[Congressional Record Volume 144, Number 74 (Wednesday, June 10, 1998)]
[Senate]
[Pages S6037-S6046]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. DURBIN (for himself, Ms. Snowe, Mr. Gorton, Mr. Wellstone,
Ms. Mikulski, Mrs. Feinstein, Mr. Chafee, Mrs. Boxer, Mrs.
Murray, Mr. Grassley, Mr. Wyden, Mr. Bingaman, Mr. Kerry, Mr.
Robb, Mr. Inouye, Mr. Torricelli, Mr. Levin, Mr. Bumpers, Mr.
Johnson, Mr. DeWine, Mr. Kohl, Ms. Collins, Mr. Cleland, and
Mr. Moynihan):
S. 2152. A bill to establish a program to provide credit and other
assistance for encouraging microenterprises in developing countries,
and for other purposes; to the Committee on Foreign Relations.
microcredit for self-sufficiency act of 1998
Mr. DURBIN. Mr. President, I rise to introduce a bill today which is
cosponsored by at least 20 of my colleagues in the Senate, a bipartisan
offering on an issue which I came to be familiar with over 10 years
ago. I traveled to the country of Bangladesh. It is not exactly on the
itinerary of favorite congressional trips because it is a country
which, although it is large and very interesting, has had its share of
misfortune. It seems whenever any natural disaster would strike in the
world it would stop in Bangladesh. We, of course, conjure an image in
our mind of people who have suffered through typhoons and tornadoes and
flooding and all sorts of deprivation. It is a very poor country.
Then Congressman, the late Mike Synar, and I went to Bangladesh. One
of the reasons we went was to explore an issue which we had heard a lot
about. There is an institution created in Bangladesh known as the
Grameen Bank. Grameen means ``people's bank.'' It is an extraordinary
institution because it is an unusual bank; it is
[[Page S6038]]
a bank designed to provide very small loans to very poor people. So
Congressman Synar and I joined with people from the American Embassy
and got in our four-wheel drive vehicle and drove out from Dakar into
the countryside until the road ended, and then our four-wheel vehicle
could go no further and we got out and started hiking a few miles into
the brush and came upon a tiny little village. In this village we were
invited to a bank meeting, a meeting of the board of directors of the
Grameen Bank, in this tiny, obscure, almost nameless Bangladesh
village. The bank meeting was unlike any meeting of any board of
directors one would ever imagine.
Seated in a little shelter were about 30 or 40 women, all dressed in
brightly colored saris, with a third eye in their foreheads, many of
them holding babies in a typical Asian squatting position and looking
up at these visitors who had come to see them.
Our host, a professor from a university in Bangladesh who was
familiar with the program, Dr. Huk, introduced us to the women in the
audience. He said at one point, ``Is there anyone here who has ever
heard of the United States of America?'' Not one of them had. And here
we were, these two Congressmen standing before them, looking like
creatures from some other planet I am sure, wanting to know more about
this little bank.
This bank has grown in size and scope in an effort to provide
microcredit, small loans, to some of the poorest people in the world.
What does $100 mean to an American? For us, it might be a nice trip
shopping or a trip to a restaurant. But for a woman living in
Bangladesh, $100 might mean that she can buy some tools and develop a
skill and a craft to feed her family; $100 might mean that she can buy
a milking cow that she can then use, not only to feed her family, but
to sell the products and to make some money for her future.
How does this work, that people who are so poor, with literally no
earthly possessions, can be debtors, can borrow money from a bank? It
works because the concept is that when they undertake this debt,
several other villagers will sign up with them, cosign the note, if you
will, in a guarantee that the payment will be made because, you see,
the cosigners cannot get a debt of their own until the original debt is
paid off. So they look very carefully to make sure that the debt is
repaid on a monthly basis. The payback rate on Grameen Bank is over 95
percent.
Why in the world would I raise this question here on the floor of the
U.S. Senate in the great country that we live in, with all of our
wealth and opportunity? Because I, frankly, think that this is a model
that we should encourage and follow around the world. We do not spend
an extraordinarily great amount of money on foreign aid compared to
other nations, but we do spend billions of dollars. The bill that I
introduce suggests that we should take a portion of that money each
year and dedicate it to microcredit projects, projects like the Grameen
Bank around the world.
Many Americans might say, ``Well, Senator, it sounds like a great
idea, but why should we worry about a woman in Bangladesh?'' One of the
women in this meeting I attended came up to me afterwards and, with an
interpreter--she had a baby in her arms --she told me her life story.
She was 18 years old. The baby she was holding was her third child.
She told me, quite proudly, that she was not going to have any more
children. She was practicing birth control. She said, ``My other two
children are alive.'' Now, that is an amazing statement in the United
States. You think, ``Well, of course, why would you bring that up?''
But in a developing country, it is a very serious concern: Will my baby
survive? Do I need to have another baby? That is why many of the
developing countries have such high birth rates.
She had decided that because of good health techniques, which the
United States and United Nations had encouraged, that her babies had a
chance to live, and with the Grameen Bank, she had a chance to improve
their livelihood. She said, quite proudly, ``I'm going to have a family
of three and that is all we need and Grameen Bank has really helped to
make this possible.''
A tiny loan of $100, a family planning program, some public health
techniques and this woman is going to limit her family to three. Is
that important to us in the United States? It is, because in Asia, in
Africa and around the world, the problem of overpopulation is one that
is not local or regional, it is a global problem.
Overpopulation leads to many problems--economic instability,
political instability, environmental degradation. Look at the nation of
India today. India is in the headlines because of its recent nuclear
test, its fears of China and Pakistan. Yet, India is going to be in the
headlines in a few years because it will be the most populated nation
in the world. It will pass China. As that teeming population grows and
creates political pressures, it becomes a concern in the United States.
I hope we will make modest investments in those foreign aid programs
that really can improve the quality of life in developing countries and
can really cope with some of the problems such as overpopulation.
Microcredit enjoys broad bipartisan support.
An organization known as RESULTS, which is nationwide but has a very
significant chapter in Chicago, has encouraged me to introduce this
legislation, which I am happy to do. There are many people who are
strong supporters of this. One of them is well known to many of us who
grew up watching ``The Mary Tyler Moore Show.'' Her name is Valerie
Harper, also known as Rhoda.
For some reason, this has become a passion for her, a commitment to
helping women around the world receive basic credit so that they can
lift their lives and improve their families. I salute Valerie Harper
for her leadership on this. Microcredit encourages entrepreneurship and
free market economic development.
The repayment rates on these loans are over 95 percent, and it is
found that $1 million put into microcredit can generate $15 million in
small loans over 5 years as people get better off and start building
their own livelihoods. It gives poor people, and especially women, the
means to meet the needs of their family in areas of health, education,
and nutrition.
Our First Lady Hillary Rodham Clinton spoke in Chicago a few years
ago, and I thought she made a very important observation. She said, if
you will look at the underdeveloped nations and wonder if they have a
chance to move toward democracy or toward a free market economy, the
first place you should look is how they treat women. Are women given an
opportunity to be educated? Are they given an opportunity to work
outside the home and develop their skills? How are they treated? I
think we are finding in countries where microcredit is becoming an
important part of the program that women are given that chance.
This bill in particular requires the U.S. Agency for International
Development to spend $160 million for fiscal year 1999 on its
Microenterprise Assistance Program, with at least 50 percent of that
amount dedicated to serving the poorest in the world with microcredit
loans under $300. We know that these loans are repaid, and we know that
they are recycled, so we are creating a stock, a basic pool of money
that can be reinvested in nations around the world to bring them up to
higher living standards.
One-fifth of the world's population lives in extreme poverty.
Microcredit is one of the most effective antipoverty tools in
existence. I talked to one of my colleagues and asked him to cosponsor
this bill the other day and he said, ``You know, I like this bill.
There are so many things we do in foreign aid that end up creating more
bureaucracies and agencies and studies; this is real, this gives to
people who need a helping hand the kind of help that they really
need.''
Unfortunately, AID has had this program, even though it has not been
specifically authorized, and they have not funded it at levels that I
think are adequate. So this legislation will set a standard for how
much we invest in this program each and every year. Many of my
colleagues have joined me on this legislation. I hope that others who
have not will take a look at it. I think they will find that this is a
reasonable approach, a successful approach, and one where the
investment in America's foreign aid dollars will not only be in our
best interest, but in
[[Page S6039]]
the best interest of people around the world who just need a helping
hand and opportunity. 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. 2152
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 ``Microcredit for Self-
Sufficiency Act of 1998''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--Congress makes the following findings:
(1) More than 1,000,000,000 people in the developing world
are living in severe poverty.
(2) According to the United Nations Children's Fund, the
mortality for children under the age of 5 is 10 percent in
all developing countries and nearly 20 percent in the poorest
countries.
(3) Nearly 33,000 children die each day from malnutrition
and disease which is largely preventable.
(4)(A) Women in poverty generally have larger work loads
and less access to educational and economic opportunities
than their male counterparts.
(B) Directly aiding the poorest of the poor, especially
women, in the developing world has a positive effect not only
on family incomes, but also on child nutrition, health, and
education, since women tend to reinvest income in their
families.
(5)(A) The poor in the developing world, particularly
women, generally lack stable employment and social safety
nets.
(B) Many women turn to self-employment to generate a
substantial portion of their livelihood.
(C) These poor entrepreneurs are often trapped in poverty
because they cannot obtain credit at reasonable rates to
build their asset base or expand their otherwise viable self-
employment activities.
(D) Many of the poor are forced to pay interest rates as
high as 10 percent per day to money lenders.
(6)(A) On February 2-4, 1997, an international Microcredit
Summit was held in Washington, D.C., to launch a plan to
expand access to credit for self-employment and other
financial and business services to 100,000,000 of the world's
poorest families, especially the women of those families, by
2005.
(B) With an average of 5 people to a family, achieving this
goal will mean that the benefits of microcredit will reach
nearly half of the world's more than 1,000,000,000 absolute
poor.
(7)(A) The poor are able to expand their incomes and their
businesses dramatically when they have access to loans at
reasonable interest rates.
(B) Through the development of self-sustaining microcredit
programs, poor people themselves can lead the fight against
hunger and poverty.
(8)(A) Nongovernmental organizations such as the Grameen
Bank, Accion International, and the Foundation for
International Community Assistance (FINCA) have been
successful in lending directly to the very poor.
(B) These institutions generate repayment rates averaging
95 percent or higher.
(9)(A) Microcredit institutions not only reduce poverty,
but also reduce the dependency on foreign assistance.
(B) Interest income on a credit portfolio can be used to
pay recurring institutional costs, assuring that the long-
term development is sustained.
(10) Microcredit institutions leverage foreign assistance
resources because loans are recycled, generating new benefits
to program participants.
(11) The development of sustainable microcredit
institutions that provide credit and training, and mobilize
domestic savings, are critical to a global strategy of
poverty reduction and broad-based economic development.
(12)(A) In 1994, AID launched a Microenterprise Initiative
in consultation with Congress.
(B) The Initiative was committed to expanding funding for
AID's microenterprise programs, provided funding of
$137,000,000 for fiscal year 1994, and set a goal that, by
the end of fiscal year 1996, half of all microenterprise
resources would support programs and institutions providing
credit to the poorest with loans under $300.
(C) In fiscal year 1996, total funding for microenterprise
activities fell to $111,000,000 of which only 39 percent was
used for programs benefiting the poorest with loans under
$300.
(D) Increased investment in microcredit institutions
serving the poorest is critical to achieving the Microcredit
Summit's goal.
(E) AID's funding for microenterprise activities in the
developing world should be expanded to $160,000,000 for
fiscal year 1999 to parallel the growing capacity of
microcredit institutions in the developing world.
(13) Providing the United States share of the global
investment needed to achieve the goal of the Microcredit
Summit will require only a modest increase in United States
funding for international microcredit programs, with an
increased focus on institutions serving the poorest.
(14)(A) In order to reach tens of millions of the poorest
with microcredit, it is crucial to expand and replicate
successful microcredit institutions.
(B) Microcredit institutions need assistance in developing
their institutional capacity to expand their services and tap
commercial sources of capital.
(15) PVOs and other nongovernmental organizations have
demonstrated competence in developing networks of local
microcredit institutions that can reach large numbers of the
very poor, and help the very poor achieve financial
sustainability.
(16) Since AID has developed very effective partnerships
with PVOs and other nongovernmental organizations, AID should
place a priority on investing in PVOs and other
nongovernmental organizations through AID's central funding
mechanisms.
(17) By expanding and replicating successful microcredit
institutions, AID should be able to assure the creation of a
global infrastructure to provide financial services to the
world's poorest families.
(18)(A) AID can provide leadership among bilateral and
multilateral development aid agencies as such agencies expand
their support of microenterprise for the poorest.
(B) AID should seek to improve the coordination of efforts
at the operational level to promote the best practices for
providing financial services to the poor and to ensure that
adequate institutional capacity is developed.
(b) Purposes.--The purposes of this Act are--
(1) to provide for the continuation and expansion of AID's
commitment to develop microcredit institutions;
(2) to make microenterprise development the centerpiece of
the overall economic growth strategy of AID;
(3) to support and develop the capacity of United States
PVOs, and other international nongovernmental organizations
to provide credit, savings, and training services to
microentrepreneurs; and
(4) to increase the amount of assistance devoted to
providing access to credit for the poorest sector in
developing countries, particularly women.
SEC. 3. DEFINITIONS.
In this Act:
(1) AID.--The term ``AID'' means the United States Agency
for International Development.
(2) Microcredit, microenterprise, poverty lending; poverty
lending portion of mixed programs; mixed programs.--The terms
``microcredit'', ``microenterprise'', ``poverty lending
portion of mixed programs'', and ``mixed programs'' have the
meaning given such terms under the 1994 Microenterprise
Initiative of AID.
(3) PVOs and other nongovernmental organizations.--The term
``PVOs and other nongovernmental organizations'' means--
(A) private voluntary organizations (including cooperative
organizations), and
(B) international, regional, or national nongovernmental
organizations,
that are active in the region or country where the project is
located and that have the capacity to develop and implement
microenterprise programs that are oriented toward working
directly with the poor, especially the poorest and women.
SEC. 4. MICROENTERPRISE ASSISTANCE.
(a) Authorization.--
(1) In general.--The President, acting through the
Administrator of AID, is authorized to establish programs to
provide credit and other assistance for microenterprises in
developing countries.
(2) Use of pvos and other nongovernmental organizations.--
Programs to provide credit for microenterprises and related
activities under this section shall be carried out primarily
by United States PVOs and other United States and indigenous
nongovernmental organizations, including credit unions,
cooperative organizations, and other private financial
intermediaries.
(b) Eligibility Criteria.--The Administrator of AID shall
establish criteria for determining which entities described
in subsection (a)(2) are eligible to carry out the purposes
described in section 2(b). Such criteria shall include the
following:
(1) The extent to which the recipients of credit from the
entity lack access to the local formal financial sector.
(2) The extent to which the recipients of credit from the
entity are among the poorest people in the country.
(3) The extent to which the entity is oriented toward
working directly with poor women.
(4) The extent to which the entity is implementing a plan
to become financially self-reliant by charging realistic
interest rates to its borrowers.
(c) Funding Levels for Fiscal Year 1999.--
(1) In general.--Of the amounts made available to carry out
chapter 1 of part I of the Foreign Assistance Act of 1961 (22
U.S.C. 2151 et seq.), not less than $160,000,000 of the funds
made available for fiscal year 1999 shall be used to provide
assistance under this Act. The funds authorized under the
preceding sentence shall be in addition to any funds made
available in fiscal year 1999 for microenterprise activities
in the former Soviet Union and Eastern Europe pursuant to the
FREEDOM Support Act and any funds for special assistance
initiatives within Europe, the newly independent states of
the Former Soviet Union, Asia, and the Near East.
(2) Additional requirements.--
(A) Poverty lending.--Of the funds made available under
paragraph (1), not less than
[[Page S6040]]
$80,000,000 shall be used to support poverty lending.
(B) Support of pvos and other nongovernmental
organizations.--Of the funds made available under paragraph
(1), not less than $35,000,000 shall be provided through the
central funding mechanisms of AID for support of United
States PVOs and United States and indigenous nongovernmental
organizations.
(C) Matching grant program.--Of the funds made available
under paragraph (1), not less than $10,000,000 shall be used
for the private voluntary organizations matching grant
program of AID for support of United States PVOs.
(3) Definitions.--For purposes of this subsection--
(A) To support poverty lending.--The term ``to support
poverty lending'' means--
(i) funds lent to members of the poverty target population
(as defined in subparagraph (B)) in low-income countries in
amounts equivalent to $300 or less in 1997 United States
dollars; and
(ii) funds used for institutional development of an entity
described in subsection (a)(2), that is engaged in--
(I) making loans of $300 or less in 1997 United States
dollars to members of the poverty target population; or
(II) the poverty lending portion of a mixed program.
(B) Poverty target population.--The term ``poverty target
population'' means the poorest 50 percent of those
individuals living below the poverty line, defined by the
national government of the foreign country to which funds are
being provided.
SEC. 5. PROGRAM PERFORMANCE CRITERIA.
(a) Strengthening of Appropriate Mechanisms.--The
Administrator of AID shall--
(1) strengthen appropriate mechanisms, including mechanisms
for central microenterprise programs, for the purpose of
strengthening the institutional development of the entities
described in section 4(a)(2); and
(2) develop and strengthen appropriate mechanisms for the
purpose of gathering and disseminating the best practice for
targeting microcredit to the poorest segment of the
population.
(b) Monitoring System.--In order to sustain the impact of
the assistance authorized under section 4, the Administrator
of AID shall establish a monitoring system that--
(1) establishes performance goals for such assistance and
expresses such goals in an objective and quantifiable form;
(2) establishes performance systems or indicators to
measure the extent to which projects are achieving such
goals; and
(3) provides a basis for recommendations for adjustments to
such assistance to enhance the benefit of such assistance for
the very poor, particularly women.
(c) Additional Monitoring Requirements.--As a part of the
monitoring system established under subsection (b), the
Administrator of AID--
(1) using data provided by lending institutions, shall
monitor the actual amount of microenterprise credit and the
number of loans made available to the poverty target
population as a result of each project or program carried out
pursuant to this Act;
(2) using data provided by lending institutions, shall
monitor the amount of funding provided pursuant to this Act
which is allocated to organizations engaged in making loans
of under $300 to the poverty target population, or to the
poverty lending portion of mixed programs;
(3) shall report to Congress annually on the progress in
implementing AID's institutional plan of action to achieve
the Microcredit Summit goal of expanding access to credit and
other financial and business services to 100,000,000 of the
world's poorest families, especially the women in those
families, by 2005; and
(4) shall include a summary of the information collected
under paragraphs (1) and (2) in AID's annual presentation to
Congress.
Ms. SNOWE. Mr. President, I am pleased to be the lead cosponsor of
the Microcredit for Self-Sufficiency Act of 1998. This bipartisan
measure is an excellent means of fighting poverty and allowing the
world's enterprising poor to escape it.
Microcredit programs extend small loans to very poor people for self-
employment projects that generate income to allow them to care for
themselves and their families. These loans are provided without
collateral to poor people so they can start or expand small businesses.
Microcredit encourages entrepreneurship and productivity among the
poorest people in the world and allows them and their families to
escape from poverty with dignity.
I have always believed that the foreign assistance expenditures made
by the United States should provide the maximum benefit in a cost-
efficient manner. Microcredit meets this most important test.
Microcredit loans are repaid by borrowers at commercial interest rates
or higher, and repayment rates reach 95% and above. The money invested
in microcredit programs is continually recycled, allowing lenders to
reach more people over time.
This assessment is borne out by the Foundation for International
Community Assistance (FINCA) which is a non-governmental organization
working in Latin America, Africa, Asia and the United States. It
estimates that, over 5 years, $1 million invested in one of their
microcredit programs generates $15 million in new loans.
The microcredit concept has been a great success. Around the world,
small investments have allowed an estimated 10 million poor people to
begin self-employment ventures as opposed to relying on government
handouts. Far more families could benefit from microcredit, but do not
yet have access to such opportunities as this type of lending is not
typically done by most financial institutions. It is microcredit
institutions that will undertake such opportunities to provide a poor
woman in Bangladesh, for example, with the funds to buy an extra cow or
goat to increase her modest farming output.
Indeed, one real-life illustration of the success of this program has
been the Grameen Bank in Bangladesh. In 1976, a man named Muhammad
Yunus conducted an innovative research endeavor to examine the
possibility of designing a credit delivery system to provide banking
services to help the rural poor. These are individuals who want to
escape poverty but find that conventional sources of lending are
unavailable to them because they lack the collateral to get a loan.
The Grameen Bank Project began with the goals of extending banking
facilities to poor men and women, and creating opportunities for self-
employment. It also aimed to reverse the vicious cycle of low income,
low savings, and low investment by providing these individuals with
credit that would yield greater investment and income.
Today, the Grameen Bank is the largest rural credit institution in
Bangladesh. It has over two million borrowers--94 percent of whom are
women. The Grameen Bank covers more than half of all villages in
Bangladesh and the repayment of its loans, which average $160 in United
States dollars, is over 95%. The Bank has also helped train
approximately 4,000 individuals from about 100 nations over the last 10
years. There have been 223 Grameen style programs replicated in some 58
nations in the last decade. This success story demonstrates what an
individual is capable of when given the opportunity to help himself or
herself escape poverty.
Take the instance of Amena Begum, who in 1993, lived in poverty with
her family in a village in Bangladesh. She and her family survived by
living as squatters and earning money as day laborers or by operating
micro-businesses in constant debt to loansharks. That same year, she
convinced her husband to move the family to another village and joined
the Grameen Bank. A neighbor told her ``We're all poor--or at least we
all were when we joined. I'll stick up for you because I know you'll
succeed in business.''
Well, she was elected secretary of her Grameen Bank group and repaid
a loan she received to start a chicken and duck raising business.
Grameen then gave her a second loan and, today, her business is growing
and providing for her family's basic needs.
A continent away in Ethiopia another woman, Alemnesh Geressu, her
landless husband, and their seven children were also struggling. For
several years, she bought grain from a trader and sold it in the local
market. However, most of her profit went back to the lender who charged
more than 10 percent interest per month. With loans from a Catholic
Relief Services Program, she was able to buy grain at a lower price
from nearby farmers and make higher profits. Her business grew
dramatically and she now sells a local beverage, grows vegetables and
even raised a cow--all in addition to her grain marketing activities.
Alemnesh now pays back her loan at a commercial rate that is ten
times less than she used to pay to the local money lenders. She has
enough to feed her family well and to send two of her children to
school. Alemnesh says she now has ``more confidence and skills in
myself and I wish the program could accommodate more women to improve
their lives.''
More families need to be touched by such programs. Just last year, at
the 1997 Global Microcredit Summit, donor nations and international
institutions established the goal of reaching 100 million of the
world's poorest families,
[[Page S6041]]
especially the women in those families with microcredit loans by the
year 2005. I believe that this bill, the Microcredit for Self-
Sufficiency Act of 1998, puts the United States on track to provide its
share of funding to help achieve this worthwhile goal.
This bill authorizes not less than $160 million in Fiscal Year 1999
for the United States Agency for International Development's
microenterprise program. To ensure that microcredit assistance goes to
those most in need of assistance, the bill targets at least half of
these resources to institutions serving the world's poorest families,
with loans under $300. Further, the bill channels a larger proportion
of microcredit assistance through effective nongovernmental
organizations that promote the development and expansion of microcredit
programs worldwide.
Mr. President, microcredit programs enjoy broad bipartisan support
not only because they help millions to work their way out of poverty
but because they also recycle foreign aid dollars through loan
repayments. Microcredit programs are self-sustainable, can be
replicated, and are powerful vehicles for social development.
This bill would increase the number of families that have access to
such programs. Microcedit programs would be raised to a higher priority
among our nation's foreign aid initiatives. And the investments called
for in this bill will help bring the possibility of financial
independence to millions of potential entrepreneurs who struggle to
survive on less than $1 a day.
______
By Mr. DORGAN (for himself and Mr. Reid):
S. 2153. A bill to require certain expenditures by the Federal
Reserve System to be made subject to congressional appropriations, to
prohibit the maintenance of surplus accounts by Federal reserve banks,
to provide for annual independent audits of Federal reserve banks, to
apply Federal procurement regulations to the Federal Reserve System, to
reform the pricing practices of the Federal Reserve System for services
provided to the domestic banking system, and for other purposes; to the
Committee on Banking, Housing, and Urban Affairs.
THE FEDERAL RESERVE FISCAL ACCOUNTABILITY ACT OF 1998
Mr. DORGAN. Mr. President, today Senator Reid and I are introducing
legislation to help address a number of budgetary excesses and
accountability lapses at the Federal Reserve Board.
When the General Accounting Office (GAO) released its comprehensive
and historic report about the management of the Federal Reserve
system--which took over two years to assemble --we learned about
disturbing financial practices and management failures within the
Federal Reserve system. The report is packed with examples of where the
Fed could substantially trim costs, and it makes specific
recommendations for changes in Fed operations. Unfortunately, the
Federal Reserve dismissed most of the GAO's recommendations as
irrelevant or unnecessary.
The GAO report shows that during the late 1980s and early 1990s,
Federal Reserve expenditures jumped by twice the rate of inflation,
while the rest of the federal government has been downsizing. This
runaway spending is remarkable given Chairman Greenspan's advice about
the need for belt-tightening in the rest of government.
The gold-plated hood ornament of the Federal Reserve System's
questionable practices is, in my judgment, its huge cash surplus
account that's funded with billions of dollars in taxpayer money to
protect against losses, despite the fact that the Fed hasn't suffered a
loss for more than 80 consecutive years. When the GAO's report was
released a couple of years ago, the Fed had squirreled away some $3.7
billion into the surplus account, which was up some 79% from its level
in the late 1980s. Now the Fed has increased the surplus account by
another 40% to about $5.2 billion--even though the GAO concluded that
``it is unlikely that the Federal Reserve will ever incur sufficient
annual losses such that it would be required to use any funds in the
surplus account.''
Our bill, the ``Federal Reserve Fiscal Accountability Act of 1998,''
includes many of the changes recommended by the GAO. It would do the
following:
First, the Federal Reserve is required to immediately return to the
general fund of the federal Treasury the $5.2 billion of taxpayer's
money that has unnecessarily accumulated in the Fed's surplus fund. In
addition, the bill asks the GAO to determine the extent to which the
Fed's future net earnings should be transferred to the federal Treasury
each year.
Second, the GAO, in consultation with the Federal Reserve, will
identify and report to Congress a list of the Federal Reserve System
activities that are not related to the making of monetary policy. After
the report is completed, all non-monetary policy expenditures, as
identified by the GAO, would be subject to the congressional
appropriations process.
We do not intend to inject politics into monetary policy with this
provision. However, over 90 percent of the Fed's operations have
nothing to do with interest rate policy according to the GAO. And there
is simply no good reason why the Fed's non-monetary expenditures are
immune from the same kind of oversight and review required of other
federal agencies.
Third, the regional Federal Reserve banks and the Board of Governors
will be subjected to annual independent audits. This provision merely
codifies what the Federal Reserve has been doing for the most part in
recent practice. The detection of any possible illegal acts must be
reported to the Comptroller General.
Fourth, the Federal Reserve will be required to follow the same
procurement and contracting rules that apply to other federal agencies.
These rules should help to prevent the examples of favoritism
highlighted in the GAO report and increase competition among contract
bidders with the Fed. This requirement ought to substantially reduce
procurement costs on a system-wide basis.
Finally, we've made some changes to require the Fed to compete more
fairly with the private sector in providing a variety of payment system
services, such as check clearing and transportation to banks and other
financial institutions.
I invite my colleagues to join us as cosponsors of this much-needed
legislation.
Mr. REID. Mr. President, I rise today with the Senator from North
Dakota to introduce legislation which we believe will improve fiscal
management within the Federal Reserve System and will allow private-
sector competitors to compete fairly in ``priced services.'' We assure
you that nothing in this bill affects monetary policy of the Federal
Reserve.
Back in September 1993, Senator Dorgan and I requested a GAO
investigation of the operations and management of the Federal Reserve
System. We were concerned because no close examination of the Fed's
operations had ever been conducted before. The GAO report that was
issued in 1996 raised serious questions about management within the Fed
which this bill will address.
One of the most astonishing findings in the 1996 report was the Fed
had squirreled-away $3.7 billion in taxpayer money in a slush fund. As
of January 1998, this amount has now grown to $5.2 billion. This money
could be used for deficit reduction. The Fed claims the slush fund is
needed to cover system losses. Since it was created in 1913, however,
the Fed has never operated at a loss. This bill prohibits maintenance
of surplus accounts and the surplus funds must be sent to Treasury.
The bill requires the Comptroller General of U.S. and the Fed Board
of Governors to identify the functions and activities of the Board and
each Fed bank which relate to U.S. monetary policy. After six months
after enactment, all non-monetary policy expenses of Federal Reserve
System, will be subject to congressional appropriations. The Fed will
now have to justify its use of operating expenses.
Because of the Fed's self-financing nature, its operating costs have
escaped public investigation. In order to be fiscally responsible, all
activities regarding government finances need to be scrutinized.
Surprisingly, the GAO study was the very first look into the internal
operations of the Fed. We think that oversight is needed on the
workings of this large and influential public entity. While the rest of
Federal government has tightened its belt and
[[Page S6042]]
down-sized, the Fed enjoyed enormous growth in its operating costs and
questionable growth in its staffing.
Clearly, the Fed could do much more to increase its fiscal
responsibility, particularly as it urges frugal practices for other
agencies. The picture the GAO report painted of the internal management
of the Fed is one of conflicting policies, questionable spending,
erratic personnel treatment, and favoritism in procurement and
contracting policies.
To date, there has never been an annual, independent audit of the
nation's central banking system. This bill provides for annual
independent audits of the banks, the Board of Governors and the Federal
Reserve System. The detection of any possible illegal acts must be
reported to the Comptroller General. The bill requires an annual audit
of each Federal reserve bank, the Federal reserve board of governors
and in turn, an audit of the Federal reserve system. This Auditor must
be a certified public accountant who is totally independent of the Fed.
An annual audit is fiscally sound policy which would instill greater
public confidence in our banking system.
This bill would also would reform the pricing practices of Federal
Reserve System so that fair competition with private businesses would
exist. It will eliminate the possibility of accusations of favoritism
and conflict of interest in procurement and contracting. This
examination will ensure that the Federal Reserve is competing fairly
with its private-sector competitors. This matter of fairness becomes
very important when the agency both competes with the private sector
and also regulates their competitors.
The Federal Reserve operates several lines of business, which compete
with the private sector. These businesses are referred to as ``priced
services.'' This legislation will ensure that the Federal Reserve is
accountable for the manner in which these businesses are run and how
the prices for these services are calculated. The Federal Reserve is
required by the Monetary Control Act of 1980 to match its revenues with
its costs so that the prices for services it sells are not subsidized.
We want to make sure that no accounting or pricing policy hides any
subsidy. This legislation will benefit anyone who cashes a check in
this country because it promotes a fair and competitive market place
for those who provide the many services necessary to process the
collection of checks. Costs should be fully recovered in the Federal
Reserve's pricing. These annual audits will ensure that they are
recovered and will level the playing field for those who can offer
competitive services
We usually think of the Federal Reserve in the terms of monetary
policy, of setting interest rates. I want to make it very clear, I'm
not attempting to interfere with, or impugn, the monetary policy of the
Fed. I am simply seeking greater accountability in the operating
expenses and internal management of one of our most influential
institutions. I believe that the Federal Reserve could do more to
increase its cost consciousness and to operate as efficiently as
possible. This bill will ensure that this happens and I look forward to
greater discussion of this issue by Congress. I encourage the committee
to give favorable consideration to our legislation.
______
By Mrs. BOXER:
S. 2154. A bill to promote research to identify and evaluate the
health effects of silicone breast implants, and to ensure that women
and their doctors receive accurate information about such implants; to
the Committee on Labor and Human Resources.
Silicone Breast Implant Research and Information Act
Mrs. BOXER. Mr. President, today I am introducing a bill that
will make a significant difference in the lives of millions of American
women--the Silicone Breast Implant Research and Information Act. There
is one basic reason for this bill: to make sure women have accurate and
complete information so they can make informed decisions about their
health.
Each year, nearly 180,000 women are diagnosed with breast cancer in
the United States. In total, approximately 2.6 million Americans live
with breast cancer. When a women undergoes a mastectomy, she faces the
decision of whether to have reconstructive surgery, and one important
option she has is to have a silicone breast implant.
Between 1 and 2 million women in the United States have received
silicone breast implants over the last 35 years, as part of
reconstructive surgery after mastectomy, or for cosmetic purposes.
Many women with silicone implants have come forward with a variety of
symptoms and atypical illnesses. Although research over the years has
attempted to get to the bottom of this, we still don't have the answers
women need and deserve.
In 1992, the Food and Drug Administration restricted the availability
of silicone breast implants because it had not received enough evidence
to prove that these implants are safe. Currently, silicone breast
implants are only available to women who have had breast cancer surgery
or who have other special medical needs, such as a severe injury or
birth defect. Women who need to have an implant replaced for medical
reasons, such as rupture of the implant, are also eligible.
These women should have access to the broadest possible treatment
options--including breast implants. But it is just as essential that
women can count on sound scientific research regarding the safety of
implants. It is essential that the Federal Government coordinate its
efforts on this issue to maximize the use of limited resources.
This bill contains three components women need to make informed
decisions about silicone breast implants--research, information, and
coordination. It gives women not only options, but information and
peace of mind.
I am proud to introduce this bill in the Senate, and to be joined by
Congressman Gene Green, who is introducing this bill in the House of
Representatives. I ask unanimous consent that the full text 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. 2154
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 ``Silicone Breast Implant
Research and Information Act''.
SEC. 2. FINDINGS AND PURPOSE.
(a) Findings.--Congress makes the following findings:
(1) According to the Institute of Medicine, it is estimated
that 1,000,000 to 2,000,000 American women have received
silicone breast implants over the last 35 years.
(2) Silicone breast implants have been used primarily for
breast augmentation, but also as an important part of
reconstruction surgery for breast cancer or other conditions.
(3) Women with breast cancer or other medical conditions
seek access to the broadest possible treatment options,
including silicone breast implants.
(4) Women need complete and accurate information about the
potential health risks and advantages of silicone breast
implants so that women can make informed decisions.
(5) Although the rate of implant rupture and silicone
leakage has not been definitively established, estimates are
as high as 70 percent.
(6) According to a 1997 Mayo Clinic study, 1 in 4 women
required additional surgery because of their implants within
5 years of receiving them.
(7) In addition to potential systemic complications, local
changes in breast tissue such as hardening, contraction of
scar tissue surrounding implants, blood clots, severe pain,
burning rashes, serious inflammation, or other complications
requiring surgical intervention following implantation have
been reported.
(8) According to the Institute of Medicine, concern remains
that exposure to silicone or other components in silicone
breast implants may result in currently undefined connective
tissue or autoimmune diseases.
(9) A group of independent scientists and clinicians
convened by the National Institute of Arthritis and
Musculoskeletal and Skin Diseases in April of 1997 addressed
concerns that an association may exist between atypical
connective tissue disease and silicone breast implants, and
called for additional basic research on the components of
silicone as well as biological responses to silicone.
(10) According to many reports, including a study published
in the Journal of the National Cancer Institute, the presence
of silicone breast implants may create difficulties in
obtaining complete mammograms.
(11) According to a 1995 Food and Drug Administration
publication, although silicone breast implants usually do not
interfere with a woman's ability to nurse, if the implants
leak, there is some concern that the silicone may harm the
baby. Some studies suggest a link between breast feeding with
implants and problems with the child's esophagus.
[[Page S6043]]
(b) Purpose.--It is the purpose of this Act to promote
research to identify and evaluate the health effects of
silicone breast implants, and to ensure that women and their
doctors receive accurate information about such implants.
(c) Rule of Construction.--Nothing in this Act shall be
construed to affect any rule or regulation promulgated under
the authority of the Food, Drug and Cosmetic Act that is in
effect on the date of enactment of this Act relating to the
availability of silicone breast implants for reconstruction
after mastectomy, correction of congenital deformities, or
replacement for ruptured silicone implants for augmentation.
SEC. 3. EXPANSION AND INTENSIFICATION OF ACTIVITIES REGARDING
SILICONE BREAST IMPLANTS AT THE NATIONAL
INSTITUTES OF HEALTH.
Part H of title IV of the Public Health Service Act (42
U.S.C. 289 et seq.) is amended by adding at the end the
following:
``SEC. 498C. SILICONE BREAST IMPLANT RESEARCH.
``(a) Institute-Wide Coordinator.--The Director of NIH
shall appoint an appropriate official of the Department of
Health and Human Services to serve as the National Institutes
of Health coordinator regarding silicone breast implant
research. Such coordinator shall encourage and coordinate the
participation of all appropriate Institutes in research on
silicone breast implants, including--
``(1) the National Institute of Allergy and Infectious
Diseases;
``(2) the National Institute of Arthritis and
Musculoskeletal and Skin Diseases;
``(3) the National Institute of Child Health and Human
Development;
``(4) the National Institute of Environmental Health
Sciences;
``(5) the National Institute of Neurological Disorders and
Stroke; and
``(6) the National Cancer Institute.
``(b) Study Sections.--The Director of NIH shall establish
a study section or special emphasis panel if determined to be
appropriate, for the National Institutes of Health to review
extramural research grant applications regarding silicone
breast implants to ensure the appropriate design and high
quality of such research and shall take appropriate action to
ensure the quality of intramural research activities.
``(c) Clinical Study.--
``(1) In general.--The Director of NIH shall conduct or
support research to expand the understanding of the health
implications of silicone breast implants. Such research
should, if determined to be scientifically appropriate,
include a multidisciplinary, clinical, case-controlled study
of women with silicone breast implants. Such a study should
involve women who have had such implants in place for at
least 8 years, focus on atypical disease presentation,
neurological dysfunction, and immune system irregularities,
and evaluate to what extent if any, their health differs from
that of suitable controls, including women with saline
implants as a subset.
``(2) Annual report.--The Director of NIH shall annually
prepare and submit to the appropriate Committees of Congress
a report concerning the results of the study conducted under
paragraph (1).''.
SEC. 4. EXPANSION AND INTENSIFICATION OF ACTIVITIES REGARDING
SILICONE BREAST IMPLANTS AT THE FOOD AND DRUG
ADMINISTRATION.
To assist women and doctors in receiving accurate and
complete information about the risks of silicone breast
implants, the Commissioner on Food and Drugs shall--
(1) ensure that the toll-free Consumer Information Line and
materials concerning breast implants provided by the Food and
Drug Administration are available, up to date, and responsive
to reports of problems with silicone breast implants, and
that timely aggregate data concerning such reports shall be
made available to the public upon request and consistent with
existing confidentiality standards;
(2) revise the Administration's breast implant information
update to clarify the procedure for reporting problems with
silicone implants or with the conduct of adjunct studies, and
specifically regarding the use of the Medwatch reporting
program;
(3) require that manufacturers of silicone breast implants
update implant package inserts and informed consent documents
regularly to reflect accurate information about such
implants, particularly the rupture rate of such implants; and
(4) require that any manufacturer of such implants that is
conducting an adjunct study on silicone breast implants--
(A) amend such study protocol and informed consent document
to reflect that patients must be provided with a copy of
informed consent documents at the initial, or earliest
possible, consultation regarding breast prosthesis;
(B) amend the informed consent to inform women about how to
obtain a Medwatch form and encourage any woman who withdraws
from the study, or who would like to report a problem, to
submit a Medwatch form to report such problem or concerns
with the study and reasons for withdrawing; and
(C) amend the informed consent document to provide
potential participants with the inclusion criteria for the
clinical trial and the toll-free Consumer Information number.
SEC. 5. PRESIDENT'S INTERAGENCY COMMITTEE ON SILICONE BREAST
IMPLANTS.
(a) Establishment.--There is established an interagency
committee, to be known as the President's Interagency
Committee on Silicone Breast Implants (referred to in this
Act as the ``Committee''), to ensure the strategic
management, communication, and oversight of the policy
formation, research, and activities of the Federal Government
regarding silicone breast implants.
(b) Composition.--The Committee shall be composed of--
(1) an individual to be appointed by the President who
represents the White House domestic policy staff;
(2) a representative, to be appointed by the Secretary of
Health and Human Services, from--
(A) the Office of Women's Health at the Department of
Health and Human Services;
(B) the National Institutes of Health;
(C) the Food and Drug Administration; and
(D) the Centers for Disease Control and Prevention;
(3) a representative of the Department of Defense with
experience in the Department's breast cancer research
program;
(4) representatives of any other agencies deemed necessary
to accomplish the mission of the Committee, including the
Social Security Administration if appropriate;
(5) up to 4 individuals to be appointed by the President
from scientists with established credentials and publications
in the area of silicone breast implants; and
(6) 2 women who have or have had silicone breast implants
to be appointed by the President.
(c) Chairperson.--
(1) In general.--The individual appointed under subsection
(b)(2)(A), or other official if the President determines that
such other official is more appropriate, shall service as the
chairperson of the Committee.
(2) Duties.--The chairperson of the Committee shall--
(A) not less than twice each year, convene meetings of the
Committee; and
(B) compile information for the consideration of the full
Committee at such meetings.
(d) Meetings.--The meetings of the Committee shall be open
to the public and public witnesses shall be given the
opportunity to speak and make presentations at such meetings.
Each member of the Committee shall make a presentation to the
full Committee at each such meeting concerning the activities
conducted by such member or by the entity that such member is
representing related to silicone breast implants.
(e) Administrative Provisions.--
(1) Terms and vacancies.--A member of the Committee shall
serve for a term of 2 or 4 years (rotating terms). A member
may be reappointed 2 times, but shall not exceed 8 years of
service. Any vacancy in the membership of the Committee shall
be filled in the manner in which the original appointment was
made and shall not affect the power of the remaining members
to carry out the duties of the Committee.
(2) Compensation; reimbursement of expenses.--Members of
the Committee may not receive compensation for service on the
Committee. Such members may, in accordance with chapter 57 of
title 5, United States Code, be reimbursed for travel,
subsistence, and other necessary expenses incurred in
carrying out the duties of the Committee.
(3) Staff; administrative support.--The Secretary of Health
and Human Services shall, on a reimbursable basis, provide to
the Committee such staff, administrative support, and other
assistance as may be necessary for the Committee to
effectively carry out the duties under this section.
(4) Conflict of interest.--The members of the Committee
shall not be in violation of any Federal conflict of interest
laws.
(f) Authorization of Appropriations.--There are authorized
to be appropriated such sums as may be necessary to carry out
this section.
______
By Mr. BINGAMAN:
S. 2155. A bill to provide restitution of the economic potential lost
to communities dependent on Spanish and Mexican Land Grants in New
Mexico due to inadequate implementation of the 1848 Treaty of Guadalupe
Hidalgo; to the Committee on Energy and Natural Resources.
Fair Deal for Northern New Mexico Act of 1998
Mr. BINGAMAN. Mr. President, today, I introduce a bill to
resolve a long standing controversy between many citizens of my State
of New Mexico, and their government.
In 1848, the United States entered into a treaty with Mexico to end
the Mexican/American War called the Treaty of Guadalupe-Hidalgo. In
that treaty, Mexico ceded an enormous tract of land that was to become
the American Southwest including the State of New Mexico. In return the
Treaty stipulated that the property rights of the Mexican citizens who
lived in the area, and who were to become new citizens of the United
States, would be protected.
We must recall that these new citizens had had a long, and sometimes
ancient, connection to the land. The Native American tribal peoples who
had lived there for thousands of years, had
[[Page S6044]]
become citizens of Spain and then Mexico. Also many of those new
citizens of Spanish descent had a family heritage of living on the this
land dating back 250 years to 1598, when the Spanish colonial capital
in New Mexico was established at San Juan Pueblo. They had built towns
and cities, churches, and vast irrigation systems for their farms.
Unfortunately, the treaty provisions protecting title to land were
not well and evenly implemented. It has been fairly well documented by
scholars such as Professor Malcolm Ebright at the University of New
Mexico, and Professor Emeritus Michael Meyer from the University of
Northern Arizona, that many people lost title to their land who should
have been protected by the treaty. In some cases this was due to faulty
surveying by the Surveyor General, in some cases it was due to a lack
of knowledge by American Territorial Courts about how title was
acquired under Spanish and Mexican law, and most egregiously people
sometimes lost their land through outright fraud by government
officials and land speculators.
As I said earlier, the implementation of the treaty was not uniform.
In some areas property rights were fairly well adhered to, but in
others legitimate titles were wiped out wholesale. A group of people
that were particularly hurt in this process were the relatively poor
subsistence farmers and ranchers living in northern New Mexico. These
new American citizens were easy prey for land speculators. Not only
were they learning a new language and legal system, but usually they
did not have the financial resources to defend their property rights in
the courts. In some cases, people were told that if they signed a given
document that they would be assured the continued use of their land
forever. However in reality, what they were signing were quit claim
deeds, giving title to their land to some nefarious speculator.
The ramifications of this history have caused bitter disputes and
economic hardship in northern New Mexico for generations. The issue is
still relevant for many New Mexicans feel their government has an
obligation to compensate them for their loss of land. In many cases
they may be right.
Mr. President, after 150 years it may not be possible or practicable
to revisit the thousands of title claims originally made in 1848. So
much time has passed, and so many title transfers have taken place
since then that the legal review could be a never ending legal maze.
However, Spanish and Mexican law recognized community as well as
individual land titles. Under a grant from the King of Spain or the
Mexican government, whole communities had a claim on certain lands.
These community land grants form a distinct, and often better
documented, subset of the claims made under the Treaty of Guadalupe-
Hidalgo. Given that this is a smaller, more defined group of claims,
and because of they affect whole communities, it may be possible to
settle these long standing claims and provide a sense of justice to
people in northern New Mexico.
Last year former Representative Richardson introduced a bill, H.R.
260, to create a commission to study and recommend settlement of these
claims. His successor in office, Representative Redmond has carried on
this issue in his own bill, H.R. 2538. These bills have been useful in
bringing the issue to national attention and I commend both of my
colleagues for introducing them.
Mr. President, my bill, which I call the Fair Deal for Northern New
Mexico Act, builds upon the efforts in the other body. For example, the
House bill is focused on an exhaustive legal review of the various
community land grant claims and whether land should be transferred back
to the claimants. My bill also has a review of these claims, but
acknowledges that after 150 years, that we may never be able to reach
legal certainty in some cases. We may find that a claim is colorable,
that it has a legal basis, but not exactly what is owed. Also, we may
find that the other people in the community currently either own the
land in question, or if it's federal land, they may have long standing
leases on which they depend. For that reason, my bill creates a package
of options for settlement of these claims with the involvement and
support of the whole community that would be affected.
I won't dwell on the differences between this bill and the one in the
House because I see this bill as a broadening and strengthening of that
effort. Let me just run briefly what my bill would do, and my hope is
that as this works its way through committee and on the floor that
we'll reach an agreement with the House sponsors on legislation that
will resolve this long standing legal dispute in New Mexico.
My bill has three key components: the creation of county-wide
settlement committees, the reasonable but expedited time-frame, and a
broad range of settlement options. First, it would create seven member
settlement committees, one for each county in New Mexico in which their
are these community land grant claims. To get the federal agencies
actively involved in a solution to the issue, the Secretaries of
Agriculture and Interior would each have a representative on these
committees. The State Lands Commissioner would represent the interests
of the State's educational trust fund. Finally, each county commission
would appoint four representatives, at least one of which must be a
Tribal member if there is an Indian Pueblo within that county, and at
least one of which is a non-Indian heir to a Spanish or Mexican Land
Grant.
Second, the bill tries to keep the issue on the front burner by
limiting the settlement committees to a set schedule. The settlement
committees would have ninety days to publish a set of guidelines on to
how to document a land claim, and then people would have one year to
file their claims. These committees would then have three years in
which to review the claims and develop a proposed settlement to be
submitted to Congress.
The whole process from creation of these committees to proposals to
Congress would take about five years. I think this very important. It
should be long enough to develop some solid settlement proposals, but
it is a short enough time-frame that the people in New Mexico will see
action before they just become frustrated.
Finally, the settlement committees would have a number of options to
choose from to create a settlement that will satisfy the claims and the
communities in which they are made. As with the House bill, one options
would be to transfer land directly back to a particular community land
grant. However, the committee might propose that federal lands be set
aside for under special designations for community use, or that lands
should be transferred to local municipalities to benefit everyone in
the community. Further, a settlement committee could recommend that a
package of economic develop grants or tuition scholarships would better
meet the current needs of claimants and the community than a transfer
of whatever land might be available. All of these options would be
tools available to a county settlement committee to use in crafting a
settlement that the people of that county would find to be fair and
just.
Mr. President, it is time for the United States to respond to its
citizens on this issue, to bring this controversy to closure, and to
give the citizens of northern New Mexico a sense that justice has been
done so that they can move forward both socially and economically
without this cloud from the past hanging over them. I think this bill
will move us forward towards those goals. I would like to call on the
Committee on Energy and Natural Resources to hold hearings on this bill
at the earliest possible time. I hope to work with the rest of the New
Mexico delegation and the other members of Congress to pass good
legislation regarding the issue.
Mr. President, I ask unanimous consent that the full 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. 2155
Be it enacted by the Senate and the House of
Representatives of the United States of America in Congress
assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Fair Deal for Northern New
Mexico Act of 1998.''
SEC. 2. PURPOSE, DEFINITIONS AND FINDINGS.
(a) Purpose.--
The purpose of this Act is to create a mechanism for the
settlement of Spanish and Mexican land grant claims in New
Mexico as claimed under the Treaty of Guadalupe-Hildalgo.
(b) Definitions.--For Purposes of this Act:
[[Page S6045]]
(1) Treaty of Guadalupe-hidalgo.--The term ``Treaty of
Guadalupe-Hidalgo'' means the Treaty of Peace, Friendship,
Limits, and Settlement (Treaty of Guadalupe Hidalgo), between
the United States and the Republic of Mexico, signed February
2, 1848 (TS 207; 9 Bevans 791);
(2) Community land grant.--The term ``community land
grant'' means a village, town, settlement, or pueblo
consisting of land held in common (accompanied by lesser
private allotments) by three or more families under a grant
from the King of Spain (or his representative) before the
effective date of the Treaty of Cordova, August 24, 1821, or
from the authorities of the Republic of Mexico before May 30,
1848, in what became the State of New Mexico, regardless of
the original character of the grant.
(3) Land grant claim.--The term ``land grant claim'' means
a claim of title to land by a community land grant under the
terms of the Treaty of Guadalupe-Hidalgo.
(4) Eligible Descendant.--The term ``eligible descendant''
means a descendant of a person who--
(A) was a Mexican citizen before the Treaty of Guadalupe-
Hildalgo;
(B) was a member of a community land grant; and
(C) became a United States citizen within ten years after
the effective date of the Treaty of Guadalupe-Hidalgo, May
30, 1848, pursuant to the terms of the Treaty.
(5) Settlement committee.--The term ``settlement
committee'' refers to committee, or one of the county
specific subcommittees as appropriate, authorized in Section
3 of this Act.
(6) Reconstituted.--The term ``reconstituted,'' with regard
to a valid community land grant, means restoration to full
status as a municipality with rights properly belonging to a
municipality under State law, including the nontaxability of
municipal property (common lands) and the right of local
self-government.
(c) Findings.--Congress Finds the Following:
(1) New Mexico has a unique and complex history regarding
land ownership due to the substantial number of Spanish and
Mexican land grants that were an integral part of the
colonization of New Mexico before the United States acquired
the area in the Treaty of Guadalupe-Hidalgo.
(2) Under the terms of the Treaty of Guadalupe-Hidalgo,
these land grant claims were recognized as valid property
claims under United States' law.
(3) Several studies, including the New Mexico Land Grant
Series published by the University of New Mexico, have
documented that the Treaty of Guadalupe-Hidalgo in regards to
these land grant claims in New Mexico was never well
implemented. Whether because of a lack of knowledge of
Spanish land law on the part of the judicial system in the
then new Territory of New Mexico, whether because of
inadequate or conflicting documentation of these claims, or
whether it was due to sharp legal practices, many of the
former citizens of Mexico, and then new citizens of the
United States, lost title to lands that had been guaranteed
to them by treaty.
(4) Following the United States' war with Mexico, the
economy of the Territory of New Mexico was dependent on the
use of land resources, and that held true for much of this
century as well. When the land grant claimants lost title to
their land, the predominantly Hispanic communities in
northern New Mexico lost a keystone to their economy. The
effects of this loss have had long lasting economic
consequences and are in part the cause that these communities
remain some of the poorest in the United States.
(5) The history of the implementation of the Treaty of
Guadalupe-Hidalgo has been a source of continuing controversy
for generations and has left a lingering sense of injustice
in the communities in northern New Mexico, which has
periodically lead to armed conflicts.
(6) The government of the United States has an obligation
to try to find an equitable remedy for the inadequate
implementation of the Treaty of Guadalupe-Hidalgo and the
consequences that has had on the communities and people of
New Mexico. This should be done as expeditiously as possible.
However, reconstructing the one hundred and fifty year
history of land title claims and transfers in these
communities is likely to prove lengthy and costly. In some
cases it may never be possible to adequately reconstruct the
title history.
(7) The Secretary of the Interior has had a experience in
administratively developing settlement packages to resolve
large and complex Tribal water rights claims as an
alternative to lengthy and expensive litigation. This
experience may be invaluable in resolving the large, complex,
and sometimes conflicting Spanish and Mexican land grant
claims in northern New Mexico.
(8) The history of colonial Spanish America, the system of
land distribution under Spanish and Mexican law, and the
subsequent impacts to that system following the transfer of
territory from Mexico to the United States under the Treaty
of Guadalupe-Hidalgo is a requisite body of knowledge in
determining an appropriate settlement of land grant claims.
It is also an integral part of the national history and
culture of the United States of America and, as such,
deserves formal recognition and interpretation by our
institutions of historical preservation.
SEC. 3. CREATION OF SETTLEMENT COMMITTEES.
(A) Within one hundred and eighty (180) days of enactment
of this Act, the Secretary of the Interior working through
the Bureau of Land Management and the Bureau of Indian
Affairs, and the and the Secretary of Agriculture working
through the Forest Service are hereby authorized and directed
to establish a ``Settlement Committee'' to develop
comprehensive settlements for land grant claims on a county
by county basis.
(b) The Settlement Committee will be comprised of separate
subcommittees for each county in which there are land grant
claims in New Mexico.
(c) Each county subcommittee shall be comprised of seven
members including: (1) a representative of the Secretary of
the Interior; (2) a representative of the Secretary of
Agriculture; (3) a representative of the State Commissioner
of Public Lands; and (4) four residents of the particular
county in question. The four county representatives are to be
appointed their county commissions: Provided, That in
counties with Federally recognized Native American Indian
Tribes that at least one county representative shall be an
enrolled member of a tribe whose reservation pueblo
boundaries come within that county: Provided further, That at
least one county representative shall be an eligible
descendent who is not an enrolled member of a Native American
Indian Tribe.
(d) Each member shall be appointed for the life of the
Settlement Committee. A vacancy in the Settlement Committee
shall be filled in the manner in which the original
appointment was made.
SEC. 4. SUBMISSION OF LAND GRANT CLAIMS.
(a) Within ninety (90) days of the creation of the
settlement committee it shall establish a set of guidelines
for the submission of land grant claims, and publish these
guidelines within papers of general circulation in each of
the counties in New Mexico.
(b) Land grant claims must be submitted to the appropriate
county settlement committee within one year of the
publication of the guidelines.
SEC. 5 REVIEW AND SETTLEMENT PACKAGE.
(a) The settlement committee for each county shall review
all of the submitted claims in the county and, based on the
documentation at its disposal, make an initial determination
concerning their potential validity including: possible past
conveyances, the accuracy of the boundaries of the land
claimed, and the number of eligible heirs affected.
(b) Upon completing this review, the settlement committee
shall develop a proposed settlement package in satisfaction
of land grant claims within that county. In creating the
settlement package, the settlement committee shall take into
account: the degree of certainty with which it has determined
that various claims are valid, the impacts, including
economic and social impacts, that any unfulfilled land
grant claims may have had on the communities within that
county, the relative benefits of various settlement
options on those communities, and whether there is a legal
entity that can accept settlement. The elements of a
proposed settlement package may include, but are not
limited to:
(1) Restoration of lands to a given land grant community or
communities;
(2) Reconstitution of a given land grant community or
communities;
(3) The setting aside of certain lands for communal use for
fuel wood, building materials, hunting, recreation, etc.
These lands could be set aside as special managerial units
within existing federal land management agencies or
transferred to local county, tribal, or municipal,
governments;
(4) Trust funds for scholarships or home and business
loans; or
(5) Land for commercial use with the proceeds to be
deposited into the trust funds.
(c) The settlement committee shall complete its review and
proposed settlement package within three years of the
deadline for submission of land grant claims under this Act,
and submit them in a report to the Senate Committee on Energy
and Natural Resources and the Senate Committee on Indian
Affairs, and to the House Resources Committee. Any proposal
that require action by the government of the State of New
Mexico shall be submitted to the Governor, to the Speaker of
the State House of Representatives, and to the President Pro
Tem of the State Senate for New Mexico.
SEC. 6. ADMINISTRATION OF THE SETTLEMENT COMMITTEE.
(a) To complete its tasks the settlement committee may use
a variety of methods to gather information and to build
community consensus on the form of a proposed settlement
package, including: the use of town meetings, holding formal
hearings, the solicitation of written comments, and the use
of mediators trained in alternative dispute resolution
methods. The settlement committee is also authorized to hire
consultants as it may choose for historical, economic, and
legal analysis. In its efforts to develop a consensus on a
settlement package, the Settlement Committee is not subject
to the Federal Advisory Committee Act (Pub. L. 92-462; 5
U.S.C. Ap. 2 Sec. 1).
(b) Gifts, Bequests, and Devises.--The Settlement Committee
may accept, use, and dispose of gifts, bequests, or devises
of services or property, both real and personal, for the
purpose of aiding or facilitating the work of the Settlement
Committee. Gifts, bequests, or devises of money and proceeds
from sales of other property received as
[[Page S6046]]
gifts, bequests, or devises shall be deposited in the
Treasury and shall be available for disbursement upon order
of the Settlement Committee. For purposes of the Federal
income, estates, and gift taxes, property accepted under this
subsection shall be considered as a gift, bequest, or devise
to the United States.
(c) Administrative Support Services.--Upon the request of
the Settlement Committee, the Administrator of General
Services shall provide to the Settlement Committee, on a
reimbursable basis, the administrative support services
necessary for the Settlement Committee to carry out its
responsibilities under this Act.
(d) Immunity.--The Settlement Committee is an agency of the
United States for the purpose of part V of title 18, United
States Code (relating to the immunity of witnesses).
(e) Compensation.--Members of the Settlement Committee
shall each be entitled to receive the daily equivalent of
level V of the Executive Schedule for each day (including
travel time) during which they are engaged in the actual
performance of duties vested in the Settlement Committee.
SEC. 7. SPANISH LAND GRANT STUDY PROGRAM.
(a) The Secretary of the Smithsonian Institution and the
Settlement Committee working in conjunction with the
University of New Mexico, and Highlands University shall
establish a Spanish Land Grant Study program with a research
archive at the Onate Center in Alcalde, New Mexico. This
program shall be designed to meet the requirements of the
Smithsonian Institution's Affiliated Institutions Program.
(b) The purposes of the Spanish Land Grant Study Program
are to assist the Settlement Committee in the performance of
its activities under section 5, and to archive and interpret
the history of land distribution in the southwestern United
States under Spanish and Mexican law, and the changes to this
land distribution system following the transfer of territory
from Mexico to the United States under the terms of the
Treaty of Guadalupe-Hidalgo in 1848.
SEC. 8. TERMINATION.
The Settlement Committee shall terminate on 180 days after
submitting its final report to Congress under section 5.
SEC. 9. AUTHORIZATION OF APPROPRIATIONS.
There is authorized to be appropriated $1,500,000 for each
of the fiscal years 1999 through 2003 for the purpose of
carrying out the activities of the Settlement Committee
created in section 3, and the Spanish Land Grant Study
Program created section 7.
______
By Mr. BOND (for himself, Mr. Grassley, Mr. Lott, Mr. Breaux, Mr.
Burns, Mr. Mack, Mr. Bingaman, Mr. Frist, Mr. Murkowski, Mrs.
Murray, Mr. Roberts, Mr. Hollings, Mr. Dodd, Mr. Faircloth, Ms.
Collins, Mr. Jeffords, Mr. Thomas, Mr. D'Amato, Mr. Hatch, Mr.
Shelby, Mr. Ashcroft, Mr. Kempthorne, Mr. Robb, Mr. Baucus, Mr.
Cleland, Mr. Craig, and Mr. Santorum):
S.J. Res. 50. A joint resolution to disapprove the rule submitted by
the Health Care Financing Administration, Department of Health and
Human Services on June 1, 1998, relating to surety bond requirements
for home health agencies under the Medicare and Medicaid programs; to
the Committee on Finance.
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