``(4) The Office of the Director of Central Intelligence 
     shall, for administrative purposes, be within the Central 
     Intelligence Agency.''.

     SEC. 306. ENCOURAGEMENT OF DISCLOSURE OF CERTAIN INFORMATION 
                   TO CONGRESS.

       (a) Encouragement.--
       (1) In general.--Not later than 30 days after the date of 
     enactment of this Act, the President shall take appropriate 
     actions to inform the employees of the executive branch, and 
     employees of contractors carrying out activities under 
     classified contracts, that the disclosure of information 
     described in paragraph (2) to the committee of Congress 
     having oversight responsibility for the department, agency, 
     or element to which such information relates, or to the 
     Members of Congress who represent such employees, is not 
     prohibited by law, executive order, or regulation or 
     otherwise contrary to public policy.
       (2) Covered information.--Paragraph (1) applies to 
     information, including classified information, that an 
     employee reasonably believes to evidence--
       (A) a violation of any law, rule, or regulation;
       (B) a false statement to Congress on an issue of material 
     fact; or
       (C) gross mismanagement, a gross waste of funds, an abuse 
     of authority, or a substantial and specific danger to public 
     health or safety.
       (b) Report.--On the date that is 30 days after the date of 
     enactment of this Act, the President shall submit to Congress 
     a report on the actions taken under subsection (a).

     SEC. 307. PROVISION OF INFORMATION ON VIOLENT CRIMES AGAINST 
                   UNITED STATES CITIZENS ABROAD TO VICTIMS AND 
                   VICTIMS' FAMILIES.

       (a) Sense of Congress.--It is the sense of Congress that--
       (1) it is in the national interests of the United States to 
     provide information regarding the murder or kidnapping of 
     United States citizens abroad to the victims, or the families 
     of victims, of such crimes; and
       (2) the provision of such information is sufficiently 
     important that the discharge of the responsibility for 
     identifying and disseminating such information should be 
     vested in a cabinet-level officer of the United States 
     Government.
       (b) Responsibility.--The Secretary of State shall take 
     appropriate actions to ensure that the United States 
     Government takes all appropriate actions to--
       (1) identify promptly information (including classified 
     information) in the possession of the departments and 
     agencies of the United States Government regarding the murder 
     or kidnapping of United States citizens abroad; and
       (2) subject to subsection (c), make such information 
     available to the victims or, where appropriate, the families 
     of victims of such crimes.
       (c) Classified Information.--The Secretary shall work with 
     the Director of Central Intelligence to ensure that 
     classified information relevant to a crime covered by 
     subsection (b) is promptly reviewed and, to the maximum 
     extent practicable without jeopardizing sensitive sources and 
     methods or other vital national security interests, made 
     available under that subsection.

     SEC. 308. STANDARDS FOR SPELLING OF FOREIGN NAMES AND PLACES 
                   AND FOR USE OF GEOGRAPHIC COORDINATES.

       (a) Survey of Current Standards.--
       (1) Survey.--The Director of Central Intelligence shall 
     carry out a survey of current standards for the spelling of 
     foreign names and places, and the use of geographic 
     coordinates for such places, among the elements of the 
     intelligence community.
       (2) Report.--Not later than 90 days after the date of 
     enactment of this Act the Director shall submit to the 
     congressional intelligence committees a report on the survey 
     carried out under paragraph (1).
       (b) Guidelines.--
       (1) Issuance.--Not later than 180 days after the date of 
     enactment of this Act, the Director shall issue guidelines to 
     ensure the use of uniform spelling of foreign names and 
     places and the uniform use of geographic coordinates for such 
     places. The guidelines shall apply to all intelligence 
     reports, intelligence products, and intelligence databases 
     prepared and utilized by the elements of the intelligence 
     community.
       (2) Basis.--The guidelines under paragraph (1) shall, to 
     the maximum extent practicable, be based on current United 
     States Government standards for the transliteration of 
     foreign names, standards for foreign place names developed by 
     the Board on Geographic Names, and a standard set of 
     geographic coordinates.
       (3) Submittal to congress.--The Director shall submit a 
     copy of the guidelines to the congressional intelligence 
     committees.
       (c) Congressional Intelligence Committees Defined.--In this 
     section, the term ``congressional intelligence committees'' 
     means the following:
       (1) The Select Committee on Intelligence of the Senate.
       (2) The Permanent Select Committee on Intelligence of the 
     House of Representatives.
                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

     SEC. 401. MULTIYEAR LEASING AUTHORITY.

       Section 5 of the Central Intelligence Agency Act of 1949 
     (50 U.S.C. 403f) is amended--
       (1) in paragraph (e), by striking out ``without regard'' 
     and all that follows through the end and inserting in lieu 
     thereof a semicolon;
       (2) by redesignating paragraph (f) as paragraph (g); and
       (3) by inserting after paragraph (e) the following new 
     paragraph (f):
       ``(f) Notwithstanding section 1341(a)(1) of title 31, 
     United States Code, enter into multiyear leases for lease 
     terms of not to exceed 15 years, except that--
       ``(1) any such lease shall be subject to the availability 
     of appropriations in an amount necessary to cover--
       ``(A) rental payments over the entire term of the lease; or
       ``(B) rental payments over the first 12 months of the term 
     of the lease and the penalty, if any, payable in the event of 
     the termination of the lease at the end of the first 12 
     months of the term; and
       ``(2) if the Agency enters into a lease using the authority 
     in subparagraph (1)(B)--
       ``(A) the lease shall include a clause that provides that 
     the lease shall be terminated if specific appropriations 
     available for the rental payments are not provided in advance 
     of the obligation to make the rental payments;
       ``(B) notwithstanding section 1552 of title 31, United 
     States Code, amounts obligated for paying costs associated 
     with terminating the lease shall remain available until such 
     costs are paid;
       ``(C) amounts obligated for payment of costs associated 
     with terminating the lease may be used instead to make rental 
     payments under the lease, but only to the extent that such 
     amounts are not required to pay such costs; and
       ``(D) amounts available in a fiscal year to make rental 
     payments under the lease shall be available for that purpose 
     for not more than 12 months commencing at any time during the 
     fiscal year; and''.

     SEC. 402. SUBPOENA AUTHORITY FOR THE INSPECTOR GENERAL OF THE 
                   CENTRAL INTELLIGENCE AGENCY.

       (a) Authority.--Subsection (e) of section 17 of the Central 
     Intelligence Agency Act of 1949 (50 U.S.C. 403q) is amended--
       (1) by redesignating paragraphs (5) through (7) as 
     paragraphs (6) through (8), respectively; and
       (2) by inserting after paragraph (4) the following new 
     paragraph (5):
       ``(5)(A) Except as provided in subparagraph (B), the 
     Inspector General is authorized to require by subpoena the 
     production of all information, documents, reports, answers, 
     records, accounts, papers, and other data and documentary 
     evidence necessary in the performance of the duties and 
     responsibilities of the Inspector General.
       ``(B) In the case of Government agencies, the Inspector 
     General shall obtain information, documents, reports, 
     answers, records, accounts, papers, and other data and 
     evidence for the purpose specified in subparagraph (A) using 
     procedures other than subpoenas.
       ``(C) The Inspector General may not issue a subpoena for or 
     on behalf of any other element or component of the Agency.
       ``(D) In the case of contumacy or refusal to obey a 
     subpoena issued under this paragraph, the subpoena shall be 
     enforceable by order of any appropriate district court of the 
     United States.
       ``(E) Not later than January 31 and July 31 of each year, 
     the Inspector General shall submit to the Select Committee on 
     Intelligence

[[Page S5423]]

     of the Senate and the Permanent Select Committee on 
     Intelligence of the House of Representative a report of the 
     Inspector General's exercise of authority under this 
     paragraph during the preceding six months.''.
       (b) Limitation on Authority for Protection of National 
     Security.--Subsection (b)(3) of that section is amended by 
     inserting ``, or from issuing any subpoena, after the 
     Inspector General has decided to initiate, carry out, or 
     complete such audit, inspection, or investigation or to issue 
     such subpoena,'' after ``or investigation''.
         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

     SEC. 501. ACADEMIC DEGREES IN INTELLIGENCE.

       (a) In General.--Section 2161 of title 10, United States 
     Code, is amended to read as follows:

     ``Sec. 2161. Joint Military Intelligence College: master of 
       science in strategic intelligence; bachelor of science in 
       intelligence

       ``Under regulations prescribed by the Secretary of Defense, 
     the President of the Joint Military Intelligence College may, 
     upon recommendation by the faculty of the college, confer the 
     degree of master of science in strategic intelligence and the 
     degree of bachelor of science in intelligence upon the 
     graduates of the college who have fulfilled the requirements 
     for such degree.''.
       (b) Conforming Amendment.--The item relating to section 
     2161 in the table of sections at the beginning of chapter 108 
     of such title is amended to read as follows:

``2161. Joint Military Intelligence College: master of science in 
              strategic intelligence; bachelor of science in 
              intelligence.''.

     SEC. 502. FUNDING FOR INFRASTRUCTURE AND QUALITY OF LIFE 
                   IMPROVEMENTS AT MENWITH HILL AND BAD AIBLING 
                   STATIONS.

       Section 506(b) of the Intelligence Authorization Act for 
     Fiscal Year 1996 (Public Law 104-93; 109 Stat. 974) is 
     amended by striking out ``for fiscal years 1996 and 1997'' 
     and inserting in lieu thereof ``for fiscal years 1998 and 
     1999''.

     SEC. 503. MISUSE OF NATIONAL RECONNAISSANCE OFFICE NAME, 
                   INITIALS, OR SEAL.

       (a) In General.--Subchapter I of chapter 21 of title 10, 
     United States Code, is amended by adding at the end the 
     following:

     ``Sec. 426. Unauthorized use of National Reconnaissance 
       Office name, initials, or seal

       ``(a) Prohibited Acts.--Except with the joint written 
     permission of the Secretary of Defense and the Director of 
     Central Intelligence, no person may knowingly use, in 
     connection with any merchandise, retail product, 
     impersonation, solicitation, or commercial activity, in a 
     manner reasonably calculated to convey the impression that 
     such use is approved, endorsed, or authorized by the 
     Secretary or the Director, any of the following:
       ``(1) The words `National Reconnaissance Office' or the 
     initials `NRO'.
       ``(2) The seal of the National Reconnaissance Office.
       ``(3) Any colorable imitation of such words, initials, or 
     seal.
       ``(b) Injunction.--(1) Whenever it appears to the Attorney 
     General that any person is engaged or is about to engage in 
     an act or practice which constitutes or will constitute 
     conduct prohibited by subsection (a), the Attorney General 
     may initiate a civil proceeding in a district court of the 
     United States to enjoin such act or practice.
       ``(2) Such court shall proceed as soon as practicable to 
     the hearing and determination of such action and may, at any 
     time before final determination, enter such restraining 
     orders or prohibitions, or take such other action as is 
     warranted, to prevent injury to the United States or to any 
     person or class of persons for whose protection the action is 
     brought.''
       (b) Clerical Amendment.--The table of sections at the 
     beginning of that subchapter is amended by adding at the end 
     the following:

``426. Unauthorized use of National Reconnaissance Office name, 
              initials, or seal.''.
                                 ______
                                 
      By Mr. KYL (for himself and Mr. Gramm):
  S. 859. A bill to repeal the increase in tax on Social Security 
benefits; to the Committee on Finance.


               THE SENIOR CITIZENS INCOME TAX RELIEF ACT

  Mr. KYL. Mr. President, I am pleased to have my colleague, Senator 
Phil Gramm, join me as an original cosponsor of the Senior Citizens 
Income Tax Relief Act. This legislation would give seniors relief from 
the Clinton Social Security tax increase of 1993.
  The recently passed Federal budget deal provides target levels for 
new spending and for modest tax relief. As Congress begins to write the 
bills to implement this budget blueprint, attention turns to the 
details. One of them is whether there will be sufficient room for tax 
relief for senior citizens.
  Millions of America's senior citizens depend on Social Security as a 
critical part of their retirement income. Having paid into the program 
throughout their working lives, retirees count on the Government to 
meet its obligations under the Social Security contract. For many, the 
security provided by this supplemental pension plan is the difference 
between a happy and healthy retirement and one marked by uncertainty 
and apprehension, particularly for the vast majority of seniors on 
fixed incomes.
  As part of his massive 1993 tax hike, President Clinton imposed a tax 
increase on senior citizens, subjecting to taxation up to 85 percent of 
the Social Security received by seniors with annual incomes of over 
$34,000 and couples with over $44,000 in annual income.
  This represents a 70-percent increase in the marginal tax rate for 
these seniors. Factor in the Government's Social Security earnings 
limitation, and a senior's marginal tax rate can reach 88 percent--
twice the rate paid by millionaires.
  An analysis of Government-provided figures on the 1993 Social 
Security tax increase finds that, by next year, America's seniors will 
have paid an extra $25 billion because of this tax hike, including $380 
million from senior citizens in Arizona alone.
  Mr. President, I want to make an additional important point. Despite 
all the partisan demagoguery, the only attack on Social Security in 
recent years has come from the administration and the other party in 
the Omnibus Budget Reconciliation Act of 1993. Not one Republican 
supported this tax increase on Social Security benefits.
  At the Clinton administration's insistence, the amount of tax relief 
we will be able to provide will be severely limited. It will be 
difficult, then, to repeal the Social Security tax increase. This is 
why I offered an amendment to ensure that we are able to expand tax 
relief in the future, and why the first tax relief proposal I am 
introducing will repeal President Clinton's 1993 Social Security tax 
increase.
                                 ______
                                 
      By Mr. HARKIN:
  S. 860. A bill to protect and improve rural health care, and for 
other purposes; to the Committee on Finance.


      the rural health care protection and improvement act of 1997

  Mr. HARKIN. Mr. President, I rise today to introduce the Rural Health 
Care Protection and Improvement Act of 1997. This legislation is 
critical to the survival of the fragile health care systems and 
infrastructure in rural areas and small towns across America.
  Rural Americans are more often poor, more often uninsured, and more 
often without access to health care than other Americans. The health 
care system in many small towns in Iowa is on the critical list--we 
have too few doctors, nurses, and other health care professionals and 
many of our rural hospitals are barely making it.
  Iowa ranks first in the percentage of citizens over age 85 and third 
nationally in the percentage of the population over age 65. Because of 
our demographics our health care providers in Iowa depend heavily on 
Medicare payments. And many of them are struggling. One reason they are 
struggling is because of the gross inequities between rural and urban 
Medicare payment rates. In fact, the House Ways and Means Committee 
recently published a report estimating that Iowa loses $0.7 billion a 
year because of current Medicare payment policies. The higher cost of 
living in areas such as New York City and Miami in no way justifies the 
huge disparity in payment rates. The current system rewards waste and 
inefficiency and penalizes States like Iowa whose health care providers 
practice a conservative, cost-effective approach to health care.
  The legislation I am introducing today would correct this wrong-
headed system. This bill would make Medicare payments to managed care 
plans fairer for rural areas by readjusting the AAPCC so that rates are 
more equitable between rural and urban areas.
  But even more importantly, this bill corrects the inequities in the 
regular fee-for-service Medicare Program. AAPCC rates are unfair 
because they are tied directly to Medicare fee-for-service payments, 
and fee-for-service payments are very low in rural areas.
  Even with a correction in managed care payments, over two-thirds of 
Iowa seniors will likely continue to receive care under the standard 
fee-for-service system. This bill corrects fee-for-service rates, so 
that seniors in rural areas

[[Page S5424]]

will at last be able to receive the quality and access to health care 
they deserve.
  Mr. President, my legislation would also reauthorize and extend the 
Rural Health Transition Grant Program. This grant program helps small 
rural hospitals and their communities adapt to the changing health care 
marketplace. Specifically, the grants help hospitals adjust to 
reductions in the need for inpatient services and increased demand for 
outpatient and emergency services and help rural hospitals meet the 
increasingly difficult task of recruiting staff.
  Rural hospitals use these funds for a variety of programs. For 
example, Marengo Memorial Hospital, Mitchell County Hospital, Franklin 
General in Hampton, and Kossuth County Hospital as well as other 
hospitals used funds to help develop rural health care networks. 
Pochahontas Community Hospital and Community Memorial Hospital in 
Sumner used funds to recruit health professionals and Holy Family 
Hospital in Estherville used funds to improve emergency services.
  These grants are provided over 3 years. They represent a small but 
vital source of revenue for hospitals struggling to adjust to a new 
health care environment. Unfortunately, these grants were not 
reauthorized last year, and there are many hospitals that were promised 
transition grant funds but for whom the money is no longer available. 
This legislation would help ensure that these few hospitals are able to 
finish out their grants and meet the changing needs of their patients 
and communities.
  Mr. President, the health care system is undergoing tremendous change 
and our rural hospitals must adjust to this new environment. The 
Transition Grant Program helps hospitals modify the type and extent of 
services so they can better serve rural communities.
  Mr. President, the legislation I am introducing will help improve 
access and enhance the quality of health care in rural areas. And it 
will help shore up the fragile health care infrastructure in our rural 
communities and small towns.
                                 ______
                                 
      By Mr. INHOFE:
  S. 861. A bill to amend the Federal Property and Administrative 
Services Act of 1949 to authorize donation of Federal law enforcement 
canines that are no longer needed for official purposes to individuals 
with experience handling canines in the performance of law enforcement 
duties; to the Committee on Governmental Affairs.


           donation of law enforcement dogs to their handlers

  Mr. INHOFE. Mr. President, I rise today to introduce a bill to 
address the situation encountered when certain members of our Federal 
law enforcement community are no longer able to perform their assigned 
duties. These members of the Federal law enforcement community to which 
I refer are not people, but canines.
  The purpose of this legislation is simple. The bill will streamline 
the regulations that govern the adoption of Federal law enforcement 
canines by their handlers. Currently, these animals are considered 
Federal property and when their tenure of service has ended, they are 
considered surplus Government property. Under current Federal 
regulations, Government agencies are forced to comply with procedures 
to ensure maximum return for the Government's investment in the animal 
at auction.
  These animals have received special security training to best equip 
them for the demands of their duties. Because of the hazards associated 
with their duties, this specialized training often makes these animals 
unsuitable as pets for those not trained to handle these animals.
  Because of the highly specialized training these animals receive, 
they should not be simply auctioned to the highest bidder. Currently, 
if no trained handler comes forward and offers the highest bid for the 
animal, the possibility exists that it will spend the rest of its life 
caged, or even worse, destroyed.
  Under this legislation, the eligible animals would be donated to 
their handlers, who would then assume all costs and responsibilities 
associated to the care of that animal. This practice is commonplace for 
local law enforcement agencies nationwide.
  This is not a drastic departure from previous Government procedure. 
In 1993, the General Services Administration granted a waiver for 
Border Patrol canine handlers to purchase their partners for a nominal 
fee. Unfortunately, this waiver has expired and has not been renewed.
  Mr. President, this is a commonsense solution to a very simple 
problem. I urge my colleagues to support this bill and ease the 
restrictions concerning the adoption of Federal law enforcement 
canines.

                          ____________________