[Congressional Record Volume 144, Number 21 (Thursday, March 5, 1998)]
[Senate]
[Pages S1436-S1461]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mrs. HUTCHISON (for herself, Mr. Grams, and Mr. Ashcroft):
S. 1711. A bill to amend the Internal Revenue Code of 1986 to
eliminate the marriage penalty tax, to increase the income levels for
the 15 and 28 percent tax brackets, to provide a 1-year holding period
for long-term capital gains, to index capital assets for inflation, to
reduce the highest estate tax rate to 28 percent, and for other
purposes; to the Committee on Finance.
THE TAX RELIEF AND DEBT REDUCTION ACT OF 1998
Mrs. HUTCHISON. Mr. President, today Senator Rod Grams and I are
introducing the half-and-half bill. We like to say half-and-half is
more than just rich milk. We want to have the plan in place so if we,
in fact, have a surplus, we will start doing the responsible thing for
the people of our country. We believe half should go to debt reduction,
to start paying down the $5 trillion debt, and half should go to tax
relief for the hard-working American family.
The Federal tax burden today is the greatest that it has been in the
history of our country. In fact, 38.3 percent of the average family
income is spent on taxes. That is a whale of a burden on people who are
trying to raise children, trying to put them through college, and we
are very pleased to try to bring down that tax burden with the half-
and-half Tax Relief and Debt Reduction Act of 1998.
This is what our bill does. First, it eliminates the marriage tax
penalty by allowing couples to file as singles. Mr. President, 21
million American couples today pay an average of $1,400 more because
they got married. You see behind me an example, and this is a real
example. A first-year schoolteacher in Houston is paid $27,000. A
rookie police officer in Houston, TX starts out at $29,698. After they
get married, their tax burden will be $638.44 more, just because they
got married. We do not think that is right. We do not believe that
Americans should have to choose between love and money. We want an
equitable and fair burden on the taxpayers of this country, and we do
not think that people who get married, who are both working, should
have to pay more taxes.
The second thing our bill does is raise the income levels for the 15
and 28 percent tax brackets. For a single person, before he or she
would move into the 28 percent bracket, it would go up to $35,000; a
married couple, $50,000, and for a head of household it would be
$40,000. The 28 percent bracket would be expanded for a single person
to $71,050; a married couple at $109,950, and head of household $93,750
It is very important that we start giving that relief at these lower
income and middle income levels, and that is what this bill will do.
The bill also repeals the 18-month capital gains holding period and
makes it 12 months instead. It is a fact that our elderly people pay
the most in capital gains taxes, and we think that is wrong. So we are
going to try to reduce the holding period so our elderly people who may
have to sell assets to live on will not be burdened any more than is
absolutely necessary.
We index capital gains taxes for inflation in our bill. Taxpayers
should not have to pay a capital gains tax in assets that have
increased in value simply due to inflation. Last year we started this
process of by allowing an exemption of $500,000 in capital gains for
the sale of a home. That's a big help to an elderly person. We want to
make it even easier for them.
We would cut the top estate tax rate from 55 percent to 28 percent.
We believe estate taxes take away from the ability of Americans to
realize the American dream of giving their children a better start.
So we are trying to bring down the tax burden on the hard-working
American family. We believe it is important that people be able to keep
more of the money they earn, and 38 percent of the average American's
pay, salary, going to taxes, is too much of a burden. So I am very
pleased Senator Grams has come on as the major cosponsor of this bill.
Mr. GRAMS: Mr. President, I rise today to join Senator Hutchison in
introducing legislation to lockbox any budget surplus for tax relief
and national debt reduction. Given this week's budget surplus
projections, the ``Tax Relief and Debt Reduction Act of 1998'' is the
right legislation at the right time.
Eighty-five years ago this week, the Internal Revenue Service began
collecting the individual income tax, initiating 85 years of ever-
increasing hardship for America's taxpaying families. Now, with a
budget surplus closer and taxes at an all-time high, it is time that
Washington let the taxpayers keep more of their own money, so that
families can spend it meeting their own needs--whether that is child
care, health insurance, clothing, or groceries. By dedicating half of
any budget surplus to reducing the debt and the other half to family
tax relief, Senator Hutchison's legislation protects the taxpayers of
today while reducing the burden on the taxpayers of tomorrow. I commend
her for her leadership on this timely issue.
Mr. President, I would like to offer some perspective into why we are
introducing the ``Tax Relief and Debt Reduction Act" today.
If it seems as though the media has a label for everyone these days,
blame it on the era of the 15-second sound bite. At a point in history
when many in the media consider brevity the most virtuous of virtues,
journalists compete for our attention by whittling down their words
into a kind of reporter's shorthand that, over time, becomes
meaningless to news consumers.
The shorthand gets especially muddied when it is applied to politics.
Once a person enters public office, the media is quick to toss them a
label--conservative or liberal, left wing or right wing. As political
realities evolve, though, the labels have less and less relevance as
time goes on. They become a cliche, no longer very useful in describing
a political philosophy.
I believe the American public has already moved beyond the media in
breaking from the label mentality, and whether they consider it
consciously, they have shifted their thinking from the old concept of
liberal versus conservative to that of taxpayers versus big Government.
Today, every action of the government is being evaluated by a standard
that strikes home for the folks who work for a living, raise a family,
and pay their taxes: does it benefit the taxpayers or does it benefit
the Government?
What we have discovered through this new way of thinking is that far
too often, the Government is prospering at the expense of the
taxpayers. Too much faith in Government equals less freedom for
families and individuals. Dependency on Government equals less
independence for the governed. And as the Government prospers, we have
learned that big Government does not necessarily translate into better
Government--it is just bigger Government, with more bureaucracy, paid
for by higher taxes.
Families today are taxed at the highest levels since World War II,
with 38 percent of a typical family's budget going to pay taxes on the
Federal, State, and local level. In nominal dollars, a two-income
family is paying more just in taxes today than their paychecks totaled
in 1977. That is nearly 50% more than they are spending for food,
shelter, and clothing combined.
Taxpayers do not mind paying taxes when they can see results. In
local government, the results are obvious: clean streets, police cars
on patrol, regular garbage pickup. On the Federal level, the results
are much less evident. Families want to believe Washington is
[[Page S1437]]
spending their tax dollars prudently, but when the evening newscasts
focus repeatedly on the ``fleecing of America,'' they wonder: is the
Government serving the taxpayers, or just serving itself?
There is no question the Federal Government is growing bigger.
Contrary to the claim of President Clinton in his State of the Union
address that ``we have the smallest Government in 35 years,'' the
Federal Government will spend more tax dollars in 1998 than it has in
the history of this nation--$1.7 trillion. That is a 19 percent
increase since the President took office in 1993, although inflation
during that same period has risen less than 14 percent.
The President would add thousands of new civilian federal employees
and, according to an analysis of his budget by the Senate Budget
Committee, $123 billion in new federal programs that would touch nearly
every aspect of daily life, from our classrooms to our boardrooms to
our bedrooms.
To pay for all that new government, the President calls for boosting
taxes by $115 billion over the next five years. That is a massive hike
that would effectively wipe out the hard-fought $85 billion tax cut
Americans won under last year's Taxpayer Relief Act.
A big, expensive federal government is a bad deal for the taxpayers.
It is an even worse deal for my fellow Minnesotans. A recent study
conducted by the Northeast-Midwest Institute shows that Minnesota ranks
49th of 50 states in Federal dollars returned to the State. The people
of Minnesota pay one of highest tax rates in the Nation, but only one
other state receives less service in return from the Federal
Government.
According to the National Taxpayers Union, if Congress could roll
federal domestic spending back to 1969 levels, a family of four would
keep $9,000 a year more of its own money than it does today. Millions
of families would pay no income tax at all. Unfortunately, tax-and-
spend, not tax relief and streamlining, is the policy Washington now
pursues.
The most disturbing sign that the taxpayers are losing the
``taxpayers versus big government'' debate is the rush in Washington to
spend a budget surplus that does not yet exist. If a surplus does
develop, the Government has no claim on it because the Government did
not generate it. A surplus will be borne of the sweat and hard work of
the American people, and it therefore should be returned to the people
as called for under the ``Tax Relief and Debt Reduction Act of 1998.''
When Washington serves itself instead of meeting the needs of its
owners, the taxpayers, spending rises, taxes increase, responsibilities
are neglected, and people begin to feel constricted by a Government
they sense is deeply out of touch. At their urging, we have begun to
turn the focus away from the smothering squeeze of big government
toward families and new partnerships that move Washington from the
center of the circle to another spoke along its hub. Where the Federal
Government once held all the power, communities--local churches,
nonprofit organizations, job providers, individual volunteers, and
charities of all types--have stepped forward to work with neighbors to
attack problems on the local level.
Freedom for families also means giving families the freedom to spend
more of their own dollars as they choose. We have taken steps in
Washington to return more of that control to working Minnesotans and
all working Americans, through tax relief, beginning with passage last
year of the $500 per-child tax credit.
Mr. President, the states offer us an excellent model of how we
should use a future budget surplus. In recent years, many Republican
governors cut taxes and shrank the size of their governments, and in
the process turned budget deficits into surpluses. They are now using
those surpluses to provide further tax relief. Take my own State of
Minnesota, for example. When Governor Arne Carlson was elected to
office in 1990, he inherited a deficit greater than $1.8 billion and a
government that was spending 15 percent faster than the rate of
inflation. Today, the State government has a $1.3 billion budget
surplus. Now the Governor is using the surplus to give Minnesotans a
property tax cut and an increase in the education homestead credit.
Returning a future surplus to those who created it, the Nation's
hardworking taxpayers, is the right way to use that surplus.
I agree with President Clinton that saving Social Security is vitally
important. But I believe we can save Social Security and provide tax
relief simultaneously, if we have the political will to enact sound
fiscal policies. The best way to save Social Security is to stop
looting the Social Security surplus to fund general Government
programs, return the borrowed surplus to the trust funds, and begin
real reform to change the system from ``paygo'' to one that is
prefunded.
As the Federal Government has grown, it is ironic that it has grown
further away from the one thing from which it derives its strength. And
that is the people. In 1998, Congress and the President have the power
to bring government closer to the people, to refocus its attention on
serving the taxpayers, not fortifying itself. Yet, while Washington may
have the power to change, does it have the resolve to change? I believe
it does, because if we intend to reduce the growing burden awaiting the
next generation of taxpayers, ``Failure is not an option.''
In closing, the Hutchison legislation would help move government
toward the taxpayers and toward greater accountability, and I urge my
colleagues to support it.
Mrs. HUTCHISON addressed the Chair.
The PRESIDING OFFICER. The Senator from Texas.
Mrs. HUTCHISON. Mr. President, I thank Senator Grams for taking a
leadership role in this. He has been dedicated, since he was elected to
the U.S. Senate, to sound fiscal policies. I think this bill is a sound
approach to any surplus that we might have. I appreciate his
cosponsorship.
I ask unanimous consent to add Senator Ashcroft as a third original
cosponsor of the bill.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mrs. HUTCHISON. Mr. President, just to sum up. I think the Hutchison-
Grams-Ashcroft half and half bill is sound policy. It is a responsible
approach. If we, indeed, have worked hard and cut the deficits and will
go toward a balanced budget even sooner than we thought, I think we
create a great dilemma of what to do with the surplus. Because we have
worked so hard and become more efficient, I hope we will take this
opportunity not to backslide, not to go into more spending programs
that will put us in the same situation we were before, but instead take
the opportunity to start paying down the $5 trillion debt.
So this would be an opportunity to start paying down the debt and put
in the pockets of hard-working Americans more of the money they earn.
Thirty-eight percent of a person's income is too much to be doling out
to Government programs that you may or may not think are a good
priority.
So we are going to try to lessen that at the same time that we begin
to pay down the debt so our children and grandchildren will not have to
take from us that kind of burden. Thank you, Mr. President. I thank the
managers of the bill for allowing us to take this time to introduce the
bill.
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. 1711
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 ``Half and
Half: Tax Relief and Debt Reduction Act of 1998''.
(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.
(c) Section 15 Not To Apply.--No amendment made by section
3 shall be treated as a change in a rate of tax for purposes
of section 15 of the Internal Revenue Code of 1986.
SEC. 2. COMBINED RETURN TO WHICH UNMARRIED RATES APPLY.
(a) In General.--Subpart B of part II of subchapter A of
chapter 61 (relating to income tax returns) is amended by
inserting after section 6013 the following new section:
[[Page S1438]]
``SEC. 6013A. COMBINED RETURN WITH SEPARATE RATES.
``(a) General Rule.--A husband and wife may make a combined
return of income taxes under subtitle A under which--
``(1) a separate taxable income is determined for each
spouse by applying the rules provided in this section, and
``(2) the tax imposed by section 1 is the aggregate amount
resulting from applying the separate rates set forth in
section 1(c) to each such taxable income.
``(b) Treatment of Income.--For purposes of this section--
``(1) earned income (within the meaning of section 911(d)),
and any income received as a pension or annuity which arises
from an employer-employee relationship, shall be treated as
the income of the spouse who rendered the services, and
``(2) income from property shall be divided between the
spouses in accordance with their respective ownership rights
in such property.
``(c) Treatment of Deductions.--For purposes of this
section--
``(1) except as otherwise provided in this subsection, the
deductions allowed by section 62(a) shall be allowed to the
spouse treated as having the income to which such deductions
relate,
``(2) the deduction for retirement savings described in
paragraph (7) of section 62(a) shall be allowed to the spouse
for whose benefit the savings are maintained,
``(3) the deduction for alimony described in paragraph (10)
of section 62(a) shall be allowed to the spouse who has the
liability to pay the alimony,
``(4) the deduction referred to in paragraph (16) of
section 62(a) (relating to contributions to medical savings
accounts) shall be allowed to the spouse with respect to
whose employment or self-employment such account relates,
``(5) the deductions allowable by section 151 (relating to
personal exemptions) shall be determined by requiring each
spouse to claim 1 personal exemption,
``(6) section 63 shall be applied as if such spouses were
not married, and
``(7) each spouse's share of all other deductions
(including the deduction for personal exemptions under
section 151(c)) shall be determined by multiplying the
aggregate amount thereof by the fraction--
``(A) the numerator of which is such spouse's adjusted
gross income, and
``(B) the denominator of which is the combined adjusted
gross incomes of the 2 spouses.
Any fraction determined under paragraph (7) shall be rounded
to the nearest percentage point.
``(d) Treatment of Credits.--Credits shall be determined
(and applied against the joint liability of the couple for
tax) as if the spouses had filed a joint return.
``(e) Treatment as Joint Return.--Except as otherwise
provided in this section or in the regulations prescribed
hereunder, for purposes of this title (other than sections 1
and 63(c)) a combined return under this section shall be
treated as a joint return.
``(f) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out
this section.''.
(b) Unmarried Rate Made Applicable.--So much of subsection
(c) of section 1 as precedes the table is amended to read as
follows:
``(c) Separate or Unmarried Return Rate.--There is hereby
imposed on the taxable income of every individual (other than
a married individual (as defined in section 7703) filing a
joint return or a separate return, a surviving spouse as
defined in section 2(a), or a head of household as defined in
section 2(b)) a tax determined in accordance with the
following table:''.
(c) Basic Standard Deduction for Unmarried Individuals Made
Applicable.--Subparagraph (C) of section 63(c)(2) is amended
to read as follows:
``(C) $3,000 in the case of an individual who is not--
``(i) a married individual filing a joint return or a
separate return,
``(ii) a surviving spouse, or
``(iii) a head of household, or''.
(d) Clerical Amendment.--The table of sections for subpart
B of part II of subchapter A of chapter 61 is amended by
inserting after the item relating to section 6013 the
following:
``Sec. 6013A. Combined return with separate rates.''.
(e) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
1998.
SEC. 3. INCOME TAXED AT LOWEST RATE INCREASED TO $35,000 FOR
UNMARRIED INDIVIDUALS, $40,000 FOR HEADS OF
HOUSEHOLDS, AND $50,000 FOR JOINT RETURNS AND
SURVIVING SPOUSES.
(a) General Rule.--Section 1 (relating to tax imposed) is
amended by striking subsections (a) through (e) and inserting
the following:
``(a) Married Individuals Filing Joint Returns and
Surviving Spouses.--There is hereby imposed on the taxable
income of--
``(1) every married individual (as defined in section 7703)
who makes a single return jointly with his spouse under
section 6013, and
``(2) every surviving spouse (as defined in section 2(a)),
a tax determined in accordance with the following table:
The tax is:e income is:
15% of taxable income..................................................
$7,500, plus 28% of the excess over $50,000............................
$24,286, plus 31% of the excess over $109,950..........................
$38,546, plus 36% of the excess over $155,950..........................
$82,646, plus 39.6% of the excess over $278,450........................
``(b) Heads of Households.--There is hereby imposed on the
taxable income of every head of a household (as defined in
section 2(b)) a tax determined in accordance with the
following table:
The tax is:e income is:
15% of taxable income..................................................
$6,000, plus 28% of the excess over $40,000............................
$21,050, plus 31% of the excess over $93,750...........................
$36,007, plus 36% of the excess over $142,000..........................
$85,129 plus 39.6% of the excess over $278,450.........................
``(c) Separate or Unmarried Return Rate.--There is hereby
imposed on the taxable income of every individual (other than
a married individual (as defined in section 7703) filing a
joint return or a separate return, a surviving spouse as
defined in section 2(a), or a head of household as defined in
section 2(b)) a tax determined in accordance with the
following table:
The tax is:e income is:
15% of taxable income..................................................
$5,250, plus 28% of the excess over $35,000............................
$15,344, plus 31% of the excess over $71,050...........................
$33,029, plus 36% of the excess over $128,100..........................
$87,155, plus 39.6% of the excess over $278,450........................
``(d) Married Individuals Filing Separate Returns.--There
is hereby imposed on the taxable income of every married
individual (as defined in section 7703) who does not make a
single return jointly with his spouse under section 6013, a
tax determined in accordance with the following table:
The tax is:e income is:
15% of taxable income..................................................
$3,750, plus 28% of the excess over $25,000............................
$12,143, plus 31% of the excess over $54,975...........................
$19,273, plus 36% of the excess over $77,975...........................
$41,323, plus 39.6% of the excess over $139,225........................
``(e) Estates and Trusts.--There is hereby imposed on the
taxable income of--
``(1) every estate, and
``(2) every trust,
taxable under this subsection a tax determined in accordance
with the following table:
The tax is:e income is:
15% of taxable income..................................................
$255, plus 28% of the excess over $1,700...............................
$899, plus 31% of the excess over $4,000...............................
$1,550, plus 36% of the excess over $6,100.............................
$2,360, plus 39.6% of the excess over $8,350.''........................
(b) Inflation Adjustment To Apply in Determining Rates for
1999.--Subsection (f) of section 1 is amended--
(1) by striking ``1993'' in paragraph (1) and inserting
``1998'',
(2) by striking ``1992'' in paragraph (3)(B) and inserting
``1997'', and
(3) by striking paragraph (7).
(c) Conforming Amendments.--
(1) The following provisions are each amended by striking
``1992'' and inserting ``1997'' each place it appears:
(A) Section 25A(h).
(B) Section 32(j)(1)(B).
(C) Section 41(e)(5)(C).
(D) Section 42(h)(6)(G)(i)(II).
(E) Section 68(b)(2)(B).
(F) Section 135(b)(2)(B)(ii).
(G) Section 151(d)(4).
(H) Section 221(g)(1)(B).
(I) Section 512(d)(2)(B).
(J) Section 513(h)(2)(C)(ii).
(K) Section 877(a)(2).
(L) Section 911(b)(2)(D)(ii)(II).
(M) Section 4001(e)(1)(B).
(N) Section 4261(e)(4)(A)(ii).
(O) Section 6039F(d).
(P) Section 6334(g)(1)(B).
(Q) Section 7430(c)(1).
(2) Subparagraph (B) of section 59(j)(2) is amended by
striking ``, determined by substituting `1997' for `1992' in
subparagraph (B) thereof''.
(3) Subparagraph (B) of section 63(c)(4) is amended by
striking ``by substituting for'' and all that follows and
inserting ``by substituting for `calendar year 1997' in
subparagraph (B) thereof `calendar year 1987' in the case of
the dollar amounts contained in paragraph (2) or (5)(A) or
subsection (f).''.
(4) Subparagraph (B) of section 132(f)(6) is amended by
inserting before the period ``, determined by substituting
`calendar year 1992' for `calendar year 1997' in subparagraph
(B) thereof''.
(5) Paragraph (2) of section 220(g) is amended by striking
`` by substituting `calendar year 1997' for `calendar year
1992' in subparagraph (B) thereof''.
(6) Subparagraph (B) of section 685(c)(3) is amended by
striking ``, by substituting `calendar year 1997' for
`calendar year 1992' in subparagraph (B) thereof''.
(7) Subparagraph (B) of section 2032A(a)(3) is amended by
striking ``by substituting `calendar year 1997' for `calendar
year 1992' in subparagraph (B) thereof''.
[[Page S1439]]
(8) Subparagraph (B) of section 2503(b)(2) is amended by
striking ``by substituting `calendar year 1997' for `calendar
year 1992' in subparagraph (B) thereof''.
(9) Paragraph (2) of section 2631(c) is amended by striking
``by substituting `calendar year 1997' for `calendar year
1992' in subparagraph (B) thereof''.
(10) Subparagraph (B) of 6601(j)(3) is amended by striking
``by substituting `calendar year 1997' for `calendar year
1992' in subparagraph (B) thereof''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
1998.
SEC. 4. 1-YEAR HOLDING PERIOD FOR ANY LONG-TERM CAPITAL GAIN.
(a) In General.--Section 1(h)(4) (defining adjusted net
capital gain) is amended by adding ``and'' at the end of
subparagraph (B), by striking ``, and'' at the end of
subparagraph (C) and inserting a period, and by striking
subparagraph (D).
(b) Conforming Amendments.--Section 1(h) is amended--
(1) in paragraph (6), by striking subparagraph (A) and
inserting the following:
``(A) In general.--The term `unrecaptured section 1250
gain' means the amount of long-term capital gain which would
be treated as ordinary income if section 1250(b)(1) included
all depreciation and the applicable percentage under section
1250(a) were 100 percent.'',
(2) by striking paragraphs (8), (10), and (11),
(3) in paragraph (9), by striking ``section 1202 gain, or
mid-term gain'' and inserting ``or section 1202 gain'',
(4) by redesignating paragraph (9) as paragraph (8), and
(5) by adding at the end the following:
``(8) Treatment of pass-thru entities.--
``(A) In general.--The Secretary may prescribe such
regulations as are appropriate (including regulations
requiring reporting) to apply this subsection in the case of
sales and exchanges by pass-thru entities and of interests in
such entities.
``(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.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
1998.
SEC. 5. INDEXING OF CERTAIN ASSETS FOR PURPOSES OF
DETERMINING GAIN OR LOSS.
(a) In General.--Part II of subchapter O of chapter 1
(relating to basis rules of general application) is amended
by inserting after section 1021 the following new section:
``SEC. 1022. INDEXING OF CERTAIN ASSETS FOR PURPOSES OF
DETERMINING GAIN OR LOSS.
``(a) General Rule.--
``(1) Indexed basis substituted for adjusted basis.--Except
as provided in paragraph (2), if an indexed asset which has
been held for more than 1 year is sold or otherwise disposed
of, then, for purposes of this title, the indexed basis of
the asset shall be substituted for its adjusted basis.
``(2) Exception for depreciation, etc.--The deduction for
depreciation, depletion, and amortization shall be determined
without regard to the application of paragraph (1) to the
taxpayer or any other person.
``(b) Indexed Asset.--
``(1) In general.--For purposes of this section, the term
`indexed asset' means--
``(A) stock in a corporation, and
``(B) tangible property (or any interest therein), which is
a capital asset or property used in the trade or business (as
defined in section 1231(b)).
``(2) Certain property excluded.--For purposes of this
section, the term `indexed asset' does not include--
``(A) Creditor's interest.--Any interest in property which
is in the nature of a creditor's interest.
``(B) Options.--Any option or other right to acquire an
interest in property.
``(C) Net lease property.--In the case of a lessor, net
lease property (within the meaning of subsection (h)(1)).
``(D) Certain preferred stock.--Stock which is preferred as
to dividends and does not participate in corporate growth to
any significant extent.
``(E) Stock in certain corporations.--Stock in--
``(i) an S corporation (within the meaning of section
1361),
``(ii) a personal holding company (as defined in section
542), and
``(iii) a foreign corporation.
``(3) Exception for stock in foreign corporation which is
regularly traded on national or regional exchange.--Clause
(iii) of paragraph (2)(E) shall not apply to stock in a
foreign corporation the stock of which is listed on the New
York Stock Exchange, the American Stock Exchange, or any
domestic regional exchange for which quotations are published
on a regular basis other than--
``(A) stock of a foreign investment company (within the
meaning of section 1246(b)), and
``(B) stock in a foreign corporation held by a United
States person who meets the requirements of section
1248(a)(2).
``(c) Indexed Basis.--For purposes of this section--
``(1) General rule.--The indexed basis for any asset is--
``(A) the adjusted basis of the asset, increased by
``(B) the applicable inflation adjustment.
``(2) Applicable inflation adjustment.--The applicable
inflation adjustment for any asset is an amount equal to--
``(A) the adjusted basis of the asset, multiplied by
``(B) the percentage (if any) by which--
``(i) the chain-type price index for GDP for the last
calendar quarter ending before the asset is disposed of,
exceeds
``(ii) the chain-type price index for GDP for the last
calendar quarter ending before the asset was acquired by the
taxpayer.
The percentage under subparagraph (B) shall be rounded to the
nearest \1/10\ of 1 percentage point.
``(3) Chain-type price index for GDP.--The chain-type price
index for GDP for any calendar quarter is such index for such
quarter (as shown in the last revision thereof released by
the Secretary of Commerce before the close of the following
calendar quarter).
``(d) Special Rules.--For purposes of this section--
``(1) Treatment as separate asset.--In the case of any
asset, the following shall be treated as a separate asset:
``(A) a substantial improvement to property,
``(B) in the case of stock of a corporation, a substantial
contribution to capital, and
``(C) any other portion of an asset to the extent that
separate treatment of such portion is appropriate to carry
out the purposes of this section.
``(2) Assets which are not indexed assets throughout
holding period.--
``(A) In general.--The applicable inflation ratio shall be
appropriately reduced for calendar months at any time during
which the asset was not an indexed asset.
``(B) Certain short sales.--For purposes of applying
subparagraph (A), an asset shall be treated as not an indexed
asset for any short sale period during which the taxpayer or
the taxpayer's spouse sells short property substantially
identical to the asset. For purposes of the preceding
sentence, the short sale period begins on the day after the
substantially identical property is sold and ends on the
closing date for the sale.
``(3) Treatment of certain distributions.--A distribution
with respect to stock in a corporation which is not a
dividend shall be treated as a disposition.
``(4) Section cannot increase ordinary loss.--To the extent
that (but for this paragraph) this section would create or
increase a net ordinary loss to which section 1231(a)(2)
applies or an ordinary loss to which any other provision of
this title applies, such provision shall not apply. The
taxpayer shall be treated as having a long-term capital loss
in an amount equal to the amount of the ordinary loss to
which the preceding sentence applies.
``(5) Acquisition date where there has been prior
application of subsection (a)(1) with respect to the
taxpayer.--If there has been a prior application of
subsection (a)(1) to an asset while such asset was held by
the taxpayer, the date of acquisition of such asset by the
taxpayer shall be treated as not earlier than the date of the
most recent such prior application.
``(6) Collapsible corporations.--The application of section
341(a) (relating to collapsible corporations) shall be
determined without regard to this section.
``(e) Certain Conduit Entities.--
``(1) Regulated investment companies; real estate
investment trusts; common trust funds.--
``(A) In general.--Stock in a qualified investment entity
shall be an indexed asset for any calendar month in the same
ratio as the fair market value of the assets held by such
entity at the close of such month which are indexed assets
bears to the fair market value of all assets of such entity
at the close of such month.
``(B) Ratio of 90 percent or more.--If the ratio for any
calendar month determined under subparagraph (A) would (but
for this subparagraph) be 90 percent or more, such ratio for
such month shall be 100 percent.
``(C) Ratio of 10 percent or less.--If the ratio for any
calendar month determined under subparagraph (A) would (but
for this subparagraph) be 10 percent or less, such ratio for
such month shall be zero.
``(D) Valuation of assets in case of real estate investment
trusts.--Nothing in this paragraph shall require a real
estate investment trust to value its assets more frequently
than once each 36 months (except where such trust ceases to
exist). The ratio under subparagraph (A) for any calendar
month for which there is no valuation shall be the trustee's
good faith judgment as to such valuation.
``(E) Qualified investment entity.--For purposes of this
paragraph, the term `qualified investment entity' means--
``(i) a regulated investment company (within the meaning of
section 851),
``(ii) a real estate investment trust (within the meaning
of section 856), and
``(iii) a common trust fund (within the meaning of section
584).
``(2) Partnerships.--In the case of a partnership, the
adjustment made under subsection (a) at the partnership level
shall be passed through to the partners.
``(3) Subchapter s corporations.--In the case of an
electing small business corporation, the adjustment under
subsection (a) at the corporate level shall be passed through
to the shareholders.
``(f) Dispositions Between Related Persons.--
[[Page S1440]]
``(1) In general.--This section shall not apply to any sale
or other disposition of property between related persons
except to the extent that the basis of such property in the
hands of the transferee is a substituted basis.
``(2) Related persons defined.--For purposes of this
section, the term `related persons' means--
``(A) persons bearing a relationship set forth in section
267(b), and
``(B) persons treated as single employer under subsection
(b) or (c) of section 414.
``(g) Transfers To Increase Indexing Adjustment or
Depreciation Allowance.--If any person transfers cash, debt,
or any other property to another person and the principal
purpose of such transfer is--
``(1) to secure or increase an adjustment under subsection
(a), or
``(2) to increase (by reason of an adjustment under
subsection (a)) a deduction for depreciation, depletion, or
amortization,
the Secretary may disallow part or all of such adjustment or
increase.
``(h) Definitions.--For purposes of this section--
``(1) Net lease property defined.--The term `net lease
property' means leased real property where--
``(A) the term of the lease (taking into account options to
renew) was 50 percent or more of the useful life of the
property, and
``(B) for the period of the lease, the sum of the
deductions with respect to such property which are allowable
to the lessor solely by reason of section 162 (other than
rents and reimbursed amounts with respect to such property)
is 15 percent or less of the rental income produced by such
property.
``(2) Stock includes interest in common trust fund.--The
term `stock in a corporation' includes any interest in a
common trust fund (as defined in section 584(a)).
``(i) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out
the purposes of this section.''.
(b) Clerical Amendment.--The table of sections for part II
of subchapter O of chapter 1 is amended by inserting after
the item relating to section 1021 the following new item:
``Sec. 1022. Indexing of certain assets for purposes of determining
gain or loss.''.
(c) Adjustment To Apply for Purposes of Determining
Earnings and Profits.--Subsection (f) of section 312
(relating to effect on earnings and profits of gain or loss
and of receipt of tax-free distributions) is amended by
adding at the end thereof the following new paragraph:
``(3) Effect on earnings and profits of indexed basis.--
For substitution of indexed basis for adjusted basis in the case of
the disposition of certain assets after December 31, 1998, see section
1022(a)(1).''.
(d) Effective Dates.--
(1) In general.--The amendments made by this section shall
apply to the disposition of any property the holding period
of which begins after December 31, 1998.
(2) Certain transactions between related persons.--The
amendments made by this section shall not apply to the
disposition of any property acquired after December 31, 1998,
from a related person (as defined in section 1022(f)(2) of
the Internal Revenue Code of 1986, as added by this section)
if--
(A) such property was so acquired for a price less than the
property's fair market value, and
(B) the amendments made by this section did not apply to
such property in the hands of such related person.
SEC. 6. REDUCTION OF TOP ESTATE TAX RATE FROM 55 TO 28
PERCENT.
(a) In General.--Section 2001(c) (relating to imposition
and rate of tax) is amended to read as follows:
``(c) Rate Schedule.--
``If the amount with respect to which the tentative tax to be computed
is:
The tentative tax is:
18 percent of such amount..............................................
$1,800 plus 20 percent of the excess of such amount over $10,000.......
$3,800 plus 22 percent of the excess of such amount over $20,000.......
$8,200 plus 24 percent of the excess of such amount over $40,000.......
$13,000 plus 26 percent of the excess of such amount over $60,000......
$18,200 plus 28 percent of the excess of such amount over $80,000.''...
(b) Effective Date.--The amendment made by this section
shall apply to the estates of decedents dying, and gifts
made, after December 31, 1998.
SEC. 7. REVENUE EFFECT OF ACT NOT TO EXCEED 50 PERCENT OF
FEDERAL BUDGET SURPLUS.
Not later than 90 days after the date of enactment of this
Act, if the Secretary of the Treasury determines that in any
of the 4 succeeding fiscal years the amendments made by this
Act will result in a reduction of the estimated revenues
received in the Treasury for such fiscal year in an amount in
excess of 50 percent of the estimated Federal unified budget
surplus (if any) for such year (determined without regard to
such amendments), the Secretary shall submit to the Committee
on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate a legislative proposal to
appropriately modify the provisions of the Internal Revenue
Code of 1986 affected by such amendments to eliminate such
excess amount. Any legislation enacted for the purpose of
achieving the revenue effect of such legislative proposal
submitted pursuant to this subsection shall appropriately
identify such purpose.
______
By Mr. JEFFORDS (for himself and Mr. Lieberman):
S. 1712. A bill to amend title XXVII of the Public Health Service Act
and part 7 of subtitle B of title I of the Employee Retirement Income
Security Act of 1974 to improve the quality of health plans and provide
protections for consumers enrolled in such plans; to the Committee on
Labor and Human Resources.
the health care quality, education, security, and trust act
Mr. JEFFORDS. Mr. President, today, I join with my good friend
Senator Lieberman to introduce the Health Care Quality, Education,
Security, and Trust Act--``The Health Care QUEST Act''--in order to
improve the quality of our nation's health care system and provide
necessary consumer protections without adding significant new costs;
increasing litigation; or micro managing health plans.
Over the past decade across the country, an extraordinary change has
taken place in the delivery of health care. In 1996, over 67% of
Americans received their health care through managed care--almost
double the percentage that existed in 1990. However, this transition
has not been problem-free. Many consumers worry that the quality of
their health care is being sacrificed to cut costs. While the
traditional fee-for-service health care system was guilty of over
utilization and runaway costs, consumers did feel that they would get
the necessary services, treatment, and information to recover from a
serious illness or manage a chronic health problem. People are now
worried that managed care only manages costs and, in effect, rations
care. One consequence of this transformation is that Americans are
losing confidence in the quality of care they receive from our health
system.
The American Association of Health Plans' voluntary initiative to
respond to these concerns, ``Putting Patients First,'' is an important
step and I urge that they continue to expand this effort. Businesses,
such as General Motors and GTE, have also initiated programs to improve
the quality of the health care received by their employees. In
addition, a number of states have already passed legislative
initiatives to address many of the problems consumers have experienced
with their health plans. However, I believe that Federal legislation is
necessary because the Employee Retirement Income Security Act of 1974
(ERISA) prevents states from enforcing health care quality standards
that relate to the employer-sponsored health benefits that 148 million
Americans receive.
The Health Care QUEST Act addresses these concerns through four
provisions. First, it creates a Health Quality Council to set national
goals for improving health and serve as a resource for Congress and the
President regarding health care quality. Second, it expands the duties
and responsibilities of the Agency for Health Care Policy and Research
(AHCPR) in order to develop the tools needed to measure and report
health care quality. The Act also requires that employers and health
plans provide enrollees with health plan information such as measures
of consumer satisfaction and their right to access speciality health
services. Finally, the Act calls for the establishment of the ``prudent
layperson'' standard of access to emergency room care, the right to use
an impartial independent external appeals process and the guarantee
that a patient's health care professional is able to recommend the best
treatment options and to serve as their advocate.
These provisions will help to restore consumers confidence in the
quality of our nation's health care system and provide a level playing
field--so that managed care plan compete on the basis of quality as
well as cost. Based on an analysis by the Lewin Group, the added costs
for information disclosure and external appeals requirements are
extremely low. The estimated monthly cost per person for comparative
information and for external appeals with a
[[Page S1441]]
three year phase-in is only $0.88. This cost estimate doesn't take into
account the improved market efficiency and increased competition that
the Lewin Group indicates will be achieved with these requirements.
Much of the debate over this issue to date in Washington has been
conducted from two very divergent viewpoints. Many House members, and
some in the Senate, believe we should regulate health care very
closely, on a disease-by-disease or procedure-by-procedure basis.
Another sizable camp believes that there is nothing wrong with the
health care marketplace that can't be be sorted out by its own
operation.
Obviously, I disagree. And Congress, too, disagreed when it
confronted many of these issues in the Medicare program last year. Much
of what I propose in the Health Care QUEST Act is contained in the
``Balanced Budget Act of 1997'' and applies to plans that enroll
Medicare beneficiaries. Extending the same standards to the private
sector will ensure that all Americans have the same rights and
protections.
The states have developed comprehensive approaches that provide
regulation for those components of the health care system under their
jurisdiction. The challenge for the federal government is to define
regulatory solutions for those sectors under federal control that
advance the consumer choice health care market while recognizing the
voluntary nature of our private system. These regulatory solutions, in
my opinion, should not determine medical necessity, establish hospital
lengths-of-stay, or impede private sector initiatives. Furthermore, we
must not set into statute standards that would preclude efforts for
continued quality improvement or fail to recognize the evolutionary
nature of medical practice.
The McCarran-Ferguson Act of 1945 granted states the authority to
regulate the business of insurance. However, ERISA preempted state law
with regard to the regulation of employee benefit plans. While ERISA
provides detailed standards for employer provided pensions, it provides
only minimal standards for health plans. Currently about 41 percent of
those who receive their health coverage through employer-sponsored
plans are in self-insured health plans. The Health Care Quest Act
follows the framework established under the Health Insurance
Portability and Accountability Act of 1996 (HIPAA) by setting national
standards for employer sponsored plans under ERISA and a federal floor
for insurance companies to follow that states can build upon.
The Health Care QUEST Act will help to restore consumer confidence in
our health care system and also promote market efficiency and
accountability. I look forward to working with other Senators to enact
legislation this year that establishes necessary consumer protections
and sets national standards to guide our nation's market based health
care reform efforts.
______
By Mr. HOLLINGS:
S. 1714. A bill to suspend through December 31, 1999, the duty on
certain textile machinery; to the Committee on Finance.
duty suspension legislation
Mr. HOLLINGS. Mr. President, today, I introduce duty suspension
legislation designed to permit the import of certain textile weaving
machinery into the United States duty free.
The equipment to be imported is not manufactured in the United States
and therefore its importation will not displace domestic sourcing.
Moreover, because the product at issue is manufacturing equipment, it
will assist in the creation of additional jobs in the textile industry.
I believe that this is the most appropriate use of such legislation.
I am therefore hopeful that this new capacity can be used to supply
both domestic and foreign needs and will increase employment in the
textile industry.
______
By Mrs. BOXER (for herself and Mrs. Feinstein):
S. 1716. A bill to direct the Secretary of the Interior, acting
through the Commissioner of Reclamation, to develop an action plan to
restore the Salton Sea in California and to conduct wildlife resource
studies of the Salton Sea, to authorize the Secretary to carry out a
project to restore the Salton Sea, and for other purposes, to the
Committee on Environment and Public Works.
SONNY BONO MEMORIAL SALTON SEA RESTORATION ACT
Mrs. BOXER. Mr. President, today I am introducing the Sonny Bono
Memorial Salton Sea Restoration Act. My legislation will lead to an
efficient and responsible restoration of the unique Salton Sea
ecosystem.
Over the years, scientists, communities and politicians alike have
been trying to draw national attention to the decline of the Salton
Sea. Our late friend and colleague, Representative Sonny Bono, who died
in a tragic skiing accident in January, worked tirelessly to make this
issue an environmental priority for this Congress. With this
legislation, we can carry on that legacy.
The Salton Sea is a unique natural resource in Southern California.
Created in 1905 by a breach in a levee along the Colorado River, the
Salton Sea is California's largest inland body of water. It is one of
the most important habitats for migratory birds along the Pacific
Flyway.
For 16 months after the breach, the Colorado River flowed into a dry
lakebed, filling it to a depth of 80 feet. For a time following the
closure of the levee, the water levels declined rapidly as evaporation
greatly exceeded inflow. A minimum level was reached in the 1920s,
after which the sea once again began to rise, due largely to the
importation of water into the basin for agricultural purposes from the
New and Alamo Rivers.
Since there is no natural outlet for the sea at its current level,
evaporation is the only way water leaves the basin. All the salts
carried with water that flows into the sea have remained there, along
with salts re-suspended from prehistoric/historic times by the new
inundation. Salinity is currently more than 25 percent higher than
ocean water, and rising.
This extreme salinity, along with agricultural and wastewater in the
sea, are rapidly deteriorating the entire ecosystem. The existing
Salton Sea ecosystem is under severe stress and nearing collapse, with
millions of fish and thousands of bird die-offs in recent years. Birds
and fish that once thrived here are now threatened with death and
disease as the tons of salts and toxic contaminants that are constantly
dumped into the Salton Sea become more and more concentrated and deadly
over time. The local economy is also being affected by the disaster at
the Salton Sea by the loss of recreational opportunities, decrease in
tourism, and the impact on agriculture.
Despite the urgency of the situation, we do not have the solution at
hand and, therefore, must move forward swiftly, but not hastily. The
legislation I am introducing today allows the Department of Interior to
adequately review all options for restoring the sea and comply with all
environmental laws while also requiring tight, yet realistic, time
frames.
I have been working with local and national interests and received
many favorable comments on my legislation. Secretary Bruce Babbitt
said, ``I have had an opportunity to review the Salton Sea legislation
that Senator Boxer is introducing this morning. In my judgement, the
bill as drafted reflects a more thoughtful and practical approach for
addressing the serious environmental challenges that face the Salton
Sea. I look forward to working with the Senator in refining and,
hopefully implementing this important initiative.''
John Flicker, President of the National Audubon Society said, ``The
National Audubon Society strongly endorses this legislation by Senator
Boxer. This bill sets in motion a process to determine the source of
the ecological crisis facing the Salton Sea and provide recommendations
on how to reverse the Salton Sea's rapid deterioration.''
Senator Boxer's bill represents an important step forward in the
fight to save the Salton Sea,'' said Congressman George Brown. ``She
has done an outstanding job building a consensus bill that can win
local and federal support.''
And the Tellis Codekas, President of the Salton Sea Authority and
President of the Coachella Valley Water District said, ``Senator Boxer
is on the right track with her bill. Her legislation builds on a
bipartisan local and national effort to save the Salton Sea.''
[[Page S1442]]
I am proud of this support. Under my legislation, Interior will
report to Congress within one year on the options for restoring the
Salton Sea, including a recommendation for a preferred option. Interior
will review ways to reduce and stabilize salinity, stabilize surface
elevation, restore the health of fish and wildlife resources and their
habitats, enhance recreational use and economic development, and
continue the use the Salton Sea for irrigation drainage.
Interior then has another 6 months within which it must complete all
environmental compliance and permitting activities required to
implement the proposal. By the end of this eighteen month period,
Interior must submit a final report to Congress, at which time the
authorization for construction is triggered, allowing Congress 30
legislative days to make changes in the plan, or to stop it.
We all now agree that we must take the necessary long-term and short-
term steps to stabilize salinity and contaminant levels to protect the
dwindling fishery resources and to reduce the threats to migratory
birds. However, there is no consensus on how that should be done.
The legislation that I am introducing forces those decisions to be
made in a timely manner. But, it is not necessary to waive the
provisions of one of our landmark environmental laws, the National
Environmental Policy Act of 1969, in order to force this process. We
must deal with this situation quickly. But, we can take prompt and
responsible actions within the framework of environmental laws.
I would like to thank members of the Salton Sea Authority, including
the Imperial County Board of Supervisors, the Riverside County Board of
Supervisors, the Imperial Irrigation District, and the Coachella Valley
Water District, National Audubon Society, Department of Interior, and
Congressman George Brown for their assistance with this legislation. It
is with the help and support of local and national interests that I was
able to develop this consensus legislation.
In a December 23, 1998 article in USA Today, Sonny said, ``This is
our last chance. If we don't move within a year or two, it will be too
late.'' He was right: the clock is ticking and we must act now to find
a solution. Scientists have warned that the Salton Sea will be a dead
sea within fifteen years.
I am hopeful that my House and Senate colleagues and I can act
quickly to ensure passage of this legislation to restore the ailing
Salton Sea. This is necessary and important legislation that will not
only benefit Californians and our natural heritage, but will also carry
on the legacy of Representative Bono.
I ask unanimous consent that the full text of my legislation be
printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1716
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 ``Sonny Bono Memorial Salton
Sea Restoration Act''.
SEC. 2. FINDINGS.
Congress finds that--
(1) the Salton Sea, located in Imperial County and
Riverside County, California, is an economic and
environmental resource of national importance;
(2) the Salton Sea is a critical component of the Pacific
flyway;
(3) the concentration of salinity or pollutants in the
Salton Sea has contributed to the recent deaths of migratory
waterfowl;
(4) the Salton Sea is critical as a reservoir for
irrigation and municipal and stormwater drainage;
(5) the Salton Sea provides benefits to surrounding
communities and nearby irrigation and municipal water users;
(6) remediating the Salton Sea will provide national and
international benefits; and
(7) Federal, State, and local governments have a shared
responsibility to assist in remediating the Salton Sea.
SEC. 3. DEFINITIONS.
In this Act:
(1) Salton sea authority.--The term ``Salton Sea
Authority'' means the Joint Powers Authority established
under the laws of the State of California by a Joint Power
Agreement signed on June 2, 1993.
(2) Secretary.--The term ``Secretary'' means the Secretary
of the Interior, acting through the Commissioner of
Reclamation.
SEC. 4. SALTON SEA RESTORATION ACTION PLAN.
(a) In General.--As soon as practicable after the date of
enactment of this Act, the Secretary, in accordance with the
memorandum of understanding entered into under subsection
(f), shall prepare an action plan for restoring the Salton
Sea in California.
(b) Contents.--The action plan shall consist of--
(1) a study of the feasibility of various alternatives for
remediating the Salton Sea;
(2) the selection of 1 or more practicable and cost-
effective options for remediating the Salton Sea; and
(3) the development of a remediation plan that will
implement the options.
(c) Objectives.--In preparing the action plan, the
Secretary shall evaluate options that will--
(1) reduce and stabilize the overall salinity of the Salton
Sea to a level between 35 and 40 parts per thousand;
(2) stabilize the surface elevation of the Salton Sea to a
level that is between 240 feet below sea level and 230 feet
below sea level;
(3) restore habitat and reclaim water quality over the long
term to promote healthy fish and wildlife resources and their
habitats in the Salton Sea;
(4) enhance the potential for recreational uses and
economic development of the Salton Sea; and
(5) ensure the continued use of the Salton Sea as a
reservoir for irrigation and municipal and stormwater
drainage.
(d) Options.--In evaluating options under the action plan,
the Secretary shall--
(1) consider--
(A) using impoundments to segregate a portion of the waters
of the Salton Sea in 1 or more evaporation ponds located in
the Salton Sea basin;
(B) pumping water out of the Salton Sea;
(C) augmenting the flow of water into the Salton Sea;
(D) improving the quality of wastewater discharges from
Mexico (including discharges from the Alamo River, the
Whitewater River, and the New River) and from other water
users in the Salton Sea basin;
(E) implementing any other economically feasible
remediation options; and
(F) implementing any combination of the actions described
in subparagraphs (A) through (E); and
(2) limit the options to economically feasible and proven
technologies.
(e) Factors.--In evaluating the feasibility of options
under the action plan, the Secretary shall consider--
(1) the ability of Federal, tribal, State, and local
government sources and private entities to fund capital
construction costs and annual operation, maintenance, energy,
and replacement costs; and
(2) how and where to dispose, permanently and safely, of
water pumped out of the Salton Sea and any salts that may be
condensed and accumulated in implementing the option.
(f) Memorandum of Understanding.--
(1) In general.--The Secretary shall carry out the action
plan under this section in accordance with a memorandum of
understanding entered into with the Salton Sea Authority, the
Governor of the State of California, and such other tribal or
local entities as the Secretary considers appropriate.
(2) Criteria.--The memorandum of understanding shall, at a
minimum, establish criteria for the evaluation and selection
of options under this section, including criteria for
determining the magnitude and practicability of costs of
construction, operation, and maintenance of each evaluated
option.
(g) Relationship to Other Laws.--
(1) Reclamation laws.--
(A) In general.--An option recommended by the action plan
shall not be subject to the Act of June 17, 1902, and Acts
amendatory thereof or supplementary thereto (32 Stat. 388,
chapter 1093; 43 U.S.C. 371 et seq.) (including regulations
adopted under those Acts).
(B) Nonreimbursable and nonreturnable.--Funds provided to
carry out the option shall be considered nonreimbursable and
nonreturnable.
(2) Law of the river.--An option recommended by the action
plan--
(A) shall not supersede or otherwise affect any treaty,
law, or agreement governing use of water from the Colorado
River; and
(B) shall be carried out in a manner that is consistent
with rights and obligation of persons under all such
treaties, laws, and agreements.
(h) Reports.--
(1) Interim report.--Not later than 1 year after the date
of enactment of this Act, the Secretary shall submit to
Congress an interim report on the findings and
recommendations of the action plan, including--
(A) a summary of options considered for remediating the
Salton Sea; and
(B) a recommendation of a preferred option for remediating
the Salton Sea.
(2) Final report.--Not later than 18 months after the date
of enactment of this Act, the Secretary shall submit to
Congress a final report on the findings and recommendations
of the action plan, including--
(A) a plan to implement the preferred option;
(B) a recommendation for sharing costs to carry out the
preferred option, with (at the option of the Secretary) a
different cost-sharing formula for capital construction costs
than is applied to annual operation, maintenance, energy, and
replacement costs; and
[[Page S1443]]
(C) the completion of all environmental compliance and
permitting activities required for any construction activity
under the preferred option.
(i) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $30,000,000.
SEC. 5. SALTON SEA RESTORATION PROJECT.
(a) In General.--Not later than 30 legislative days after
the Secretary submits the final report required under section
4(h)(2), the Secretary shall have the authority to carry out
a project for remediating the Salton Sea that is based on the
preferred option recommended in the final report, unless
otherwise directed by Congress.
(b) Legislative Day.--In subsection (a), the term
``legislative day'' means any day on which either House of
Congress is in session.
(c) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $300,000,000.
SEC. 6. SALTON SEA WILDLIFE RESOURCES STUDIES.
(a) In General.--Concurrently with the action plan carried
out under section 4, the Secretary shall enter into
contracts, grants, and cooperative agreements with Federal
and non-Federal entities to conduct studies recommended by
the Salton Sea Research Management Committee under subsection
(b)(1), including studies of hydrology, wildlife pathology,
and toxicology relating to the wildlife resources of the
Salton Sea.
(b) Salton Sea Research Management Committee.--
(1) In general.--The Secretary shall establish a committee,
to be known as the ``Salton Sea Research Management
Committee'', to make recommendations to the Secretary on the
selection of topics for studies under this section and
management of the studies.
(2) Membership.--The Committee shall be composed of 4
members, of which--
(A) 1 member shall be appointed by the Secretary;
(B) 1 member shall be appointed by the Governor of the
State of California;
(C) 1 member shall be appointed by the Torres Martinez
Desert Cahuilla Tribal Government; and
(D) 1 member shall be appointed by the Salton Sea
Authority.
(c) Coordination.--The Secretary shall ensure that studies
under this section are conducted in coordination with
appropriate international bodies, Federal agencies, and
California State agencies, including--
(1) the International Boundary and Water Commission;
(2) the United States Fish and Wildlife Service;
(3) the Environmental Protection Agency;
(4) the California Department of Water Resources;
(5) the California Department of Fish and Game;
(6) the California Resources Agency;
(7) the California Environmental Protection Agency;
(8) the California Regional Water Quality Board; and
(9) California State Parks.
(d) Peer Review.--The Secretary shall require that studies
conducted under this section be subject to peer review.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $7,000,000.
SEC. 7. REDESIGNATION OF SALTON SEA NATIONAL WILDLIFE REFUGE
RENAMED AS THE SONNY BONO SALTON SEA NATIONAL
WILDLIFE REFUGE.
(a) In General.--The Salton Sea National Wildlife Refuge,
in Imperial County, California, shall be known and designated
as the ``Sonny Bono Salton Sea National Wildlife Refuge''.
(b) References.--Any reference in a law, map, regulation,
document, record, or other paper of the United States to the
Refuge referred to in subsection (a) shall be deemed to be a
reference to the ``Sonny Bono Salton Sea National Wildlife
Refuge''.
SEC. 8. EMERGENCY ACTION TO STABILIZE SALTON SEA SALINITY.
If, during the conduct of studies authorized by this Act,
the Secretary determines that environmental conditions at the
Salton Sea warrant immediate emergency action to stabilize
the salinity of the Salton Sea, the Secretary shall
immediately submit a report to Congress documenting the
conditions and making recommendations for their remediation,
together with specific recommendations for actions to be
required and the cost of the actions.
Mrs. FEINSTEIN. Mr. President, today I join my colleague Senator
Boxer in introducing the Sonny Bono Memorial Salton Sea Restoration
Act. This legislation is similar to that now pending in the House of
Representatives, but it seeks to respond to concerns expressed by
local, state and federal officials about problems with the House bill.
Despite the fact that there are differences between the two versions,
the time to address the problems of the Salton Sea has come,
legislation will move forward promptly, and be signed into law.
I have spoken on this floor about the problems facing the Salton Sea.
Now it is time to turn to how to solve those problems. The legislation
introduced today reflects the work of scores of people in California
concerned with the Salton Sea. It is consistent with the approach they
believe is most appropriate, and it involves them in the process.
This legislation proceeds in two stages.
First, it provides funding and sets a deadline of 18 months for the
conduct of additional scientific research on the problems facing the
Salton Sea, for the evaluation of various projects to address these
problems, for the selection of a specific project, and for the
completion of the necessary environmental reviews required by the
National Environmental Policy Act and the California Environmental
Quality Act.
Second, it authorizes funding, subject to modification by Congress,
for the implementation of the project that is chosen.
The research funded in this legislation is absolutely crucial, for
the problems facing the Salton Sea are complex. Previously, most
concerns expressed about the Sea related to its increasing salinity and
its rising water level. More recently, however, massive die offs of
fish and migratory birds have occurred, that appear to be caused by
problems other than salinity.
So, in addition to determining the optimum elevation for the Sea, and
the desirable level of salinity, it is important to understand the
interrelationships between these two components and the pollutants that
continue to flow into the Sea.
Finally, this legislation proposes a tight timetable for reaching a
decision on the best project to solve the problems facing the Sea.
However, it is my understanding that the Department of the Interior
already has the authority and a limited amount of funding to begin
additional testing and environmental review and is willing to do so.
This means that an 18 month timetable is realistic. There has been deep
concern that a 12 month timetable is insufficient if a sound plan is to
evolve which also involves the rivers, now heavily polluted, which
empty into and add contamination to the Salton Sea. Therefore, I urge
all parties to begin working while this legislation moves through
Congress.
Mr. President, in closing, I want to say that I look forward to
working with my colleagues in the House to craft a bill that is
acceptable to both bodies, a bill that will preserve and enhance the
Salton Sea, a bill that is a fitting tribute to the memory of the late
Congressman Sonny Bono, who cared so deeply about the Salton Sea. Thank
you.
______
By Mr. KENNEDY:
S. 1717. A bill to amend the Immigration and Nationality Act to
strengthen the naturalization process; to the Committee on the
Judiciary.
the new american citizenship act
Mr. KENNEDY. Mr. President, few aspects of immigration are more
important than the naturalization of new Americans. Naturalization goes
to the heart of those we welcome to join our country. Unlike those of
us who were born in this country, naturalized immigrants are Americans
by choice. Naturalization is the occasion when these new citizens
embrace our nation, and our nation embraces them.
Unfortunately, America's immigrant heritage and history are under
increasing attack today. Legal immigrants have been unfairly hurt by
recent actions to deal with illegal immigration. Voting rights, welfare
benefits, and naturalization itself are also under assault.
It now takes two to four years for immigrants to become naturalized
citizens. The backlogs continue to increase. It is time to improve the
naturalization process, and deal more responsibly with these important
issues.
Today, Congressman Gephardt and I are introducing the ``New American
Citizenship Act,'' because we believe legal immigrants deserve a fair,
efficient and affordable way to become citizens. Our bill builds on the
recent reforms by INS to reach out to potential new citizens, help them
learn our history and form of government, and ensure that the
naturalization process is one in which America can take pride.
Our bill provides increased services, and requires INS to reduce the
naturalization process to six months with no backlogs. We encourage
local communities to help in this effort, by disseminating information
to community-
[[Page S1444]]
based organizations on the requirements of citizenship and the contents
of the naturalization exam. Under our proposal, INS cannot increase the
naturalization fee to more than $150 until they have shown progress in
reducing the backlog.
In addition, we take specific steps to prevent fraud and abuse in the
exam. We strengthen the fingerprint process to prevent the mistaken
naturalization of unqualified applicants.
Each naturalization ceremony represents the continuing renewal and
revitalization of our country. As Barbara Jordan said,
We are a nation of immigrants, dedicated to the rule of
law. That is our history and our challenge to ourselves. . .
. It is literally a matter of who we are as a nation and who
we become as a people. E Pluribus Unum. Out of many, one. One
people. The American people.
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. 1717
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 ``New American Citizenship
Act''.
SEC. 2. DECLARATION AND PURPOSES.
(a) Declarations.--(1) Congress declares that it is the
historic policy of the United States to welcome as new
American citizens those legal immigrants who qualify for
naturalization and who are committed to American democratic
principles, our form of Government, and the Constitution of
the United States.
(2) Congress reaffirms the existing statutory requirements
for naturalization concerning good moral character, lawful
and continuous residence in the United States, and an
understanding of the English language and the history,
principles, and form of Government of the United States.
(b) Purposes.--The purposes of this Act are to ensure
that--
(1) the naturalization process of the United States
properly welcomes those who are committed to American
citizenship to participate fully in American civic life;
(2) the act of naturalization is reserved for those who
meet the qualifications established by the Constitution and
the laws and policies of the United States;
(3) individuals applying for naturalization are provided a
fair, efficient, and affordable process;
(4) the backlog of pending applications for naturalization
is reduced so that qualified applicants may become new
American citizens within six months of applying for
naturalization; and
(5) the Immigration and Naturalization Service provides
adequate assistance and information to individuals applying
for naturalization.
SEC. 3. BACKLOG REDUCTION.
(a) In General.--The Attorney General shall present to
Congress not later than 3 months after the date of enactment
of this Act a detailed plan for substantially reducing the
backlog at each district and regional office of the
Immigration and Naturalization Service. The plan shall
include specific target dates for reducing or eliminating the
backlog, and the percentage of reduction that will be
achieved by each target date.
(b) Report.--During each of the fiscal years 1998, 1999,
2000, and 2001, the Attorney General shall submit a monthly
report to the Committees on the Judiciary of the Senate and
the House of Representatives concerning the progress that is
being made in meeting the targets to reduce the backlog of
naturalization applications.
SEC. 4. EQUIPPING NEW AMERICANS FOR CITIZENSHIP.
(a) Integrity of Testing Procedures.--The Attorney General
shall ensure that procedures utilized by the Immigration and
Naturalization Service to carry out the standardized
naturalization examinations include the following:
(1) Administration of examinations.--
(A) Proctoring.--All standardized naturalization
examinations shall be proctored by an entity certified by the
Immigration and Naturalization Service to perform such
function. The Immigration and Naturalization Service may
certify more than 1 entity to proctor naturalization
examinations.
(B) Special rule for ``for-profit'' entities.--A for-profit
organization shall not be allowed to administer or proctor
the standardized naturalization examination if such
organization also provides citizenship courses.
(2) Pilot program.--During the 24-month period beginning on
the date of enactment of this Act, the Attorney General,
through a board or contractor determined by the Attorney
General to be qualified to administer standardized
examinations, shall test the feasibility of administering
naturalization examinations to a representative sample of
immigrants throughout the United States. The Attorney General
shall allow for special arrangements for naturalization
applicants who are homebound, in nursing homes, need
expedited handling of their applications, or have other
extenuating circumstances or incapacitations.
(A) Report.--Not later than 12 months after the institution
of the pilot program under this subsection, the Attorney
General shall submit a report to Congress regarding the
future feasibility of the program.
(B) Requirements of board or contractor.--The board or
contractor selected by the Attorney General to develop and
administer a standardized test under the pilot program
shall--
(i) be qualified to administer standardized examinations
and able to ensure the integrity of the examination process
through the use of proctors or other appropriate means;
(ii) be able to offer the examination at multiple test
sites located within immigrant communities;
(iii) prepare multiple versions of the naturalization
examination to be used at each examination site, and must
revise the examinations on at least a quarterly basis; and
(iv) have the ability to offer the examination with enough
frequency to meet the needs of each community in which the
examination is offered.
(C) Appeals.--The Attorney General shall provide an appeals
process to permit immigrants who fail the standardized
naturalization examination under the pilot program to either
have the examination results reviewed by an independent
examiner or retake the examination at no cost.
(3) Content of test.--Any new or redesigned naturalization
examination developed pursuant to this Act shall not create
barriers to citizenship that did not exist under the
examinations used before the enactment of this Act.
(b) Provision of Naturalization Materials.--
(1) Materials for home-study.--The Attorney General through
the Immigration and Naturalization Service shall make
sufficient material, such as textbooks and sample questions,
available at no cost to naturalization applicants who choose
to study for the naturalization examination without the
assistance of a citizenship course.
(2) Handbook.--Upon request, and at the time of adjustment
to or admission as a lawful permanent resident, the Attorney
General shall provide each such individual with a handbook
describing--
(A) the process for obtaining citizenship through
naturalization, as well as information on the requirements
for naturalization, including the good moral character and
continuous residency requirements;
(B) information on the civics and English language portions
of the naturalization examination; and
(C) the privileges and responsibilities of citizenship,
including the right to vote only after taking the oath of
allegiance.
(3) Dissemination of materials.--
(A) In general.--The Attorney General shall widely
disseminate, at no cost, to public schools and organizations
that provide instruction on citizenship responsibilities and
prepare applicants for the naturalization examination
materials, such as textbooks, sample questions, and other
information regarding the content of the naturalization
examination that the Immigration and Naturalization Service
determines relevant to assist such organizations in preparing
applicants for the naturalization examination.
(B) Development.--The materials described in this
subsection shall be developed in consultation with adult
educators and organizations that offer citizenship courses.
(c) Effective Date.--Except as provided in subsection
(a)(2), this section shall take effect on the date that is 6
months after the date of enactment of this Act.
SEC. 5. PLAN FOR ENSURING EFFICIENCY AND INTEGRITY OF THE
NATURALIZATION PROCESS.
(a) In General.--Not later than 1 year after the date of
enactment of this Act, the Attorney General shall develop a
plan for ensuring the efficiency and integrity of the
naturalization process.
(b) Objectives.--The plan described in subsection (a) shall
have the following objectives:
(1) To substantially increase the efficiency of the
naturalization process, including the development of--
(A) a system that requires the Immigration and
Naturalization Service to complete the entire naturalization
process in 6 months or less; and
(B) a contingency plan the Immigration and Naturalization
Service will use to accommodate sudden increases in
applications, including arrangements with Congress for the
rapid reprogramming of funds and positions when necessary.
(2) To increase the integrity and accuracy of
naturalization, by taking steps to ensure that--
(A) the fingerprint process for naturalization applicants
is as accurate and secure as possible;
(B) there is clear recourse for applicants with illegible
or nonexistent fingerprints, including communication in
writing from the Immigration and Naturalization Service
indicating the reasons for rejection of the fingerprints, and
instructions on what action, if any, the applicant must take;
(C) the integrity of the naturalization examination is
maintained by ensuring that the examination is applied
consistently across the United States, that it adequately
tests knowledge of English and civics, and
[[Page S1445]]
that the examination is not subject to fraud; and
(D) Immigration and Naturalization Service offices are
provided with clear guidelines to ensure consistency among
offices of the Service in conducting naturalization
interviews, including the institution of a standard checklist
for the relevant components of the applicant's file, a
uniform worksheet for offices to use in determining
eligibility, and a list of examples of the offenses which
disqualify applicants for naturalization.
(3) To maintain proper oversight of the naturalization
process, including--
(A) development of national quality assurance procedures to
facilitate effective oversight of fingerprint procedures,
naturalization examination centers, and final Immigration and
Naturalization Service naturalization interviews;
(B) accountability of field personnel involved in the
naturalization process to Immigration and Naturalization
Service headquarters;
(C) outreach by national and local Immigration and
Naturalization Service naturalization offices to community
groups and State and local officials for the purpose of
encouraging qualified immigrants to seek United States
citizenship;
(D) ensuring that applicants are treated fairly and
hospitably, and that a priority is given to customer service,
including increased customer service training for all
naturalization adjudication officers;
(E) providing naturalization applicants with adequate
information on the naturalization process, procedure, and
approximate timetable for the entire naturalization process;
and
(F) ensuring that Immigration and Naturalization Service
offices contain sufficient waiting areas with notices of
procedure and instructions in languages common to the
community served by the individual office.
(4) To ensure that the naturalization process will be
continually updated as new innovations emerge, such as--
(A) improved data sharing and digital fingerprint
technologies; and
(B) establishment of a system for local Immigration and
Naturalization Service offices to share best practices
regarding the naturalization process, or ideas those offices
have to improve the process, and for incorporation of these
lessons into ongoing naturalization planning by the
Immigration and Naturalization Service.
(c) Access for Individuals With Disabilities.--In
redesigning the naturalization process, the Attorney General
shall provide written guidance to the Immigration and
Naturalization Service officers and to applicants so that
individuals with disabilities are afforded reasonable
accommodations throughout the naturalization process,
including, but not limited to, access to Immigration and
Naturalization Service facilities, testing sites, and to the
English language and civics portions of the naturalization
examination.
SEC. 6. DETERRING NATURALIZATION FRAUD.
The Attorney General shall ensure that the naturalization
fingerprint submission process deters naturalization fraud
and maintains the integrity of the program by implementing
the following requirements:
(1) Except in the case of law enforcement agencies
designated by the Immigration and Naturalization Service to
take fingerprints for naturalization applicants, fingerprint
cards shall be sent directly by the Immigration and
Naturalization Service, or its designee, to the Federal
Bureau of Investigation for processing, rather than returning
the fingerprint card to the applicant for submission.
(2) Procuring the technology to institute electronic
fingerprint checks at all Immigration and Naturalization
Service offices by the fiscal year 2000.
SEC. 7. ENSURING INELIGIBLE IMMIGRANTS ARE NOT NATURALIZED.
(a) Criminal History Background Check.--The Immigration and
Naturalization Service shall ensure that a criminal history
background check with the Federal Bureau of Investigation is
completed for each naturalization applicant prior to the
naturalization interview, including requirements that--
(1) all fingerprints shall be sent directly to the Federal
Bureau of Investigation as described in section 6;
(2) prior to each naturalization interview, every
naturalization file shall contain documented evidence that a
criminal background check has been completed and the results
of any background check that indicates an applicant has a
Federal Bureau of Investigation record have been received;
(3) the Federal Bureau of Investigation shall expeditiously
conduct a criminal history background check on each applicant
for naturalization, and shall provide a response describing
the applicant's criminal history as reflected in the Bureau's
records; and
(4) where the applicant cannot provide legible
fingerprints, the Federal Bureau of Investigation shall
conduct a criminal history background check based on the
person's name and any other method of positive identification
used by the Federal Bureau of Investigation for criminal
history background checks.
(b) Naturalization Interviews.--All naturalization
applicants, at the time of a standardized naturalization
examination or interview by an adjudications officer, shall
be required to demonstrate basic ability to speak and
understand words in ordinary usage in the English language,
in accordance with section 312(a)(1) of the Immigration and
Nationality Act, unless the applicant is exempt from the
requirements of that section pursuant to section 312(b) of
such Act, and at the time of interview, each adjudications
officer shall--
(1) question each applicant about any arrest, charge,
conviction, or imprisonment which was revealed as a result of
the criminal history check;
(2) determine whether any crime which the applicant reveals
he or she committed is one which would disqualify the
applicant from naturalization;
(3) verify that the applicant was asked all mandatory
questions during the naturalization interview;
(4) refer complex cases involving potentially disqualifying
crimes to a supervisory officer for review;
(5) ensure that applicants are informed that they are not
United States citizens until they take the oath of
allegiance; and
(6) provide each applicant with information on the legal
requirements which need to be fulfilled before such applicant
can register to vote.
(c) Oath of Allegiance Requirements.--The Immigration and
Naturalization Service shall ensure that certificates of
citizenship are not to be distributed to naturalization
applicants prior to taking the oath of allegiance.
SEC. 8. FUNDING AND FEES.
(a) Availability of Funds.--Of the funds appropriated to
the Immigration and Naturalization Service for each of fiscal
years 1999, 2000, and 2001, $100,000,000 shall be made
available for backlog reduction, and technological and
infrastructure changes needed to ensure the appropriate
conduct of naturalization activities, including the purchase
of equipment for enhanced recordkeeping and fingerprint
checks, the development of testing centers, the conduct of
the pilot program described in section 4(a)(2), and other
purposes.
(b) Limitation on Fees.--
(1) In general.--The naturalization application fee charged
by the Immigration and Naturalization Service shall not
exceed $150 per applicant until the backlog of pending
naturalization applications has been substantially reduced in
each Immigration and Naturalization Service district.
(2) Backlog; substantially reduced.--For purposes of this
section:
(A) Backlog.--The term ``backlog'' means naturalization
applications which have been pending for longer than 6 months
from the time the application was submitted to the
Immigration and Naturalization Service.
(B) Substantially reduced.--The backlog of pending
naturalization applications for a fiscal year shall be
considered to be ``substantially reduced'' if the number of
naturalization applications in the backlog in each
Immigration and Naturalization Service district at the end of
the fiscal year is at least 30 percent less than the number
of applications in the backlog in each district at the end of
the previous fiscal year.
SEC. 9. DEFINITION.
In this Act, the term ``Attorney General'' means the
Attorney General, acting through the Commissioner of
Immigration and Naturalization.
______
By Mr. LIEBERMAN (for himself and Mr. Dodd):
S. 1718. A bill to amend the Weir Farm National Historic Site
Establishment Act of 1990 to authorize the acquisition of additional
acreage for the historic site to permit the development of visitor and
administrative facilities and to authorize the appropriation of
additional amounts for the acquisition of real and personal property;
to the Committee on Energy and Natural Resources.
weir farm visitor center legislation
Mr. LIEBERMAN. Mr. President, I rise today to join my friend Senator
Dodd in introducing legislation that is vitally important to the future
of Connecticut's only national park, the Weir Farm National Historic
Site.
As my colleagues may recall, Weir Farm was the home of the great
American painter J. Alden Weir, who is widely considered a leader of
the American Impressionism movement of the late 19th Century. The
brilliant natural beauty of Weir Farm's landscape served as the
inspiration for much of Weir's art as well as the work of several other
renowned Impressionists who often traveled to the farm at the time. The
splendor and serenity of this place also moved Weir's descendants and
other artists who later made their home at the farm to preserve much of
the landscape in the pristine state that originally inspired the many
painters who visited there.
Congress sought to protect this enormously valuable piece of our
national heritage when it approved legislation that Senator Dodd and I
cosponsored in 1990 to make Weir Farm part of the National Park System
and the first site to honor an American painter. This legislation (P.L.
101-485) authorized the Park Service to acquire 62
[[Page S1446]]
acres of the original Weir property along with several of the buildings
that Weir lived and worked in and many of the original furnishings. The
State of Connecticut strongly supported this project and helped make it
possible by approving a $4.25 million bond issue to purchase the 60
acres of open space surrounding the Weir homestead. The legislation was
also strongly endorsed by a coalition of 20 leading national
conservation groups, including The Nature Conservancy, which owns a
large preserve of open land adjacent to the park property that further
enhances the park's conservation mission.
Today, thousands of visitors who make their way to Weir Farm each
year can get lost in the tranquility of the place. They can tour the
studio where Weir and his successors toiled and the classic New England
barn that caught the eye of many visiting artists and that was
rehabilitated with a generous appropriation from Congress. But
something is missing--the art itself.
Sadly, these visitors cannot view the wonderful collection of
Impressionist works that the park managers and supporters are in the
process of acquiring through private donations. That is because there
is simply no place to put them on the current site. The cramped
historic buildings are ill-equipped to accommodate even a legitimate
visitor center, let alone a museum-quality gallery. And the possibility
of building an addition has rightly been ruled out of the question
because it would distort the landscape and run counter to the park's
mission of preserving the historic character of the property.
The legislation we are introducing today would help fill that void
and help the park fulfill another critical part of its mission, which
is to reunite Weir Farm's historic landscape with the rich array of art
it inspired. Specifically, our bill would authorize the Park Service to
go forward with its plan to acquire a neighboring property outside the
park's boundary and build a full-fledged visitor center to house the
collection of privately-acquired paintings from Weir, Childe Hassam,
John Twachtman and several others. A companion version of this bill is
being introduced in the House today as well by Congressman Jim Maloney,
who represents the district in which the park is located.
The Park Service approved this project as part of Weir Farm's long-
term General Management Plan. The Park Service has already identified
an ideal 13-acre site to house the visitor center, as well as an
adjacent administrative and maintenance facility that was also called
for under the management plan. The owners of the targeted site are
willing sellers and the Trust for Public Land--with a donation from the
Weir Farm Trust, the park's private partner--has generously agreed to
act as an intermediary in the purchase by putting an option on the
property to prevent it from being developed.
But for the project to go forward, Congress must first approve the
acquisition and a one-time change in the park's boundary. Our
legislation would do just that, providing the Park Service with the
authority to acquire up to 15 additional acres and expand the park's
boundary to include this new land. It would also raise the
authorization for land acquisition included in the original Weir Farm
legislation up from $1.5 million to $4 million.
The Park Service estimates that the total cost of acquiring the
property for the future visitor center will be $1.6 million. Of that
total, it is expected that approximately $500,000 would come from
unexpended land acquisition funds already appropriated by Congress and
state and private contributions. That leaves a Federal contribution in
the neighborhood of $1.1 million, which the Park Service has indicated
it will request in its budget for fiscal year 2000. The projected cost
of building the visitor center and the adjoining administrative/
maintenance facility is $4.7 million, of which approximately half would
come from private sources and the other half would come from Federal
funding through the Park Service.
This project not only has the strong support of the Park Service and
the State of Connecticut but of the communities surrounding Weir Farm,
which straddles the town line between Wilton and Ridgefield. A number
of residents in Ridgefield, where the visitor center would be built,
initially expressed concern about the impact the project could have on
the neighborhood. But the park managers and the leaders of the Weir
Farm Trust worked diligently to address those concerns and show the
community that the visitor center would in no way threaten the pastoral
nature of the area or significantly worsen traffic along the
neighborhood's narrow, windy roads.
In fact, the friends of Weir Farm showed that this plan would
actually enhance the conservation goals of the park and the community.
It would prevent the historic character of the Weir property from being
disturbed. And the proposed visitor center site would link the park to
an additional 119 acres of contiguous open space owned by the state and
the Town of Ridgefield. Also, an independent study showed that the
proposed visitor center would not significantly impact the flow of
traffic in the neighborhood, and the Park Service is confident that
this plan provides the best long-term solution for managing
transportation to the park site.
In addition to reaching out to local residents, the park managers and
the Ridgefield town government collaborated closely with my office and
Senator Dodd's office to help us craft the bill we are introducing
today in such a way as to ensure that the natural and historic
character of the site would be preserved and to ensure the town
maintained control over how the property was to be developed. As a
result of these efforts, both the Ridgefield Planning and Zoning
Commission and the Board of Selectmen formally approved this
legislation late last year.
This was not an easy process, and I want to express my deep
appreciation to Weir Farm's superintendent, Sarah Olson, and to the
town leaders in Ridgefield for their cooperation and their commitment
to reach a resolution that is for the good of both the community and
the park.
The visitor center we're proposing to build will help Weir Farm
realize its full potential not just as a pastoral prize but as a true
cultural landmark, one that will likely attract art lovers from
throughout the region and hopefully the nation to see Weir's jewel and
its splendid setting.
The alternative, Mr. President, is that if this project does not move
forward, we will have squandered a wonderfully unique opportunity to
make Weir Farm the only place of its kind to wed art and artistic
vision in this way. The Ridgefield Press and The Wilton Bulletin, the
leading local newspapers, urged us not to let this opportunity slip
away in a joint editorial published last year that strongly endorsed
the visitor center project. ``Bringing the art to Weir Farm,'' the
editors wrote, ``has the potential to turn the site into something more
than a retreat for artists and hikers--allowing an unusual cultural
experience of considerable depth.''
Senator Dodd and I would ask our colleagues to help us seize this
important opportunity by supporting this legislation, which would
complete the mission we started eight years ago when we agreed to make
Weir Farm part of the park system.
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. 1718
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. WEIR FARM NATIONAL HISTORIC SITE, CONNECTICUT.
(a) Acquisition of Land for Visitor and Administrative
Facilities.--Section 4 of the Weir Farm National Historic
Site Establishment Act of 1990 (16 U.S.C. 461 note; Public
Law 101-485; 104 Stat. 1171) is amended by adding at the end
the following:
``(d) Acquisition of Land for Visitor and Administrative
Facilities; Limitations.--
``(1) Acquisition.--
``(A) In general.--To preserve and maintain the historic
setting and character of the historic site, the Secretary may
acquire not more than 15 additional acres for the development
of visitor and administrative facilities for the historic
site.
``(B) Proximity.--The property acquired under this
subsection shall be contiguous to or in close proximity to
the property described in subsection (b).
``(C) Management.--The acquired property shall be included
within the boundary of the historic site and shall be managed
and maintained as part of the historic site.
``(2) Development.--
``(A) In general.--The Secretary shall keep development of
the property acquired under paragraph (1) to a minimum so
that the character of the acquired property will
[[Page S1447]]
be similar to the natural and undeveloped landscape of the
property described in subsection (b).
``(B) Parking area.--Any parking area for the resulting
visitor and administrative facility shall not exceed 30
spaces.
``(C) Sales.--Items sold in the visitor facilities--
``(i) shall be limited to educational and interpretive
materials related to the purpose of the historic site; and
``(ii) shall not include food.
``(3) Agreements.--Prior to and as a prerequisite to any
development of visitor and administrative facilities on the
property acquired under paragraph (1), the Secretary shall
enter into 1 or more agreements with the appropriate zoning
authority of the town of Ridgefield, Connecticut, and the
town of Wilton, Connecticut, for the purposes of--
``(A) developing the parking, visitor, and administrative
facilities for the historic site; and
``(B) managing bus traffic to the historic site and
limiting parking for large tour buses to an offsite
location.''.
(b) Increase in Maximum Acquisition Authority.--Section 7
of the Weir Farm National Historic Site Act of 1990 (16
U.S.C. 461 note; Public Law 101-485; 104 Stat. 1173) is
amended by striking ``$1,500,000'' and inserting
``$4,000,000''.
Mr. DODD. Mr. President, today I join with Senator Lieberman in
introducing legislation to add up to 15 acres to the Weir Farm National
Historic Site in Connecticut for the creation of a visitor center and
art gallery.
The new property is located in Ridgefield, Connecticut. Because the
land is adjacent to undeveloped State and Town land, the non-profit
Weir Farm Heritage Trust can ensure that the proposed visitor center
and gallery will be in keeping with the pastoral theme of the historic
site.
Eight years ago, Congress established Weir Farm as Connecticut's
first national park and the only National Park Service site in the
country dedicated to the celebration of an American painter. The 62
acre historic site contains the home and studio of the founder of
American impressionism, J. Alden Weir and this rich landscape is the
inspiration for many of his paintings.
Together, the National Park Service and the Weir Farm Heritage Trust
seek to raise public awareness of the farm's historical and cultural
significance and to preserve the farm's artistic tradition, while
developing a world renown art collection and providing artist
workshops. Through a Visiting Artists Program, several artists each
year are invited to work within the surroundings of Weir Farm.
More than eleven thousand people visited Weir Farm in 1996 and almost
ten thousand came in 1997. The Park Service estimates that by the year
2010, the number of visitors could increase to between 25,000-40,000.
It is for these reasons that the Weir Farm Heritage Trust would like to
acquire this land and convert an existing building into a visitor
center and art gallery and construct a modest 30-space parking area.
Language in the bill stipulates that the National Park Service will
enter into a binding agreement with appropriate town zoning commissions
to manage the projected increase in bus traffic and develop parking,
visitor and administrative facilities.
In December, the Ridgefield, Connecticut Selectmen voted in favor of
the land acquisition proposal. In November, the Ridgefield Planning and
Zoning commission also voted in favor of the plan, after convening
several public hearings on the matter.
This proposal is important to the people of Connecticut and all those
who wish to see a bit of artistic history preserved in its natural
state. I urge my colleagues to support this land acquisition proposal
as well.
______
By Mr. BAUCUS (for himself and Mr. Burns):
S. 1719. A bill to direct the Secretary of Agriculture and the
Secretary of the Interior to exchange land and other assets with Big
Sky Lumber Co; to the Committee on Energy and Natural Resources.
the gallatin completion act of 1998
Mr. BAUCUS. Mr. President, I rise today to announce the introduction
of the Gallatin Land Consolidation Act of 1998. I am pleased to be
joined in this introduction by my fellow members of the Montana
delegation--Senator Burns and Congressman Hill. The Gallatin Act is a
bipartisan bill that is the culmination of years of hard work and
unheralded cooperation between the Montana delegation, local
communities, conservation and user groups, and all levels of
government.
The consolidation of this area makes sense on many levels. In the
Gallatin area, the Act will consolidate the historic checkerboard
ownership that has muddied the waters of land management for years.
This bill will establish logical and effective ownership and management
of these lands. In the long run, consolidation will substantially
reduce the cost to the Forest Service--and ultimately the taxpayer--of
managing the Gallatin National Forest. By eliminating this checkerboard
ownership pattern, the bill improves public access to Forest Service
lands and reduces the disputes that currently arise over the proper
location of property lines.
Perhaps most importantly, this bill will protect these areas so that
our children can enjoy them just as we do. The checkerboard ownership
pattern invites sprawling subdivisions. Whether those occur across the
Taylor Fork, or north in the Bangtails, the effect is the same. The
Forest Service lands will be diminished in value for wildlife and
recreation as every other section of land is developed. This
checkerboard development would also diminish the pristine vistas that
make this area so special. By consolidating these lands, we can protect
recreational opportunities, wildlife herds, our famous fisheries, and
the area's beautiful scenery.
While consolidation benefits the entire Gallatin area, in the Taylor
Fork alone, the benefits are awe-inspiring. This area is critical
winter range for elk and moose and helps to sustain the largest
contingent of grizzly bears in the lower forty-eight states. The
conservation of the Taylor Fork, the Gallatin roaded area, and the
Bangtails will allow for the continued historic uses that define the
character of Montana such as hunting, grazing, recreation, and wildlife
habitat protection.
I would like to take a minute to thank the Montana delegation for
their hard work that has led to introduction of this Act. I also want
to recognize and applaud the efforts of all the folks in Montana who
have been instrumental in crafting this consolidation.
Local conservation and wildlife groups in Bozeman and in Butte have
worked long and hard to ensure that this bill protects the fisheries
and wildlife that make these lands unique. In response to their
suggestions, we have crafted the bill to ensure that the public will be
involved in planning the timber-for-land component of this exchange. In
response to their suggestions, we have also provided for a fair and
public process to determine the management direction for the acquired
lands, and have included a restoration program to improve the
environmental health of these lands. Together, these changes will
ensure that these lands will be enjoyed by sportsmen and by all
Montanans for generations to come.
And I would like to thank those in the timber industry who have
worked to ensure that this exchange will protect Montana mills. The
Independent Forest Products Association, who represents many of
Montana's small mills has been ever vigilant to ensure that the Forest
Service small business provisions are respected. In that vein, I would
especially like to thank Al Kington, whose last-minute advice allowed
us to craft the bill to provide extra protection for Montana's small
mills.
I would also like to thank those who have worked so hard to ensure
that the Taylor Fork is protected. The Rocky Mountain Elk Foundation
has worked tirelessly to raise funds to purchase one of the sections in
the Taylor Fork. Local land owners including the Kelsey's of the 9\1/4\
Circle Ranch and the Patton's of the Black Butte Ranch and the other
members of the Upper Gallatin Community, helped with those efforts and
have been vocal advocates for conserving these lands for all Montanans.
I would also like to thank Gallatin County Commissioners Jane
Jelinksi, Phil Olson and Bill Murdock. My staff met with the
commissioners individually and as a group as we crafted this exchange.
I appreciate their input and look forward to working with them in the
future.
Big Sky Lumber, the private party to this exchange has negotiated the
terms of this agreement in good faith. They have provided a number of
concessions to make this exchange more responsive to public concerns.
These include
[[Page S1448]]
agreements to providing public recreation access across their lands,
protecting viewsheds in the Bridger Canyon area, and providing options
to local landowners to allow them to purchase some of these lands
following the exchange.
Last, but certainly not least, I would like to thank two public
employees, Bob Dennee with the U.S. Forest Service, and Kurt Alt with
the Montana Department of Fish, Wildlife and Parks. These two
individuals have logged long hours on this exchange over the years and
have been an invaluable resource for me and my staff.
However, it should be clear to all that our work is not done. As the
bill moves through the legislative process, I will continue working to
make sure that this consolidation is responsive to the people that it
serves. I look forward to working with the Montana public to finalize
this exchange and to protect these important lands.
Every once in a while, we are blessed to work on efforts for which we
know our children will thank us. And the Gallatin Consolidation is one
of those efforts. If we do not take this opportunity to address the
problems that were created by the railroad land grants a century ago,
we may never have another such opportunity. If we do not act now, these
lands will be broken into smaller and smaller pieces--all to the
detriment of our fish, wildlife, and cultural heritage. If we do not
act now, it will be to the detriment of our children. However, if we
succeed, our children and our grand children will be forever grateful.
Mr. President, I encourage my colleagues to join me in supporting
this important effort. And I thank my colleague from Montana for his
continued hard work and cooperation on this bill.
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. 1719
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 ``Gallatin Land Consolidation
Act of 1998''.
SEC. 2. FINDINGS.
Congress finds that--
(1) the land north of Yellowstone National Park possesses
outstanding natural characteristics and wildlife habitats
that make the land a valuable addition to the National Forest
System;
(2) it is in the interest of the United States to establish
a logical and effective ownership pattern for the Gallatin
National Forest, reducing long-term costs for taxpayers and
increasing and improving public access to the forest; and
(3) it is in the interest of the United States for the
Secretary of Agriculture to enter into an Option Agreement
for the acquisition of land owned by Big Sky Lumber Co. to
accomplish the purposes of this Act.
SEC. 3. DEFINITIONS.
In this Act:
(1) BLM land.--The term ``BLM land'' means approximately
3,000 acres of Bureau of Land Management land (including all
appurtenances to the land) that is proposed to be acquired by
BSL, as depicted in Exhibit B to the Option Agreement.
(2) BSL.--The term ``BSL'' means Big Sky Lumber Co., an
Oregon joint venture, and its successors and assigns, and any
other entities having a property interest in the BSL land.
(3) BSL land.--The term ``BSL land'' means approximately
55,000 acres of land (including all appurtenances to the
land) owned by BSL that is proposed to be acquired by the
Secretary of Agriculture, as depicted in Exhibit A to the
Option Agreement.
(4) Forest system land.--The term ``Forest System land''
means approximately 28,000 acres of land (including all
appurtenances to the land) owned by the United States in the
Gallatin National Forest, Flathead National Forest, Deer
Lodge National Forest, Lolo National Forest, and Lewis and
Clark National Forest that is proposed to be acquired by BSL,
as depicted in Exhibit B to the Option Agreement.
(5) Option agreement.--The term ``Option Agreement'' means
the document signed by BSL, dated ____________ and entitled
``Option Agreement for the Acquisition of Big Sky Lumber Co.
Lands Pursuant to the Gallatin Range Consolidation and
Protection Act of 1993'', and the exhibits (including an
exchange agreement) and maps attached to the agreement.
SEC. 4. GALLATIN LAND CONSOLIDATION COMPLETION.
(a) In General.--Notwithstanding any other provision of
law, if BSL offers title to the BSL land, including mineral
interests, that is acceptable to the United States and meets
the requirements of subsection (e)--
(1) the Secretary of Agriculture shall accept a warranty
deed to the BSL land and a quit claim deed to the mineral
interests in the BSL land;
(2) the Secretary of Agriculture shall convey to BSL,
subject to valid existing rights and to such other terms,
conditions, reservations, and exceptions as may be agreed on
by the Secretary of Agriculture and BSL fee title to the
Forest System land;
(3) the Secretary shall grant to BSL timber harvest rights
to approximately 20,000,000 board feet of timber in
accordance with subsection (c) and as described in Exhibit C
to the Option Agreement;
(4)(A) subject to the availability of funds, the Secretary
of Agriculture shall purchase the portion of the BSL land in
the Taylor Fork area depicted on Exhibit D to the Option
Agreement at a purchase price of not more than $6,500,000;
and
(B) to extent that funds are not available, the Secretary
of Agriculture shall acquire the remaining Taylor Fork
sections through an exchange of assets; and
(5) the Secretary of the Interior shall convey to BSL, by
patent or otherwise, subject to valid existing rights and to
such other terms, conditions, reservations, and exceptions as
may be agreed to by the Secretary of the Interior and BSL,
fee title to the BLM land.
(b) Valuation.--The property and other assets exchanged by
BSL and the United States under subsection (a) shall be
approximately equal in value, as determined by the Secretary
of Agriculture.
(c) Timber Harvest Rights.--
(1) In general.--Not later than December 31 of the second
full calendar year that begins after the date of enactment of
this Act, the Secretary shall prepare, grant to BSL, and
commence administration of the timber harvest rights
identified in Exhibit C to the Option Agreement.
(2) Grants.--
(A) In general.--The Secretary shall grant timber harvest
rights to BSL not earlier than the date that is 45 days after
the date on which the Secretary issues a decision notice to
grant the timber harvest rights, or, if such a decision
notice is appealed, after the date of final resolution of the
appeal.
(B) Limitation.--The Secretary may not grant timber harvest
rights that are the subject of administrative appeal or
litigation.
(3) Administration.--After timber harvest rights are
granted to BSL, the decision notice for those rights and the
administration of those rights in accordance with the
decision notice shall not be subject to administrative appeal
or judicial review.
(4) Schedules.--The Secretary and BSL shall mutually
develop and agree on schedules for the harvest of timber the
harvest rights to which are granted to BSL in the exchange.
(5) Timber sale program.--The timber harvest rights granted
under this Act--
(A) shall constitute the timber sale program for the
Gallatin National Forest for the period beginning on the date
of enactment of this Act and ending on December 31 of the
second full calendar year that begins after that date; and
(B) shall be funded by the Secretary annually at levels
that are commensurate with the preparation and administration
involved in the program.
(6) Substitution.--If circumstances, such as natural
catastrophe, administrative appeals or litigation, regulatory
or legal limitations, or environmental or financial
circumstances, prevent the Secretary from granting the timber
harvest rights identified in Exhibit C to the Option
Agreement, the Secretary shall replace the value of the
diminished timber harvest rights by substituting equivalent
timber harvest rights volume from the same market area.
(7) Open market.--All timber harvest rights granted to BSL
in the exchange under subsection (a) shall be offered for
sale by BSL through the competitive bid process.
(8) Small business.--All timber harvest rights granted to
BSL in the exchange shall be subject to compliance by BSL
with Forest Service small business program procedures in
effect as of the date of enactment of this Act, including
contractual provisions for payment schedules, harvest
schedules, and bonds and including the right of the highest
bidder among qualified small businesses that submit minimum
bids to be awarded a timber contract.
(9) Compliance with option agreement.--The Secretary and
BSL shall comply with the terms and conditions of the Option
Agreement, including terms and conditions with respect to
timber harvest rights included in the exchange.
(d) Rights-of-Way.--As part of the exchange under
subsection (a)--
(1) the Secretary of Agriculture, under the authority of
the Federal Land Policy and Management Act of 1976 (43 U.S.C.
1701 et seq.), shall convey to BSL such easements in or other
rights-of-way over Forest System land as may be agreed to by
the Secretary of Agriculture and BSL; and
(2) BSL shall convey to the United States such easements in
or other rights-of-way over land owned by BSL as may be
agreed to by the Secretary of Agriculture and BSL.
(e) Quality of Title.--
(1) Determination.--The Secretary of Agriculture shall
review the title for the BSL land described in subsection (a)
and, within 45 days after receipt of all applicable title
documents from BSL, determine whether--
(A) the applicable title standards for Federal land
acquisition have been satisfied or
[[Page S1449]]
the quality of the title is otherwise acceptable to the
Secretary of Agriculture;
(B) all draft conveyances and closing documents have been
received and approved;
(C) a current title commitment verifying compliance with
applicable title standards has been issued to the Secretary;
and
(D) the title includes both the surface and subsurface
estates without reservation or exception (except by the
United States or the State of Montana, by patent or as
otherwise agreed to by the Secretary and BSL), including--
(i) minerals, mineral rights, and mineral interests
(including severed oil and gas surface rights), subject to
and excepting other outstanding or reserved oil and gas
rights;
(ii) timber, timber rights, and timber interests, except
those reserved subject to section 251.14 of title 36, Code of
Federal Regulations, by BSL and agreed to by the Secretary;
(iii) water, water rights, ditch, and ditch rights; and
(iv) any other interest in the property.
(2) Conveyance of title.--
(A) In general.--If the quality of title does not meet
Federal standards or is otherwise determined to be
unacceptable to the Secretary of Agriculture, the Secretary
shall advise BSL regarding corrective actions necessary to
make an affirmative determination under paragraph (1).
(B) Title to subsurface estate.--Title to the subsurface
estate shall be conveyed by BSL to the Secretary of
Agriculture in the same form and content as that estate is
received by BSL from Burlington Resources Oil & Gas Company
Inc. and Glacier Park Company.
(f) Timing of Implementation.--
(1) Land-for-land exchange.--The Secretary of Agriculture
shall accept the conveyance of land described in subsection
(a) not later than 45 days after the Secretary of Agriculture
has made an affirmative determination of quality of title.
(2) Land-for-timber exchange.--The Secretary shall make the
timber harvest rights described in subsection (a)(3)
available not later than December 31 of the second full
calendar year that begins after the date of enactment of this
Act.
(3) Purchase.--The Secretary of Agriculture shall complete
the purchase of BSL land under subsection (a)(4) not later
than 30 days after the date on which appropriated funds are
made available and an affirmative determination of quality of
title is made with respect to the BSL land.
SEC. 5. GENERAL PROVISIONS.
(a) Minor Corrections.--
(1) In general.--The Option Agreement shall be subject to
such minor corrections as may be agreed to by the Secretary
of Agriculture and BSL.
(2) Notification.--The Secretary shall notify the Committee
on Energy and Natural Resources of the Senate, the Committee
on Resources of the House of Representatives, and each member
of the Montana congressional delegation of any changes made
pursuant to this subsection.
(b) Public Availability.--The Option Agreement--
(1) shall be on file and available for public inspection in
the office of the Supervisor of the Gallatin National Forest;
and
(2) shall be filed with the county clerk of each of
Gallatin County, Park County, Madison County, Granite County,
Broadwater County, Meagher County, Flathead County, and
Missoula County, Montana.
(c) Status of Land.--All land conveyed to the United States
under this Act shall be added to and administered as part of
the Gallatin National Forest and Deerlodge National Forest,
as appropriate, in accordance with the Act of March 1, 1911
(commonly known as the ``Weeks Act'') (36 Stat. 961, chapter
186), and other laws (including regulations) pertaining to
the National Forest System.
(d) Management.--
(1) Public process.--Not later than 30 days after the date
of completion of the land-for-land exchange under section
4(f)(1), the Secretary shall initiate a public process to
amend the Gallatin National Forest Plan and the Deerlodge
National Forest Plan to integrate the acquired BSL land into
the plans.
(2) Process time.--The amendment process under paragraph
(1) shall be completed not later than 360 days after the date
on which the amendment process is initiated.
(3) Limitation.--An amended management plan shall not
permit surface occupancy on the BSL land for access to
reserved or outstanding oil and gas rights or for exploration
or development of oil and gas.
(4) Interim management.--Pending completion of the forest
plan amendment process under paragraph (1), the Secretary
shall--
(A) manage the acquired BSL land under the same standards,
guidelines, and management directions as adjacent land
managed by the Forest Service; and
(B) maintain all existing public access to the acquired BSL
land.
(e) Restoration.--
(1) In general.--After acquiring the BSL land, the
Secretary shall implement a restoration program including
reforestation and watershed enhancements to bring the BSL
land and surrounding national forest land into compliance
with Forest Service standards and guidelines.
(2) State and local conservation corps.--In implementing
the restoration program, the Secretary shall, when
practicable, use partnerships with State and local
conservation corps, including the Montana Conservation Corps,
under the Public Lands Corps Act of 1993 (16 U.S.C. 1721 et
seq.).
(f) Implementation.--The Secretary of Agriculture shall
ensure that sufficient funds are made available to the
Gallatin National Forest to carry out this Act.
SEC. 6. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated such sums as are
necessary to carry out this Act.
Mr. BURNS. Mr. President, I am pleased today to introduce with my
colleague, Senator Baucus, the Gallatin Consolidation Act completion
phase, know as Gallatin II (two). Our colleague, Congressman Hill, is
introducing identical legislation today in the House.
The bill we have jointly introduced today is the result of much
cooperation and communication among the citizens of the state of
Montana, the Forest Service, the partners of Big Sky Lumber and the
Montana Congressional Delegation. Ranchers, property owners,
outfitters, environmentalists, county commissioners, sportsmens groups,
wildlife associations and other groups have sat at the table attempting
to find consensus on the difficult aspects of the exchange.
That process will continue. The introduction of this bill today does
not end the public involvement. In fact, it just opens a different
facet of public input. Committee hearings are next in line as we
consider this legislation.
The lands the U.S. Forest Service will acquire under this act are
some of the richest wildlife habitat areas in the state of Montana.
Today the lands in the Gallatin National Forest are still held in a
mostly checkerboard land-ownership pattern. Add into this mix a
dramatic increase in residential development in rural areas near the
National Forests and you have further complicated the resource problems
for multiple use in our National Forests.
With this bill we are attempting to consolidate the National Forest
System ownership pattern and preserve some of these corridors for
wildlife, resource protection, and future generations who are fortunate
enough to visit these forests.
I want to thank my colleagues, Congressman Hill and Senator Baucus
for their participation and cooperation in formulating a delegation
approach to this complex land exchange. I look forward to moving this
bill forward in an efficient and timely manner so that the deadline for
accomplishing the exchange can be met.
Thank you, Mr. President.
______
By Mr. HATCH (for himself, Mr. Leahy, and Mr. Kohl):
S. 1720. A bill to amend title 17, United States Code, to reform the
copyright law with respect to satellite retransmissions of broadcast
signals, and for other purposes; to the Committee on the Judiciary.
THE COPYRIGHT COMPULSORY LICENSE IMPROVEMENT ACT OF 1998
Mr. HATCH. Mr. President, I rise to introduce a bill that will help
provide for greater consumer choice and competition in television
services, the Copyright Compulsory License Improvement Act of 1998.
Joining me in introducing this bill are my colleagues Senators Leahy
and Kohl.
The options consumers have for viewing television entertainment have
vastly increased since that fateful day in September 1927 when
television inventor and Utah native Philo T. Farnsworth, together with
his wife and colleagues, viewed the first television transmission in
the Farnsworth's home workshop: a single black line rotated from
vertical to horizontal. Both the forms of entertainment and the
technologies for delivering that entertainment have proliferated over
the 70 years since that day. In the 1940s and 50s, televisions began
arriving in an increasing number of homes to pick up entertainment
being broadcast into a growing number of cities and towns.
In the late 60s and early 70s, cable television began offering
communities more television choices by initially providing community
antenna system of receiving broadcast television signals, and later by
offering new created-for-cable entertainment. The development of cable
television made dramatic strides with the enactment of the cable
compulsory license in 1976, providing an efficient way of clearing
copyright rights for the retransmission of broadcast signals over cable
systems.
[[Page S1450]]
In the 1980s, television viewers began to be able to receive
television entertainment with their own home satellite equipment, and
the enactment of the Satellite Home Viewer Act in 1988 helped develop a
system of providing options for television service to Americans who
lived in areas too remote to receive television signals over the air or
via cable.
Much has changed since the original Satellite Home Viewer Act was
adopted in 1988. The Satellite Home Viewer Act was originally intended
to ensure that households that could not get television in any other
way, traditionally provided through broadcast or cable, would be able
to get television signals via satellite. The market and the satellite
industry has changed substantially since 1988. Many of the difficulties
and controversies associated with the satellite license have been at
least partly a product of the satellite business attempting to move
from a predominately need-based rural niche service to a full service
video delivery competitor in all markets, urban and rural.
Now, many market advocates both in and out of Congress are looking to
satellite carriers to compete directly with cable companies for
viewership, because we believe that an increasingly competitive market
is better for consumers both in terms of cost and the diversity of
programming available. The bill I introduce today will move us toward
that kind of robust competition.
The bill I introduce today is focused on changes that we can make
this year to move the satellite television industry to the next level,
making it a full competitor in the multi-channel video delivery market.
It has been said time and again that a major, and perhaps the biggest,
impediment to satellite's ability to be a strong competitor to cable is
its current inability to provide local broadcast signals. (See, e.g.,
Business Week (22 Dec. 1997) p. 84.) This problem has been partly
technological and partly legal. Today, with this bill, we hope to begin
removing the legal impediments to use of the emerging technology that
will make local retransmission of broadcast signals a reality.
This is a forward-looking bill which will create an incentive for
companies to develop the means by which to provide local programming to
local markets over satellite systems. In the next few years, if we make
these legal changes, the satellite industry should be able to offer
television viewers their own local programming of news, weather,
sports, and entertainment, with digital quality picture and sound. This
will mean that viewers in the remoter areas of my large home state of
Utah will be able to watch television programming originating in Salt
Lake City, rather than New York or California. Utahns in remote areas
will have access to local weather and other locally and regionally
relevant information. And, most important to all the constituents of my
colleagues is that they will finally have a choice for full service
multi-channel video programming: They will be able to choose cable or
one of a number of satellite carriers. This should foster an
environment of proliferating choice and lowered prices, all to the
benefit of consumers, our constituents.
To that end, the ``Copyright Compulsory License Improvement Act''
makes the following changes to the Satellite Home Viewers Act:
It makes the satellite compulsory license permanent, just like the
cable compulsory license. Under the current law the satellite license
will sunset next year.
It allows satellite carriers to retransmit a local television station
to households within that station's local market, just like cable does,
and sets a zero copyright rate for providing this service.
It allows consumers to switch from cable to satellite service for
network signals without the waiting period now required in the law.
It reforms the current structure of the administrative body which
determines rates and distributions applicable to all copyright
compulsory licenses to make it more efficient and less expensive for
the parties, as well as more technically expert.
It creates substantial regulatory parity between the industries,
including must-carry rules, retransmission consent requirements,
network non-duplication, syndicated exclusivity, and sports blackout
restrictions. These regulations will be phased in over a period of time
in which the Federal Communications Commission can carefully consider
and tailor their implementation. During that time, the portions of the
satellite compulsory license which determine who is eligible to receive
network and superstation signals from satellite carriers will continue
to apply as they do now.
Mr. President, this is a forward-looking bill that establishes the
environment in which there can be more vigorous and fair competition in
the video delivery market. But it is constructed to be practical in the
realm of achievable legislation. Let me make clear that this bill is
carefully balanced to ensure competition. It will do much to put the
satellite industry on a more equal footing with its competitors and
other market actors, both in terms of its benefits and
responsibilities.
Mr. President, let me briefly mention an issue that I think is
important to touch on briefly at introduction. I am aware that there is
currently controversy and even litigation over some issues relating to
compliance with restrictions in the law as it is now written regarding
satellite carriers providing network service. Let me make it clear that
the introduction of this bill is but the beginning of a process. I
would hope that this beginning is not interpreted by anyone as a
license to disregard the law as it is now constituted in hopes of any
future changes in the law. Our debates and discussions need to be fair
and frank, and that process is not helped by abuse or disregard for
current law. I would expect full compliance with and application of
current law regarding the restrictions on eligibility for distant
network signals or any other provisions in current law until such time
as changes in the law are actually made.
Having said that, I welcome and urge my colleagues and all interested
parties to join in a constructive discussion of this very important
legislation. I recognize that we may be able improve this bill before
final passage, but I believe the essential balance of this bill is
necessary to making it achievable now. I commend it to my colleagues
for their consideration and look forward to working with them to help
hasten more vigorous competition in the television delivery market and
the ever-widening consumer choice that will follow it.
I ask unanimous consent that the bill and an explanatory section-by-
section analysis be printed in the Record.
There being no objection, the items were ordered to be printed in the
Record, as follows:
S. 1720
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 ``Copyright Compulsory License
Improvement Act''.
SEC. 2. SECONDARY TRANSMISSIONS BY SATELLITE CARRIERS.
Section 119 of title 17, United States Code, is amended--
(1) by amending the section heading to read as follows:
``Sec. 119. Limitations on exclusive rights: Secondary
transmissions by satellite carriers'';
and
(2) by striking subsection (a) and inserting the following:
``(a) Secondary Transmissions by Satellite Carriers for
Private Home Viewing.--
``(1) Secondary transmissions of distant and local
broadcast signals subject to statutory licensing.--Subject to
the provisions of subsections (b) and (c) of this section and
section 114(d), a secondary transmission of a primary
transmission made by a television broadcast station licensed
by the Federal Communications Commission or by the Public
Broadcasting Service satellite feed and embodying a
performance or display of a work shall be subject to
statutory licensing under this section if--
``(A) the secondary transmission is permissible under the
rules, regulations, and authorizations of the Federal
Communications Commission and is made by a satellite carrier
to the public for private home viewing; and
``(B) the carrier makes a direct or indirect charge for
each retransmission service to each household receiving the
secondary transmission or to a distributor that has
contracted with the carrier for direct or indirect delivery
of the secondary transmission to the public for private home
viewing.
``(2) Submission of subscriber lists to television
broadcast stations.--
``(A) Initial lists.--A satellite carrier that makes
secondary transmissions of a primary
[[Page S1451]]
transmission of a television broadcast station pursuant to
paragraph (1) shall, within 90 days after commencing such
secondary transmissions, submit to that television broadcast
station--
``(i) a list identifying all subscribers within the
designated market area of that television broadcast station
to whom the satellite carrier has made such secondary
transmissions; and
``(ii) a list of all television broadcast stations whose
primary transmissions have been transmitted by the satellite
carrier to those subscribers during that 90-day period.
``(B) Subsequent lists.--After the submission of the lists
under subparagraph (A), the satellite carrier shall, on the
15th day of each month, submit to each television broadcast
station--
``(i) a list, which shall be dated, that identifies the
name of any subscriber described in subparagraph (A) who has
been added or dropped since the last submission under this
paragraph; and
``(ii) a list of all television broadcast stations whose
primary transmissions have been added or dropped by the
satellite carrier since the last submission under this
paragraph
``(C) Identifying information.--(i) Each list of
subscribers under this paragraph shall include the name of
each subscriber, together with the subscriber's home address,
which shall include the street address or rural route as the
case may be, city, county, State, and zip code and, if
different from the subscriber's home address, the location of
the subscriber's satellite receiving dish to which the
secondary transmissions are made, identified by street
address or rural route as the case may be, city, county,
State, and zip code.
``(ii) Each list of television broadcast stations under
this paragraph shall include the station's call letters and
community of license.
``(iii) Subscriber information submitted under this
paragraph may be used only for purposes of monitoring
compliance by the satellite carrier with this section.
``(3) Penalties for noncompliance with accounting and
royalty requirements.--Notwithstanding the provisions of
paragraph (1), the willful or repeated secondary transmission
to the public by a satellite carrier of a primary
transmission made by a television broadcast station licensed
by the Federal Communications Commission or by the Public
Broadcasting Service satellite feed and embodying a
performance or display of a work is actionable as an act of
infringement under section 501, and is fully subject to the
remedies provided by sections 502 through 506 and 509, if the
satellite carrier has not deposited the statement of account
and royalties fees required by subsection (b), or has failed
to make the submissions to networks required by paragraph
(2).
``(4) Penalties for willful alterations of programming.--
Notwithstanding the provisions of paragraph (1), the
secondary transmission to the public by a satellite carrier
of a primary transmission made by a television broadcast
station licensed by the Federal Communications Commission or
by the Public Broadcasting Service satellite feed and
embodying a performance or display of a work is actionable as
an act of infringement under section 501, and is fully
subject to the remedies provided by section 502 through 506
and sections 509 and 510, if the content of the particular
program in which the performance or display is embodied, or
any commercial advertising or station announcement
transmitted by the primary transmitter during, or immediately
before or after, the transmission of such program, is in any
way willfully altered by the satellite carrier through
changes, deletions, or additions, or is combined with
programming from any other broadcast signal.
``(5) Penalties for discrimination against distributor.--
Notwithstanding the provisions of paragraph (1), the willful
or repeated secondary transmission to the public by a
satellite carrier of a primary transmission made by a
television broadcast station licensed by the Federal
Communications Commission or by the Public Broadcasting
Service satellite feed and embodying the performance or
display of a work is actionable as an act of infringement
under section 501, and is fully subject to the remedies
provided by sections 502 through 506 and 509, if the
satellite carrier unlawfully discriminates against a
distributor.
``(6) License limited to secondary transmissions to
households in the United States.--The statutory license
created by this section shall apply only to secondary
transmissions to households located in the United States.''.
SEC. 3. STATUTORY LICENSE FOR SATELLITE CARRIERS.
Section 119 of title 17, United States Code, is amended by
striking subsection (b) and inserting the following:
``(b) Statutory License for Secondary Transmissions for
Private Home Viewing.--
``(1) Deposit of accounts and fees with register of
copyrights.--A satellite carrier whose secondary
transmissions are subject to statutory licensing under
subsection (a) shall, on a semiannual basis, deposit with the
Register of Copyrights, in accordance with requirements that
the Register shall prescribe by regulation--
``(A) a statement of account, covering the preceding 6-
month period, specifying the names and locations of all
television broadcast stations whose signals were
retransmitted, and listing the Public Broadcasting Service
satellite feed, if carried, at any time during that period,
to subscribers for private home viewing, the total number of
subscribers that received such retransmissions, and other
such data as the Register of Copyrights may from time to time
prescribe by regulation; and
``(B) a royalty fee for that 6-month period for each
television broadcast station whose primary transmission was
retransmitted beyond the local market of the station, and for
the Public Broadcasting Service satellite feed, if carried,
computed by multiplying the total number of subscribers
receiving the secondary transmission, and the number of
subscribers receiving a secondary transmission of the Public
Broadcasting Service satellite feed, during each calendar
month by the rate in effect for television broadcast stations
as determined under chapter 8 of this title and section 8(c)
of the Copyright Compulsory License Improvement Act.
``(2) Investment of fees.--The Register of Copyrights shall
receive all fees deposited under this section and, after
deducting the reasonable costs incurred by the Copyright
Office under this section (other than the costs deducted
under paragraph (4)), shall deposit the balance in the
Treasury of the United States, in such manner as the
Secretary of the Treasury directs. All funds held by the
Secretary of the Treasury shall be invested in interest-
bearing securities of the United States for later
distribution with interest by the Copyright Royalty
Adjudication Board as provided in this title. The Register
may, four or more years after the close of any calendar year,
close out the account for royalty payments made under this
section for that calendar year (including payments made under
this section as in effect before the effective date of the
Copyright Compulsory License Improvement Act), and may treat
any funds remaining in such account and any subsequent
deposits that would otherwise be attributable to that
calendar year as attributable to the calendar year in which
the account is closed.
``(3) Persons to whom fees are distributed.--The royalty
fees deposited under paragraph (2) shall, in accordance with
the procedures provided in paragraph (4), be distributed to
those copyright owners whose works were included in a
secondary transmission for private home viewing made by a
satellite carrier during the applicable 6-month accounting
period and who file a claim with the Board under paragraph
(4).
``(4) Procedures for distribution.--The royalty fees
deposited under paragraph (2) shall be distributed in
accordance with the following procedures:
``(A) Filing of claims for fees.--During the month of July
in each year, each person claiming to be entitled to
statutory license fees for secondary transmissions for
private home viewing shall file a claim with the Copyright
Royalty Adjudication Board, in accordance with requirements
that the Board shall prescribe by regulation. For purposes of
this paragraph, any claimants may agree among themselves as
to the proportionate division of statutory license fees among
them, may lump their claims together and file them jointly or
as a single claim, or may designate a common agent to receive
payment on their behalf.
``(B) Determination of controversy; distributions.--After
the first day of August of each year, the Copyright Royalty
Adjudication Board shall determine whether there exists a
controversy concerning the distribution of royalty fees. If
the Board determines that no such controversy exists, the
Board shall, after deducting reasonable administrative costs
under this paragraph, distribute such fees to the copyright
owners entitled to receive them, or to their designated
agents. If the Board finds the existence of a controversy,
the Board shall, pursuant to chapter 8 of this title, conduct
a proceeding to determine the distribution of royalty fees.
``(C) Withholding of fees during controversy.--During the
pendency of any proceeding under this subsection, the
Copyright Royalty Adjudication Board shall withhold from
distribution an amount sufficient to satisfy all claims with
respect to which a controversy exists, but shall have
discretion to proceed to distribute any amounts that are not
in controversy. The action of the Board to distribute royalty
fees may precede the declaration of a controversy if all
parties to the proceeding file a petition with the Board
requesting such distribution, except that such amount may not
exceed 50 percent of the amounts on hand at the time of the
request.''.
SEC. 4. DEFINITIONS.
Section 119 of title 17, United States Code, is amended by
striking subsection (d) and inserting the following:
``(d) Definitions.--As used in this section--
``(1) Designated market area.--The term `designated market
area' has the meaning given that term in section 337(g) of
the Communications Act of 1934.
``(2) Distributor.--The term `distributor' means an entity
which contracts to distribute secondary transmissions from a
satellite carrier and, either as a single channel or in a
package with other programming, provides the secondary
transmission either directly to individual subscribers for
private home viewing or indirectly through other program
distribution entities.
``(3) Local market.--The `local market' for a television
broadcast station has the meaning given that term in section
337(g) of the Communications Act of 1934.
[[Page S1452]]
``(4) Primary transmission.--The term `primary
transmission' has the meaning given that term in section
111(f) of this title.
``(5) Private home viewing.--The term `private home
viewing' means the viewing, for private use in a household by
means of satellite reception equipment which is operated by
an individual in that household and which serves only such
household, of a secondary transmission delivered by a
satellite carrier of a primary transmission of a television
station licensed by the Federal Communications Commission or
of the Public Broadcasting Service satellite feed.
``(6) Public broadcasting service satellite feed.--The term
`Public Broadcasting Service satellite feed' means the
national satellite feed distributed by the Public
Broadcasting Service (other than the transmissions that may
not be encrypted under section 705(c) of the Communications
Act of 1934), consisting of educational and informational
programming intended for private home viewing, to which the
Public Broadcasting Service holds national terrestrial
broadcast rights.
``(7) Satellite carrier.--The term `satellite carrier'
means an entity that uses the facilities of a satellite or
satellite service licensed by the Federal Communications
Commission, and operates in the Fixed-Satellite Service under
part 25 of title 47, Code of Federal Regulations (as in
effect on February 1, 1998), or the Direct Broadcast
Satellite Service under part 100 of title 47, Code of Federal
Regulations (as in effect on February 1, 1998), to establish
and operate a channel of communications for point-to-
multipoint distribution of television station signals, and
that owns or leases a capacity or service on a satellite in
order to provide such point-to-multipoint distribution,
except to the extent that such entity provides such
distribution pursuant to tariff under the Communications Act
of 1934, other than for private home viewing.
``(8) Secondary transmission.--The term `secondary
transmission' means the further transmitting of a primary
transmission simultaneously with the primary transmission.
``(9) Subscriber.--The term `subscriber' means an
individual who receives a secondary transmission service for
private home viewing by means of a secondary transmission
from a satellite carrier and pays a fee for the service,
directly or indirectly, to the satellite carrier or to a
distributor.
``(10) Television broadcast station.--The term `television
broadcast station' means an over-the-air, commercial or
noncommercial television broadcast station licensed by the
Federal Communications Commission under subpart E of part 73
of title 47, Code of Federal Regulations.''.
SEC. 5. EXCLUSIVITY OF SECTION 119 OF TITLE 17, UNITED STATES
CODE.
Section 119 of title 17, United States Code, is amended by
adding at the end the following:
``(e) Exclusivity for This Section With Respect to
Secondary Transmissions of Television Stations by Satellite
to Members of the Public.--No provision of section 111 of
this title or any other law (other than this section) shall
be construed to contain any authorization, exemption, or
license through which secondary transmissions by satellite
carriers for private home viewing of programming contained in
a primary transmission may be made without obtaining the
consent of the copyright owner.''.
SEC. 6. CONFORMING AMENDMENT.
The table of contents for chapter 1 of title 17, United
States Code, is amended by striking the item relating to
section 119 and inserting the following:
``119. Limitations on exclusive rights: Secondary transmissions by
satellite carriers.''.
SEC. 7. COPYRIGHT ROYALTY ADJUDICATION BOARD.
(a) Establishment and Functions.--Chapter 8 of title 17,
United States Code, is amended to read as follows:
``CHAPTER 8--COPYRIGHT ROYALTY ADJUDICATION BOARD
``Sec.
``801. Copyright Royalty Adjudication Board: establishment.
``802. Membership and qualifications of the Board.
``803. Selection of administrative copyright judges.
``804. Independence of the Board.
``805. Removal and sanction of administrative copyright judges.
``806. Functions.
``807. Factors for determining royalty fees.
``808. Institution of proceedings.
``809. Conduct of proceedings.
``810. Judicial review.
``811. Administrative matters.
``812. Rule of construction.
``Sec. 801. Copyright Royalty Adjudication Board:
establishment
``There is hereby established within the Copyright Office
the Copyright Royalty Adjudication Board (hereinafter
referred to in this chapter as the `Board').
``Sec. 802. Membership and qualifications of the Board
``(a) Membership.--
``(1) In general.--The Board shall consist of 1 full-time
chief administrative copyright judge, and such part-time
administrative copyright judges as the Librarian of Congress,
upon the recommendation of the Register of Copyrights, finds
necessary to conduct the business of the Board in a timely
manner. At no time shall the number of authorized
administrative copyright judges be less than 3 or more than
5.
``(2) Part-time administrative copyright judges.--Chapter
34 of title 5 shall not apply to a part-time administrative
copyright judge. For purposes of this subsection the
Librarian of Congress shall promulgate regulations relating
to part-time employment of administrative copyright judges.
``(b) Qualifications.--
``(1) Chief administrative copyright judge.--The chief
administrative copyright judge shall be an attorney with 10
or more years of legal practice with demonstrated experience
in administrative hearings or court trials and demonstrated
knowledge of copyright law.
``(2) Other administrative copyright judges.--Each
administrative copyright judge, other than the chief
administrative copyright judge, shall be an individual with
expertise in the business and economics of industries
affected by the actions taken by the Board to carry out its
functions.
``(c) Terms.--(1) The term of each administrative copyright
judge (including the chief administrative copyright judge)
shall be 5 years, except that, of the first administrative
copyright judges appointed, the Librarian of Congress, upon
the recommendation of the Register of Copyrights, shall
appoint all but one of them to lesser terms to establish a
staggering of terms such that in any calendar year no more
than one term is due to expire.
``(2) The term of each administrative copyright judge
(including the chief administrative copyright judge) shall
begin when the term of the predecessor of that member ends.
An individual appointed to fill the vacancy occurring before
the expiration of the term for which the predecessor of that
individual was appointed shall be appointed for the remainder
of that term. When the term of office of a member ends, the
member may continue to serve until a successor is selected.
``(d) Compensation.--The compensation of the administrative
copyright judges shall be governed solely by the provisions
of section 5376 of title 5 and such regulations as the
Librarian of Congress may adopt that are not inconsistent
with that section. The compensation of the administrative
copyright judges shall not be subject to any regulations
adopted by the Office of Personnel Management pursuant to its
authority under section 5376(b)(1) of title 5.
``Sec. 803. Selection of administrative copyright judges
``(a) Selection.--(1) The Librarian of Congress, upon the
recommendation of the Register of Copyrights, shall select
the administrative copyright judges (including the chief
administrative copyright judge) among individuals found
qualified under section 802(b) who meet the financial
conflict of interest under section 805(a). Notwithstanding
any other provision of law and at the discretion of the
Librarian, the Librarian shall determine the method of
selecting the members.
``(2) Administrative copyright judges previously selected
by the Librarian of Congress may be selected to serve
additional terms. There shall be no limit on the number of
terms any individual may serve.
``(b) Effect of Vacancy.--In no event shall a vacancy in
the Board impair the right of the remaining administrative
copyright judges to exercise all of the powers of the Board.
``Sec. 804. Independence of the Board
``(a) In General.--The Board shall have independence in
reaching its determinations concerning the adjustment of
copyright royalty rates, the distribution of copyright
royalties, the acceptance or rejection of royalty claims and
rate adjustment petitions, and such rulemaking functions as
are delegated to it under this title.
``(b) Performance Appraisals.--Notwithstanding any other
provision of law or any regulation of the Library of
Congress, no administrative copyright judge shall receive an
annual performance appraisal.
``(c) Inconsistent Duties Barred.--No administrative
copyright judge may be assigned duties inconsistent with his
or her duties and responsibilities as a administrative
copyright judge.
``Sec. 805. Removal and sanction of administrative copyright
judges
``(a) Standards of Conduct.--The Librarian of Congress,
upon the recommendation of the Register of Copyrights, shall
adopt regulations regarding the standards of conduct,
including financial conflict of interest and restrictions
against ex parte communications, which shall govern the
administrative copyright judges and the proceedings under
this chapter.
``(b) Removal or Sanction.--The Librarian of Congress, upon
the recommendation of the Register of Copyrights, may remove
or sanction an administrative copyright judge for violation
of the standards of conduct adopted under subsection (a),
misconduct, neglect of duty, or any disqualifying physical or
mental disability. Any such removal or sanction may be made
only after notice and opportunity for hearing, but the
Librarian of Congress, upon the recommendation of the
Register of Copyrights, may suspend the administrative
copyright judge during the pendency of such hearing.
``Sec. 806. Functions
``Subject to the provisions of this chapter, the functions
of the Board shall be--
``(1) to make determinations concerning the adjustment of
reasonable copyright royalty rates for--
[[Page S1453]]
``(A) secondary transmissions to the public by a cable
system of a primary transmission as provided in section 111;
``(B) the making and distributing of phonorecords by means
other than digital phonorecord delivery, as provided in
section 115;
``(C) secondary transmissions to the public by a satellite
carrier of a primary transmission made by a television
broadcast station and the Public Broadcasting Service
satellite feed as provided in section 119; and
``(D) each digital audio recording device imported into and
distributed in the United States or manufactured and
distributed into the United States as provided in section
1004;
``(2) to make determinations as to reasonable rates and
terms of royalty payments for--
``(A) the public performance of a sound recording by means
of a digital audio transmission as provided in section 114;
``(B) the making and distribution of phonorecords by means
of a digital phonorecord delivery as provided in section 115;
``(C) the public performance of nondramatic musical works
by means of coin-operated phonorecord players as provided in
section 116; and
``(D) the use of nondramatic musical works and pictorial,
graphic, and sculptural works by public broadcasting entities
as provided in section 118;
``(3) to accept or reject royalty claims filed under
sections 111, 119, and 1007, on the basis of timeliness or
the failure to establish the basis for a claim;
``(4) to determine, in cases where controversy exists, the
distribution of royalty fees deposited with the Register of
Copyrights under sections 111, 119, and 1003;
``(5) to determine the status of a digital audio recording
device or a digital audio interface device under sections
1002 and 1003, as provided in section 1010; and
``(6) to engage in such rulemaking as is expressly provided
in sections 111, 114, 115, 118, and 119.
``Sec. 807. Factors for determining royalty fees
``(a) For Cable Rates.--The rates applicable under section
111 shall be calculated solely in accordance with the
following provisions:
``(1) The rates established by section 111(d)(1)(B) may be
adjusted to reflect--
``(A) national monetary inflation or deflation, or
``(B) changes in the average rates charged cable
subscribers for the basic service of providing secondary
transmissions to maintain the real constant dollar level of
the royalty fee per subscriber which existed as of October
19, 1976, except that--
``(i) if the average rates charged cable system subscribers
for the basic service of providing secondary transmissions
are changed so that the average rates exceed national
monetary inflation, no change in the rates established by
section 111(d)(1)(B) shall be permitted; and
``(ii) no increase in the royalty fee shall be permitted
based on any reduction in the average number of distant
signal equivalents per subscriber.
The Board may consider all factors relating to the
maintenance of such level of payments including, as an
extenuating factor, whether the cable industry has been
restrained by subscriber rate regulating authorities from
increasing the rates for the basic service of providing
secondary transmissions.
``(2) In the event that the rules and regulations of the
Federal Communications Commission are amended at any time
after April 15, 1976, to permit the carriage by cable systems
of additional television broadcasting signals beyond the
local service area of the primary transmitters of such
signals, the royalty rates established by section
111(d)(1)(B) may be adjusted to insure that the rates for the
additional distant signal equivalents resulting from such
carriage are reasonable in light of the changes effected by
the amendment to such rules and regulations. In determining
the reasonableness of rates proposed following an amendment
of Federal Communications Commission rules and regulations,
the Board shall consider, among other factors, the economic
impact on copyright owners and users, except that no
adjustment in royalty rates shall be made under this
paragraph with respect to any distant signal equivalent or
fraction thereof represented by--
``(A) carriage of any signal permitted under the rules and
regulations of the Federal Communications Commission in
effect on April 15, 1976, or the carriage of a signal of the
same type (that is, independent, network, or noncommercial
educational) substituted for such permitted signal, or
``(B) a television broadcast signal first carried after
April 15 1976, pursuant to an individual waiver of the rules
and regulations of the Federal Communications Commission, as
such rules and regulations were in effect on April 15, 1976.
``(3) In the event of any change in the rules and
regulations of the Federal Communications Commission with
respect to syndicated and sport program exclusivity after
April 15, 1976, the rates established by section 111(d)(1)(B)
may be adjusted to assure that such rates are reasonable in
light of the changes to such rules and regulations, but any
such adjustment shall apply only to the affected television
broadcast signals carried on those systems affected by the
change.
``(4) The gross receipts limitations established by section
111(d)(1)(C) and (D) shall be adjusted to reflect national
monetary inflation or deflation or changes in the average
rates charged cable system subscribers for the basic service
of providing secondary transmissions to maintain the real
constant dollar value of the exemption provided by such
section, and the royalty rate specified therein shall not be
subject to adjustment.
``(b) For Rates Other Than Cable or Satellite Carriers.--
The rates applicable under sections 114, 115, and 116 shall
be calculated to achieve the following objectives:
``(1) To maximize the availability of creative works to the
public.
``(2) To afford the copyright owner a fair return for his
or her creative work and the copyright user a fair income
under existing economic conditions.
``(3) To reflect the relative roles of the copyright owner
and the copyright user in the product made available to the
public with respect to relative creative contribution,
technological contribution, capital investment, cost, risk,
and contribution to the opening of new markets for creative
expression and media for their communications.
``(4) To minimize any disruptive impact on the structure of
the industries involved and on generally prevailing industry
practices.
``(c) For Rates for Noncommercial Broadcasting.--The rates
applicable under section 118 shall be calculated to achieve
reasonable rates. In determining reasonable rates, the Board
shall base its decision so as to--
``(1) assure a fair return to copyright owners;
``(2) encourage the growth and development of public
broadcasting; and
``(3) encourage musical and artistic creation.
``(d) Rates for Satellite Carriers.--The rates applicable
under section 119 shall be calculated to represent most
clearly the fair market value of secondary transmissions. In
determining the fair market value, the Board shall base its
decision on economic, competitive, and programming
information presented by the parties, including--
``(1) the competitive environment in which such programming
is distributed, the cost for similar signals in similar
private and compulsory license marketplaces, and any special
features and conditions of the retransmission marketplace;
``(2) the economic impact of such fees on copyright owners
and satellite carriers; and
``(3) the impact on the continued availability of secondary
transmissions to the public.
``Sec. 808. Institution of proceedings
``(a) Petition Required To Institute Proceedings.--With
respect to proceedings concerning the adjustment of royalty
rates as provided in sections 111, 114, 115, 116, and 119,
during the calendar years or under the circumstances
specified in the schedule set forth in subsection (c), any
owner or user of a copyrighted work whose royalty rates are
to be established or adjusted by the Board may file a
petition with the Board declaring that the petitioner
requests an adjustment of the rate. The Board shall make a
determination as to whether the petitioner has a significant
interest in the royalty rate in which an adjustment is
requested. If the Board determines that the petitioner has a
significant interest, the Board shall cause notice of this
determination, with the reasons therefor, to be published in
the Federal Register, together with the notice of
commencement of proceedings under this chapter. With respect
to proceedings concerning the adjustment of royalty rates
under section 1004, any interested copyright party may
petition the Board as provided in that section.
``(b) Petition Not Required To Institute Proceedings.--With
respect to proceedings concerning the adjustment of royalty
rates as provided in section 118 and the distribution of
royalties as provided in section 111, 119, and 1007, no
petition is required to institute proceedings. All
proceedings concerning the adjustment of rates under section
118 shall commence as provided in section 118(c) of this
title. All proceedings concerning the distribution of
royalties under section 111, 119, or 1007 shall commence as
provided in such sections and in subsection (c)(8) of this
section.
``(c) Schedule of Proceedings.--
``(1) Section 111 proceedings.--In proceedings concerning
the adjustment of royalty rates as provided in section 111, a
petition described in subsection (a) may be filed during the
year 2000 and in each subsequent fifth calendar year, except
that in the event that the rules and regulations of the
Federal Communications Commission are amended with respect to
distant signal importation, or to syndicated and sports
program exclusivity, any owner or user of a copyrighted work
subject to the royalty rates established or adjusted pursuant
to section 111 may, within 12 months after such amendments
take effect, file a petition with the Board to institute
proceedings to insure that the rates are reasonable in light
of the changes to such rules and regulations. Any such
adjustments shall apply only to the affected television
broadcast signals carried on those systems affected by the
change. Any change in royalty rates made pursuant to this
subsection may be reconsidered in the year 2000, and each
fifth calendar year thereafter, as the case may be.
``(2) Section 114 proceedings.--In proceedings concerning
the adjustment of royalty rates and terms as provided in
section 114, the Board shall proceed when and as provided by
that section.
[[Page S1454]]
``(3) Section 115 proceedings.--In proceedings concerning
the adjustment of royalty rates and terms as provided in
section 115, a petition described in subsection (a) may be
filed in the year 2007 and in each subsequent tenth calendar
year or as prescribed in section 115(c)(3).
``(4) Section 116 proceedings.--(A) In proceedings
concerning the adjustment of royalty rates as provided in
section 116, a petition described in subsection (a) may be
filed at any time within 1 year after negotiated licenses
authorized by section 116 are terminated or expire or are not
replaced by subsequent agreements.
``(B) If a negotiated license authorized by section 116 is
terminated or expires and is not replaced by another such
license agreement which provides permission to use a quantity
of musical works not substantially smaller than the quantity
of such works performed on coin-operated phonorecord players
during the 1-year period ending March 1, 1989, the Board,
upon petition filed under subsection (a) within 1 year after
such termination or expiration, shall promptly establish an
interim royalty rate or rates for the public performance by
means of a coin-operated phonorecord player of nondramatic
musical works embodied in phonorecords which had been subject
to the terminated or expired negotiated license agreement.
Such rate or rates shall be the same as the last such rate or
rates and shall remain in force until the conclusion of the
proceedings to adjust the royalty rates applicable to such
works, or until superseded by a new negotiated license
agreement, as provided in section 116(b).
``(5) Section 118 proceedings.--In proceedings concerning
the adjustment of royalty rates and terms as provided in
section 118, the Board shall proceed when and as provided by
that section.
``(6) Section 119 proceedings.--In proceedings concerning
the adjustment of royalty rates governing secondary
transmissions of as provided in section 119, a petition
described in subsection (a) may be filed during the year 2001
and in each subsequent fifth calendar year.
``(7) Proceedings concerning distribution of royalty
fees.--In proceedings concerning the distribution of royalty
fees under section 111, 119, or 1007, the Board shall, upon a
determination that a controversy exists concerning such
distribution, cause to be published in the Federal Register
notice of commencement of proceedings under this chapter.
``Sec. 809. Conduct of proceedings
``(a) Board Proceedings.--The Board shall, for the purposes
of making its determinations in carrying out the functions
set forth in section 806, conduct proceedings subject to
subchapter II of chapter 5 of title 5.
``(b) Procedures.--Subject to the approval of the Register
of Copyrights, the Board, shall adopt regulations to govern
the conduct of the proceedings of the Board. The regulations
shall include, but not be limited to, provisions for--
``(1) public access to and inspection of the records of the
Board pursuant to section 706;
``(2) the right of the public to attend the proceedings of
the Board;
``(3) the procedures to apply when formal hearings are
conducted; and
``(4) the procedures to apply and the basis upon which
distribution or royalty controversies may be decided on the
basis of written pleadings.
``(c) Participation of Copyright Office.--During the
conduct of proceedings, the Register of Copyrights may file
formally with the Board the position of the Copyright Office
on any matter before the Board. Such filings shall be served
on all parties to the proceeding. The Board may accept or
reject the position of the Copyright Office.
``(d) Majority Rule.--The Board shall act in all procedural
and substantive matters on the basis of majority rule.
``(e) Number of Presiding Judges.--The Board shall decide,
in its discretion, whether 1 or 3 administrative copyright
judges shall preside in a royalty distribution or rate
adjustment proceeding. In no event shall the number of
presiding administrative copyright judges be more than 3.
``(f) Participation of Parties.--Any copyright owner who
has filed an acceptable claim claiming entitlement to the
distribution of royalties, or any copyright owner or user who
would be affected by a royalty rate to be established or
adjusted by the Board, may submit relevant information and
proposals to the Board in proceedings applicable to the
interest of the copyright owner or user.
``(g) Time Limits for Initial Decision.--Proceedings under
section 118 operate under the time limits established in that
section. For all other proceedings, if 1 administrative
copyright judge is presiding in a proceeding, the Board shall
issue its initial decision to the parties to the proceeding
and the Register of Copyrights within 6 months after the
declaration of a controversy in the proceeding. If more than
1 administrative copyright judge is presiding in a
proceeding, the Board shall issue its initial decision to the
parties to the proceeding and the Register of Copyrights
within 1 year after the declaration of a controversy in the
proceeding.
``(h) Requirements for Initial Decisions.--The initial
decision under subsection (g) shall include a statement of
findings and conclusions and the reasons or basis therefor,
on all the material issues of fact, law, or discretion
presented on the record. The initial decision shall take into
account prior decisions of the Copyright Royalty Tribunal,
prior decisions of copyright arbitration royalty panels, as
adopted or modified by the Librarian of Congress, and the
procedural and evidentiary rulings the Librarian of Congress
made that were applicable to the proceedings of the copyright
arbitration royalty panels. Notwithstanding any provision of
section 603 or 604 of title 5, neither the initial decision
nor the final decision is required to include a regulatory
flexibility analysis.
``(i) Petitions for Reconsideration and Final Agency
Action.--Any party to the proceeding concerned or the
Register of Copyrights may petition the Board to reconsider
its initial decision in the proceeding. If there are no
petitions for reconsideration, the initial decision becomes
the final decision of the Board without further proceedings.
If there are petitions for reconsideration, the Board shall
issue a final decision to the parties to the proceeding and
the Register of Copyrights which shall constitute final
agency action. The time period by which parties to the
proceeding or the Register of Copyrights may file a petition
for reconsideration and the time period by which the Board
shall render its final decision shall be established by
regulation by the Board, subject to the approval of the
Register of Copyrights.
``Sec. 810. Judicial review
``(a) Appeals.--Within 1 week after the Board issues a
final decision under section 809, or, if there are no
petitions for reconsideration, within 1 week after the time
the initial decision of the Board under section 809 becomes
the final decision, the Board shall cause to be published in
the Federal Register the decision of the rate adjustment or
the royalty distribution, as the case may be. Any aggrieved
party who would be bound by the final decision may appeal the
decision to the United States Court of Appeals for the
Federal Circuit within 30 days after the publication of the
decision in the Federal Register. In any appeal to which the
Board is a party, the chief administrative copyright judge
shall refer the conduct of the litigation in defense of the
Board's decision to the Department of Justice which shall
have the authority to represent the Board under section 516
of title 28. If no appeal is brought within such 30-day
period, the decision of the Board is final, and the royalty
fee or determination with respect to the distribution of
fees, as the case may be, shall take effect as set forth in
the decision. The pendency of an appeal under this subsection
shall not relieve persons who would be affected by the
determinations on appeal under section 111, 114, 115, 116,
118, 119, or 1003, of the obligation to deposit the statement
of account or to pay royalty fees specified in those
sections.
``(b) Review Subject to Chapter 7 of Title 5.--The judicial
review of the Board's final decision shall be had, in
accordance with chapter 7 of title 5, on the basis of the
record before the Board.
``Sec. 811. Administrative matters
``(a) Administrative Support.--The Library of Congress,
upon the recommendation of the Register of Copyrights, shall
provide the Board with the necessary administrative services
and personnel related to proceedings under this title.
``(b) Authority To Publish in Federal Register.--The
actions of the Board which may be published in the Federal
Register by and under the authority of the Board include--
``(1) actions of the Board required to be published in the
Federal Register under this title;
``(2) actions of the Board required to be published in the
Federal Register under regulations adopted by the Board upon
the approval of the Register of Copyrights; and
``(3) regulations of the Board required to be published in
the Federal Register to which the Board has been delegated
the exclusive right to adopt.
``(c) Collection and Use of Fees.--
``(1) Deduction of costs from fees.--The Librarian of
Congress and the Register of Copyrights may, to the extent
not otherwise provided under this title, deduct from the
royalty fees deposited or fees collected under this title the
reasonable costs incurred by the Library of Congress and the
Copyright Office under this chapter. Such deduction may be
made before the fees are distributed to any copyright owner.
``(2) Collection of fees.--The Register of Copyrights may
impose and collect fees in advance to carry out the
ratemaking proceedings. All fees received under this section
shall be deposited by the Register of Copyrights in the
Treasury of the United States and shall be credited to the
appropriations for necessary expenses of the Copyright
Office. Such fees that are collected shall remain available
until expended. The Register may refund any sum paid by
mistake or in excess of the fee required under this section.
``(d) Positions Required for Administration of Compulsory
Licensing.--Section 307 of the Legislative Branch
Appropriations Act of 1994 shall not apply to the members of
the Board, employee positions in the Board, or employee
positions in the Library of Congress that are required to be
filled in order to carry out section 111, 114, 115, 116, 118,
or 119 or chapter 10.
``(e) Budget.--In each annual request for appropriations,
the Register of Copyrights shall identify the portion thereof
intended for the support of the Board and a statement
[[Page S1455]]
which shall include an assessment of the budgetary needs of
the Board.
``(f) Annual Report.--The Board shall prepare an annual
report of its work and accomplishments during each fiscal
year, which the Register of Copyrights shall include in the
annual report required under section 701(c).
``Sec. 812. Rule of construction
``Nothing in this chapter shall be construed to affect the
authority of the Register of Copyrights to establish
regulations under sections 701 and 702.''.
(b) Technical and Conforming Amendments.--
(1) Table of chapters.--The item relating to chapter 8 in
the table of chapters for title 17, United States Code, is
amended to read as follows:
``8. Copyright Royalty Adjudication Board....................801''.....
(2) Jurisdiction of federal circuit.--Section 1295(a) of
title 28, United States Code, is amended--
(A) in paragraph (13) by striking ``and'' after the
semicolon;
(B) in paragraph (14) by striking the period and inserting
a semicolon and ``and ''; and
(C) by adding at the end the following new paragraph:
``(15) of an appeal from a final decision of the Copyright
Royalty Adjudication Board under sections 809(i) and 810 of
title 17.''.
SEC. 8. TRANSITION PROVISIONS.
(a) Transitional Procedures.--During the period beginning
on the date of the enactment of this Act and ending on the
effective date of this Act, the Register of Copyrights shall
adopt regulations to govern proceedings under chapter 8 of
title 17, United States Code, as amended by section 7 of this
Act. Such regulations shall remain in effect unless and until
the Copyright Royalty Adjudication Board, upon the approval
of the Register of Copyrights, adopts supplemental or
superseding regulations pursuant to section 809(b) of title
17, United States Code.
(b) Proceedings in Progress.--
(1) Copyright arbitration royalty panel proceedings.--
Unless the Register of Copyrights, for good cause, finds
otherwise, proceedings in which a copyright arbitration
royalty panel has been convened by the Librarian of Congress
under chapter 8 of title 17, United States Code, as in effect
before the effective date of this Act, shall continue in
effect and shall be governed under chapter 8 of such title,
and applicable regulations, as in effect prior to such
effective date, and proceedings in which a copyright
arbitration royalty panel has not been convened by the
Librarian of Congress under chapter 8 of title 17, United
States Code, before the effective date of this Act shall be
suspended and recommenced under the amendments made by
section 7.
(2) Continued proceedings.--For those proceedings continued
under paragraph (1), the functions of the Librarian of
Congress and the Register of Copyrights relating to the
report of the copyright arbitration royalty panel under title
17, United States Code, as in effect before the effective
date of this Act, may, in the Librarian's discretion, upon
the recommendation of the Register of Copyrights, be
delegated to the Copyright Royalty Adjudication Board, when
constituted.
(3) Appeals.--In any appeal of a decision of the Librarian
of Congress adopting or rejecting a determination of a
copyright arbitration royalty panel which is pending in the
United States Court of Appeals for the District of Columbia
Circuit on or after the effective date of this Act, if such
case is remanded by the court, the Librarian of Congress
shall not reconvene the copyright arbitration royalty panel
which rendered the determination, but shall direct the
Copyright Royalty Adjudication Board, when constituted, to
conduct proceedings in accordance with the directions of the
court. If the case is remanded by the court after the
enactment date of this Act but before the effective date of
this Act, the Librarian of Congress shall have the discretion
to reconvene the copyright arbitration royalty panel which
rendered the determination, or direct the Copyright Royalty
Adjudication Board when constituted, to conduct proceedings
in accordance with the directions of the court.
(c) Effectiveness of Existing Rates and Distributions.--All
royalty rates and all determinations with respect to the
proportionate division of compulsory license fees among
copyright claimants, whether made by the Copyright Royalty
Tribunal, copyright arbitration royalty panels, or by
voluntary agreement, before the effective date of this Act,
shall remain in effect until modified by voluntary agreement
or pursuant to the amendments made by this Act.
(d) Transfer of Appropriations.--All unexpended balances of
appropriations made by the Copyright Office for the support
of the copyright arbitration royalty panels, as of the
effective date of this Act, are transferred on such effective
date to the support of the Copyright Royalty Arbitration
Board for the purposes for which such appropriations were
made except that, in the event that any copyright arbitration
royalty panels continue to operate after the effective date
of this Act, the Register of Copyrights shall retain such
portions of the unexpended balances of appropriations as are
necessary to support the continuing copyright arbitration
royalty panels.
SEC. 9. AMENDMENTS TO OTHER PROVISIONS OF TITLE 17, UNITED
STATES CODE.
(a) Secondary Transmissions by Cable Systems.--Section
111(d) of title 17, United States Code, is amended--
(1) in paragraph (2) in the last sentence by striking
``Librarian of Congress'' and all that follows through the
end of the sentence and inserting the following: ``Copyright
Royalty Adjudication Board as provided in this title. The
Register of Copyrights may, 4 or more years after the close
of any calendar year, close out the account for royalty
payments made for that calendar year, and may treat any funds
remaining the such account and any subsequent deposits that
would otherwise be attributable to that calendar year as
attributable to the succeeding calendar year.''; and
(2) in paragraph (4)--
(A) in subparagraph (A)--
(i) by striking ``Librarian of Congress'' the first place
it appears and inserting ``Copyright Royalty Adjudication
Board''; and
(ii) by striking ``Librarian of Congress'' the second place
it appears and inserting ``Board'';
(B) in subparagraph (B)--
(i) by striking ``Librarian of Congress shall, upon the
recommendation of the Register of Copyrights'' and inserting
``Copyright Royalty Adjudication Board shall'';
(ii) by striking ``Librarian'' each subsequent place it
appears and inserting ``Board''; and
(iii) in the last sentence by striking ``convene a
copyright royalty arbitration panel'' and inserting ``conduct
a proceeding''; and
(C) in subparagraph (C)--
(i) by striking ``Librarian of Congress'' and inserting
``Copyright Royalty Adjudication Board''; and
(ii) by adding at the end the following: ``The action of
the Board to distribute royalty fees may precede the
declaration of a controversy if all parties to the proceeding
file a petition with the Board requesting such distribution,
except that such amount may not exceed 50 percent of the
amounts on hand at the time of the request.''.
(b) Scope of Exclusive Rights in Sound Recordings.--Section
114(f) of title 17, United States Code, is amended--
(1) in paragraph (1)--
(A) by amending the first sentence to read as follows:
``During the first week of January, 2000, the Copyright
Royalty Adjudication Board shall cause notice to be published
in the Federal Register of the initiation of voluntary
negotiation proceedings for the purpose of determining or
adjusting reasonable terms and rates of royalty payments for
the activities specified in subsection (d)(2) of this
section.''; and
(B) in the third sentence by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Adjudication
Board'';
(2) by striking paragraphs (2), (3), and (4) and inserting
the following:
``(2) In the absence of license agreements negotiated under
paragraph (1), during the 60-day period beginning 6 months
after publication of the notice specified in paragraph (1),
and upon the filing of a petition in accordance with section
808(a), the Copyright Royalty Adjudication Board shall,
pursuant to chapter 8, conduct a proceeding to determine and
publish in the Federal Register a schedule of rates and
terms. In addition to the objectives set forth in section
807(a) in establishing or adjusting such rates and terms, the
Board may consider the rates and terms for comparable types
of digital audio transmission services and comparable
circumstances under voluntary license agreements negotiated
as provided in paragraph (1). The Copyright Royalty
Adjudication Board, upon the approval of the Register of
Copyrights, shall also establish requirements by which
copyright owners may receive reasonable notice of the use of
their sound recordings under this section, and under which
records of such use shall be kept and made available by
entities performing sound recordings.
``(3) License agreements voluntarily negotiated at any time
between 1 or more copyright owners of sound recordings and 1
or more entities performing sound recordings shall be given
effect in lieu of any determination by the Copyright Royalty
Adjudication Board.
``(4) Publication of a notice of the initiation of
voluntary negotiation proceedings as specified in paragraph
(1) and the procedures specified in paragraph (2) shall be
repeated, in accordance with regulations that the Copyright
Royalty Adjudication Board, upon the approval of the Register
of Copyrights, shall prescribe--
``(A) no later than 30 days after a petition is filed by
any copyright owners of sound recordings or any entities
performing sound recordings affected by this section
indicating that a new type of digital audio transmission
service on which sound recordings are performed is or is
about to become operational; and
``(B) during the first week of January 2005 and at 5-year
intervals thereafter.''; and
(3) in paragraph (5)(A)(i) by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Adjudication
Board, upon the approval of the Register of Copyrights,''.
(c) Compulsory License for Making and Distributing
Phonorecords.--Section 115(c)(3) of title 17, United States
Code, is amended--
(1) in subparagraph (C)--
(A) by amending the first sentence to read as follows: ``At
the times established in subparagraph (F), the Copyright
Royalty Adjudication Board shall cause notice to be published
in the Federal Register of the initiation of voluntary
negotiation proceedings
[[Page S1456]]
for the purpose of determining reasonable terms and rates of
royalty payments for the activities specified in subparagraph
(A) until the effective date of any new terms and rates
established pursuant to this subparagraph or subparagraph (D)
or (F), or such other date (regarding digital phonorecord
deliveries) as the parties may agree.'';
(B) in the third sentence by striking ``Librarian of
Congress'' and inserting ``Copyright Royalty Adjudication
Board'';
(2) by amending subparagraph (D) to read as follows:
``(D) In the absence of license agreements negotiated under
subparagraphs (B) and (C), upon the filing of a petition in
accordance with section 808(a), the Copyright Royalty
Adjudication Board shall, pursuant to chapter 8, conduct a
proceeding to determine and publish in the Federal Register a
schedule of rates and terms. Such rates and terms shall
distinguish between--
``(i) digital phonorecord deliveries where the reproduction
or distribution of a phonorecord is incidental to the
transmission which constitute the digital phonorecord
delivery, and
``(ii) digital phonorecord deliveries in general.
In addition to the objectives set forth in section 807(a),
in establishing or adjusting rates and terms, the Board may
consider rates and terms under voluntary license agreements
negotiated as provided in subparagraphs (B) and (C). The
Board, upon the approval of the Register of Copyrights, shall
also establish requirements by which copyright owners may
receive reasonable notice of the use of their works under
this section, and under which records of such use shall be
kept and made available by persons making digital phonorecord
deliveries.'';
(3) in subparagraph (E)(i) in the first sentence by
striking ``Librarian of Congress'' and inserting ``Copyright
Royalty Adjudication Board''; and
(4) in subparagraph (F) by striking ``Librarian of
Congress'' and inserting `` Copyright Royalty Adjudication
Board, upon the approval of the Register of Copyrights,''.
(d) Negotiated Licenses for Public Performances by Means of
Coin-Operated Phonorecord Players.--Section 116 of title 17,
United States Code, is amended--
(1) by amending subsection (b)(2) to read as follows:
``(2) Rate adjustment proceeding.--Parties not subject to
such a negotiation may determine, by a rate adjustment
proceeding in accordance with the provisions of chapter 8,
the terms and rates and the division of fees described in
paragraph (1).''; and
(2) in subsection (c)--
(A) in the subsection heading by striking ``Copyright
Royalty Arbitration Panel'' and inserting ``Copyright Royalty
Adjudication Board''; and
(B) by striking ``a copyright arbitration royalty panel and
inserting ``the Copyright Royalty Adjudication Board''.
(e) Use of Certain Works in Connection With Noncommercial
Broadcasting.--Section 118 of title 17, United States Code,
is amended--
(1) in subsection (b)--
(A) by striking paragraph (1) and redesignating paragraphs
(2) and (3) as paragraphs (1) and (2), respectively;
(B) in paragraph (1), as so redesignated, by striking
``Librarian of Congress'' and inserting ``Copyright Royalty
Adjudication Board'';
(C) in paragraph (2), as so redesignated--
(i) by striking ``paragraph (2)'' each place it appears and
inserting ``paragraph (1)'';
(ii) by striking ``Librarian of Congress'' the first place
it appears and inserting ``Copyright Royalty Adjudication
Board'';
(iii) by striking ``Librarian of Congress'' the second and
third places it appears and inserting ``Board''; and
(iv) by striking ``Librarian of Congress'' the last place
it appears and inserting ``Board, upon the approval of the
Register of Copyrights,'';
(2) in subsection (c)--
(A) by striking ``1997'' and inserting ``2002''; and
(B) by striking ``Librarian of Congress'' and inserting
``Copyright Royalty Adjudication Board, upon the approval of
the Register of Copyrights,'';
(3) in subsection (d)--
(A) by striking ``(b)(2)'' and inserting ``(b)(1)''; and
(B) by striking ``a copyright arbitration royalty panel
under subsection (b)(3)'' and inserting ``the Copyright
Royalty Adjudication Board under subsection (b)(2)''; and
(4) in subsection (e), by striking paragraphs (1) and (2).
(f) Digital Audio Recording Devices and Media.--
(1) Royalty payments.--Section 1004(a)(3) of title 17,
United States Code, is amended in the third sentence--
(A) by striking ``the 6th year after the effective date of
this chapter'' and inserting ``1998'';
(B) by striking ``Librarian of Congress'' the first place
it appears and inserting ``Copyright Royalty Adjudication
Board''; and
(C) by striking ``Librarian of Congress'' the second place
it appears and inserting ``Board''.
(2) Entitlement to royalty payments.--Section 1006(c) of
title 17, United States Code, is amended by striking
``Librarian of Congress shall convene a copyright arbitration
royalty panel which'' and inserting ``Copyright Royalty
Adjudication Board''.
(3) Procedures for distributing royalty payments.--Section
1007 of title 17, United States Code, is amended--
(A) in subsection (a)(1)--
(i) by striking ``after the calendar year in which this
chapter takes effect'';
(ii) by striking ``Librarian of Congress'' the first place
it appears and inserting ``Copyright Royalty Adjudication
Board''; and
(iii) by striking ``Librarian of Congress'' the second
place it appears and inserting ``Board'';
(B) in subsection (b)--
(i) by amending the first sentence to read as follows:
``After the first day of March of each year, the Copyright
Royalty Adjudication Board shall determine whether there
exists a controversy concerning the distribution of royalty
payments under section 1006(c).''; and
(ii) by striking ``Librarian of Congress'' each place it
appears and inserting ``Board''; and
(C) in subsection (c)--
(i) by amending the first sentence to read as follows: ``If
the Copyright Royalty Adjudication Board finds the existence
of a controversy, the Board shall, pursuant to chapter 8 of
this title, conduct a proceeding to determine the
distribution of royalty payments.'';
(ii) by striking ``Librarian of Congress'' each place it
appears and inserting ``Board''; and
(iii) by striking ``Librarian under this section'' and
inserting ``Board under this section. The action of the Board
to distribute royalty fees may precede the declaration of a
controversy if all parties to the proceeding file a petition
with the Board requesting such distribution, except that such
amount may not exceed 50 percent of the amounts on hand at
the time of the request.''.
(4) Adjudication of certain disputes.--Section 1010 of
title 17, United States Code, is amended--
(A) by amending the section heading to read as follows:
``Sec. 1010. Adjudication of certain disputes'';
(B) in subsection (a)--
(i) in the subsection heading by striking ``Arbitration''
and inserting ``Adjudication''; and
(ii) by striking ``mutually agree to binding arbitration
for the purpose of determining'' and inserting ``petition the
Copyright Royalty Adjudication Board to determine'';
(C) by striking subsection (b) and redesignating
subsections (c) and (d) as subsections (b) and (c),
respectively;
(D) in subsection (b), as so redesignated, by striking
``arbitration'' each place it appears and inserting
``adjudication'';
(E) by amending subsection (c), as so redesignated, to read
as follows:
``(c) Adjudication Proceeding.--The Copyright Royalty
Adjudication Board shall conduct an adjudication proceeding
with respect to the matter concerned, pursuant to chapter 8
of this title. The parties to the proceeding shall bear the
entire costs thereof in such manner and proportion as the
Board shall direct.''; and
(F) by striking subsections (e), (f), and (g).
SEC. 10. TECHNICAL AMENDMENTS.
(a) Clerical Amendment to Chapter 10 of Title 17, United
States Code.--The item relating to section 1010 in the table
of contents for chapter 10 of title 17, United States Code,
is amended to read as follows:
``1010. Adjudication of certain disputes.''.
(b) Clerical Amendment to Chapter 9 of Title 17, United
States Code.--The item relating to section 903 in the table
of contents for chapter 9 of title 17, United States Code, is
amended to read as follows:
``903. Ownership, transfer, licensing, and recordation.''.
(c) Clerical Amendment to Table of Chapters.--The item
relating to chapter 6 in the table of chapters for title 17,
United States Code, is amended to read as follows:
``6. Manufacturing Requirements and Importation..............601''.....
SEC. 11. RETRANSMISSION CONSENT.
Section 325(b) of the Communications Act of 1934 (47 U.S.C.
325(b)) is amended--
(1) by striking paragraphs (1) and (2) and inserting the
following:
``(b)(1) No cable system or other multichannel video
programming distributor shall retransmit the signal of a
broadcasting station, or any part thereof, except--
``(A) with the express authority of the station;
``(B) pursuant to section 614, in the case of a station
electing, in accordance with this subsection, to assert the
right to carriage under such section; or
``(C) pursuant to section 337, in the case of a station
electing, in accordance with this subsection, to assert the
right to carriage under such section.
``(2) The provisions of this subsection shall not apply
to--
``(A) retransmission of the signal of a noncommercial
broadcasting station;
``(B) retransmission of the signal of a superstation by a
satellite carrier to subscribers for private home viewing if
the originating station was a superstation on January 1,
1998;
``(C) retransmission of the signal of a broadcasting
station that is owned or operated by, or affiliated with, a
broadcasting network directly to a home satellite antenna, if
the household receiving the signal is located in an area in
which such station
[[Page S1457]]
may not assert its rights not to have its signal duplicated
under the Commission's network nonduplication regulations; or
``(D) retransmission by a cable operator or other
multichannel video programming distributor of the signal of a
superstation if such signal was obtained from a satellite
carrier and the originating station was a superstation on
January 1, 1998.'';
(2) by adding at the end of paragraph (3) the following new
subparagraph:
``(C) Within 45 days after the effective date of the
Copyright Compulsory License Improvement Act, the Commission
shall commence a rulemaking proceeding to revise the
regulations governing the exercise by television broadcast
stations of the right to grant retransmission consent under
this subsection, and such other regulations as are necessary
to administer the limitation contained in paragraph (2). Such
regulations shall establish election time periods that
correspond with those regulations adopted under subparagraph
(B). The rulemaking shall be completed within 180 days after
the effective date of the Copyright Compulsory License
Improvement Act.''; and
(3) by adding at the end the following new paragraph:
``(7) For purposes of this subsection:
``(A) The term `superstation' means a television broadcast
station, other than a network station, licensed by the
Commission that is secondarily transmitted by a satellite
carrier.
``(B) The term `satellite carrier' has the meaning given
that term in section 119(d) of title 17, United States
Code.''.
SEC. 12. MUST-CARRY FOR SATELLITE CARRIERS RETRANSMITTING
TELEVISION BROADCAST SIGNALS.
Title III of the Communications Act of 1934 is amended by
inserting after section 336 the following new section:
``SEC. 337. CARRIAGE OF LOCAL TELEVISION SIGNALS BY SATELLITE
CARRIERS.
``(a) Carriage Obligations.--Each satellite carrier
providing direct to home service of a network station to
subscribers located within the local market of such station
shall offer to carry all television broadcast stations
located within that local market, subject to section 325(b).
Carriage of additional television broadcast stations within
the local market shall be at the discretion of the satellite
carrier, subject to section 325(b).
``(b) Duplication Not Required.--Notwithstanding subsection
(a), a satellite carrier shall not be required to offer to
carry the signal of any local television broadcast station
that substantially duplicates the signal of another local
television broadcast station which is secondarily transmitted
by the satellite carrier, or to offer to carry the signals of
more that one local television broadcast station affiliated
with a particular broadcast network (as the term is defined
by regulation).
``(c) Channel Positioning.--Each signal carried in
fulfillment of the carriage obligations of a satellite
carrier under this section shall be carried on the satellite
carrier channel number on which the local television
broadcast station is broadcast over the air, or on the
channel on which it was broadcast on January 1, 1985, or on
the channel it was broadcast on January 1, 1998, at the
election of the station, or on such other channel number as
is mutually agreed upon by the station and the satellite
carrier. Any dispute regarding the positioning of local
television broadcast stations shall be resolved by the
Commission.
``(d) Compensation for Carriage.--A satellite carrier shall
not accept or request monetary payment or other valuable
consideration in exchange either for carriage of local
television broadcast stations in fulfillment of the
requirements of this section or for channel positioning
rights provided to such stations under this section, except
that any such station may be required to bear the costs
associated with delivering a good quality signal to the
principal headend of the satellite carrier.
``(e) Remedies.--
``(1) Complaints by broadcast stations.--Whenever a local
television broadcast station believes that a satellite
carrier has failed to meet its obligations under this
section, such station shall notify the carrier, in writing,
of the alleged failure and identify its reasons for believing
that the satellite carrier is obligated to offer to carry the
signal of such station or has otherwise failed to comply with
the channel positioning or repositioning or other
requirements of this section. The satellite carrier shall,
within 30 days of such written notification, respond in
writing to such notification and either commence to carry the
signal of such station in accordance with the terms requested
or state its reasons for believing that it is not obligated
to carry such signal or is in compliance with the channel
positioning and repositioning or other requirements of this
section. A local television broadcast station that is denied
carriage or channel positioning or repositioning in
accordance with this section by a satellite carrier may
obtain review of such denial by filing a complaint with the
Commission. Such complaint shall allege the manner in which
such satellite carrier has failed to meet its obligations and
the basis for such allegations.
``(2) Opportunity to respond.--The Commission shall afford
such satellite carrier and opportunity to present data and
arguments to establish that there has been no failure to meet
its obligations under this section.
``(3) Remedial actions; dismissal.--Within 120 days after
the date a complaint is filed, the Commission shall determine
whether the satellite carrier has met its obligations under
this section. If the Commission determines that the satellite
carrier has failed to meet such obligations, the Commission
shall order the satellite carrier to reposition the
complaining station or, in the case of an obligation to carry
a station, to commence carriage of the station and to
continue such carriage for at least 12 months. If the
Commission determines that the satellite carrier has fully
met the requirements of this section, it shall dismiss the
complaint.
``(f) Regulations by Commission.--Within 180 days after the
effective of this section, the Commission shall, following a
rulemaking proceeding, issue regulations implementing the
requirements imposed by this section.
``(g) Definitions.--As used in this section:
``(1) Television broadcast station.--The term `television
broadcast station' means a full-power television broadcast
station, and does not include a low-power or translator
television broadcast station.
``(2) Local market.--The term `local market' means the
designated market area in which a station is located and--
``(A) for a commercial television broadcast station located
in any of the 150 largest designated market areas, all
commercial television broadcast stations licensed to a
community within the same designated market area are within
the same local market;
``(B) for a commercial television broadcast station that is
located in a designated market area that is not one of the
150 largest, the local market includes, in addition to all
commercial television broadcast stations licensed to a
community within the same designated market area, any station
that is significantly viewed, as such term is defined in
section 76.54 of the Commission's regulations (47 C.F.R.
76.54); and
``(C) for a noncommercial educational television broadcast
station, the local market includes any station that is
licensed to a community within the same designated market
area as the noncommercial educational television broadcast
station.
``(3) Designated market area.--The term `designated market
area' means a designated market area, as determined by the
Nielsen Media Research and published in the DMA Market and
Demographic Report.''.
SEC. 13. NETWORK NONDUPLICATION; SYNDICATED EXCLUSIVITY AND
SPORTS BLACKOUT.
(a) Regulations.--
(1) In general.--Within 45 days after the effective date of
this Act, the Federal Communications Commission shall
commence a rulemaking to establish regulations that apply
network nonduplication protection, syndicated exclusivity
protection, and sports blackout protection to the
retransmission of broadcast signals by satellite carriers to
subscribers for private home viewing. To the extent possible,
such regulations shall, subject to paragraph (2), include the
same level of protection accorded retransmissions of
television broadcast signals by cable systems for network
nonduplication (47 C.F.R. 76.92), syndicated exclusivity (47
C.F.R. 151), and sports blackout (47 C.F.R. 76.67).
(2) Network nonduplication.--The network nonduplication
regulations required under paragraph (1) shall allow a
television broadcast station in any local market to assert
nonduplication rights--
(A) against a satellite carrier throughout such local
market if that satellite carrier retransmits to subscribers
for private home viewing in such local market the signal of
another television broadcast station located within such
local market; or
(B) against all satellite carriers within the zone in which
the television broadcast station may be received over-the-
air, using conventional consumer television receiving
equipment, as determined under regulations prescribed by the
Federal Communications Commission, but such zone shall not
extend beyond such local market of such station.
(3) Local market defined.--The term ``local market'' has
the meaning provided in section 337(g) of the Communications
Act of 1934, as added by section 12 of this Act.
(b) Deferred Applicability of Amendments to Section 119 of
Title 17, United States Code.--Notwithstanding the amendments
to section 119 of title 17, United States Code, made by this
Act, until the regulations regarding network nonduplication
protection are established under subsection (a), the
statutory license under subsection (a) of such section 119
for secondary transmissions of primary transmissions of
programming contained in a primary transmission made by a
network station (as defined in section 119(d) of title 17,
United States Code, as in effect on the day before the
effective date of this Act) shall be limited to secondary
transmissions to persons who reside in unserved households
(as defined in section 119(d) of title 17, United States
Code, as in effect on the day before the effective date of
this Act).
SEC. 14. EFFECTIVE DATE.
This Act and the amendments made by this Act shall take
effect on January 1, 1999.
____
Section by Section Analysis of the Copyright Compulsory License
Improvement Act
section 1
The title of the bill is the ``Copyright Compulsory License
Improvement Act.''
section 2
Section 2 of the bill amends the section 119 satellite
carrier compulsory license of the
[[Page S1458]]
Copyright Act to create a statutory licensing scheme that
permits satellite carriers to provide their subscribers with
local and distant television broadcast signals, as well as
the national satellite feed of the Public Broadcasting
Service. Satellite carriers may retransmit any television
broadcast signals to subscribers for private home viewing,
provided that such retransmissions are in compliance with the
rules and regulations of the Federal Communications
Commission. Such compliance would include syndicated
exclusivity, sports blackout and network nonduplication
protection for broadcasters, as required by section 13 of the
bill.
Section 2 requires satellite carriers to provide initial
and updated lists to local television stations identifying
subscribers in the local television station's area who
receive satellite service and the names of the network
stations provided to those subscribers. This will allow
television stations to preserve their network nonduplication
rights provided in section 13 of the bill.
Section 2 prohibits satellite carriers from willfully
altering the programming contained on television broadcast
signals and the PBS national satellite feed that the carriers
retransmit. In addition, satellite carriers are prohibited
from unlawfully discriminating against a distributor of
satellite retransmitted broadcast programming, and any such
unlawful discrimination constitutes an act of copyright
infringement subject to the penalties of chapter 5 of the
Copyright Act. It is also copyright infringement for a
satellite carrier to fail to submit a statement of account
and royalty fee necessary to obtain the satellite compulsory
license.
section 3
Section 3 of the bill creates the terms and conditions of
the satellite compulsory license. Carriers must submit a
statement of account and royalty fee to the Copyright Office
on a semiannual basis for subsequent distribution to
copyright owners. The royalty fee for retransmission of
distant television broadcast stations, and the PBS national
feed, is the royalty fee in effect on date of enactment of
the bill for retransmission of distant television broadcast
signals. There is no royalty fee for television broadcast
signals that are retransmitted to subscribers who reside
within the local markets of such signals.
The remainder of section 3 continues the provisions of the
existing law by prescribing how the royalty fees are
collected and maintained for distribution, and how copyright
owners of works contained on retransmitted television
broadcast signals and the PBS national feed may claim
royalties.
section 4
Section 4 of the bill contains definitions of terms used in
the section 119 compulsory license. Most of the definitions
in the existing law are carried forward. New provisions
include a definition of ``designated market area'' and
``local market'' for determining royalty-free local
retransmissions of broadcast signals, and a definition of the
new PBS national feed.
section 5
Section 5 of the bill carries forward the provision of
existing law maintaining exclusivity of the satellite license
with the cable compulsory license of the Copyright Act, found
at 16 U.S.C. 111. That is, a satellite carrier making
secondary transmissions of television broadcast signals, and
the PBS national feed, for private home viewing may only do
so under the terms of the section 119 license, and may not
invoke the terms of the section 111 cable license.
section 6
Section 6 of the bill contains a conforming amendment
amending the table of contents of chapter 1 of the Copyright
Act.
section 7
Section 7 of the bill completely revises chapter 8 of the
Copyright Act, replacing the current Copyright Arbitration
Royalty Panels with a Copyright Royalty Adjudication Board.
New section 801 of the Copyright Act establishes the
Copyright Royalty Adjudication Board within the U.S.
Copyright Office.
New section 802 of the Copyright Act establishes the
membership and qualifications of the Board. New section
802(a) establishes that the Board should be comprised of one
full-time Chief Administrative Copyright Judge and at least
two part-time Administrative Copyright Judges. It is left up
to the discretion of the Librarian of Congress, upon the
recommendation of the Register of Copyrights, to determine
how many other part-time Administrative Copyright Judges the
Board shall have. The determination should be based on how
many judges the Board will need to conduct its business in a
timely manner.
New section 802(b) requires that the Chief Administrative
Copyright Judge be an attorney with ten or more years of
legal practice and have experience either in administrative
hearings or court trials, and a demonstrated knowledge of
copyright law. Other Administrative Copyright Judges must
possess expertise in the business and economics of industries
affected by the actions the Board takes.
New section 802(c) provides that the term of the Board
members shall be five years on a staggered basis so that no
more than one term is due to expire in any one year. To
achieve this, the Librarian of Congress, upon the
recommendation of the Register of Copyrights, shall appoint
some of the initial Board members to shorter than five year
terms.
New section 802(d) provides compensation for the members of
the Board at the Senior Level in accordance with the
provisions of 5 U.S.C. Sec. 5376.
New Section 803 of the Copyright Act provides for selection
of the members of the Board. New section 803(a) provides that
the Librarian of Congress, upon the recommendation of the
Register of Copyrights, selects the members of the Board. The
Librarian may only select those persons found qualified under
section 802(b) and found to meet the financial conflict of
interest standards adopted under section 805(a). The
Librarian may reselect, without limit, members of the Board
to additional terms. Section 803(b) provides that actions
taken by the Board during those times will be valid,
notwithstanding any temporary vacancy.
New section 804 of the Copyright Act provides for the
independence of the Board. New section 804(a) provides that
the Board shall have decisional independence on the
substantive matters before it. Board members are neither to
receive performance appraisals nor are they to be assigned
duties inconsistent with their duties and responsibilities as
members of the Board.
New section 805 of the Copyright Act provides for removal
and sanction of the members of the Board. New section 805(a)
provides that the Register of Copyrights shall adopt
regulations regarding the standards of conduct that members
of the Board are expected to maintain. The Register is
specifically instructed to adopt regulations concerning
financial conflict of interest and ex parte communications.
New section 805(b) provides that the Librarian, upon the
recommendation of the Register of Copyrights, may remove or
sanction a member of the Board, upon notice and opportunity
for hearing, for violation of any of the standards of conduct
adopted under section 804(a). In addition, the Librarian may
also remove or sanction for misconduct, neglect of duty, or
any disqualifying physical or mental disability.
New section 806 of the Copyright Act provides for the
functions of the Board. New section 806(a) enumerates the
rate setting, royalty distribution, and rulemaking functions
that are delegated to the Board. The Board determines the
rates for: cable retransmission of broadcast signals, the
making and distributing of phonorecords by means other than
digital phonorecord delivery, satellite carrier
retransmission of broadcast signals, and the importing and
distributing or manufacturing and distributing of digital
audio recording devices.
The Board determines the rate and terms for: the public
performance of a sound recording by means of a digital audio
transmission; the making and distributing of phonorecords by
means of a digital phonorecord delivery; the public
performance of music on jukeboxes; the use of music and
visual works by public broadcasting entities; and the
transmission to the public by a satellite carrier of a
primary transmission of a public telecommunications signal.
The Board accepts or rejects claims filed by copyright
owners to royalties deposited with the Copyright Office in
the cable fund, the satellite carrier fund, and the digital
audio recording fund. Then, for those claims that the Board
accepts, the Board determines how much each claimant should
receive from those funds.
The Board has jurisdiction to decide, when petitioned, if a
particular digital audio recording device or digital audio
recording interface device is subject to the provisions of
chapter 10 for paying a royalty on the distribution of such
devices.
The Board also has certain rulemaking authority, some of
which is upon the approval of the Register of Copyrights,
concerning the filing of claims, the notice and recordkeeping
requirements pertaining to some of the compulsory licenses,
and the Board's own procedures.
New section 806(b) provides that the creation of the
Copyright Royalty Adjudication Board does not diminish the
authority of the Register of Copyrights to establish
regulations interpreting the provisions and terms of the
Copyright Act.
New section 807 of the Copyright Act sets out the factors
for determining the royalty fees for the section 114, 115,
116, 118 and 119 compulsory licenses of the Copyright Act.
The section also lists the factors that the Board shall take
into account when determining or adjusting royalty rates.
New section 808 of the Copyright Act provides for the
institution of royalty distribution and rate adjustment
proceedings under the compulsory licenses. New section 808
instructs the Board when proceedings shall occur, and whether
the proceedings require a petition to initiate them or
whether they commence automatically.
New section 809 of the Copyright Act describes the conduct
of royalty distribution and rate adjustment proceedings. New
section 809(a) provides that the Board shall conduct its
proceedings in accordance with the Administrative Procedure
Act. New section 809(b) provides that the Board shall adopt
its own rules of procedures upon the approval of the Register
of Copyrights. New section 809(c) authorizes the Copyright
Office, in its discretion, to file formal pleadings with the
Board on any matter pending before the Board. All Copyright
Office pleadings shall be formally filed and served on all
the parties to the proceeding. The Board may accept or reject
the advice of the Copyright Office.
[[Page S1459]]
New section 809(d) provides that all actions of the Board
are by majority rule. New section 809(e) allows the Board the
discretion to determine whether, in a particular proceeding,
one or three members should preside. New section 809(f)
permits all parties whose claims are accepted or who have an
interest in the royalty rate to be set to participate in the
proceeding and submit relevant proposals and evidence.
New section 809(g) provides that, except as provided in
sections 118 and 119(c), the time limit for the issuance of
initial decisions in proceedings with one presiding member
shall be six months from the declaration of the controversy,
and the time limit for initial decisions in proceedings with
three presiding members shall be one year from the
declaration on the controversy.
New section 809(h) provides that the initial decision shall
contain the same level of reasoned decision-making that is
required under the Administrative Procedure Act, and take
into account the precedent of the decisions of the Copyright
Royalty Tribunal, the copyright arbitration royalty/panels
and the decisions of the Librarian of Congress made in
respect to the copyright arbitration royalty panels.
New section 809(i) provides the parties to the proceeding
and the Register of Copyrights an opportunity to petition the
entire Board to reconsider any initial decision issued by its
presiding member or members. If there are no petitions for
reconsideration, the initial decision becomes the final
decision automatically. If there are petitions for
reconsideration, the entire Board considers the petition, and
issues a final decision. The final decision of the entire
Board constitutes final agency action. Section 809(i)
provides that the time limits for filing petitions for
reconsideration, and for the entire Board to issue the final
decision shall be determined by regulation.
New section 810 of the Copyright Act provides for judicial
review of Board determinations. New section 810(a) provides
that when the initial decision becomes the final decision,
the Board shall have one week to publish the final decision
in the Federal Register. Parties aggrieved by the decision of
the Board shall have 30 days from the appearance of the final
decision in the Federal Register to appeal the decision to
the United States Circuit Court of Appeals for the Federal
Circuit. In that case, the Board shall be the defending
party, and the Chairperson of the Board shall refer the
conduct of the Board's defense to the Department of Justice.
Notwithstanding the pendency of any appeal, persons who
would pay the royalty rates adjusted by the Board's
decision are still obligated to pay the adjusted rate and,
if applicable, to file a statement of account with the
Copyright Office.
New section 810(b) provides that judicial review of the
Board's final decision is in accordance with the
Administrative Procedure Act.
New section 811 delineates various administrative matters
related to administration of the compulsory licenses. New
section 811(a) instructs the Librarian of Congress, upon the
recommendation of the Register of Congress, to provide the
Board with the necessary administrative services and
personnel support it needs. Personnel support may include the
services of experts such as a statistician or an economist,
when a particular proceeding requires such expertise.
New section 811(b) delegates to the Board the authority to
publish in the Federal Register notices of the Board's
actions in its proceedings, and such regulations as the Board
has been delegated the exclusive right to adopt. New section
811(c) authorizes the Librarian of Congress to assess fees
for the reasonable costs incurred in a rate making proceeding
from those parties interested in participating in the
proceeding. The section further authorizes the Register of
Copyrights to deduct from the ratemaking fees and from the
royalty fees deposited with the Copyright Office the
reasonable costs incurred by the Copyright Office and the
Board.
New section 811(d) provides that notwithstanding any
ceiling imposed on the full-time equivalent positions in the
Library of Congress, the members of the Board or employees in
support of the Board do not count in the calculation of that
ceiling.
New section 811(e) provides that when the Register of
Copyright submits to Congress the budget of the Copyright
Office, the Register shall identify the portion intended for
the Board with a statement assessing the Board's budgetary
needs.
Section 811(f) provides that the Board shall prepare its
own annual report and it shall be included in the Copyright
Office's annual report.
Section 812 provides a rule of construction continuing the
general power of the Register of Copyrights to establish
regulations governing the Copyright Act, and makes technical
and conforming amendments, including providing for appeals
from decisions of the Board to the Court of Appeals for the
Federal Circuit.
section 8
Section 8 of the bill provides transitional rules for the
establishment of the Board. For example, prior to the
constituting of the Board, the Register of Copyrights shall
adopt the Board's rules of procedure, but that when the Board
is constituted, it may adopt supplemental or superseding
regulations, upon the approval of the Register of Copyrights.
The section also provides that copyright arbitration
royalty panels that have already been convened at the time of
the passage of this act may continue and complete their
proceeding, unless the Register of Copyrights, finds for good
cause, that the proceeding should be discontinued. For those
proceedings that continue, the report of the copyright
arbitration royalty panels shall be submitted to the
Librarian of Congress, or the Librarian may, in his
discretion, direct the panel to submit the report to the
Board. If there are any appeals pending of a decision of a
copyright arbitration royalty panel that are eventually
remanded by the Court, the remanded case shall go to the
Board, not to a reconvened copyright arbitration royalty
panel.
section 9
Section 9 of the bill contains conforming amendments to
substitute the Copyright Royalty Adjudication Board for the
copyright arbitration royalty panels and the Librarian of
Congress wherever appropriate.
section 10
Section 10 makes technical and conforming amendments.
section 11
Section 11 amends the section 325 of the Communications Act
to provide that satellite carriers must in certain
circumstances obtain retransmission permission from a
broadcaster before they can retransmit the signal of a
network broadcast station. Like the regime applicable to the
cable industry, network broadcasters are afforded the option
of either granting retransmission consent, or they may elect
must-carry status as provided in section 12 of the bill. All
satellite carriers that provide local service of television
network stations must obtain either retransmission consent of
the local broadcasters, or carry their signals subject to the
must-carry provisions.
Section 11 does exempt carriage of certain broadcast
stations from the retransmission consent requirement.
Retransmission consent does not apply to noncommercial
broadcasting stations, and superstations that existed as
superstations on January 1, 1998. Also exempt from the
retransmission consent requirement is retransmission of a
network station to a household that is not subject to the
network nonduplication protection provided in section 13 of
the bill. The purpose of this provision is to allow
subscribers who reside in the designated market area of a
network affiliate, but do not live in an area where the
relevant local stations can request network nonduplication
(assuring that a subscriber does not or cannot otherwise
receive the signal of the local affiliate) to obtain a
distant signal of the same network from their satellite
carrier.
Section 11 also directs the Federal Communications
Commission to, within 45 days of enactment of the bill,
commence a rulemaking proceeding to adopt regulations
governing the exercise of retransmission rights for satellite
retransmissions for private home viewing.
section 12
Section 12 of the bill creates must-carry obligations for
satellite carriers retransmitting television broadcast
signals. The provisions are similar to those applicable to
the cable industry. Any satellite carrier that retransmits a
network television broadcast signal to subscribers residing
within the local market of that signal, must offer to carry
all the television stations in the local market to
subscribers residing in the local market. This approach of
``carry one, then carry all'' is subject to the
retransmission consent election of section 11 of the bill.
Thus, a satellite carrier does not have to carry a local
television broadcast station if the station elects
retransmission consent rather than must-carry. The ``local
market'' of a broadcast station is defined as the station's
Designated Market Area, as determined by Nielsen Media
Research.
Section 12 tracks the cable must-carry provisions of the
1992 Cable Act by relieving satellite carriers from the
burden of having to carry more than one affiliate of the same
network if both of the affiliates are located in the same
local market. Local broadcasters are also afforded channel
positioning rights, and are required to provide a good
quality signal to the satellite carrier's principal headend
in order to assert must-carry rights. Satellite carriers are
forbidden from obtaining compensation from local broadcasters
in exchange for carriage. Section 12 also provides a means
for broadcasters to seek redress from the Federal
Communications Commission for violations of the must-carry
obligations.
section 13
Section 13 of the bill directs the Federal Communications
Commission, within 45 days of enactment of the bill, to
commence rulemaking proceedings to impose network
nonduplication protection, syndicated exclusivity and sports
blackout protection on satellite retransmissions of
television broadcast signals for private home viewing. The
regulations to be adopted are to be similar to those
currently in force for retransmissions of television
broadcast signals by cable systems, to the extent possible,
recognizing that there are technological and other
differences between cable and satellite.
In adopting network nonduplication protection rules, the
Commission is directed to adopt rules that permit satellite
carriers to provide distant network signals to subscribers
who reside within the designated market area of a network
station affiliated with the same network but cannot receive
an over-the-air signal of the local affiliate, and further do
not receive the local signal from a cable or satellite
service. The purpose of this provision is to prevent local
affiliates from asserting network nonduplication protection
[[Page S1460]]
against subscribers who legitimately cannot or do not receive
the local network affiliate signal, but allow stations to
protect their network exclusivity if they do. Thus, if the
satellite carrier serving a subscriber provides him or her
with the local affiliate for that designated market area, the
satellite carrier may not also provide such subscriber with
distant network signals affiliated with the same network.
Additionally, if a subscriber can receive the local
affiliate's signal over the air, the satellite carrier cannot
provide distant network signals affiliated with the same
network. This replaces the current ``white area'' system,
based on the Grade-B contour of a station enforceable in
court, with rules prescribed and overseen by the FCC, once
the FCC establishes rules.
section 14
This section provides that the bill shall become effective
on January 1, 1999.
Mr. LEAHY. Mr. President, today I am introducing a bill with Chairman
Hatch concerning satellite television that I hope will prove to be good
news for consumers throughout the nation and in Vermont.
I greatly appreciate this opportunity to work with Chairman Hatch and
Senator Kohl.
We intend for this bill to lead to head-to-head competition between
cable and satellite TV providers. This should open more choices and
services to Vermonters, at lower prices. The bill also will allow
householders who want to subscribe to this new satellite TV service to
receive all local Vermont TV stations by satellite. The goal is to
offer Vermonters more choices, more TV selections--and especially of
local programming--but at lower rates.
In areas of the country where there is this full competition with
cable providers, rates to customers are considerably lower. I helped
foster the home satellite industry with passage of the Satellite Home
Viewer Act in 1988 and the extension of that act in 1994. Now it is
time for the home satellite industry to offer a competitive alternative
to cable. It is my hope that we can foster that competition and do so
in a way that preserves the local perspective and service provided by
the local network affiliate system.
This bill is intended to permit satellite TV providers to offer the
networks through their local TV channels to viewers throughout Vermont
and a full complement of superstations and movies. This means that
local Vermont TV stations will be available over satellite to many
areas of Vermont currently unserved by satellite or by cable.
I have received scores of letters from Vermonters who have complained
about the current situation. Under current law, it is illegal for
satellite TV providers to offer local TV channels over a satellite dish
when you live in a area where you are likely to get a clear TV signal
with a regular rooftop antenna.
This means that thousands of Vermonters living in or near Burlington
cannot receive local signals over their satellite dishes. I understand
their frustration. At our farm in Middlesex, we receive signals from
one and a half stations.
This bill is intended to adjust the statutory copyright licenses in
order to allow satellite carriers to offer local TV signals to viewers
no matter where they live in Vermont. To take advantage of this
opportunity, satellite carriers will in general have to follow the
rules that cable providers have to follow. This will mean that they
must carry all full-power local Vermont TV stations in their TV
offering.
Today, Vermonters receive satellite signals with programming from
stations in other states. In other words, they would get a CBS station
from another state but not WCAX, the Burlington CBS affiliate. I hope
that our bill will correct this upside-down situation and make network
programming available to all, while preserving local programming and
respecting the affiliate system.
By allowing satellite providers to offer a larger variety of
programming, including local stations, the satellite industry would be
able to compete with cable, and the cable industry will be competing
with satellite carriers. Cable will continue to be a highly effective
competitor with its ability to offer extremely high-speed Internet
connections to homes and businesses.
A major reason I voted against the Telecommunications Act of 1996--
and I was only one of five who voted against that bill--was my fear
that cable, satellite and telephone rates would go up significantly in
rural states. I wish I had been wrong, but the rates, in fact, have
been climbing since then. When fully implemented this bill should
reverse that trend as has been the case in cities where there were
competitors to cable.
The second major improvement in this bill is that satellite carriers
that offer local Vermont channels in their mix of programming will be
able to reach Vermonters throughout our state. The system will be based
on regions called Designated Market Areas, or DMAs, established through
marketing surveys done by the Nielsen Corporation ratings organization.
Vermont has one large DMA covering most of the state and part of the
Adirondacks in New York--the Burlington-Plattsburg DMA--and parts of
two smaller ones in Bennington County (the Albany-Schenectady-Troy DMA)
and in Windham County (the Boston DMA).
Over time those two counties could be included in the Burlington-
Plattsburg DMA depending on marketing, advertising and other
demographic factors that Nielsen Corporation examines.
This new satellite system is not yet available. Companies are
preparing to launch spot-beam satellites to take advantage of this
bill. I encourage them to do so. Using current technology, signals
would be provided by spot-beam satellites using some 150 regional
uplink sites throughout that nation to beam local signals up to two
satellites. Those satellites would use 60 spot beams to send those
local signals, received from the regional uplinks, back to satellite
dish owners. High-definition TV would be offered under this system at a
later date.
Under this bill, and using this spot-beam technology, home owners
with satellite dishes in downtown Burlington, and in almost every
county in Vermont, would receive all the full-power TV stations in the
Burlington-Plattsburg DMA, including Vermont public television.
Therefore, subscribers to the new satellite technology would be able to
receive WPTZ, WCAX, WNNE, Vermont public television, and other full-
power broadcast stations, throughout most of Vermont. Bennington
residents would receive the stations in the Schenectady-Albany-Troy
DMA. Windham County residents would receive full power stations in the
Boston DMA.
As I mentioned earlier, Bennington and Windham Counties could be
included in the Burlington-Plattsburg DMA at a later date as the
demographics of the region evolve, or as technology changes.
Under this bill, Vermonters will have more choices. Those who want
this new satellite service will be allowed to sign up in the next
couple of years or keep their present satellite service.
Those who want to stick with cable, or with regular broadcast TV, are
able to continue their viewing in those ways. Since technology advances
so quickly, other systems could be developed before this bill is fully
implemented that would provide other service but using different
technologies.
I share the frustration of so many that laws and regulations in this
case have tended to frustrate consumer choices and stifle technology.
That is not the way it should be. It is time to update our satellite
viewing laws to encourage full and vigorous competition with the cable
industry and expand viewer options.
Mr. KOHL. Thank you, Mr. President. Along with my colleagues,
Senators Hatch and Leahy, I rise in support of the Copyright Compulsory
License Improvement Act of 1997. This proposal, although clearly not a
final product, is an important step forward in creating true
competition between satellite and cable television. And that is an
important step forward for consumers.
Mr. President, this bill generally takes the right approach. It gives
satellite carriers the ability to provide the one thing that consumers
want most: local television broadcast signals. In return, the satellite
carriers must comply with FCC regulations governing syndicated
exclusivity, sports blackout protection, and network nonduplication.
The measure also creates a retransmission consent process, and
establishes certain ``must carry'' obligations on satellite carriers
that rebroadcast local signals. As a
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general premise, it seems only fair that the benefits of carrying local
signals should be balanced with reasonable regulatory burdens that are
consistent with cable's obligations. But we should also look at
reducing at least some of the ``must carry'' burdens--for example, why
should any provider be required to carry the Home Shopping Network,
which is predominantly commercial?
So what does all this mean for businesses and consumers? Hopefully,
it will create more availability and affordability in television
programs. And it will help to preserve local television stations, who
provide all of us with vital information like news, weather, and
special events--especially sports. We ought to get moving on this
sooner, rather than later. It would be a mistake to wait until just
before the license expires in 1999.
This measure replaces the Copyright Arbitration Royalty Panels with a
Copyright Royalty Adjudication Board. In addition to its clever new
acronym (``CRAB''), the Board in the future will hopefully find a
better way to create parity in the fees that cable and satellite
providers pay in copyright royalties. This time around, however, it
would be wise to lower legislatively the recently proposed 27 cent
rate.
In any event, we should view the Copyright Compulsory License
Improvement Act as a point of departure rather than a final product. I
am hopeful we can work with the Commerce Committee, which clearly has
an important role to play in many of these matters. This measure is a
significant step in promoting competition, and Senators Hatch and Leahy
deserve enormous credit for creating a constructive approach, which can
only benefit consumers nationwide. I urge my colleagues to join me in
supporting it.
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