Congressional Record, Volume 144 Issue 24 (Tuesday, March 10, 1998)

[Congressional Record Volume 144, Number 24 (Tuesday, March 10, 1998)]
[Senate]
[Pages S1697-S1702]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. LUGAR:
S. 1733. A bill to require the Commissioner of Social Security and
food stamp State agencies to take certain actions to ensure that food
stamp coupons are not issued for deceased individuals; to the Committee
on Agriculture, Nutrition, and Forestry.

THE FOOD STAMP FRAUD PREVENTION ACT

Mr. LUGAR. Mr. President, I rise today to introduce a bill to combat
fraud and waste in the food stamp program--in this case, the fraud and
waste results from deceased individuals being counted as food stamp
recipients. At my request, the General Accounting Office (GAO) has
recently completed an inquiry into groups of ineligible persons being
counted as food stamp recipients. In the report being released today,
GAO reported that 26,000 deceased individuals in four states were on
the food stamp rolls. My bill will require the Social Security
Administration to share information from its Death Master file with
state food stamp agencies to verify that no deceased individuals are
counted as members of food stamp households, either increasing a
households' benefits or allowing an individual to illegally receive
benefits in the deceased person's name.
Last year, GAO reported to the Agriculture Committee that over $3
million in food stamp benefits were being overpaid to prisoners'
households. In response, we passed legislation to stop prisoners from
receiving payments. In follow-up to the prisoner study and legislation,
I requested that GAO determine if other ineligible individuals were
similarly being counted as members of food stamp households. Today

[[Page S1698]]

GAO will release the details of their study showing that, over a 2-year
period, about 26,000 deceased individuals in the four states examined
(California, Texas, New York, and Florida) were counted as members of
food stamp households. According to GAO, this resulted in overpayments
of food stamp benefits of an estimated $8.6 million in four states
alone.
Current law requires that households notify their local welfare
office of any changes in the makeup of the household within ten days.
The GAO report showed that the deceased individuals were counted in
food stamp households for an average of four months; and, in a few
instances, the deceased individuals were counted as beneficiaries for
the full two years the review was conducted. This is unacceptable
particularly since this type of fraud can easily be prevented.
Mr. President, one federal agency has the information to prevent this
fraud and abuse, but is not sharing it with other agencies issuing
federal benefits. The Social Security Administration (SSA) has a Death
Master File that compiles death information from a wide variety of
sources and is considered the most comprehensive list of death
information available in the federal government. According to the GAO,
a match using SSA's Death Master File information could be a cost-
effective method for identifying such individuals in food stamp
households and eliminating these overpayments. States already rely on
the SSA to verify the social security numbers of food stamp applicants.
Therefore, a system already exists in one branch of the federal
government that, with some modifications, could stop these
overpayments.
Although the Social Security Administration agrees that a portion of
their death information can be shared with the states and the
Department of Agriculture for food stamp program purposes, in SSA's
comments to GAO it does not believe it has the authority, under current
law, to share all of the death information. Therefore, I am introducing
legislation that will require the Commissioner of SSA to establish
cooperative arrangements with each state agency that administers the
food stamp program that will allow the sharing of all death data. My
bill then requires the food stamp program to provide the information
necessary for the Commissioner to verify that no deceased individual is
being counted as part of a food stamp household.
The Food Stamp program provides a safety net for millions of people.
We cannot allow fraud and abuse to undermine the food stamp program.
Integrity is essential to ensure a program that can serve those in
need. It is Congress' responsibility to play a role in ending fraud and
abuse in all federally funded programs. This legislation is an
important step in ending fraud and abuse in the Food Stamp program.
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. 1733

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

SECTION 1. NOTIFICATION OF CERTAIN STATE AGENCIES BY
COMMISSIONER OF SOCIAL SECURITY OF DECEASED
INDIVIDUALS.

(a) In General.--Section 205(r) of the Social Security Act
(42 U.S.C. 405(r)) is amended by adding at the end the
following:
``(8)(A) The Commissioner shall establish a cooperative
arrangement with each State agency that administers the food
stamp program established under the Food Stamp Act of 1977 (7
U.S.C. 2011 et seq.).
``(B) Under the arrangement in subparagraph (A), the State
agency shall provide information to the Commissioner, in such
form and manner as the Commissioner determines necessary,
regarding individuals receiving benefits under the food stamp
program.
``(C) The Commissioner shall compare information received
under subparagraph (B) with information obtained under
paragraph (1) and notify the State agency of the individuals
who are deceased.
``(D) An arrangement under subparagraph (A) shall meet the
requirements of paragraph (3)(A).''.
(b) Report.--Not later than 180 days, 1 year, and 18 months
after the date of enactment of this Act, the Commissioner of
Social Security shall submit a report regarding the progress
and effectiveness of the cooperative arrangements established
with State agencies under section 205(r)(8) of the Social
Security Act (42 U.S.C. 405(r)(8)) to--
(1) the Committee on Agriculture of the House of
Representatives;
(2) the Committee on Agriculture, Nutrition, and Forestry
of the Senate;
(3) the Committee on Ways and Means of the House of
Representatives;
(4) the Committee on Finance of the Senate; and
(5) the Secretary of the Treasury.
(c) Amendment of Internal Revenue Code of 1986.--Clause
(ii) of subparagraph (B) of section 6103(d)(4) of the
Internal Revenue Code of 1986 (relating to the availability
and use of death information) is amended by inserting ``or,
in the case of a food stamp program established under the
Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.), State
agency'' after ``agency''.

SEC. 2. PROVISION OF INFORMATION TO ENSURE NONISSUANCE OF
FOOD STAMP COUPONS FOR DECEASED INDIVIDUALS.

Section 11(e)(20) of the Food Stamp Act of 1977 (7 U.S.C.
2020(e)(20)) is amended--
(1) in subparagraph (A), by striking ``and'' at the end;
(2) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following:
``(C) to provide such information to the Commissioner of
Social Security as the Commissioner determines is necessary
to enable the Commissioner to use the information provided
under the arrangement established under section 205(r)(8) of
the Social Security Act (42 U.S.C. 405(r)(8)) to verify and
otherwise ensure that coupons are not issued for deceased
individuals;''.

SEC. 3. EFFECTIVE DATE.

This Act and the amendments made by this Act take effect on
the date that is 180 days after the date of enactment of this
Act.
______

By Mr. WARNER (for himself and Mr. Robb):
S. 1735. A bill to allow the National Park Service to acquire certain
land for addition to the Wilderness Battlefield, as authorized by
Public Law 102-541, by purchase or exchange as well as by donation; to
the Committee on Energy and Natural Resources.

longstreet's flank attack legislation

Mr. WARNER. Mr. President, I rise today to introduce legislation
which will preserve a site of great historical importance. The legacy
of Civil War battlefields must be perpetuated, not only to commemorate
those who lost their lives in this tragic epoch, but also to consecrate
land upon which some of our country's finest strategic maneuvers
occurred. On the hallowed land of Wilderness, VA occurred one of the
greatest tactical stratagems in military history. Snatching the
initiative to turn the tide of battle, Lt. Gen. James A. Longstreet,
under the command of Gen. Robert E. Lee, forced back Union forces
directed by Gen. Ulysses S. Grant, in an advance known as
``Longstreet's Flank Attack.''
Mr. President, this legislation will allow the Park Service to
acquire this stretch of land, which will serve to complete Wilderness
Battlefield. The legacy of the Civil War is far-reaching. A war which
wrought such destruction has been the source of much fascination for
scholars and amateur historians. The Battle of Wilderness is legendary
for the tactical skills employed and the caliber of the soldiers who
fought. There, among the tangled forests and twisted undergrowth, the
Union Army, numerically superior and well supplied, were forced into
confrontation with General Lee's hardscrabble Confederate troops. It
would be one of the last battles in which Lee's incomparable martial
machine would force Grant's Army of the Potomac to withdraw. It is also
the site of the wounding of General Longstreet, who, like Gen.
Stonewall Jackson, was wounded by friendly fire. Though Longstreet's
injury was not mortal, the genius of the cadre of officers under the
command of Lee dwindled. Thus would begin the twilight of the
Confederacy.
Legislation passed in the 102d Congress would have allowed the Park
Service to acquire this land by donation. Despite numerous efforts, the
Park Service has been unable to accomplish this. The legislation at
hand would amend Public law 102-541 to allow the Park Service to
procure the land by purchase or exchange as well as donation. The
heritage and history which dwell amongst the interlaced undergrowth of
this land deserve our recognition. I look forward to the swift passage
of this bill.
______

By Mr. ROBB:
S. 1736. A bill to authorize the Secretary of Transportation to issue
a certificate of documentation with appropriate endorsement for
employment in the coastwise trade for vessel Betty Jane; to the
Committee on Commerce, Science, and Transportation.

[[Page S1699]]

jones act waiver legislation

Mr. ROBB. Mr. President, I am introducing a bill today to authorize
the Coast Guard to issue the appropriate endorsement for the vessel
Betty Jane Virginia Registration number VA 7271 P to engage in the
coastwise trade and fisheries. This legislation is necessary to resolve
an issue regarding official documentation of the Betty Jane's chain of
title.
The Betty Jane was built in the United States in Deltaville, Virginia
by an American private boat builder in 1970. It is a 36-foot wood hull,
in-board gas propulsion boat, which is planned to be used for the
excursion tourboat trade. The builder and the only former boat owner
are deceased. The lack of an appropriate affidavit from these persons
has left a gap in the chain of title of the vessel. The Coast Guard has
informed the owner of the Betty Jane that if the gap is left
unresolved, a coastwise endorsement cannot be issued for the vessel,
even though the present owner is a U.S. citizen, the only former owner
was a U.S. citizen, and the vessel was built in the United States.
The Congress passes a number of these technical bills every year. I'm
introducing this bill today so that the Senate Commerce Committee may
act upon it with the upcoming coastwise bill this session.
______

By Mr. MACK (for himself, Mr. Kerrey, Mr. Nickles, Mr. Conrad,
Mr. Grassley, Ms. Moseley-Braun, Mr. Breaux, Mr. Craig, Mr.
Coverdell, Mr. McConnell, Mr. Thurmond, Mr. Murkowski, Mr.
Bond, Mr. Lugar, Mr. Ashcroft, Mr. DeWine, and Mr. Abraham):
S. 1737. A bill to amend the Internal Revenue Code of 1986 to provide
a uniform application of the confidentiality privilege to taxpayer
communications with federally authorized practitioners; to the
Committee on Finance.

the taxpayer confidentiality act of 1998

Mr. MACK. Mr. President, I rise to introduce the Taxpayer
Confidentiality Act of 1998. This bill corrects an inequity in the way
that taxpayers are treated by the IRS. Under current law,
communications between taxpayers and their lawyers concerning tax
advice can often be protected from disclosure to the IRS by the common
law attorney-client privilege.
Many taxpayers choose to obtain their tax advice from practitioners
who are not attorneys. Under federal law, there are other categories of
tax practitioners to whom these taxpayers can turn for tax advice--
certified public accountants, enrolled agents, enrolled actuaries, and
attorneys providing advice in the role of a tax practitioner. These tax
practitioners are subject to federal regulation, and are authorized to
provide tax advice and to represent taxpayers before the IRS.
But under current law, communications with these other tax
practitioners cannot be protected from disclosure to the IRS by a
client privilege. The very same words on the very same piece of paper
that would be beyond the reach of the IRS if they were the advice of an
attorney at law would have to be turned over to the IRS if they came
from a certified public accountant or an enrolled agent. This is an
unfair penalty to impose on a taxpayer based on their choice of tax
advisor, particularly since many taxpayers do not have the financial
resources to hire legal counsel.
The Taxpayer Confidentiality Act of 1998 fixes this unjust situation,
and provides taxpayers with the confidence of knowing that their tax
advice communications with any federally-authorized tax practitioners
are afforded equal confidentiality protections in dealings with the
IRS.
This bill does not unduly restrict the ability of the IRS to gather
information. The IRS will still be able to discover the facts. The
taxpayer can protect from disclosure only tax advice communications
that would be protected by the attorney-client privilege if the advisor
were acting as an attorney. The client privilege extends only to
communications and does not cover the taxpayer's business records.
Also, courts have widely held that information used to prepare a tax
return is not subject to a privilege and thus, under the Act, would
remain subject to disclosure.
The bill will not hinder criminal investigations and prosecutions, as
taxpayers can assert the privilege only in noncriminal matters before
the IRS and noncriminal judicial proceedings arising from these
matters. And existing exceptions to the attorney-client confidentiality
privilege would also apply to the protections under the bill. Thus,
communications in the furtherance of a crime or a fraud would not be
protected.
And the bill does not affect the ability of anyone other than the
IRS--including other federal or state agencies, and private individuals
involved in civil litigation--to obtain access to information that they
have the right under current law to obtain. It is just a narrowly-
tailored, common-sense solution to the problem of treating taxpayers
differently based on the tax advisor they employ. Taxpayers should have
a right to privacy in the tax advice they receive from qualified tax
practitioners.
The Taxpayer Confidentiality Act of 1998 does not modify the
attorney-client privilege in any way, and does not expand the authority
of federally-regulated tax practitioners in any way. It merely provides
equal treatment for all taxpayers who receive tax advice from
federally-authorized sources. The Act curbs unwarranted IRS
intrusiveness, and must be included in our IRS reform efforts.
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. 1737

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 ``Taxpayer Confidentiality Act
of 1998''.

SEC. 2. UNIFORM APPLICATION OF CONFIDENTIALITY PRIVILEGE TO
TAXPAYER COMMUNICATIONS WITH FEDERALLY
AUTHORIZED PRACTITIONERS.

(a) In General.--Chapter 77 of the Internal Revenue Code of
1986 (relating to miscellaneous provisions) is amended by
adding at the end the following new section:

``SEC. 7525. UNIFORM APPLICATION OF CONFIDENTIALITY PRIVILEGE
TO TAXPAYER COMMUNICATIONS WITH FEDERALLY
AUTHORIZED PRACTITIONERS.

``(a) General Rule.--With respect to tax advice, the same
common law protections of confidentiality which apply to a
communication between a taxpayer and an attorney shall also
apply to a communication between a taxpayer and any federally
authorized tax practitioner if the communication would be
considered a privileged communication if it were between a
taxpayer and an attorney.
``(b) Limitations.--Subsection (a) may only be asserted
in--
``(1) noncriminal tax matters before the Internal Revenue
Service, and
``(2) noncriminal proceedings in Federal courts with
respect to such matters.
``(c) Federally Authorized Tax Practitioner.--For purposes
of this section, the term `federally authorized tax
practitioner' means any individual who is authorized under
Federal law to practice before the Internal Revenue Service
if such practice is subject to Federal regulation under
section 330 of title 31, United States Code.''
(b) Conforming Amendment.--The table of sections for such
chapter 77 is amended by adding at the end the following new
item:

``Sec. 7525. Uniform application of confidentiality privilege to
taxpayer communications with federally authorized
practitioners.''

By Mr. ABRAHAM:
S. 1738. A bill to amend the National Sea Grant College Program act
to exclude Lake Champlain from the definition of the Great Lakes, which
was added by the National Sea Grant College Program Reauthorization Act
of 1998; to the Committee on Commerce, Science, and Transportation.

great lakes legislation

Mr. ABRAHAM. Mr. President, I rise today to introduce legislation to
reverse the recent designation of Lake Champlain as a ``Great Lake.''
Mr. President, I was extremely pleased to be an original cosponsor of
the Sea Grant College Program Act, an important piece of legislation
which supplies crucial funding for programs targeted at zebra mussel
research and control. This Act is extremely important to the Great Lake
states, which suffer considerably from zebra mussel infestation.
Late last year, the Sea Grant College Program Act was amended to
allow

[[Page S1700]]

Vermont Universities to apply for grants related to zebra mussel
programs. This amendment, which designated Vermont's Lake Champlain a
Great Lake, was never offered in Committee for consideration. Nor was
it shared with the Great Lakes Task Force, whose Members would have
been very interested in reviewing it.
This was unfortunate, Mr. President, because that Lake Champlain
suffers greatly from zebra mussel infestations and needs help. Let me
make clear, I am not opposed to allowing Vermont Universities to apply
to the Sea Grant program. Lake Champlain has a very real zebra mussel
problem and it should be addressed. Michiganians can understand and
empathize with Vermont's efforts to battle this invader.
However, I am troubled by the approach taken to achieve funding for
zebra mussel programs in Vermont. Rather than asking for language which
would specifically allow Vermont Universities to apply for Sea Grant
dollars, the definition of a Great Lake was changed to include Lake
Champlain when, clearly, it is not. Lake Ontario, covering over 7,300
square miles, is the smallest of the Great Lakes. It is almost 17 times
the size of Lake Champlain and twice as deep. Lake Superior, the
largest of the Great Lakes, is over 70 times the size of Lake
Champlain. Clearly Vermont's lake is not a member of this elite class.
For that reason, Mr. President, I have introduced this legislation to
reverse the designation of Lake Champlain as a Great Lake. I would
support language that specifically allows Vermont to apply for Sea
Grant assistance, but I cannot agree to language changing the
definition of a Great Lake, even for such a limited purpose.
Notwithstanding assurances to the contrary, I believe such an action
could lead to a host of unintended consequences and even serve as the
basis for states outside the region to push for participation in a
number of substantial Great Lakes issues. In addition, I oppose
defining Lake Champlain as a Great Lake in the interest of clarity and
truth. To call Lake Champlain a Great Lake is sheer nonsense.
The legislation I have introduced will amend the definition to state
that only the Great Lakes, Superior, Michigan, Huron, Erie and Ontario
are to be defined as Great Lakes. I hope that we can resolve this soon
and put this entire matter to rest.
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. 1738

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

SECTION 1. DEFINITION OF GREAT LAKES FOR NATIONAL SEA GRANT
COLLEGE PROGRAM ACT.

Section 203 of the National Sea Grant College Program Act
(33 U.S.C. 1122) is amended in paragraph (5), as added by
section 4(a)(3) of the National Sea Grant College Program
Reauthorization Act of 1998, by striking ``includes Lake
Champlain'' and inserting ``applies to Lake Superior, Lake
Michigan, Lake Huron, Lake Erie and Lake Ontario''.
______

By Mr. FRIST (for himself and Mr. Rockefeller):
S. 1739. A bill to establish a commission, under the aegis of the
National Science Foundation, to review and propose recommendations for
assuring United States leadership in science and mathematics; to the
Committee on Labor and Human Resources.

the national commission for science and mathematics leadership act

Mr. FRIST. Mr. President, I rise today to announce the establishment
of the National Commission for Science and Mathematics Leadership. This
effort is a direct result of the United States' devastating performance
of 12th grade students on the recently released Third International
Mathematics and Science Study (TIMSS), the most comprehensive and
rigorous comparison of quantitative skills across nations. If we, as a
nation, are going to continue to be global leaders in the new
knowledge-based economy, we must first re-evaluate our current failures
in our classrooms. I concur with Secretary Daley when he stated,
``These results are entirely unacceptable.''
TIMSS was designed to constructively assess the students' knowledge
of mathematics and science needed to function effectively in society as
adults. American 12th graders were outperformed in mathematics and
science literacy by their counterparts in 12 of 20 countries, and only
faired better than 2, Cypress and South Africa. In advanced mathematics
and physics, no country performed more poorly. We simply cannot accept
the conclusion of this study without considering its consequences on
our entire educational system.
The 4th grade TIMSS measurement indicated that the American students
are well above the international average in mathematics and very near
the top in achievement in science. However, the United States Is the
only country in TIMSS whose students dropped in ranking from above
average in mathematics at the fourth grade level to slightly below
average performance at the eighth grade. And it only gets worse. Why
does this drop-off occur? American students start out equal with or
ahead in basic skills and steadily decline the longer they stay in
school, compared with the students of our country's main trading
partners.
Our children cannot afford to be illiterate in mathematics and
science. The rapidly changing American society demands skills requiring
mathematics, science, and technology. Information Technology, perhaps
the fastest growing sector of our economy with 90% of new jobs, relies
on more than basic high school literacy in mathematics and science.
The National Commission on Science and Mathematics Leadership is a
first step toward improving our current educational system. It is a
solid commitment from Congress to establish a core of national experts
to review and propose recommendations for assuring leadership in
science and mathematics training in the United States. Furthermore,
using TIMSS as a comprehensive and valuable tool, the Commission, in
coordination with the National Academy of Sciences, will analyze the
results of this international study to better our schools, and more
importantly, the future of our children.
Mr. ROCKEFELLER. Mr. President, I rise today to join my colleague
Senator Frist in introducing legislation to authorize the National
Science Foundation to form a commission to review and propose
recommendations for assuring the United States leadership in science
and mathematics. This bill would require the formation of a 12 member
commission of experts in the field of science and mathematics
education. The commission is charged with reviewing the recently
released Third International Mathematics and Science (TIMSS) study
results, along with whatever other relevant information they need to
assess the state of science and mathematics education in the United
States, and reporting back to Congress with a set of recommendations
for implementation by public and private agencies; these
recommendations would serve to allow United States students to become
preeminent among the nations of the world.
As everyone in the Senate knows, I have been a long and ardent
supporter of education. That is why I read with such dismay the recent
TIMSS study results which show United States students behind every
major industrialized nation in the study. This is an unacceptable
situation. The United States' economy is becoming increasingly
dependent on high-technology, information management, and intellectual
ability rather than raw materials, natural resources and muscle power.
It is imperative that our high-school graduates--whether they go on to
college, post-secondary technical training, or move straight into the
workforce--have a solid foundation of science and mathematics
education. A recent study suggests that 60 percent of positions require
some sort of computer skills, while only 22 percent of today's workers
have applicable skills. We can not let this inequality continue to
future generations.
Unfortunately the TIMSS study results show that we are setting up our
students to fail. We need to identify, and work diligently to
implement, means to correct this situation. The commission formed by
this bill is a needed first step. I encourage my colleagues to support
this bill.
______

By Ms. COLLINS (for herself and Mr. Durbin):
S. 1740. A bill to amend the Communications Act of 1934 to improve
the

[[Page S1701]]

protections against the unauthorized change of subscribers from one
telecommunications carrier to another, and other purposes; to the
Committee on Commerce, Science, and Transportation.

the telephone slamming prevention act of 1998

Ms. COLLINS. Mr. President, today I am introducing a bill to curtail
a fraudulent practice known as slamming--the unauthorized change of a
customer's telephone service provider. Telephone slamming is a
widespread and growing problem. In Maine, for example, slamming
complaints to the local telephone company increased by 100% from 1996
to 1997. Nationwide, slamming is also the number one telephone-related
complaint to the FCC. While the FCC received a total of more than
20,000 slamming complaints in 1997, a significant increase over the
previous year, estimates from phone companies indicated that as many as
one million people were slammed last year.
Last fall, the Permanent Subcommittee on Investigations, which I
chair, undertook an extensive investigation of the slamming problem. On
February 18th, I chaired a field hearing on slamming in Portland,
Maine. My distinguished colleague, Senator Richard Durbin, joined me at
the hearing, and we heard first-hand from several consumers about the
problems they experienced with telephone slamming.
At the Subcommittee hearing, Maine slamming victims explained how
some long-distance companies used fraudulent or deceptive practices to
change their telephone service. Witnesses used words such as
``stealing,'' and ``criminal,'' and ``break-in'' to describe practices
employed by unscrupulous telephone companies to switch unsuspecting
customers and boost profits.
One witness, Pamela Corrigan from West Farmington, Maine, testified
that she was sent an unsolicited ``welcome package'' in the mail, which
looked like the stacks of junk mail that we receive every day. However,
this ``junk mail'' was not what it appeared to be. This ``welcome
package'' automatically signed her up for a new long distance service
unless she returned a card rejecting the change. She was amazed and
appalled that it was possible for a company to change her long distance
service simply because she did not respond that she did not want their
service.
Another witness, Susan Deblois from Winthrop, Maine, testified that
when she was slammed, her children were unable to use the 800 number
she had for them to call home in case of an emergency.
Slamming not only affects families but also small businesses and
communities. For example, Steve Klein, the owner of Mermaid
Transportation Company in Portland, Maine, testified that his business
phone lines, which are critical to his livelihood, were tied up for
four days which he was slammed by a long-distance telephone reseller
which falsely represented itself as AT&T.
Similarly, Ms. Corrigan, who is the town manager of Farmington,
Maine, reported that the town's phone lines were also slammed. Simply
put, Mr. President, no one is immune from this illegal activity.
Victims of slamming are frustrated. They are angry. They should not
have to spend their time and energy resolving problems that are not of
their own making. People rely on their home and business telephone
service, and they should be able to choose their own long-distance
company without fear that their decision will be changed without their
consent.
Deliberate slamming is like stealing and should not be tolerated. The
FCC must step up enforcement efforts to make sure that existing laws
and regulations are followed by telephone companies, and Congress must
act to strengthen penalties to halt this pernicious practice.
The comprehensive legislation that I am introducing today, along with
my colleague Senator Durbin, will attack the problem of slamming from
all sides.
First, the bill gets tough with those who engage in deliberate
slamming. It would increase civil penalties and establish new criminal
penalties for intentional slamming. Specifically, civil penalties would
be increased to a minimum of $50,000 for the first slamming offense and
$100,000 for a subsequent offense.
Criminal penalties would be established for intentional slamming, the
same as those for any other federal crime: a maximum of $100,000 and
one year imprisonment for a misdemeanor and $250,000 and five years
imprisonment for a felony. In addition, anyone convicted of intentional
slamming will be disqualified from being a telecommunications service
provider. The bill would also allow the states to bring action in
federal court against slammers on behalf of its residents, a provision
suggested by Senator Durbin.
Second, our legislation increases consumer protection. It would give
control back to consumers by taking the financial incentive away from
companies that engage in slamming. Rather than paying the slamming
company, consumers could pay their original carrier at their previous
rate. It would further protect consumers by eliminating the so-called
``welcome package'' method of verification, a favorite tool of
slammers, which is misused and deceptive.
Third, the bill strongly encourages the FCC to step up its
enforcement efforts against slamming. It would require local telephone
companies to report a summary of slamming complaints to the FCC for
further investigation, and it would require the FCC to report to
Congress on its enforcement actions against slammers.
Finally, the legislation would require the FCC to report to Congress
on whether or not its current procedures contain sufficient safeguards
to prevent unscrupulous telecommunications providers from receiving an
FCC license in the first place.
Mr. President, consumers have lost control over their
telecommunications service to unscrupulous providers. The Collins-
Durbin legislation would go a long way toward halting slamming. I urge
my colleagues to join me in the fight against slamming by co-sponsoring
the ``Telephone Slamming Prevention Act of 1998.''
For the information of all my colleagues, I ask unanimous consent to
include in the Record a detailed summary of the provisions contained in
this comprehensive anti-slamming bill.
There being no objection, the summary was ordered to be printed in
the Record, as follows:

Summary of Telephone Slamming Prevention Act of 1998

(1) Clarification of Verification Procedures: The bill
amends current law, which allows the FCC to determine the
verification procedures that telecommunications carriers can
use when executing a change in subscriber service, to place
some restrictions on the approved verification methods.
Specifically, this provision will eliminate the ``welcome
package'' method of verification. It will still allow the FCC
to determine the appropriate forms of verification and the
time and manner in which such verification must be retained
by carriers.
(2) Liability for Charges: The bill also allows subscribers
who have been slammed, and who have not yet paid their
telephone bill to the unauthorized carrier, to pay their
original carrier for their phone usage, at the rate they
would have been charged by their original carrier. The
provision will not change existing law and FCC regulations
that make the slamming carrier liable to the original carrier
for any charges it collects from a slammed subscriber. This
provision is designed to take away the financial incentive
for slamming.
(3) Additional Penalties: The bill also increases the civil
penalties for slamming and creates criminal penalties.
The civil penalties provision will require the FCC to
assess a minimum of $50,000 for the first slamming offense,
and $100,000 for any subsequent offense, unless the
Commission determines that there are mitigating
circumstances. Currently, the penalty typically assessed by
the FCC is only $40,000 for each offense.
In addition, this provision will allow the Commission, at
its discretion, to assess civil penalties against carriers
that make unauthorized carrier changes on behalf of their
agents or resellers. It will require the Commission to
promulgate regulations on the oversight responsibilities of
the underlying facilities-based carriers for their agents or
resellers. This will make it clear to carriers, who sell
access to their telephone lines, that they have some
responsibility for the actions of their agents or resellers.
Currently, slamming is not a crime. The criminal penalties
provision will make intentional slamming a misdemeanor for
the first offense (not more than one year imprisonment), and
a felony for subsequent intentional slamming offenses (not
more than five years imprisonment). Criminal fines for
intentional slamming are the same as those for any other
federal crime: a maximum of

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$100,000 for a misdemeanor and $250,000 for a felony. In
addition, anyone convicted of the crime of intentional
slamming will not be allowed to be a telecommunications
service provider, and any company substantially controlled by
a person convicted of intentional slamming will also be
disqualified from providing such services. After five years,
however, the FCC shall have the option to reinstate such
individuals or companies disqualified under this provision,
if it is in the public interest to do so.
(4) State Actions: The bill gives the states the right to
take action against slammers on behalf of its residents, and
makes it clear that nothing in this section preempts the
states from taking action against intra-state slammers. This
provision is necessary because some state supreme courts have
ruled that FCC regulatory authority preempts the states from
acting in this area.
(5) Reports on Slamming Complaints: The bill requires all
telecommunications carriers, including local exchange
carriers, to report on the number of subscriber slamming
complaints against each carrier. The provision allows the FCC
to determine how often these reports would have to be
submitted. This provision would not require carriers to refer
complaints on an individual basis, only a summary report that
could be used by the FCC to determine which companies are
engaging in patterns and practices of slamming.
(6) FCC Report on Slamming and Enforcement Actions: The
bill establishes a requirement that FCC submit a report to
Congress on its slamming enforcement actions. The FCC already
provides this information in its Common Carrier Scorecard, so
this provision does not establish a new report. It is
designed to make it clear to the FCC that Congress considers
slamming enforcement important.
(7) FCC Report on Adequacy of FCC License Process: This
bill requires the FCC report to Congress on whether current
licensing requirements and procedures are sufficient to
prevent fraudulent telecommunications providers from
receiving an FCC license. Currently, the FCC does not review
telecommunications provider applications prior to issuing FCC
licenses, allowing fraudulent companies into the
telecommunications marketplace.

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