[Congressional Record Volume 144, Number 47 (Friday, April 24, 1998)]
[Senate]
[Pages S3585-S3592]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. GRAMS:
  S. 1982. A bill to equalize the minimum adjustments to prices for 
fluid milk under milk marketing orders; to the Committee on 
Agriculture, Nutrition, and Forestry.


                      THE DAIRY REFORM ACT OF 1998

  Mr. GRAMS. Mr. President, I rise today to introduce legislation that 
seeks to restore fairness to the nation's dairy system--fairness that 
has long been missing, particularly in the Upper Midwest and especially 
in my home state of Minnesota.
  When Minnesotans are asked to name my state's leading industries, 
agriculture will certainly be at or near the top of most every list. 
Farming and farm-related business plays a critical role in Minnesota's 
economy. One out of every four Minnesota jobs is tied in some way to 
agriculture, and 25% of the state's economy is dependent upon farmers 
and agri-business, most of it focused in the dairy industry.
  What many people do not realize is that, despite those statistics, 
our state's dairy industry is in real trouble.
  Since dropping to number five in milk production--behind Wisconsin, 
California, Pennsylvania, and New York--Minnesota has been slowly but 
steadily losing its clout among the top dairy states in the nation. We 
have lost over 10,000 dairy farms in just the last decade, and today, 
dairy farms are drying up at a rate of about three every single day. 
Milk production has dropped significantly as a result--nearly 20% in 
the last decade.
  What makes this especially troubling is that much of the decline in 
Minnesota's dairy industry can be traced

[[Page S3586]]

directly to farm policies mandated outside of Minnesota's control, in 
Washington. And the outdated federal milk marketing orders program is a 
serious part of our dairy problems.
  The Midwest is one of the best places in the country for dairy. It 
should be growing and expanding in the Midwest, but because of the 
Government's outdated policies and programs, it is hurting and killing 
the dairy industry in the Midwest.
  The milk marketing orders is yet another example of a well-
intentioned scheme dreamed up by Washington bureaucrats that has gone 
seriously awry. Instead of helping Minnesotans, the milk orders 
actually hurt the state's economy and penalizing its taxpayers, while 
benefiting dairy farmers outside the Midwest.
  The problem can be traced back to 1937, when Congress enacted the 
``Agricultural Marketing Agreement Act.'' The legislation was created 
to encourage the milk production near the nation's major population 
centers and set a minimum price paid to dairy farmers for Class I milk. 
That federal ``nudge'' was necessary in some instances, because without 
refrigerated trucks, fluid milk could not be transported over long 
distances.
  In 1985, as part of that year's farm bill, Congress expanded the milk 
orders program to aid the dairy industry outside the Midwest by 
increasing the minimum price for Class I milk based on a ridiculous 
formula.
  This basically helps producers outside the Upper Midwest, while 
making dairy production less profitable for producers inside the Upper 
Midwest region.
  That is not because of anything that the farmers are doing, their 
productivity, the land, the climate, whatever. The only reason for the 
decline, again, is because of an outdated Federal dairy policy.
  This process is unfair and archaic. Above all, it is opposite in 
every way to the free market.
  The Upper Midwest dairy industry, one of the most efficient in the 
world, is only asking for a fair shake in this process. And so, Mr. 
President, the legislation I introduce today will amend one of the most 
inequitable components of the Agricultural Marketing Act of 1937--the 
Class I milk price differentials.
  USDA is currently in the process of reforming its system of Federal 
Milk Marketing Orders. Unfortunately, the Class I differentials 
proposal released earlier this year was disappointing. Two options have 
been offered under the proposal. Option ``1A''--the status quo option--
is plainly unacceptable. Option ``1B'' does take a small step in the 
right direction, but it does not go far enough. However, a small step 
for reform is most certainly preferable to a step backward as ``1A'' 
would do.
  As short-term progress, I support Option ``1B'' because, as I have 
said, it is the only option USDA is currently considering that makes a 
move toward fairness in federal dairy policy. My bill would continue 
the reform beyond the small gains for equity that ``1B'' establishes. 
We cannot allow ourselves to become satisfied until we secure 
substantive federal dairy reform.
  Common sense would tell us that USDA's proposal of a small step 
toward market-policy is the compromise position for dairy reform. 
However, as you can imagine, there has been the typical, standard-fare 
outcry against any sort of reform--even the minimal reform that was 
offered in the form of Option ``1B.'' And surely that is little more 
than an acknowledgment on the part of USDA that equity and fairness 
really do matter in national dairy policy.
  USDA has explicitly expressed its preference for ``1B.'' However, my 
optimism is guarded, given the fact that ``the status quo option'' is 
being seriously considered as a measure of reform.
  It is all too likely that they may move us a step backward and call 
it reform. There is every reason to believe that USDA will succumb to 
the pressure of maintaining the unjustifiable status quo.
  So many constituencies have been built up around this antiquated 
dairy pricing policy, and now to try to put any fairness into the 
system we are going to have these outcries from across the country.
  So, in addition to the objective of shaping the policy debate beyond 
short-term fixes, I believe that we in the Upper Midwest must now 
proceed with progressive dairy reform in the event we once again, find 
ourselves standing alone in the name of justifiable, equitable, dairy 
policy.
  The Dairy Reform Act of 1998 establishes a uniform Class I price 
differential of $1.80 for each marketing area subject to an order. The 
newly proposed 11 Federal Milk Marketing Orders will remain in place to 
provide necessary over order premiums that would raise the $1.80 in 
some areas. This legislation directs us toward market-oriented reform 
because it removes the arbitrary, artificial price structure and its 
resulting interference with the market itself.
  As far as dairy policy is concerned, we're at a pivotal juncture. The 
groundwork is being laid for a national patchwork of regional compacts. 
Roughly half the country has either passed enabling compact 
legislation, is debating such legislation, or is involved in the 
Northeast Interstate Dairy Compact. We must either decide to support a 
national system, or regionalize. As I've said, USDA's Option ``1B'' is 
a small step in the right direction for dairy policy. The Dairy Reform 
Act brings us closer yet to substantive reform. The compact 
alternative, on the other hand, is not reform--it is retreat. It is 
anti-market and anti-consumer, by definition.
  There is no substantive, equity-based justification to support random 
Class I differentials. In fact, USDA's current federal marketing order 
system was deemed ``arbitrary and capricious'' by a Federal district 
court judge late last year.
  That is the fourth time that the courts have come out and said that 
the current dairy policies in this country are, again, arbitrary and 
capricious. So, bottom line, it means they are unfair, they are 
antimarket, they are anticonsumer.
  So, the case brought against USDA has been in the courts for 7 years, 
and the judge's ruling was no less than the fourth such proceeding in 
the history of the case. Given the outrageously drawn-out history of 
the case, the judge decided not to grant USDA's request to justify the 
pricing scheme.
  However, the ruling has been stayed now pending the appeal of the 
decision of the eighth circuit. After the courts have been cleared on 
the marketing order system, why is the USDA appealing? Why are they 
appealing to keep in place a system that the courts have ruled four 
times is basically unfair? Why don't they focus their efforts on 
changing the system, as the court has required, but, most important, 
changing the system to make sure that it is fair, that it does not 
discriminate against one part of the country over another, that it does 
not pick winners and losers, and it does not step on the necks of 
farmers in the Midwest?
  Under the current Federal order marketing system, the Government is 
picking winners and picking losers. This system of nonuniform 
differentials is inherently unfair, and I welcome debate of other dairy 
policy proposals for reform as well.
  Mr. President, finally, I just want to say the Dairy Reform Act of 
1998 is simply a call to fairness, just fairness, in dairy policy. It 
is a statement in no uncertain terms that we who represent upper 
Midwest dairy farmers are going to fight for equitable reform, for 
market-driven policy. I urge my colleagues to take a look at it, to say 
what is fair. Why not have everybody on a level playing field? Why not 
give farmers all over the country the same opportunity for success or 
failure? Why not get consumers market-driven prices, rather than unfair 
Federal policies aimed at the Midwest?
  So, I urge my colleagues to give their support.
                                 ______
                                 
      By Mr. SMITH of New Hampshire (for himself, Mr. Helms, and Mr. 
        Faircloth):
  S. 1983. A bill to amend section 991(a) of title 28, United States 
Code, to require certain members of the United States Sentencing 
Commission to be selected from among individuals who are victims of a 
crime of violence; to the Committee on the Judiciary.


                 u.s. sentencing commission legislation

  Mr. SMITH of New Hampshire. Mr. President, this is National Victim 
Rights Week and today I am introducing a bill to amend section 991(a) 
of

[[Page S3587]]

title 28, United States Code, to require certain members of the United 
States Sentencing Commission to be selected from among individuals who 
are victims of a crime of violence.
  Each year, Mr. President, about 40 million Americans are victimized 
by crime. Yet, all too often, the voices of those victims are lost in 
the criminal justice system. In fact, it often seems that the voices of 
those who commit crimes are heard with greater attentiveness by our 
criminal justice system than are the voices of the victims of crime. As 
President Reagan's Task Force on Victims of Crime stated in its 1982 
report, ``the criminal justice system has lost its essential balance.''
  One response to this problem has been S.J. Res. 44, a constitutional 
amendment to protect the rights of victims of crime, which has been 
introduced in this Congress by Senators Kyl and Feinstein. I am proud 
to be a cosponsor of that crime victims constitutional amendment.
  The bill that I am introducing today, Mr. President, is another 
response to the problem of the under representation of victims' rights 
in our criminal justice system. My bill, which my distinguished 
colleagues from North Carolina, Senators Faircloth and Helms, are 
cosponsoring, would reserve two of the seven seats on the United States 
Sentencing Commission for victims of violent crime.
  Mr. President, the United States Sentencing Commission is an 
independent entity within the judicial branch that establishes 
sentencing policies and practices for the Federal courts. This includes 
sentencing guidelines that prescribe the appropriate form and severity 
of punishment for offenders convicted of Federal crimes.

  The U.S. Sentencing Commission is composed of seven voting members 
who are appointed by the President, with the advice and consent of the 
Senate, for six-year terms. The Commission also includes two non-voting 
members. Of the seven voting members of the Sentencing Commission, 
three must be Federal judges.
  Under my bill, two of the four seats on the Sentencing Commission 
that are not filled by Federal judges would be reserved for victims of 
a crime of violence or, in the case of a homicide, an immediate family 
member of such a victim. My bill utilizes the existing statutory 
definition of a crime of violence that is found in section 16 of title 
18 of the United States Code.
  Mr. President, my bill preserves, to a large extent, the discretion 
of the President in making decisions about whom to nominate to seats on 
the Sentencing Commission. Under my bill, the President remains free to 
seek individuals who have professional expertise in the criminal 
justice field, so long as they also are victims of crime. Sadly, Mr. 
President, I do not believe that the President would have much 
difficulty identifying such qualified individuals.
  Mr. President, six of the seven voting seats on the Sentencing 
Commission are vacant. Let's give victims of crime a voice by requiring 
that two of those vacant seats must be filled by Americans who have 
been victimized by violent crime.
  Mr. President, I ask unanimous consent that the text of my bill be 
printed in the Record.
  Thank you, Mr. President. I yield the floor.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1983

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

     SECTION 1. COMPOSITION OF UNITED STATES SENTENCING 
                   COMMISSION.

       (a) In General.--Section 991(a) of title 28, United States 
     Code, is amended by inserting after ``same political party.'' 
     the following: ``Of the members who are not Federal judges, 
     not less than 2 members shall be individuals who are victims 
     of a crime of violence (as that term is defined in section 16 
     of title 18) or, in the case of a homicide, an immediate 
     family member of such a victim.''.
       (b) Applicability.--The amendment made by this section 
     shall apply with respect to any appointment made on or after 
     the date of enactment of this Act.
                                 ______
                                 
      By Mr. LAUTENBERG:
  S. 1984. A bill to prohibit the transfer of a handgun by a licensed 
dealer unless the transferee states that the transferee is not the 
subject of a restraining order with respect to an intimate partner of 
the transferee, a child of the transferee, or a child of an intimate 
partner of the transferee; to the Committee on the Judiciary.


            brady handgun violence protection act amendments

  Mr. LAUTENBERG. Mr. President, I rise today to introduce a bill to 
add a provision to the Brady Handgun Background Check Form to enforce 
the prohibition that persons under a restraining order for harassing, 
stalking or threatening an intimate partner or child cannot purchase a 
gun.
  The Background Check Form, used by law enforcement and gun dealers to 
enforce the Brady Handgun Violence Protection Act, currently requires a 
purchaser to answer questions on whether he or she falls into one of 
the categories prohibited from purchasing a gun. The form asks whether 
the purchaser has been convicted of a felony, has been declared 
mentally defective or been committed to a mental institution, is an 
illegal alien, fugitive from justice or an illegal user of drugs--all 
of which would disqualify the person from lawfully purchasing a gun. 
However, there is one very important disqualification not listed on 
this form. The 1994 Crime Act prohibits a person under a restraining 
order for harassing, stalking or threatening an intimate partner or the 
child of that partner from purchasing a gun. But this disqualification 
is not on the Brady Background Check Form--in fact it is the only 
disqualification not on the Form.
  Dealers, law enforcement agencies, and purchasers rely on the form to 
provide notice as to who is prohibited from purchasing a handgun, and 
law enforcement agencies use the form as a guide in making background 
checks. This omission on the Brady Form means persons under restraining 
orders for harassing, stalking and threatening their partners and their 
partner's children can more easily obtain a gun even though it is 
illegal for them to do so. My legislation is necessary because all 
changes to the form are required to be done by legislation rather than 
by regulation or order.
  This simple change to the Brady Check List can mean the difference 
between life and death for women and children across America. Domestic 
violence in the United States remains the number one threat of injury 
to women ages 15 to 44, and hundreds of thousands of women are forced 
to obtain restraining orders to protect themselves and their children 
from abusive partners every year. More than twice as many women are 
shot and killed each year by their husbands or intimate partners than 
by strangers.
  Mr. President, Congress has already recognized that persons who are 
under restraining orders for harassing, stalking, and threatening their 
spouses, partners, and children should not be able to buy a gun. This 
simple bill will help to enforce this important prohibition to keep 
guns out of the hands of those who pose a real and serious threat to 
their partners and children. Every year we see tragic incidents of 
victims of domestic violence who have obtained restraining orders only 
to be murdered by their partner.
  I hope you will join me and support this worthy bill to protect 
victims of domestic violence from the dangers that follow when their 
abusive partner gains access to a gun.
  I ask unanimous consent that a copy of this bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1984

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

     SECTION 1. PROHIBITION OF THE TRANSFER OF A HANDGUN BY A 
                   LICENSED DEALER UNLESS THE TRANSFEREE STATES 
                   THAT THE TRANSFEREE IS NOT THE SUBJECT OF A 
                   RESTRAINING ORDER WITH RESPECT TO AN INTIMATE 
                   PARTNER OF THE TRANSFEREE, A CHILD OF THE 
                   TRANSFEREE, OR A CHILD OF AN INTIMATE PARTNER 
                   OF THE TRANSFEREE.

       Section 922(s)(3)(B) of title 18, United States Code, is 
     amended--
       (1) by striking ``and'' at the end of clause (vi); and
       (2) by adding ``and'' at the end of clause (vii); and
       (3) by adding at the end the following:
       ``(viii) is not subject to a court order that--
       ``(I) restrains the transferee from harassing, stalking, or 
     threatening an intimate partner of the transferee or child of 
     such intimate partner or transferee, or engaging in other 
     conduct that would place an

[[Page S3588]]

     intimate partner in reasonable fear of bodily injury to the 
     partner or child;
       ``(II) was issued after a hearing of which the transferee 
     received actual notice, and at which the transferee had the 
     opportunity to participate; and
       ``(III)(aa) includes a finding that the transferee 
     represents a credible threat to the physical safety of such 
     intimate partner or child; or
       ``(bb) by its terms explicitly prohibits the use, attempted 
     use, or threatened use of physical force against such 
     intimate partner or child that would reasonably be expected 
     to cause bodily injury;''.
                                 ______
                                 
      By Mr. HATCH (for himself, Mr. Biden, Mr. Leahy, Mr. DeWine, and 
        Mr. Sessions):
  S. 1985. A bill to amend Part L of the Omnibus Crime Control and Safe 
Streets Act of 1968; read twice and placed on the calendar.


               the care for police survivors act of 1998

  Mr. HATCH. Mr. President, during the week of May 12, the country will 
honor once again those law enforcement and public safety officers who 
have died in the line of duty. It is entirely fitting that we do this. 
And as we remember those who have fallen in defense of the public 
safety, we should also do all we can to comfort and assist the families 
and loved ones they have left behind. The bill I rise to introduce 
today, the Care for Police Survivors Act of 1998, will help ensure that 
we are doing so.

  First, this bill, which was introduced in the House as H.R. 3565, 
will strengthen programs available to the families of slain police 
officers. For instance, the bill will allow groups like Concerns for 
Police Survivors, more commonly referred to as COPS, to increase and 
improve their services to these families. Second, this bill provides 
authority to the Director of the Bureau of Justice Assistance to spend 
no less than $150,000 out of the Public Safety Officers' Benefits 
program to support and enrich national peer support and counseling 
programs for families of police officers lost in the line of duty.
  Second, this act will expedite the process of handling cases pending 
before the Public Safety Officers' Benefits Office by allowing the 
expenditure of PSOB program funds on outside hearing officers. 
Currently, survivors of fallen police officers have to wait entirely 
too long to obtain an appeal hearing for the denial of benefits. By 
enacting this bill, we will make the process of helping these families 
less burdensome.
  I am pleased to be joined by Senators Biden, Leahy, DeWine, and 
Sessions in introducing this bill in the Senate. On Tuesday of this 
week, the House of Representatives overwhelmingly passed H.R. 3565 by a 
403 to 8 vote. I urge my colleagues to join me in expeditiously passing 
this legislation to demonstrate our tremendous gratitude and support 
for these heroes and their families.
                                 ______
                                 
      By Mr. DeWINE (for himself and Mrs. Hutchison):
  S. 1987. A bill to amend title 18, United States Code, with respect 
to violent sex crimes against children, and for other purposes; to the 
Committee on the Judiciary.


    the child protection and sexual predator punishment act of 1998

  Mr. DeWINE. Mr. President, I rise today to introduce the Child 
Protection and Sexual Predator Punishment Act of 1998. The purpose of 
this legislation is to address the problem of child molesters and 
pedophiles who use computers, and the Internet in particular, to commit 
crimes of sexual abuse and exploitation against our most vulnerable 
citizens--our children. I appreciate Senator Kay Bailey Hutchison 
joining me in this important effort.
  The Child Protection and Sexual Predator Punishment Act is a 
comprehensive bill that combats the growing problem of criminals who 
misuse our information superhighway to contact children for purposes of 
sexual abuse and exploitation. Not only does this legislation send a 
strong message that America will not tolerate the abuse of its 
children, it will also make it easier to put these heinous criminals 
out of commission.
  Mr. President, my wife Fran and I have eight children--ages 6 to 30. 
There is nothing more important to parents than protecting their 
children from harm. There was a time, not so long ago, when parents 
could feel secure when their children were at home or in a library--
that their child would at least be safe from danger in those places. 
But along with the tremendous benefit of the Internet, we have also 
unfortunately, unintentionally invited strangers into our homes, and 
sometime our children's rooms, just because computers may be located 
there. Strangers who sometimes have the immoral and criminal intent to 
lure our kids into deviant sexual, abusive, and illegal activity right 
under our noses.
  Not long ago, a 47-year-old Ohio man used the Internet to entice a 
12-year-old girl in New Jersey to make pornographic videos of herself. 
He posed on-line as a 15-year-old, who promised that he would forward 
copies of the pornographic video to her favorite music band members. 
She made four sexually explicit videos before the man was apprehended 
by authorities. There are literally hundreds of these examples, and 
many even worse, occurring every day in America. It has become 
commonplace to hear about a child being lured across the country via 
the Internet by a pedophile.
  I hope, and believe, that through this legislation we can begin to 
restore the peace of mind parents should have when their children use 
the Internet at school, at the library, or in their home.
  This bill will protect children from cyber-stalkers and porn peddlers 
by prohibiting contacting of a minor on the Internet for the purpose of 
engaging in illegal sexual activity. It prohibits knowingly 
transferring obscene materials to a minor over the Internet. In 
addition, the maximum penalty is doubled for enticing a minor to travel 
across State lines for illegal sexual activity. Using a computer to 
persuade a minor to engage in prostitution or a sexual act will carry a 
maximum sentence of 15 years, and a minimum sentence of 3 years.
  Also, law enforcement is given the tools to quickly and effectively 
investigate sex and kidnaping crimes involving children. Pretrial 
detention is provided for Federal sex offenders, and administrative 
subpoenas are allowed in certain child exploitation investigations. In 
addition, the bill clarifies that kidnaping investigations do not 
require waiting 24 hours--they can be initiated immediately. Further, 
Federal jurisdiction is provided in kidnaping cases where a facility or 
means of interstate or foreign commerce is used.
  Mr. President, a person today can get almost anything on the 
Internet. With this bill, we are trying to make sure that they cannot 
get our children.
  Mrs. HUTCHISON. Mr. President, technology has opened many doors for 
communications and information sharing. Unfortunately, criminals have 
found new ways to use the innovations to hurt children.
  Today I am introducing with Senator DeWine the Child Protection and 
Sexual Predator Punishment Act of 1998. Our bill will give law 
enforcement the necessary tools to stop crimes against children, 
especially those initiated through the Internet and commercial on-line 
services.
  Along with the proliferation of users of on-line services, our nation 
has seen a rise in crimes committed against children by sexual 
predators on-line. Every day, pedophiles stalk children through the 
computer, transmitting pornography to them and enticing them to 
participate in illegal activity. In some of the most tragic instances, 
these criminals have convinced children to travel long distances to 
meet them, only to face horrendous abuse by their ``hosts.''
  In response to the growing number of these crimes. Congress has and 
will surely continue to appropriate funds to allow collaboration among 
FBI and state and local law enforcement to develop effective means to 
prevent innocent children from being exploited. In the past, funds have 
been used to train officers to detect cybercrime, pursue sexual 
predators and establish child sexual exploitation cyber-squads of state 
and local officers.
  But the responsibility of Congress is not only to provide necessary 
resources. We have an unfinished responsibility to give officers the 
legal tools they need to stop these crimes before they happen. In 
addition, Congress must send the unequivocal message to criminals who 
dare to prey on children that such crimes will not be tolerated.
  As children and adults increase their use of computers and online 
services, this problem will only get worse. Only through aggressive 
enforcement will

[[Page S3589]]

we be able to combat this rise in tragic crimes against our most 
vulnerable citizens--children.
                                 ______
                                 
      By Mr. D'AMATO (for himself and Mr. Shelby):
  S. 1986. A bill to restructure the regulation of the Federal Home 
Loan Bank System; to the Committee on Banking, Housing, and Urban 
Affairs.


      the federal home loan bank system restructuring act of 1998

  Mr. D'AMATO. Mr. President, I rise today to introduce the ``Federal 
Home Loan Bank System Restructuring Act of 1998'' to eliminate the last 
vestiges of a bureaucratic structure which contributed to the downfall 
of the savings and loan industry in the 1980's, and cost American 
taxpayers $125 billion. I am referring to the structural weakness 
inherent in a regulatory system which allows the combination of basic 
safety and soundness oversight with management and governance 
functions. This structural weakness exists today in the Federal Housing 
Finance Board (FHFB) which oversees the Federal Home Loan Bank System. 
Moreover, the FHFB appears to be the only regulatory agency where the 
responsibility for safety and soundness regulation has not been 
separated from management and governance functions.
  I am very pleased that Senator Richard Shelby has joined as a co-
sponsor because he is the Senate's leading proponent of regulatory 
reform and eliminating outdated and unnecessary regulation.
  Mr. President, throughout most of its history, the Federal Home Loan 
Bank System was regulated by the Federal Home Loan Bank Board, the same 
agency responsible for regulating the thrift industry. In 1989, 
Congress passed the Financial Institutions Reform, Recovery and 
Enforcement Act (FIRREA) to abolish the Bank Board and create the 
Federal Housing Finance Board (``FHFB'') to assume responsibility for 
the regulation and supervision of the Federal Home Loan Bank System 
(FHLB System). FIRREA provided the FHFB with the authority to supervise 
the Federal Home Loan Banks (FHLBanks), ensure that the FHLBanks carry 
out their mission of housing finance, ensure the FHLBanks remain 
adequately capitalized and able to raise funds in the capital markets, 
and ensure the FHLBanks operate in a safe and sound manner.
  Safety and soundness regulation became the primary duty of the FHFB 
as a result of the Housing and Community Development Act of 1992. In 
that Act, Congress also recognized problems at the Federal Housing 
Finance Board and specifically identified this structural flaw as a 
serious problem. In search of a solution to this problem and 
information concerning the future of the Federal Home Loan Banks in the 
context of changing markets for housing finance, Congress mandated 
several studies. In the study conducted by the FHFB, the agency itself 
expressed concern about its dual role: ``The roles of regulation and 
governance residing in one entity are not compatible and, indeed, 
represent a long standing, well-understood inherent conflict when 
joined''. [The Report on the Structure and Role of the Federal Home 
Loan Bank System, The Federal Housing Finance Board, submitted to 
Congress on April 28, 1993, page 153.] The FHFB recognized that 
concerns about shareholder dividends and profitability should not be in 
competition with concerns over safety and soundness and the 
availability of housing finance for American taxpayers.
  Mr. President, this bill would eliminate this serious and dangerous 
conflict by transferring functions from the FHFB to the Office of 
Federal Housing Enterprise Oversight (OFHEO) and the Department of 
Housing and Urban Development (HUD). This is the current system of 
regulation designed by Congress for the other two housing-related 
government sponsored enterprises (GSEs)--Fannie Mae and Freddie Mac.
  In addition, consolidating safety and soundness regulation in one 
regulatory is consistent with the core recommendations of GAO and HUD--
that the conflict with the FHFB be resolved through the creation of a 
single housing-related GSE. Even the Chairman of the FHFB, in testimony 
before a House Banking Subcommittee last July, endorsed the GAO's 
recommendation for a single independent safety and soundness regulator 
for the Federal Home Loan Banks, Fannie Mae and Freddie Mac. He 
acknowledged that consolidation will yield more effective regulation.
  Mr. President, consolidating regulation of the housing GSE's is also 
consistent with the Administration's objective of reducing government 
by eliminating unnecessary, duplicative or redundant regulation--an 
objective we all share. By placing FHFB's safety and soundness 
functions with OFHEO, administration costs would be cut and regulatory 
consistencies would be realized as a result of the complementary nature 
of the housing finance roles played by the Federal Home Loan Banks, 
Fannie Mae, and Freddie Mac. Another important public benefit of 
consolidating oversight of the housing missions of these agencies 
within HUD is to enable HUD to more effectively assess and respond to 
the nation's affordable housing needs.

  Mr. President, the legislation would abolish the conflicting dual 
roles of the FHFB, streamline an overburdened bureaucratic process, and 
insure that those entities with the mission of promoting housing 
finance--Fannie Mae, Freddie Mac, and Federal Home Loan Banks--are 
meeting that challenge in the most effective way possible. We owe 
nothing less to the working families most in need of our assistance 
than to insure the system is working for them.
  Mr. President, this bill would address the regulation of the Federal 
Home Loan Bank System by transferring its safety and soundness 
functions to OFHEO and mission oversight to HUD. It does not--and is 
not intended to--address other policy issues pertaining to the future 
role of the Federal Home Loan Banks which remain under consideration by 
the Banking Committee, Improving the level of affordable housing, 
ensuring effective, efficient and objective regulation, cutting the fat 
out of the government, and managing the taxpayers' dollars wisely--that 
is what this bill is all about.
  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. 1986

       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 ``Federal Home Loan Bank 
     System Regulatory Restructuring Act of 1998''.

     SEC. 2. RESTRUCTURING OF FEDERAL HOME LOAN BANK REGULATOR.

       (a) In General.--The Federal Home Loan Bank Act (12 U.S.C. 
     1421 et seq.) is amended by striking sections 2A and 2B and 
     inserting the following:

     ``SEC. 2A. DUTIES AND POWERS OF THE DIRECTOR.

       ``(a) Duties.--The Director shall--
       ``(1) as a primary duty, ensure that the Federal Home Loan 
     Banks operate in a financially safe and sound manner; and
       ``(2) to the extent consistent with paragraph (1), 
     supervise the Federal Home Loan Banks and ensure that the 
     Federal Home Loan Banks remain adequately capitalized and 
     able to--
       ``(A) raise funds in the capital markets;
       ``(B) satisfy their obligations to support affordable 
     housing as required by section 10(j);
       ``(C) make payments to the Resolution Funding Corporation 
     as required by section 21B(f)(2)(C); and
       ``(D) pay dividends on bank stock sufficient for such stock 
     to remain a competitive investment for the holders of the 
     stock.
       ``(b) General Powers.--The Director may--
       ``(1) supervise the Federal Home Loan Banks and promulgate 
     and enforce such regulations and orders as are necessary to 
     carry out this Act;
       ``(2) suspend or remove for cause a director, officer, 
     employee, or agent of any Federal Home Loan Bank or joint 
     office, except that--
       ``(A) the cause of such suspension or removal shall be 
     communicated in writing to such director, officer, employee, 
     or agent and to such Bank or joint office; and
       ``(B) notwithstanding any other provision of this Act, no 
     officer, employee, or agent of a Bank or joint office shall 
     be a Federal officer or employee under any definition of 
     either term in title 5, United States Code;
       ``(3) determine necessary expenditures of the Director 
     under this Act and the manner in which such expenditures 
     shall be incurred, allowed, and paid;
       ``(4) use the United States mails in the same manner and 
     under the same conditions as a department or agency of the 
     United States;
       ``(5) issue such notice and orders, and, subject to the 
     same terms and conditions, exercise the same powers, rights, 
     and duties to

[[Page S3590]]

     enforce this Act with respect to the Federal Home Loan Banks 
     and their officers and directors, as may be issued or 
     exercised by the OFHEO with respect to Federal housing 
     enterprises under--
       ``(A) subtitle C of title XIII of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992;
       ``(B) the Federal National Mortgage Association Charter 
     Act; or
       ``(C) the Federal Home Loan Mortgage Corporation Act.
       ``(c) Staff.--
       ``(1) In general.--Subject to title IV of the Financial 
     Institutions Reform, Recovery, and Enforcement Act of 1989, 
     the OFHEO may employ, direct, and fix the compensation and 
     number of employees, attorneys, and agents of the OFHEO 
     necessary to carry out its duties under this Act, except that 
     in no event shall the Director delegate any function to any 
     employee or administrative unit of any bank, or joint office 
     of the Federal Home Loan Bank System.
       ``(2) Compensation.--In directing and fixing such 
     compensation, the Director shall consult with and maintain 
     comparability with the compensation at the Federal bank 
     regulatory agencies. Such compensation shall be paid without 
     regard to the provision of other laws applicable to officers 
     or employees of the United States, except that the Director 
     shall receive no additional compensation above that specified 
     by section 5313 of title 5, United States Code.''.
       ``(d) Receipts of the Board.--
       ``(1) Receipts.--Receipts of the Board derived from 
     assessments levied upon the Federal Home Loan Banks and from 
     other sources (other than receipts from the sale of 
     consolidated Federal Home Loan Bank bonds and debentures 
     issued under section 11 of this Act) shall be deposited in 
     the Treasury of the United States.
       ``(2) Salaries.--Salaries of the directors and other 
     employees of the OFHEO, and all other expenses necessary for 
     the Director to carry out the duties of the Director under 
     this Act--
       ``(A) may be paid from assessments described in paragraph 
     (1), or from other sources; and
       ``(B) shall not be construed to be Government Funds or 
     appropriated monies, or subject to apportionment for the 
     purposes of chapter 15 of title 31, United States Code, or 
     any other authority.
       ``(e) Annual Report.--The Director shall submit to Congress 
     an annual report.''.
       (b) Assessments.--Section 18(b) of the Federal Home Loan 
     Bank Act (12 U.S.C. 1438(b)) is amended by striking paragraph 
     (1) and inserting the following:
       ``(1) In general.--To the extent provided in advance in 
     appropriations Acts, the Director may impose a semiannual 
     assessment on the Federal Home Loan Banks, the aggregate 
     amount of which shall be sufficient to provide for the 
     payment of the expenses of the Director estimated to be 
     incurred under this Act for the period for which the 
     assessment is made.''.
       (c) Technical and Conforming Amendments.--
       (1) Definitions.--Section 2 of the Federal Home Loan Bank 
     Act (12 U.S.C. 1422) is amended--
       (A) by striking paragraph (1) and inserting the following:
       ``(1) OFHEO.--The term `OFHEO' means the Office of Federal 
     Housing Enterprise Oversight, established under section 1311 
     of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992.'';
       (B) in paragraph (2)(B), by striking ``Board'' and 
     inserting ``OFHEO'';
       (C) in paragraph (6), by striking ``Board'', and inserting 
     ``Secretary''; and
       (D) by striking paragraph (10) and inserting the following:
       ``(10) Director.--The term `Director' means the Director of 
     the OFHEO, appointed under section 1312 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992.''.
       (2) Eligibility.--Section 4(a) of the Federal Home Loan 
     Bank Act (12 U.S.C. 1424(a)) is amended in the last sentence, 
     by striking ``Board'' and inserting ``Secretary''.
       (3) Management of banks.--Section 7 of the Federal Home 
     Loan Bank Act (12 U.S.C. 1427) is amended by striking 
     ``Board'' each place it appears and inserting ``Secretary''.
       (4) Advances to members.--Section 10 of the Federal Home 
     Loan Bank Act (12 U.S.C. 1430) is amended--
       (A) in each of subsections (a) through (d), by striking 
     ``Board'' each place it appears, and inserting ``Director''; 
     and
       (B) in each of subsections (e), (g), and (j), by striking 
     ``Board'' each place it appears, and inserting ``Secretary''.
       (5) General powers and duties of banks.--Section 11(i) of 
     the Federal Home Loan Bank Act (12 U.S.C. 1431(i)) is amended 
     by striking ``Chairperson of the Board'' and inserting 
     ``Director''.
       (6) Financing corporation.--Section 21 of the Federal Home 
     Loan Bank Act (12 U.S.C. 1441) is amended--
       (A) in each of subsections (b)(5) and (e)(9), by striking 
     ``Chairperson of the Federal Housing Finance Board'' and 
     inserting ``Director''; and
       (B) by striking ``Federal Housing Finance Board'' each 
     place it appears and inserting ``Director''.
       (7) Resolution trust corporation.--Section 21B of the 
     Federal Home Loan Bank Act (12 U.S.C. 1442) is amended by 
     striking ``Federal Housing Finance Board'' each place it 
     appears and inserting ``Director''.
       (8) Member financial information.--Section 22 of the 
     Federal Home Loan Bank Act (12 U.S.C. 1442) is amended--
       (A) in subsection (a), in the last sentence, by striking 
     ``Board or'' each place it appears and inserting ``Director 
     or''; and
       (B) in subsection (b), by striking ``Board'' each place 
     that term appears and inserting ``Director''.
       (9) Forms of bank stock and obligations.--Section 23 of the 
     Federal Home Loan Bank Act (12 U.S.C. 1443) is amended by 
     striking ``Board of Directors of the Federal Housing Finance 
     Board'' and inserting ``Director''.
       (10) Housing opportunity hotline program.--Section 27(a) of 
     the Federal Home Loan Bank Act (12 U.S.C. 1447) is amended--
       (A) by striking ``Federal Housing Finance Board'' and 
     inserting ``Secretary''; and
       (B) by striking ``Board'' and inserting ``Secretary''.
       (11) Federal housing enterprise financial safety and 
     soundness act of 1992.--Section 1313 of the Federal Housing 
     Enterprise Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4513) is amended--
       (A) in subsection (a), by inserting before the period at 
     the end the following: ``, and that the Federal Home Loan 
     Banks are adequately capitalized and operating safely in 
     accordance with the Federal Home Loan Bank Act (12 U.S.C. 
     1421 et seq.)''; and
       (B) in subsection (b)--
       (i) in paragraph (10), by striking ``and'' at the end;
       (ii) in paragraph (11), by striking the period and 
     inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(12) the performance of any function or the exercise of 
     any authority assigned to the Director pursuant to the 
     Federal Home Loan Bank Act.''.
       (12) Other references.--Except as otherwise provided in the 
     amendments made by this subsection, any reference in the 
     Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.), or any 
     other provision of Federal law, to the Federal Housing 
     Finance Board, shall be construed to refer to the Director of 
     the Office of Federal Housing Enterprise Oversight.
       (d) Effective Date.--The amendments made by this section 
     shall take effect 60 days after the date of enactment of this 
     Act.

     SEC. 3. TRANSITION PROVISIONS.

       (a) Definitions.--In this section:
       (1) Appropriate agency.--The term ``appropriate agency'' 
     means--
       (A) with respect to the functions transferred under 
     subsection (b)(1), the Department of Housing and Urban 
     Development; and
       (B) with respect to the functions transferred under 
     subsection (b)(2), the Office.
       (2) Board.--The term ``Board'' means the Federal Housing 
     Finance Board established under section 22A of the Federal 
     Home Loan Bank Act (as in effect on the day before the 
     effective date of the amendments made by section 2 of this 
     Act).
       (3) Director.--The term ``Director'' means the Director of 
     the Office.
       (4) Function.--The term ``function'' means any duty, 
     obligation, power, authority, responsibility, right, 
     privilege, activity, or program.
       (5) Head of the appropriate agency.--The term ``head of the 
     appropriate agency'' means--
       (A) with respect to the functions transferred under 
     subsection (b)(1), the Secretary; and
       (B) with respect to the functions transferred under 
     subsection (b)(2), the Director.
       (6) Office.--The term ``Office'' means the Federal Housing 
     Enterprise Oversight established under section 1311 of the 
     Federal Housing Enterprises Financial Safety and Soundness 
     Act of 1992.
       (7) Secretary.--The term ``Secretary'' means the Secretary 
     of Housing and Urban Development.
       (b) Transfer of Functions.--
       (1) Transfer to department of housing and urban 
     development.--Effective 60 days after the date of enactment 
     of this Act there are transferred to the Department of 
     Housing and Urban Development all functions that the Board 
     exercised before the date of enactment of this Act (including 
     all related functions of any officer or employee of the 
     Board) relating to the functions of the Board under the 
     following provisions of the Federal Home Loan Bank Act (12 
     U.S.C. 1421 et seq.) (as in effect on the day before the 
     effective date of the amendments made by section 2 of this 
     Act):
       (A) The last sentence of section 4(a).
       (B) Section 7.
       (C) Subsections (e), (g), and (j) of section 10.
       (D) Section 27(a).
       (2) Transfer to office.--Effective 60 days after the date 
     of enactment of this Act there are transferred to the Office 
     all functions, other than the functions transferred under 
     paragraph (1), that the Board exercised before the date of 
     enactment of this Act (including all related functions of any 
     officer or employee of the Board) under the Federal Home Loan 
     Bank Act (12 U.S.C. 1421 et seq.).
       (b) Disposition of Affairs.--During the 60-day period 
     beginning on the date of enactment of this Act, the 
     Chairperson of the Board--
       (1) shall, solely for the purpose of facilitating the 
     orderly implementation of this section--
       (A) manage the employees of the Board and provide for the 
     payment of the compensation

[[Page S3591]]

     and benefits of any such employee that accrue before the 
     effective date of the transfer of such employee pursuant to 
     subsection (g); and
       (B) manage any property of the Board and arrange for the 
     transfer thereof to the Office as promptly as practicable; 
     and
       (2) may take any other action necessary for the purpose of 
     facilitating the orderly implementation of this section.
       (c) Treatment of References in Adjustable Rate Mortgage 
     Instruments.--
       (1) In general.--For purposes of adjustable rate mortgage 
     instruments that are in effect on the day before the 
     effective date of the amendments made by section 2, any 
     reference in the instrument to the Board shall be construed 
     to be a reference to the Secretary, unless the context of the 
     reference requires otherwise.
       (2) Substitution for indexes.--If any index used to 
     calculate the applicable interest rate on any adjustable rate 
     mortgage instrument is no longer calculated and made 
     available as a direct or indirect result of the enactment of 
     this Act, any index--
       (A) made available by the Secretary, pursuant to paragraph 
     (3); or
       (B) determined by the Secretary, pursuant to paragraph (4), 
     to be substantially similar to the index that is no longer 
     calculated or made available, may be substituted by the 
     holder of any such adjustable rate mortgage instrument upon 
     notice to the borrower.
       (3) Agency action required to provide continued 
     availability of indexes.--As soon as practicable after the 
     effective date of the amendments made by section 2, the 
     Secretary shall take such actions as may be necessary to 
     assure that the indexes prepared by the Board and the Federal 
     Home Loan Banks immediately before the effective date of the 
     amendments made by section 2 and used to calculate the 
     interest rate on adjustable rate mortgage instruments 
     continue to be available.
       (4) Requirements relating to substitute indexes.--If any 
     index can no longer be made available pursuant to paragraph 
     (3), an index that is substantially similar to such index may 
     be substituted for such index for purposes of paragraph (2) 
     if the Secretary determines, after notice and opportunity for 
     comment, that--
       (A) the new index is based upon data substantially similar 
     to that of the original index; and
       (B) the substitution of the new index will result in an 
     interest rate substantially similar to the rate in effect at 
     the time the original index became unavailable.
       (d) Continuation of Services.--
       (1) In general.--The head of the appropriate agency may use 
     the services of employees and other personnel and the 
     property of the Board, on a reimbursable basis, to perform 
     functions transferred by this section to the appropriate 
     agency, for such time as is reasonable to facilitate the 
     orderly transfer of functions so transferred.
       (2) Agency services.--Any agency, department, or other 
     instrumentality of the United States, and any successor to 
     any such agency, department, or instrumentality, that is 
     providing supporting services to the Board before the 
     effective date of the amendments made by section 2 in 
     connection with functions that are transferred to the head of 
     the appropriate agency under this section, shall--
       (A) continue to provide such services, on a reimbursable 
     basis, until the transfer of such functions is complete; and
       (B) consult with the Director to coordinate and facilitate 
     a prompt and reasonable transition.
       (e) Savings Provisions.--
       (1) Existing rights, duties, and obligations not 
     affected.--This section shall not affect the validity of any 
     right, duty, or obligation of the United States, the Board, 
     or any other person, that--
       (A) arises under or pursuant to the Federal Home Loan Bank 
     Act (12 U.S.C. 1421 et seq.) or any other provision of law 
     applicable with respect to such Board; and
       (B) exists on the day before the effective date of the 
     amendments made by section 2.
       (2) Continuation of suits.--No action or other proceeding 
     commenced by or against the Board, or any person or entity 
     with respect to any function of the Board that was delegated 
     to such person or entity, shall abate by reason of the 
     enactment of this Act, except that the head of the 
     appropriate agency shall be substituted for the Board or a 
     party to any such action or proceeding.
       (f) Continuation of Orders, Resolutions, Determinations, 
     and Regulations.--
       (1) In general.--Except as provided in paragraph (2), all 
     orders, resolutions, determinations, and regulations, shall 
     continue in effect according to the terms of such orders, 
     resolutions, determinations, and regulations and shall be 
     enforceable by or against the head of the appropriate agency 
     until modified, terminated, set aside, or superseded in 
     accordance with applicable law by the head of the appropriate 
     agency by any court of competent jurisdiction, or by 
     operation of law, if such orders, resolutions, determination, 
     and regulations--
       (A) have been issued, made, prescribed, or allowed to 
     become effective by the Board in the performance of functions 
     that are transferred by this section; and
       (B) are in effect on the effective date of the amendments 
     made by section 2.
       (2) Exception.--Paragraph (1) does not apply to any order, 
     resolution, determination, or regulation of the Board the 
     authority of which is terminated under this Act or the 
     amendments made by this Act.
       (g) Transfer of Employees.--
       (1) In general.--Not later than 60 days after the date of 
     enactment of this Act, each employee of the Board shall be 
     transferred to the appropriate agency and each such transfer 
     shall be construed to be a transfer of function for the 
     purpose of section 3503 of title 5, United States Code.
       (2) Retention of status, tenure, pay.--Each employee 
     transferred under this subsection shall be guaranteed a 
     position with the same status, tenure, and pay as that held 
     on the day immediately preceding the transfer. Each such 
     employee holding a permanent position shall not be 
     involuntarily separated or reduced in grade or compensation 
     during the 6-month period beginning on the date of the 
     transfer, except for cause.
       (3) Appointment authority.--
       (A) In general.--Subject to subparagraph (B), in the case 
     of any employee transferred under this subsection who 
     occupies a position in the excepted service or the Senior 
     Executive Service, any appointment authority established 
     pursuant to law or regulations of the Office of Personnel 
     Management for filling such a position shall be transferred.
       (B) Decline.--The head of the appropriate agency may 
     decline a transfer of an employee described in subparagraph 
     (A) to the extent that the authority transferred to the 
     appropriate agency relates to positions excepted from the 
     competitive service because of their confidential, policy-
     making, policy-determining, or policy-advocating character, 
     and noncareer positions in the Senior Executive Service 
     (within the meaning of section 3132(a)(7) of title 5, United 
     States Code).
       (4) Reorganization.--If the head of the appropriate agency 
     determines, after the end of the 1-year period beginning on 
     the date on which the transfer of functions to the 
     appropriate agency under this section is completed, that a 
     reorganization of the combined work-force is required, that 
     reorganization shall be deemed a ``major reorganization'' for 
     purposes of affording affected employees retirement under 
     section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States 
     Code.
       (5) Employee benefit programs.--
       (A) In general.--Any employee accepting employment as a 
     result of a transfer under this subsection may retain, during 
     the 1-year period beginning on the date on which that 
     transfer occurs, membership in any employee benefit program 
     of the Board, including insurance, to which such employee 
     belongs on the effective date of the amendments made by 
     section 2 if--
       (i) the employee does not elect to give up the benefit or 
     membership in the program; and
       (ii) the benefit or program is continued by the head of the 
     appropriate agency, as applicable.
       (B) Costs.--The difference in the costs between the 
     benefits that would have been provided by such agency or 
     entity and those provided by this section shall be paid by 
     the head of the appropriate agency, as applicable. If any 
     employee elects to give up membership in a health insurance 
     program or the health insurance program is not continued by 
     the head of the appropriate agency the employee shall be 
     permitted to select an alternate Federal health insurance 
     program within 30 days of such election or notice, without 
     regard to any other regularly scheduled open season.
       (6) Insurance.--Any employee employed by the head of the 
     appropriate agency as a result of a transfer under this 
     subsection may retain membership in any employee benefit 
     program of the Board, including insurance, that such employee 
     has on the day before the effective date of the amendments 
     made by section 2, if the employee does not elect to give up 
     such membership and the benefit or program is continued by 
     the head of the appropriate agency, as applicable.
       (7) Notice.--Each employee transferred under this 
     subsection shall receive notice of the position assignment of 
     that employee not later than 60 days after the effective date 
     of that transfer.
                                 ______
                                 
      By Ms. COLLINS (for herself and Ms. Snowe):
  S. 1988. A bill to provide for the release of interests of the United 
States in certain real property located in Augusta, Maine; to the 
Committee on Armed Services.


                      kennebec arsenal legislation

  Ms. COLLINS. Mr. President, along with my colleague, the senior 
Senator from Maine, I am pleased today to introduce legislation that 
would bring about the release of certain interests of the United States 
in property that the Federal Government conveyed to the State of Maine 
more than 90 years ago. The property in question, which is situated on 
a bluff overlooking the Kennebec River in Augusta, Maine, is known as 
the Kennebec Arsenal.
  In 1905, the Secretary of the Army, acting pursuant to a 
Congressional mandate, executed a deed transferring the property to 
Maine. That conveyance was subject to the conditions that the property 
be used for what was then called the Maine Insane Hospital and that the 
United States could take possession should the President determine that 
the country had a need for it. In

[[Page S3592]]

1980, Congress provided that the first condition be broadened to allow 
the property to be used for any public purpose. Today, I seek to 
complete the transfer process through legislation that would 
effectively eliminate the conditions attached to the conveyance.
  Mr. President, the property is no longer needed for it former 
purposes, and my bill would set in motion a chain of events that would 
allow for new uses that would benefit not only the City of Augusta and 
the State of Maine but our entire country. With the exception of the 
Kennebec Arsenal, virtually all of the great arsenals of the nineteenth 
century have been demolished or so completely altered that their 
original appearance has been lost. The new uses contemplated by Maine 
would raise money needed for repairs that would maintain what historic 
preservation experts have described as the most perfectly intact of the 
nineteenth century arsenals.
  To be more specific, the State of Maine and City of Augusta plan to 
form a nonprofit corporation to oversee the property. That corporation 
would seek out private parties interested in using the land and 
buildings for such purposes as a marina, a museum, and a restaurant. 
Those parties would provide the capital for infrastructure development 
that would likely include sidewalks, streets, water, sewer and other 
utility service, and landscaping. In addition, the Arsenal's retaining 
wall needs repair, and a marina cannot be established without 
substantial dredging of the river.
  The objective of my bill is to open the way for these improvements 
and new uses by eliminating any reversionary interests of the United 
States. The existence of such interests is a barrier to the private 
sector making the long-term commitments required to fund the 
improvements. In other words, Maine needs clear title for this plan to 
go forward.
  Mr. President, the Kennebec Arsenal occupies an important place in 
the history of Maine and the nation. It was established in 1827 to deal 
with the threat of invasion from Great Britain, either from across the 
sea or from Canada to the north. The possibility of such an invasion 
was seen as a major threat to American security during the first half 
of the nineteenth century.
  Much of the tension with the British stemmed from our disputed border 
with Canada, and in the late 1830's that dispute nearly blossomed into 
a full-scale war. While the so-called bloodless Aroostook War proved to 
be more talk than action, it caused a flurry of activity at the 
Kennebec Arsenal, with newly fabricated munitions sent there in 
anticipation of full-scale fighting. Fortunately, cooler heads and the 
arrival of the spring planting season brought the parties to the 
negotiating table.
  During the Mexican War, rockets and fixed ammunition were 
manufactured at the Arsenal and shipped to the front. During the Civil 
War, the post became an important depot of military stores. Indeed, a 
fear that Confederate guerrillas based in Canada would seek to burn the 
Arsenal led to the stationing of extra guards there, but despite the 
approach late one dark night of an unidentified boat, nothing came of 
this concern. During the latter half of the century, the Arsenal's 
importance declined, and in 1901, the Army posted an order for its 
abandonment. That process culminated in the legislation signed by 
President Theodore Roosevelt providing for the transfer of the property 
to the State for use as a hospital to serve the mentally ill.
  Mr. President, I have offered this greatly abbreviated history of the 
Kennebec Arsenal to demonstrate the value of finding uses for the 
property that will guarantee its permanent preservation. That is the 
goal of the State of Maine and the City of Augusta, and this 
legislation will remove an anachronistic obstacle to the realization of 
that goal.
  I thank you, Mr. President, and I hope to have your support for this 
very important legislation when it comes before the Committee on Armed 
Services.

                          ____________________