[Congressional Record Volume 144, Number 22 (Friday, March 6, 1998)]
[Senate]
[Pages S1516-S1521]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ABRAHAM (for himself, Mr. Hatch, Mr. McCain, Mr. DeWine, 
        and Mr. Specter):
  S. 1723. A bill to amend the Immigration and Nationality Act to 
assist the United States to remain competitive by increasing the access 
of the United States firms and institutions of higher education to 
skilled personnel and by expanding educational and training 
opportunities for American students and workers; to the Committee on 
the Judiciary.


                    THE AMERICAN COMPETITIVENESS ACT

  Mr. ABRAHAM. Mr. President, I rise today to introduce the American 
Competitiveness Act. First, let me thank Senators Hatch, McCain, and 
DeWine for cosponsoring this bill. I believe this legislation is 
important to the country's future because it constitutes an essential 
ingredient in any long-term strategy to keep the United States a leader 
in global markets in the 21st century. A coalition of America's leading 
businesses has endorsed the bill, stating that ``The American 
Competitiveness Act will do more to directly create jobs for 
Americans--and to keep jobs in this country--than any other bill that 
will be considered by Congress this year.''
  Over the past twenty years, no part of the economy has done more to 
raise the standard of living of the American people than that of 
information technology. This industry, which barely existed as a 
handful of companies just a few decades ago, now employs more than 4 
million people directly, and many others indirectly. This industry has 
improved everything from the way we work, shop, travel, and perform 
financial transactions, to the way our children study. And, as 
economist Larry Kudlow reports, this industry is central to our 
economic well-being. The hardware and software industries combined 
account for about one third of our real economic growth. Overall, 
electronic commerce is expected to grow to $80 billion by the year 
2000.
  Yet all is not well with this crucial sector of our economy. American 
companies today are engaged in fierce competition in global markets. To 
stay ahead in that competition they must win the battle for human 
capital. But companies across America are faced with severe high-skill 
labor shortages that threaten their competitiveness in this new 
Information Age economy.
  A study conducted by Virginia Tech for the Information Technology 
Association of America (ITAA) estimates that right now we have more 
than 340,000 unfilled positions for highly skilled information 
technology (IT) workers in American companies. And that number does not 
include the nonprofit sector, local or federal government agencies, 
mass transit systems, or companies with fewer than 100 employees.
  The Virginia Tech study is hardly alone in identifying this problem. 
The Department of Labor's figures project that our economy will produce 
more than 130,000 information technology jobs in each of the next 10 
years, for a total of more than 1.3 million. The data also suggest our 
universities will produce less than a quarter of the necessary number 
of information technology graduates over the next 10 years. Between 
1986 and 1995, the number of bachelor's degrees awarded in computer 
science declined by 42 percent. This means that even if undergraduate 
enrollments in this field were to increase as predicted by one survey, 
we still would not achieve the 1986 level of computer science graduates 
before 2002. And even then, we would be producing thousands fewer 
skilled workers than the market demands.
  The National Software Alliance, a consortium of concerned government, 
industry, and academic leaders that includes the U.S. Army, Navy, and 
Air Force, recently concluded that ``The supply of computer science 
graduates is far short of the number needed by industry.'' The Alliance 
points out that the current severe understaffing could lead to 
inflation and lower productivity and threaten America's 
competitiveness.
  This is serious, both in individual states and for the nation. In 
Michigan, for example, 24 of every 1,000 private sector workers are 
employed by high-tech firms, and this figure is growing rapidly in and 
around Ann Arbor, Lansing, and elsewhere in the state.
  Mr. President, if American companies cannot find home grown talent, 
and if they cannot bring talent to this country, a large number are 
likely to move key operations overseas, sending those and related jobs 
currently held by Americans with them. While companies may need to have 
some operations abroad, we should not keep in place unnecessary 
restrictions that artificially drive employers to send more operations 
out of the country.
  Further, our shortage of high skilled workers endangers continued 
economic growth. The Hudson Institute estimates that the unaddressed 
shortage of skilled workers throughout our economy will result in a 5 
percent drop in the growth rate of GDP. That translates into about $200 
billion in lost output, nearly $1,000 for every American. One industry 
official captured the peril of this situation well when he said ``it is 
as if America ran out of iron ore during the industrial revolution.''
  This problem calls for both a short term and a long term solution. 
Let me first address the short term. By this summer American businesses 
will reach the limit on the small number of highly skilled temporary 
workers they can bring in from abroad. Last year our employers reached 
this 65,000 cap on H-1B visas for the first time in history, and we did 
it by the end of August. If no action is taken, the cap may be reached 
by May this year, and perhaps January or February of 1999. Backlogs 
will worsen the problem until, practically speaking, companies can no 
longer count on being able to hire the people they need from any 
source. Particularly given today's short product cycles, this would be 
disastrous.
  That is why the legislation I am introducing today will increase the 
number of skilled temporary workers we

[[Page S1517]]

allow into the United States. This will keep American companies in this 
country, saving American jobs and contributing to the growth of the 
economy.
  This policy also will give us time to formulate a long-term solution. 
In my view, we can produce, right here in America, the talent we need 
to keep our high tech industries competitive. Through wise investments 
in human capital we can give American kids of all backgrounds, 
including kids whose opportunities seem severely limited, the chance to 
be part of the new high-tech economy.
  U.S. companies cannot be expected to solve all the educational 
problems in this country by themselves. They now spend over $210 
billion a year on the formal and informal training of their workforce, 
as well as donating more than $2.5 billion a year to colleges, high 
schools, and elementary schools. But training is not an acceptable 
alternative to early acquisition of the technical skills necessary to 
succeed, and we must do more to help kids acquire needed skills as 
early as possible.
  Some say that the entire solution is training and education. Of 
course, those both are essential, but to suggest that these represent 
the entire answer ignores a number of factors, including the global 
nature of today's economy. Recently the Senate held a long and 
educational hearing in the Judiciary Committee on the issues centrally 
related to the subject matter of this legislation. We heard from 
several of America's leading companies and others on the importance of 
swiftly addressing the high tech worker shortage by raising the H-1B 
cap before it is hit in May or June of this year.
  We heard at the hearing that Microsoft alone spends over $568 million 
annually on training and education, while Sun Microsystems spends over 
$50 million a year, not including the 20,000 volunteer hours Sun 
employees are contributing to link U.S. schools to the Internet in 
economically disadvantaged areas. Despite these expenditures, Microsoft 
and Sun today have 2,522 and 2,000 unfilled technical positions 
respectively. In addition, we heard testimony that many of their 
products for export need to involve individuals on H-1Bs with specific 
language and other skills that are pertinent to the target country.

  We learned at the hearing that Texas Instruments spends over $100 
million a year on training employees and has over 500 openings for 
skilled positions, despite, like many companies, engaging in massive 
and ongoing efforts to recruit on college campuses across the nation. 
Silicon Valley entrepreneurs are themselves making $200 million in 
charitable contributions to fund fellowships in science and engineering 
at Stanford University. Clearly more emphasis on training is extremely 
important, but is not the only solution.
  Our young people have what it takes to be valuable employees in our 
high-tech age. But our educational system is not giving them the skills 
they need. The National Research Council estimates that three quarters 
of American high school graduates would fail a college freshman math or 
engineering course. Unfortunately, most don't even try. Only 12 percent 
of 1994 college graduates earned degrees in technical fields.
  This is not acceptable. In a highly advanced economy like ours we 
cannot continue to function without highly skilled workers. And our 
workers cannot continue to prosper unless our educational system gives 
them the skills they need to succeed.
  The Administration has proposed a number of small initiatives to deal 
with this shortage of skilled labor. I support these initiatives. But 
in my view it is clear that we must go farther.
  Mr. President, allowing more skilled workers to come to the U.S. is 
in no way incompatible with improved training and education in this 
country. The question is not: Do we allow more skilled professionals to 
enter the country or do we help native-born students pursue these 
fields? Clearly we must do both. And I will work with my colleagues on 
both sides of the aisle to see to it that this is accomplished.
  To that end, Mr. President, this legislation includes a scholarship 
program aimed at helping 20,000 low-income students a year study 
mathematics, engineering, and computer science at the undergraduate and 
graduate levels.
  Of course, this is not all that we should do. We also must begin 
training unemployed Americans in the skills needed in the information 
technology industry. This legislation includes three times the funding 
level proposed by the Administration to train the unemployed in IT 
skills.
  Through careful investment in education we can increase the skill 
levels of our workers, to everyone's benefit.
  The legislation I am introducing will address these issues in the 
following ways:
  First, the bill will increase access to skilled personnel for U.S. 
companies and universities. The bill will make approximately 25,000 
more H-1B temporary visas available in 1998. A key goal of the 
legislation is to make sure there are enough visas this year to avoid 
backlogs and major disruptions. For that reason, the 1998 cap will be 
twice the level of the first 6 months of this fiscal year (through 
March 31, 1998), which, based on current INS data, would give a 12-
month total of about 90,000 visas for the year. As a safety valve, if 
that total is insufficient in a future year, as of FY 1999, other 
temporary visas that Congress has already authorized (H-2B visas), if 
they are left unused from the previous year, would be available. No 
more than 25,000 of these H-2B visas could be made available as a 
safety valve in a given year.
  The bill also responds to those who have expressed concern about 
certain occupations being included within the H-1B visa category. The 
bill removes physical/occupational therapists and other specialized 
health care workers from the H-1B program and places them into a new 
temporary visa category called H-1C, with a limit of 10,000 placed on 
such visas. Accordingly, the bill subtracts 10,000 from the H-1B cap in 
the first year of availability of H-1C visas. In each subsequent year, 
any unused H-1C visas from the previous year will be added back to the 
H-1B cap. The bill leaves unchanged the employment-based immigration 
cap of 140,000 on the number of foreign-born professionals who may 
remain permanently in the country.
  Second, the bill authorizes $50 million for the State Student 
Incentive Grant (SSIG) program to create approximately 20,000 
scholarships a year for low-income students pursuing an associate, 
undergraduate, or graduate level degree in mathematics, engineering or 
computer science. The program provides dollar-for-dollar federal 
matching funds that will grow to $100 million with state matching. The 
scholarships will be for up to $5,000 each.
  Third, the bill authorizes $10 million a year to train unemployed 
American workers in new skills for the information technology industry. 
It also authorizes $8 million for improved online talent banks to 
facilitate job searches and the matching of skills to available 
positions in high technology.
  Fourth, the bill toughens enforcement penalties and improves the 
operation of the H-1B program. It increases fines by five-fold for 
companies willfully violating the rules of the H-1B program, from 
$1,000 to $5,000. The bill adds new enforcement power by creating 
probationary periods of up to five years for willful violators of the 
H-1B program. During the probationary period, violating firms are 
subject to expanded Department of Labor ``spot inspections'' at the 
agency's discretion. The bill also includes reforms to achieve greater 
accuracy in determining prevailing wages for companies and 
universities.
  Fifth, the bill modifies the per-country limits on employment-based 
visas to eliminate the discriminatory effects of these per-country 
limits on nationals from certain Asian Pacific nations. Today, we have 
a situation where in a given year there are employment-based immigrant 
visas available within the annual limit of 140,000, yet U.S. law 
prevents individuals born in particular countries from being able to 
join employers who want to sponsor them as permanent employees. Do we 
want to keep in place a provision of law that says you can hire someone 
who meets all the proper legal criteria set forth by the U.S. 
government, but just not too many Chinese or Indians in a given year? 
This area of law calls out for reform.
  Finally, in addition to providing American universities and other 
non-profits with increased access to skilled

[[Page S1518]]

personnel, the bill overturns the Hathaway decision by requiring the 
Department of Labor to differentiate between prevailing wage 
calculations for universities, charities, and other nonprofit 
organizations and those of for-profit entities.
  Is the current 65,000 cap on H-1Bs the magic number? Let me briefly 
review the history. Prior to the 1990 Act, there was no cap on H-1B 
visas, which previously were called H-1 visas. This bill does not 
eliminate the cap, but I point out the history to give some context to 
the discussion on this issue. The 65,000 number was chosen, essentially 
out of thin air, in the 1990 Act. This number proved sufficient for a 
number of years, but now has shown to be a significant impediment to 
growth, particularly in certain industries. Simply put, there is no 
magic to this 65,000 number. In addition, at that time, to respond to 
concerns about wages, a Labor Condition Application was added to the 
program that required companies to attest they were paying individuals 
on H-1Bs the higher of the prevailing wage or actual wage paid to 
similarly employed Americans. That remains in the law. Also, at the 
time, a ``complaint-driven'' system was developed to enforce compliance 
and prosecute violators. And it was decided that the Department of 
Labor would respond to complaints and operate the enforcement of the 
program. This was done under the chairmanship of Democratic Congressman 
Bruce Morrison.

  Inaction on this issue is not very different from outright 
restriction, because it will result in such massive backlogs, that with 
today's fast-moving product cycles, access to these key professionals 
will be for all practical purposes barely possible.
  Who will benefit from restricting the entry of these skilled workers? 
``On a daily basis, our competitors in Tokyo scheme to stop the 
momentum of the American semiconductor and computer industries,'' 
testified Cypress Semiconductor CEO T.J. Rodgers. ``Even if they tried, 
they could not come up with a better plan to cut off our supply of 
critical engineering talent than by halting immigration. Unfortunately, 
it appears they may have the United States government as their ally.''
  At a hearing on a different topic held just this week in the 
Judiciary Committee we heard views from major executives about some 
issues facing the software industry. Despite differing opinions on 
these other important issues, the business leaders testifying were 
unanimous when the topic was brought up of alleviating the pending 
crisis involving H-1B visas.
  Scott McNealy, President and CEO of Sun Microsystems, noted that two 
of the four founders of his company, which now employs over 20,000 
Americans, were foreign-born individuals who entered the country via 
the employment-based immigration system. ``I cannot imagine having 
those two unbelievable national treasures not being allowed in,'' he 
said. ``And by the way, if you go down through the payroll of our 
organization, for every legal immigrant that we have hired and put on 
the payroll, they have created vast amounts of wealth and jobs and a 
byproduct--wonderful byproducts for our economy and for the planet as a 
whole.''
  Bill Gates, Chairman and CEO of Microsoft Corporation stated, 
``Microsoft is in strong agreement that raising these caps to allow 
very skilled legal immigrants to come in would be a good thing for the 
technology industry and for the country. We particularly have a lot of 
people who come to the U.S. to be educated, and it seems a shame when 
they've been educated here, not to allow them to stay in the country 
and to take what they've learned and contribute to companies like ours 
and many others.'
  Jim Barksdale, President and CEO, Netscape Communications testified, 
``We employ an awful lot of legal immigrants, who are very bright 
people and make a great contribution and more than earn their keep and 
we would like to see the limit raised.''
  Perhaps the clearest statement about what may be at stake came from 
Michael Dell, Chairman and CEO of Dell Computer. He told the Committee, 
``These companies are global companies and if this work does not occur 
on U.S. soil it occurs on some other soils. We are disarming the 
economy of the United States of America if we don't allow these folks 
to come and stay in this country.'
  The American Competitiveness Act is endorsed by the U.S. Chamber of 
Commerce, the National Association of Manufacturers, the American 
Electronics Association, the Electronics Industry Association, the 
Business Software Alliance, the Information Technology Association of 
America, American Business for Legal Immigration, the American 
Immigration Lawyers Association, the American Council of International 
Personnel, the National Technical Services Association, the Computing 
Technology Industries Association, and the United States Pan Asian 
American Chamber of Commerce.
  This issue is also extremely important to America's academic 
community. At the February 25 hearing before the Senate Judiciary 
Committee, Stephen Director, Dean of the College of Engineering at the 
University of Michigan, testified as a representative of the nation's 
higher education community. His testimony, calling for an increase in 
H-1B visas and a permanent solution for universities on prevailing wage 
issues, was endorsed by the American Council on Education, the 
Association of American Universities, the College and University 
Personnel Association, the Council of Graduate Schools, NAFSA: 
Association of International Educators and the National Association of 
State Universities and Land Grant Colleges. As noted in the testimony, 
the combined memberships of these associations represent over 2,000 
U.S. colleges and universities.
  As we move forward, Mr. President, people will no doubt ask whether 
there are additional measures to protect against abuse of the H-1B 
program that can be enacted without nullifying efforts to increase high 
tech companies' access to skilled workers.
  On that issue let me say that we must crack down on anyone who would 
abuse the system. As I've noted, this bill contains substantially 
larger fines for those engaged in willful violations and establishes 
long probationary periods for such egregious violators. The law already 
contains provisions for dealing with abuses. And there have been such 
cases. But let's keep in mind that in America, justice is served not by 
restricting the law-abiding, but by targeting those who violate our 
laws.
  In 1997, the Department of Labor found three employers who were found 
to have engaged in willful violations of the H-1B program. Three. These 
violators accounted for three visas out of 65,000 granted in that year. 
So while it is important that we make it clear that we will not 
tolerate abuse, we must keep the number of incidents in perspective and 
engage in targeted actions that do not punish the innocent with the 
guilty.
  Today, according to ITAA , 70 percent of America's high tech firms 
identify an inability to find enough skilled people as the leading 
barrier to their companies' growth and competitiveness in global 
markets. Other countries are catching on. Canada has loosened its entry 
requirements for high tech workers. Singapore has announced plans to 
move aggressively to attract skilled international workers. And India 
continues its plans to keep its best talent home to build its domestic 
industries. I repeat, if restrictions prevent American companies from 
meeting their labor needs for U.S.-based product, service, and research 
development, these companies will increasingly locate their facilities 
offshore. That will mean a loss of jobs, and less innovation and wealth 
creation in America.
  We have a diverse economy, and the relatively small number of people 
who America can welcome annually to fill key positions at companies and 
universities benefits us in many ways. We must also pursue the type of 
long-term strategy, some of which is outlined in this bill, that will 
increase educational opportunities for U.S. students.
  If we are to continue to prosper as a people, we must remain 
competitive as a nation. To do that, we must do everything within our 
power to produce more native-born workers who can fill the high skilled 
positions on which our high-tech and other industries depend. I believe 
we can accomplish this goal through increased emphasis on training and 
education. It requires only that we set our minds to the task at hand, 
and that we not bury our heads in the

[[Page S1519]]

sand and say that blocking increased access to skilled temporary 
professionals will somehow help us maintain our way of life. Our 
universities, our cutting-edge employers, and in particular our workers 
deserve better.
  Mr. President, I ask unanimous consent that the letters of support 
and the text of the bill be included in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1723

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

     SECTION 1. SHORT TITLE; REFERENCES IN ACT.

       (a) Short Title.--This Act may be cited as the ``American 
     Competitiveness Act''.
       (b) References in Act.--Except as otherwise specifically 
     provided in this Act, whenever in this Act an amendment or 
     repeal is expressed as an amendment to or a repeal of a 
     provision, the reference shall be deemed to be made to the 
     Immigration and Nationality Act (8 U.S.C. 1101 et seq.).

     SEC. 2. FINDINGS.

       Congress makes the following findings:
       (1) American companies today are engaged in fierce 
     competition in global markets.
       (2) Companies across America are faced with severe high 
     skill labor shortages that threaten their competitiveness.
       (3) The National Software Alliance, a consortium of 
     concerned government, industry, and academic leaders that 
     includes the United States Army, Navy, and Air Force, has 
     concluded that ``The supply of computer science graduates is 
     far short of the number needed by industry.''. The Alliance 
     concludes that the current severe understaffing could lead to 
     inflation and lower productivity.
       (4) The Department of Labor projects that the United States 
     economy will produce more than 130,000 information technology 
     jobs in each of the next 10 years, for a total of more than 
     1,300,000.
       (5) Between 1986 and 1995, the number of bachelor's degrees 
     awarded in computer science declined by 42 percent. 
     Therefore, any short-term increases in enrollment may only 
     return the United States to the 1986 level of graduates and 
     take several years to produce these additional graduates.
       (6) A study conducted by Virginia Tech for the Information 
     Technology Association of America estimates that there are 
     more than 340,000 unfilled positions for highly skilled 
     information technology workers in American companies.
       (7) The Hudson Institute estimates that the unaddressed 
     shortage of skilled workers throughout the United States 
     economy will result in a 5-percent drop in the growth rate of 
     GDP. That translates into approximately $200,000,000,000 in 
     lost output, nearly $1,000 for every American.
       (8) It is necessary to deal with the current situation with 
     both short-term and long-term measures.
       (9) In fiscal year 1997, United States companies and 
     universities reached the cap of 65,000 on H-1B temporary 
     visas a month before the end of the fiscal year. In fiscal 
     year 1998 the cap is expected to be reached as early as May 
     if Congress takes no action. And it will be hit earlier each 
     year until backlogs develop of such a magnitude as to prevent 
     United States companies and researchers from having any 
     timely access to skilled foreign-born professionals.
       (10) It is vital that more American young people be 
     encouraged and equipped to enter technical fields, such as 
     mathematics, engineering, and computer science.
       (11) If American companies cannot find home-grown talent, 
     and if they cannot bring talent to this country, a large 
     number are likely to move key operations overseas, sending 
     those and related American jobs with them.
       (12) Inaction in these areas will carry significant 
     consequences for the future of American competitiveness 
     around the world and will seriously undermine efforts to 
     create and keep jobs in the United States.

     SEC. 3. INCREASED ACCESS TO SKILLED PERSONNEL FOR UNITED 
                   STATES COMPANIES AND UNIVERSITIES.

       (a) Establishment of H1-C Nonimmigrant Category.--
       (1) In general.--Section 101(a)(15)(H)(i) (8 U.S.C. 
     1101(a)(15)(H)(i)) is amended--
       (A) by inserting ``and other than services described in 
     clause (c)'' after ``subparagraph (O) or (P)''; and
       (B) by inserting after ``section 212(n)(1)'' the following: 
     ``, or (c) who is coming temporarily to the United States to 
     perform labor as a health care worker, other than a 
     physician, if the alien qualifies for the exemption from the 
     grounds of inadmissibility described in section 
     212(a)(5)(C)''.
       (2) Transition rule.--Any petition filed prior to the date 
     of enactment of this Act, for issuance of a visa under 
     section 101(a)(15)(H)(i)(b) of the Immigration and 
     Nationality Act on behalf of an alien described in the 
     amendment made by paragraph (1)(B) shall, on and after that 
     date, be treated as a petition filed under section 
     101(a)(15)(H)(i)(c) of that Act, as added by paragraph (1).
       (b) Annual Ceilings for H1-B and H1-C Workers.--
       (1) Amendment of the INA.--Section 214(g)(1) (8 U.S.C. 
     1184(g)(1)) is amended to read as follows:
       ``(g)(1) The total number of aliens who may be issued visas 
     or otherwise provided nonimmigrant status during any fiscal 
     year--
       ``(A) under section 101(a)(15)(H)(i)(b)--
       ``(i) for each of fiscal years 1992 through 1997, may not 
     exceed 65,000,
       ``(ii) for fiscal year 1998, may not exceed 2 times the 
     number of aliens issued visas or otherwise provided 
     nonimmigrant status between October 1, 1997, and March 31, 
     1998,
       ``(iii) for fiscal year 1999, may not exceed the number 
     determined for fiscal year 1998 under such section, minus 
     10,000, plus the number of unused visas under subparagraph 
     (B) for the fiscal year preceding the applicable fiscal year, 
     and
       ``(iv) for fiscal year 2000 and each applicable fiscal year 
     thereafter, may not exceed the number determined for fiscal 
     year 1998 under such section, minus 10,000, plus the number 
     of unused visas under subparagraph (B) for the fiscal year 
     preceding the applicable fiscal year, plus the number of 
     unused visas under subparagraph (C) for the fiscal year 
     preceding the applicable fiscal year;
       ``(B) under section 101(a)(15)(H)(ii)(b), beginning with 
     fiscal year 1992, may not exceed 66,000; or
       ``(C) under section 101(a)(15)(H)(i)(c), beginning with 
     fiscal year 1999, may not exceed 10,000.
     For purposes of determining the ceiling under subparagraph 
     (A) (iii) and (iv), not more than 25,000 of the unused visas 
     under subparagraph (B) may be taken into account for any 
     fiscal year.''.
       (2) Transition procedures.--Any visa issued or nonimmigrant 
     status otherwise accorded to any alien under clause (i)(b) or 
     (ii)(b) of section 101(a)(15)(H) of the Immigration and 
     Nationality Act pursuant to a petition filed during fiscal 
     year 1998 but approved on or after October 1, 1998, shall be 
     counted against the applicable ceiling in section 214(g)(1) 
     of that Act for fiscal year 1998 (as amended by paragraph (1) 
     of this subsection), except that, in the case where counting 
     the visa or the other granting of status would cause the 
     applicable ceiling for fiscal year 1998 to be exceeded, the 
     visa or grant of status shall be counted against the 
     applicable ceiling for fiscal year 1999.

     SEC. 4. EDUCATION AND TRAINING IN SCIENCE AND TECHNOLOGY.

       (a) Degrees in mathematics, computer science, and 
     engineering.--Subpart 4 of part A of title IV of the Higher 
     Education Act of 1965 (20 U.S.C. 1070c et seq.) is amended--
       (1) in section 415A(b)(1) (20 U.S.C. 1070c(b)(1))--
       (A) by striking ``$105,000,000 for fiscal year 1993'' and 
     inserting ``$155,000,000 for fiscal year 1999''; and
       (B) by inserting ``, of which the amount in excess of 
     $25,000,000 for each fiscal year that does not exceed 
     $50,000,000 shall be available to carry out section 415F for 
     the fiscal year'' before the period; and
       (2) by adding at the end the following:

     ``SEC. 415F. DEGREES IN MATHEMATICS, COMPUTER SCIENCE, AND 
                   ENGINEERING.

       ``(a) Allotments and Grants.--From amounts made available 
     to carry out this section under section 415A(b)(1) for a 
     fiscal year, the Secretary shall make allotments to States to 
     enable the States to pay not more than 50 percent of the 
     amount of grants awarded to low-income students in the 
     States.
       ``(b) Use of Grants.--Grants awarded under this section 
     shall be used by the students for attendance on a full-time 
     basis at an institution of higher education in a program of 
     study leading to an associate, baccalaureate or graduate 
     degree in mathematics, computer science, or engineering.
       ``(c) Comparability.--The Secretary shall make allotments 
     and grants shall be awarded under this section in the same 
     manner, and under the same terms and conditions, as--
       ``(1) the Secretary makes allotments and grants are awarded 
     under this subpart (other than this section); and
       ``(2) are not inconsistent with this section.''.
       (b) Data Bank; Training.--
       (1) In general.--The Secretary of Labor shall--
       (A) establish or improve a data bank on the Internet that 
     facilitates--
       (i) job searches by individuals seeking employment in the 
     field of technology; and
       (ii) the matching of individuals possessing technology 
     credentials with employment in the field of technology; and
       (B) provide training in information technology to 
     unemployed individuals who are seeking employment.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated for fiscal year 1999 and each of the 4 
     succeeding fiscal years--
       (A) $8,000,000 to carry out paragraph (1)(A); and
       (B) $10,000,000 to carry out paragraph (1)(B).

     SEC. 5. INCREASED ENFORCEMENT PENALTIES AND IMPROVED 
                   OPERATIONS.

       (a) Increased Penalties for Violations of H1-B or H1-C 
     Program.--Section 212(n)(2)(C) (8 U.S.C. 1182(n)(2)(C)) is 
     amended--
       (1) by striking ``a failure to meet'' and all that follows 
     through ``an application--'' and inserting ``a willful 
     failure to meet a condition in paragraph (1) or a willful 
     misrepresentation of a material fact in an application--''; 
     and
       (2) in clause (i), by striking ``$1,000'' and inserting 
     ``$5,000''.
       (b) Spot Inspections During Probationary Period.--Section 
     212(n)(2) (8 U.S.C. 1182(n)(2)) is amended--

[[Page S1520]]

       (1) by redesignating subparagraph (D) as subparagraph (E); 
     and
       (2) by inserting after subparagraph (C) the following:
       ``(D) The Secretary of Labor may, on a case-by-case basis, 
     subject an employer to random inspections for a period of up 
     to five years beginning on the date that such employer is 
     found by the Secretary of Labor to have engaged in a willful 
     failure to meet a condition of subparagraph (A), or a 
     misrepresentation of material fact in an application.''.
       (c) Expedited Reviews and Decisions.--Section 214(c)(2)(C) 
     (8 U.S.C. 1184(c)(2)(C)) is amended by inserting ``or section 
     101(a)(15)(H)(i)(b)'' after ``section 101(a)(15)(L)''.
       (d) Determinations on Labor Condition Applications To Be 
     Made by Attorney General.--
       (1) In general.--Section 101(a)(15)(H)(i)(b) (8 U.S.C. 
     1101(a)(15)(H)(i)(b)) is amended by striking ``with respect 
     to whom'' and all that follows through ``with the Secretary'' 
     and inserting ``with respect to whom the Attorney General 
     determines that the intending employer has filed with the 
     Attorney General''.
       (2) Conforming amendments.--Section 212(n) (8 U.S.C. 
     1182(n)(1)) is amended--
       (A) in paragraph (1)--
       (i) in the first sentence, by striking ``Secretary of 
     Labor'' and inserting ``Attorney General'';
       (ii) in the sixth and eighth sentences, by inserting ``of 
     Labor'' after ``Secretary'' each place it appears;
       (iii) in the ninth sentence, by striking ``Secretary of 
     Labor'' and inserting ``Attorney General'';
       (iv) by amending the tenth sentence to read as follows: 
     ``Unless the Attorney General finds that the application is 
     incomplete or obviously inaccurate, the Attorney General 
     shall provide the certification described in section 
     101(a)(15)(H)(i)(b) and adjudicate the nonimmigrant visa 
     petition.''; and
       (v) by inserting in full measure margin after subparagraph 
     (D) the following new sentence: ``Such application shall be 
     filed with the employer's petition for a nonimmigrant visa 
     for the alien, and the Attorney General shall transmit a copy 
     of such application to the Secretary of Labor.''; and
       (B) in the first sentence of paragraph (2)(A), by striking 
     ``Secretary'' and inserting ``Secretary of Labor''.
       (e) Prevailing Wage Considerations.--Section 101(a) (8 
     U.S.C. 1101(a)) is amended by adding at the end the 
     following:
       ``(50) The term `prevailing wage' means the following:
       ``(A) If the job opportunity is subject to a wage 
     determination in the area under the Act of March 3, 1931 
     (commonly known as the Davis-Bacon Act (40 U.S.C. 276a et 
     seq.)), or the Service Contract Act of 1965 (41 U.S.C. 351 et 
     seq.), the prevailing wage shall be the rate required under 
     such Acts.
       ``(B) If the job opportunity is not covered by a prevailing 
     wage determined under the Acts referred to in subparagraph 
     (A), the prevailing wage shall be--
       ``(i) the rate of wages to be determined, to the extent 
     feasible, by adding the wage paid to workers similarly 
     employed in the area of intended employment and dividing the 
     total by the number of such workers, except that the wage set 
     forth in the application shall be considered as meeting the 
     prevailing wage standard if it is within 5 percent of the 
     average rate of wages; or
       ``(ii) if the job opportunity is covered by a collective 
     bargaining agreement, the wage rate set forth in the 
     agreement shall be considered as not adversely affecting the 
     wages of United States workers similarly employed and shall 
     be considered the `prevailing wage'.
       ``(C) A prevailing wage determination made pursuant to this 
     section shall not permit an employer to pay a wage lower than 
     that required under any other Federal, State, or local law.
       ``(D) For purposes of this section:
       ``(i) The term `similarly employed' means having 
     substantially comparable jobs in the occupational category in 
     the area of intended employment, except that, if no such 
     workers are employed by employers other than the employer 
     applicant in the area of intended employment, the term 
     `similarly employed' means--
       ``(I) having jobs requiring a substantially similar level 
     of skills within the area of intended employment; or
       ``(II) if there are no substantially comparable jobs in the 
     area of intended employment, having substantially comparable 
     jobs with employers outside of the area of intended 
     employment.
       ``(ii) The term `substantially comparable jobs' means jobs 
     with substantially comparable employers, taking into account 
     size, profit or nonprofit classification, start-up or mature 
     business operations, the specific industry, public or private 
     sector, status as an academic institution, or other defining 
     characteristics which the employer can demonstrate result in 
     a distinct wage scale from the industry at large.
       ``(iii) The term `similarly employed' shall be construed to 
     require separate average rates of wage taking into account 
     such factors as years of experience, academic degree, 
     educational institution attended, grade point average, 
     publications or other distinctions, personal traits deemed 
     essential to job performance, specialized training or skills, 
     competitive market factors, or any other factors typically 
     considered by employers within the industry.
       (iv) Employers may use either government or nongovernment 
     published surveys, including industry, region, or Statewide 
     wage surveys, to determine the prevailing wage, which shall 
     be considered correct and valid where the employer has 
     maintained a copy of the survey information.
       (f) Posting Requirement.--Section 212(n)(1)(C)(ii) (8 
     U.S.C. 1182(n)(1)(C)(ii)) is amended to read as follows:
       ``(ii) if there is no such bargaining representative, has 
     provided notice of filing to the employer's employees in the 
     occupational classification through such methods as physical 
     posting in a conspicuous location at the employer's place of 
     business, or electronic posting through an internal job bank, 
     or electronic notification available to employees in the 
     occupational classification.''.

     SEC. 6. ANNUAL REPORTS ON H1-B VISAS.

       Section 212(n) (8 U.S.C. 1182(n)) is amended by adding at 
     the end the following:
       ``(3) Using data from petitions for visas issued under 
     section 101(a)(15)(H)(i)(b), the Attorney General shall 
     annually submit the following reports to Congress:
       ``(A) Quarterly reports on the numbers of aliens who were 
     provided nonimmigrant status under section 
     101(a)(15)(H)(i)(b) during the previous quarter and who were 
     subject to the numerical ceiling for the fiscal year 
     established under section 214(g)(1).
       ``(B) Annual reports on the occupations and compensation of 
     aliens provided nonimmigrant status under such section during 
     the previous fiscal year.''.

     SEC. 7. LIMITATION ON PER COUNTRY CEILING WITH RESPECT TO 
                   EMPLOYMENT-BASED IMMIGRANTS.

       (a) Special Rules.--Section 202(a) (8 U.S.C. 1152(a)) is 
     amended by adding at the end the following new paragraph:
       ``(5) Rules for employment-based immigrants.--
       ``(A) Employment-based immigrants not subject to per 
     country limitation if additional visas available.--If the 
     total number of visas available under paragraph (1), (2), 
     (3), (4), or (5) of section 203(b) for a calendar quarter 
     exceeds the number of qualified immigrants who may otherwise 
     be issued such visas, the visas made available under that 
     paragraph shall be issued without regard to the numerical 
     limitation under paragraph (2) of this subsection during the 
     remainder of the calendar quarter.
       ``(B) Limiting fall across for certain countries subject to 
     subsection (e).--In the case of a foreign state or dependent 
     area to which subsection (e) applies, if the total number of 
     visas issued under section 203(b) exceeds the maximum number 
     of visas that may be made available to immigrants of the 
     state or area under section 203(b) consistent with subsection 
     (e) (determined without regard to this paragraph), in 
     applying subsection (e) all visas shall be deemed to have 
     been required for the classes of aliens specified in section 
     203(b).''.
       (b) Conforming Amendments.--
       (1) Section 202(a)(2) (8 U.S.C. 1152(a)(2)) is amended by 
     striking ``paragraphs (3) and (4)'' and inserting 
     ``paragraphs (3), (4), and (5)''.
       (2) Section 202(e)(3) (8 U.S.C. 1152(e)(3)) is amended by 
     striking ``the proportion of the visa numbers'' and inserting 
     ``except as provided in subsection (a)(5), the proportion of 
     the visa numbers''.
       (c) One-Time Protection Under Per Country Ceiling.--
     Notwithstanding section 214(g)(4) of the Immigration and 
     Nationality Act, any alien who--
       (1) as of the date of enactment of this Act is a 
     nonimmigrant described in section 101(a)(15)(H)(i) of that 
     Act;
       (2) is the beneficiary of a petition filed under section 
     204(a) for a preference status under paragraph (1), (2), or 
     (3) of section 203(b); and
       (3) would be subject to the per country limitations 
     applicable to immigrants under those paragraphs but for this 
     subsection,
     may apply for and the Attorney General may grant an extension 
     of such nonimmigrant status until the alien's application for 
     adjustment of status has been processed and a decision made 
     thereon.

     SEC. 8. ACADEMIC HONORARIA.

       Section 212 (8 U.S.C. 1182) is amended by adding at the end 
     the following new subsection:
       ``(p) Any alien admitted under section 101(a)(15)(B) may 
     accept an honorarium payment and associated incidental 
     expenses for a usual academic activity or activities, as 
     defined by the Attorney General in consultation with the 
     Secretary of Education, if such payment is offered by an 
     institution of higher education (as defined in section 
     1201(a) of the Higher Education Act of 1965) or other 
     nonprofit entity and is made for services conducted for the 
     benefit of that institution or entity.''.

                                             American Business for


                                            Legal Immigration,

                                                    March 2, 1998.
     Hon. Spencer Abraham,
     U.S. Senate,
     Washington, DC.
       Dear Senator Abraham: We write to applaud you, on behalf of 
     American businesses, for introducing legislation that 
     addresses the critical shortage of skilled employees in the 
     workforce. The American Competitiveness Act, which you have 
     introduced, will improve the important H-1B visa program and 
     help to ensure that U.S. companies can continue to create 
     jobs and meet the demands of the future.
       Today, as you well know, hundreds of thousands of positions 
     in the fastest growing sectors of the U.S. economy go 
     unfilled. In order

[[Page S1521]]

     for American companies to remain competitive in a global 
     market we need to attract the best talent, regardless of 
     place of birth. Professionals who come here on temporary H-1B 
     visas are a key component of America's high technology 
     workforce. With the cap on H-1B visas expected to be hit by 
     early summer of this year, your legislation could hardly come 
     to a more crucial time for American business. In addition, 
     your legislation recognizes the need to provide additional 
     training to American-born workers, so that they can continue 
     to be the world's best workforce in the 21st century. For 
     this recognition we also give you credit and offer our 
     thanks.
       We appreciate your steadfast dedication to the vital issues 
     facing the American workforce, and hope that your colleagues 
     will also recognize this problem of crisis proportions. Under 
     your leadership, Congress can solve a major dilemma for 
     American business and simultaneously reaffirm the value of 
     hard work, innovation, and competition. We also firmly 
     believe that the American Competitiveness Act will do more to 
     directly create jobs for Americans--and to keep jobs in this 
     country--than any other bill that will be considered by 
     Congress this year.
       Thank you once again for your continued leadership on this 
     critical issue. We look forward to working with you to 
     advance this much needed legislation in the weeks and months 
     ahead.
           Sincerely,
                                                    Scott Hoffman,
                                                         Director.
       American Council on International Personnel; American 
     Electronics Association; American Immigration Lawyers 
     Association; Business Software Alliance; Computing Technology 
     Industries Association; Electronic Industries Association; 
     Information Technology Association of America; National 
     Association of Manufacturers; National Technical Services 
     Association; United States Chamber of Commerce.
                                  ____

                                           United States Pan Asian


                                 American Chamber of Commerce,

                                    Washington, DC, March 3, 1998.
     Re the American Competitiveness Act.

     Senator Spencer Abraham,
     Chairman, Immigration Subcommittee, Senate Judiciary 
         Committee, Washington, DC.
       Dear Senator Abraham: We write to endorse the American 
     Competitiveness Act.
       This is a new age. Americans and U.S. businesses are 
     operating in an increasingly competitive global environment. 
     Although we are the first and best in the world, we must 
     strive to stay on top. To this end, a well-educated 
     citizenry, a hospitable workplace that offers equal 
     opportunity to all without regard to race or gender, and a 
     skilled work force are essential to sustained growth in the 
     U.S. economy.
       In my own business, I represent American companies who have 
     an unfulfilled need for information technology professionals. 
     Because our colleges and universities do not produce enough 
     of them, and whomever they have trained are immediately 
     absorbed into the workforce; our companies must recruit from 
     outside the country to get jobs done. That is why your 
     proposal to increase H-1B temporary visas by 25,000 is so 
     timely and important. This increase will reduce the backlog 
     of issuing H-1B visas to qualified workers whom our companies 
     need to render their services, save jobs and create more 
     jobs.
       We would oppose granting the Department of Labor the vastly 
     expanded authority it is now seeking. The Administration's 
     proposals to shorten the maximum length of stay for an 
     individual on an H-1B, require up-front recruiting, which 
     could delay hiring for many months or even years, and broad 
     no-layoff attestations are clearly designed to kill, rather 
     than improve the program. These ``reforms'' will severely 
     diminish companies' access to necessary personnel and will 
     therefore work against any increase in the H-1B visa quota.
       The Labor Department claims it is protecting U.S. workers, 
     but against whom are they being protected? Many of those 
     entering the United States on H-1B visas are from Asian 
     Pacific countries. Our organization finds it offensive that 
     the Administration would try to demonize such individuals in 
     the minds of the American public. This type of immigrant-
     bashing coming from the Administration must stop.
       As a non-profit organization, we whole-heartedly support 
     your proposal to permit different prevailing wage 
     calculations for universities, charities and other non-profit 
     organizations. This proposal brings reality to the 
     administration of our immigration laws. It also reflects the 
     true condition of the market place where non-profit 
     organizations do not pay at the rate of for profit 
     businesses. The proposal makes good sense.
       The Act's provisions for scholarships for low-income 
     students to pursue higher education in mathematics, 
     engineering and computer science, and increased training and 
     job search support in the information technology industry 
     will indeed prepare America's work force for the coming 
     century.
       We applaud your efforts in the bill to eliminate the 
     discriminatory effect of per country employment immigration 
     limits on nationals from certain Asian Pacific nations.
       The American Competitiveness Act is a significant step into 
     the direction that will keep us competitive into the next 
     millenium. We are pleased to support it.
       Sincerely
                                                   Susan Au Allen,
                                                        President.
                                 ______