[Congressional Record Volume 144, Number 139 (Wednesday, October 7, 1998)]
[Senate]
[Pages S11698-S11708]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. ROBERTS (for himself and Mr. McCain):
  S. 2563. A bill to amend title 10, United States Code, to restore 
military retirement benefits that were reduced by the Military 
Retirement Reform Act of 1986; to the Committee on Armed Services.


         MILITARY RETIREMENT READINESS ENHANCEMENT ACT OF 1998

  Mr. ROBERTS. Mr. President, a few weeks ago I called the Senate's 
attention to several issues in the military that are contributing to 
problems in recruiting and retention of key, midcareer military 
personnel. Briefly, those issues were as follows:
  We are asking the military, significantly smaller than it was during 
the cold war, to operate and deploy much more frequently.
  We are asking the military to deploy on missions that may not be in 
the vital national interest of this Nation.
  We are not paying servicemen and women a salary that is comparable to 
the pay they could get outside the military for the same skills.
  We are not providing quality health care for the families of the 
military, and we have not provided the promised health care for the 
retired members of the military.
  We are not providing quality housing to all military families.
  And we are not providing a retirement program that is adequate to 
justify a career commitment to the arduous lifestyle and the difficult 
family separations that are necessary in military life.
  Mr. President, I rise today to offer legislation to address military 
retirement. The bill that I am introducing repeals the Military Reform 
Retirement Act of 1986, also known as REDUX. This experiment in the 
military retirement system was introduced in 1986 with the intended 
purpose--and it was a good one--of encouraging members of the military 
to stay longer than the popular career of 20 years.
  The service chiefs now say that retirement is one of the top reasons 
that our men and women are leaving the service. The Chairman of the 
Joint Chiefs of Staff, General Shelton, listed it among the most 
pressing problems facing the military in retaining key people. The 
Secretary of Defense has voiced very similar concerns.
  Pay is being addressed slowly, including a 3.6 percent pay raise in 
this defense appropriations bill.
  The Department of Defense is working on housing issues that may solve 
the problems. Problems with the health care programs are very complex 
and multilayered and requires detailed study to solve. The issue of the 
high rate of deployments and the quality of

[[Page S11699]]

missions rests at the feet of the administration and this Congress and 
are now the subject of policy debate.
  Congress must address, however, the issue of retirement. We must show 
the men and women of our armed services that we are listening to their 
concerns and that we deeply care about them, their families and the 
commitment they make to the defense of this Nation.
  While the purpose of this bill is to repeal the 1986 retirement 
program, I want to emphasize it is not the final solution to the 
military's retirement problem. I urge the Department of Defense to 
start a comprehensive study--I think they are--and to examine all 
creative options to solve the recruitment and retention problems that 
now face the military.
  The repeal of REDUX is only but one option. There may be others. I 
know that private industry has many creative retirement programs that 
may serve as part of a final solution. The civilian sector of the 
Federal Government has long experience in retirement programs. Whatever 
course we end up taking, the bottom line must be a retirement program 
that is perceived as fair and adequate by our service men and women.
  The fundamental job of the Federal Government is to provide for the 
security of the Nation. That security begins and ends with people. It 
is clear that they are sending a strong message that we are letting 
them down. We are not providing adequately for their welfare and their 
postmilitary life.
  So providing better benefits for members of the military will pay 
dividends for national security. And, Mr. President, it is the right 
thing to do. We owe it to our military men and women who are making the 
personal and family sacrifices to do such an important job. They do an 
outstanding job under the most difficult of circumstances. It is not 
too much to ask that we provide adequate support for them and their 
families.
  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. 2563

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

     SECTION 1. SHORT TITLE; REFERENCES TO TITLE 10, UNITED STATES 
                   CODE.

       (a) Short Title.--This Act may be cited as the ``Military 
     Retirement Readiness Enhancement Act of 1998''.
       (b) References to Title 10.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of title 10, 
     United States Code.

     SEC. 2. RETIRED PAY MULTIPLIER.

       (a) Repeal of Reduction for Less Than 30 Years of 
     Service.--Subsection (b) of section 1409 is amended by 
     striking out paragraph (2).
       (b) Conforming Amendments.--(1) Paragraph (1) of such 
     subsection is amended by striking out ``paragraphs (2) and 
     (3)'' and inserting in lieu thereof ``paragraph (2)''.
       (2) Paragraph (3) of such subsection is redesignated as 
     paragraph (2).

     SEC. 3. ADJUSTMENTS OF RETIRED AND RETAINER PAY TO REFLECT 
                   CHANGES IN THE CONSUMER PRICE INDEX.

       (a) Repeal of Reduced COLA Rate.--Subsection (b) of section 
     1401a is amended--
       (1) by striking out paragraphs (1), (2), (3), and (4), and 
     inserting in lieu thereof the following:
       ``(1) General rule.--Effective on December 1 of each year, 
     the Secretary of Defense shall increase the retired pay of 
     each member and former member of an armed force by the 
     percent (adjusted to the nearest one-tenth of 1 percent) by 
     which--
       ``(A) the price index for the base quarter of that year, 
     exceeds
       ``(B) the base index.''; and
       (2) by redesignating paragraph (5) as paragraph (2).
       (b) First COLA Adjustment.--Subsections (c)(3) and (d) of 
     such section are amended by striking out ``who first became a 
     member of a uniformed service before August 1, 1986, and''.
       (c) Repeal of Special Rule on Pro Rating Initial Adjustment 
     for Post-1986 Reform Retirees.--Subsection (e) of such 
     section is repealed.
       (d) Conforming Amendments.--Subsections (f), (g), and (h) 
     of such section are redesignated as subsections (e), (f), and 
     (g), respectively.

     SEC. 4. RESTORAL OF FULL RETIREMENT AMOUNT AT AGE 62.

       (a) Repeal.--Section 1410 is repealed.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 71 is amended by striking out the item 
     relating to section 1410.

     SEC. 5. CONFORMING AMENDMENTS FOR SURVIVOR BENEFIT PLAN.

       (a) Unreduced Retired Pay as Basis for Annuity.--Section 
     1447(6)(A) is amended by striking out ``(determined without 
     regard to any reduction under section 1409(b)(2) of this 
     title)''.
       (b) Cost-of-Living Adjustments and Recomputations.--Section 
     1451 is amended by striking out subsections (h) and (i) and 
     inserting in lieu thereof the following:
       ``(h) Adjustments to Base Amount for Cost-of-Living.--
       ``(1) Increases in base amount when retired pay 
     increased.--Whenever retired pay is increased under section 
     1401a of this title (or any other provision of law), the base 
     amount applicable to each participant in the Plan shall be 
     increased at the same time.
       ``(2) Percentage of increase.--The increase shall be by the 
     same percent as the percent by which the retired pay of the 
     participant is so increased.''.
       (c) Reduction in Retired Pay.--(1) Section 1452 is 
     amended--
       (A) in subsection (c), by striking out paragraph (4); and
       (B) by striking out subsection (i).
       (2) Section 1460(d) is amended by striking out ``or 
     recomputed under section 1452(i) of this title'', or 
     recomputed, as the case may be,'' and ``or recomputation''.

     SEC. 6. EFFECTIVE DATE.

       This Act and the amendments made by this Act shall take 
     effect on October 1, 1999, and shall apply with respect to 
     retired or retainer pay accruing for months beginning on or 
     after that date.

  Mr. McCAIN. Mr. President, I rise to support and cosponsor the 
legislation that Senator Roberts introduced earlier today that 
reinstates the 50 percent retirement ``earned benefit'' plan for men 
and women in the military who retire with 20 years of military service. 
I also implore the Senate leadership to act quickly on this legislation 
and move for its swift passage before the 105th Congress adjourns for 
the year.
  Times have changed since 1986. Our economy has prospered, producing 
historically high levels of employment and resulting in the emergence 
of a very difficult recruiting and retention environment for the armed 
services. Maintaining a top-quality force requires a military personnel 
system that has the flexibility to react quickly to the dynamics of the 
civilian market, and the leadership and confidence to follow through 
with critical personnel decisions rather than neglecting them out of 
fiscal opportunism. Regrettably, this year, first, second, and third-
term enlisted retention, pilot and mid-grade officer retention, and 
recruiting are all short of the goal for each of the services.
  Recruiting and retaining quality individuals requires pay scales that 
adjust to meet prevailing rates rather than fall 14 percent behind 
comparable civilian pay. It requires adequate funding for recruiting. 
It requires proper promotion rates--not promotion boards that take five 
months to process reports of promotion boards, as is the case with the 
Navy. It requires proper living conditions and morale, welfare and 
recreation services. It also requires reasonable tours of duty, a 
higher quality of civilian leadership, and ``role models'' within the 
leadership who are seen to take service members' quality-of-life 
concerns to heart.
  Reinstatement of the 50 percent retirement plan for career military 
men and women would serve as an important signal of resolve to our 
service members that the United States Congress is aware of the 
shortfall in benefits for those who wear the uniform of their country 
and is acting to improve those benefits. Last week, the Senate Armed 
Services Committee heard directly from the Joint Chiefs that restoring 
retirement benefits is a requirement for recruiting and retaining the 
qualified individuals we rely on to defend this nation.
  General Hugh Shelton, Chairman of the Joint Chiefs of Staff, stated 
clearly that fixing the military retirement system is a top 
recommendation for restoring the readiness of our armed forces. Army 
Chief of Staff General Reimer has written to me that

       . . .the retirement package we have offered our soldiers 
     entering the Army since 1986 is inadequate. Having lost 25 
     percent of its lifetime value as a result of the 1980's 
     reforms, military retirement is no longer our number one 
     retention tool. Our soldiers and families deserve better. We 
     need to send them a strong signal that we haven't forgotten 
     them.

  The military medical health care system, particularly the TRICARE 
program, has been described by Service

[[Page S11700]]

Chiefs as falling far short of what is warranted and needed. We cannot 
ignore the erosion of retirement and health care benefits, and the 
resultant impact on retention and readiness. General Reimer writes,

       ``The loss in medical benefits when a retiree turns 65 is 
     particularly bothersome to our soldiers who are making career 
     decisions.''

  From the Service Chiefs' answers, it is highly questionable whether 
we are meeting any of these requirements. On the contrary, it is clear 
that there is much work to be done.
  Finally, it is demoralizing to the men and women we send into harm's 
way, and is incomprehensible to the American people, who expect a well-
trained and well-equipped force, to witness as many as 25,000 military 
personnel and their families on food stamps. One tax provision that I 
have tried to reverse this year excludes uniformed men and women in the 
military from beneficial tax treatment on the profits resulting from 
the sale of their homes. We order servicemembers to move from place to 
place, but we do not afford them the same tax treatment as other U.S. 
citizens. Should this issue have been permitted to exist for so many 
years?
  Mr. President, we cannot afford to neglect this array of personnel 
concerns. Let us begin by acting immediately to restore the higher 
earned benefit plan for retired service members. Senator Roberts has 
offered critical legislation to help reverse the diminishing retention 
rates that cripple our Armed Services and ultimately diminish their 
ability to execute our National Military Strategy. On behalf of all men 
and women who have honorably dedicated their careers to serving this 
country in uniform, I urge my colleagues to join me in support of this 
legislation.
                                 ______
                                 
      By Ms. LANDRIEU (for herself, Mr. Murkowski, Mr. Lott, Mr. 
        Breaux, Mr. D'Amato, Mr. Cleland, Mr. Johnson, Mr. Cochran, Ms. 
        Mikulski, and Mr. Sessions):
  S. 2566. A bill to provide Coastal Impact Assistance to State and 
local governments, to amend the Outer Continental Shelf Lands Act 
Amendments of 1978, the Land and Water Conservation Fund Act of 1965, 
the Urban Park and Recreation Recovery Act, and the Federal Aid in 
Wildlife Restoration Act (commonly referred to as the Pittman-Robertson 
Act) to establish a fund to meet the outdoor conservation and 
recreation needs of the American people, and for other purposes; to the 
Committee on Energy and Natural Resources.


         reinvestment and environmental restoration act of 1998

  Ms. LANDRIEU. Mr. President, I begin by thanking my colleague from 
Louisiana Senator Breaux, a cosponsor on this measure, as well as 
Senator Murkowski, Senator Lott, Senator D'Amato, Senator Cleland, 
Senator Johnson, Senator Cochran, Senator Sessions and Senator Mikulski 
as cosponsors of this measure, and also thank the many leaders on the 
House side that are today introducing this bill on the House side.
  Surely, with the time so short, we will not be considering this bill 
in this session, but we plan for a very lively debate as the 106th 
Congress meets in January on this very important piece of environmental 
legislation for our country.
  I will take a few minutes to outline in a highlighted form what this 
bill will attempt to do, something that we have worked on, a group of 
us, earnestly and very excitedly for the last year. Then my colleague 
from Louisiana, Senator Breaux, will say a few words about the bill.
  This is the Reinvestment and Environmental Restoration Act of 1998. 
It is going to attempt to take 50 percent of the moneys that are now 
flowing into the Federal Treasury from offshore oil and gas revenues--
which have been very significant; $120 billion since 1955--and 
redistribute those revenues in a smarter way, in a better way, and in a 
way that our country can be proud of.
  We are going to ask that 27 percent of those revenues be distributed 
to coastal States for coastal conservation impact assistance, 16 
percent to fund more fully the Land and Water Conservation Fund, and 7 
percent to fund the Wildlife Conservation and Restoration Act. These 
are the major titles of this bill. Let me very briefly hit on each one.
  I am from Louisiana, a State that has supported, proudly supported, 
oil and gas drilling and exploration. It has created many jobs in our 
State. We try to do it in a more environmentally sensitive way each and 
every year, and every decade we make tremendous progress. Other States 
like Texas, Mississippi, and to a certain degree, Alabama, although not 
as much, and Alaska, join in that effort.
  There are many States that do not have drilling and many States that 
have a moratorium on drilling. This bill is not a pro-drilling bill or 
anti-drilling bill. The purpose is to say that the production of those 
resources off the shores of our States, although they are offshore, 
have tremendous impact--both positive and negative--on the States that 
host drilling.
  Louisiana has contributed since the 1950s over 90 percent of these 
revenues that I spoke about, the $120 billion, and we have gotten less 
than 1 percent back. It is time to correct that inequity. That is what 
the first title of this bill does. It says to Louisiana, thank you for 
your commitment to our energy security and for the way that you have 
contributed to this oil and gas drilling. We believe that some of this 
money should go back to help your State and the coastal areas to shore 
up our wetlands and to reinvest in our environment. That is Title I of 
this bill. It will distribute funds to all coastal States, whether they 
have drilling or not.
  As I said, there are no incentives; there are no disincentives. It is 
a revenue-sharing bill to all the coastal States. These revenues are 
collected from a nonrenewable resource. One day these oil and gas wells 
will be dried up. It might be 10 years from now or 20 years from now, 
but some day they will be dried up, and we want to make sure that a 
portion of this money is reinvested back into our States for 
environmental infrastructure and wetland conservation so that we have 
something to show for it.
  The second part of this bill amends the Land and Water Conservation 
Act in an attempt to restore this fund, or to more fully fund it. I 
will ask unanimous consent to have printed in the Record an excerpt 
from an editorial from the New York Times on this subject.
  I will read the first short paragraph of this editorial.

       More than 30 years ago, Congress passed a quiet little 
     environmental program that offered great promise to future 
     generations of Americans. Conceived under Dwight Eisenhower, 
     proposed by John F. Kennedy and signed into law by Lyndon 
     Johnson, the Federal Land and Water Conservation Fund was 
     designed to provide a steady revenue stream to preserve 
     ``irreplaceable lands of natural beauty and unique 
     recreational value.'' Royalties from offshore oil and gas 
     leases would provide the money, giving the program an 
     interesting symmetry. Dollars raised from depleting one 
     natural resource would be used to protect another.

  The problem is, this promise was never fulfilled. That is what the 
second title of this bill will do. It seeks to make this promise real 
for our families, for our children, and for the next generation. It 
will take, as I said, 16 percent of these revenues to almost fully fund 
the State side and the Federal side of the Land and Water Conservation 
Fund. It will provide a reliable and steady stream of revenue to do 
just that.
  Let me share with you that on the Federal side in only 6 out of the 
last 33 years have we really lived up to the promise that we made to 
the land and water conservation side. On the State side, the funding 
record has been even more dismal. Only 1 year out of 33 years since 
this Land and Water Conservation Fund was enacted did we live up to 
that promise. So title II happens to fully restore funding so that we 
can plan and count on these moneys to help expand our parks and our 
recreation for our children and families in rural and urban areas 
around this great country.
  Finally, title III is a new title, a new chapter, but an attempt to 
sort of weave together some of the attempts by my colleague, Senator 
Breaux, and others to improve the Wildlife Conservation and Restoration 
Act. I believe it makes little sense to spend all of our money in this 
area on the back end, after species have become endangered. Then we 
have problems not only

[[Page S11701]]

with the species in question but with property rights. We have 
questions with economies that can be very negatively affected when 
industries have to move out or can't proceed because of this.
  So we believe it is time to start investing some money on the front 
end. That is what this title does--helping species, helping States to 
give educational and technical assistance to stop these species from 
becoming endangered, and therefore saving the taxpayers a lot of money 
and local economies a lot of anguish, and to give some much-needed 
revenue to our State wildlife agencies around this country.
  So those are generally the titles of the bill.
  I just want to say that it is high time that we live up to the 
promise made 30 years ago, and we can do that by more wisely spending 
this money. It makes no sense to take 100 percent of these revenues and 
spend them on Federal operating expenses that have nothing to do with 
our environment, or with this promise that was made, or with our 
investments in future generations. It is time not just for Louisiana, 
Texas, Alaska, and Mississippi, who have contributed so much to this 
industry, but also it is high time for all of our States to benefit in 
a more direct way than they are currently. This is a wiser fiscal 
policy, it is a much wiser environmental policy, and it most certainly 
is an idea whose time has come.
  To reiterate, the Reinvestment and Environmental Restoration Act of 
1998 will go farther than any legislation to date to make good on 
promises that were made to the people of this country decades ago. In 
addition, it will begin to right a wrong endured by oil and gas 
producing states for over 50 years, particularly for the states along 
the Gulf of Mexico, and my state of Louisiana.
  The Reinvestment and Environmental Restoration Act first provides a 
guaranteed source of funding equal to twenty-seven percent of all Outer 
Continental Shelf revenues for Coastal Impact Assistance to states to 
offset the impacts of offshore oil and gas activity, as well as to non-
producing states for environmental purposes. This funding goes directly 
to States and local governments for improvements in air and water 
quality, fish and wildlife habitat, wetlands, or other coastal 
resources, including shoreline protection and coastal restoration. 
These revenues to coastal states will help offset a range of costs 
unique to maintaining a coastal zone. The formula is based on 
population, coastline and proximity to production.
  Second, the bill provides a permanent stream of revenue for the State 
and Federal sides of the Land and Water Conservation Fund, as well as 
for the Urban Parks and Recreation Recovery Program. Under the bill, 
funding to the LWCF becomes automatic at sixteen percent of annual 
revenues. Receiving just under half this amount, the state side of LWCF 
will provide funds to state and local governments for land acquisition, 
urban conservation and recreation projects, all under the discretion of 
state and local authorities. Since its enactment in 1965, the LWCF 
state grant program has funded more than 37,000 park and recreation 
projects throughout the nation, including in Louisiana the Joe Brown 
Park Development in New Orleans, the Baton Rouge Animal Exhibit, the 
Veterans Memorial Park in Point Barre and the Northwestern State 
University Recreation Complex in Natchitoches. The Urban Parks program 
would enable cities and towns to focus on the needs of its populations 
within our more densely inhabited areas with fewer greenspaces, 
playgrounds and soccer fields for our youth. Stable funding, not 
subject to appropriations, will provide greater revenue certainty to 
state and local planning authorities.
  A stable baseline will be established for Federal land acquisition 
through the LWCF at a level higher than the historical average over the 
past decade. Federal LWCF will receive just under half of the amount in 
this title of the bill. And, nothing in this bill will preclude 
additional Federal LWCF funds to be sought through the annual 
appropriations process. Some very worthy national projects that have 
received funding in the past include the Atchafalaya National Wildlife 
Refuge in Louisiana, the Mississippi Sandhill Crane Wildlife Refuge, 
the Cape Cod National Seashore, Voyageurs National Park in Minnesota 
and the Sterling Forest in New Jersey. Federal LWCF dollars will be 
used for land acquisition in areas which have been and will be 
authorized by Congress. The bill will restore Congressional intent with 
respect to the LWCF, the goal of which is to share a significant 
portion of revenues from offshore development with the states to 
provide for protection and public use of the natural environment.
  Finally, the wildlife conservation and restoration provision includes 
guaranteed funding of seven percent of annual OCS revenues for wildlife 
habitat protection, conservation education and de-listing of endangered 
species. Moreover, this funding may be used by states for habitat 
preservation and land acquisition of wintering habitat for important 
species, therefore preventing listings under the Endangered Species 
Act.
  While we are proud of the accomplishment represented by the 
introduction of this bill, I feel compelled to mention other interests 
that are not included in the legislation, but for which I maintain a 
strong level of support and commitment. The National Historic 
Preservation Fund is an important authorized use for Outer Continental 
Shelf revenues. In fact, I introduced legislation earlier this year to 
reauthorize the fund for its continued viability and vitality. We see 
the Reinvestment and Environmental Restoration Act as a starting point 
for debate and consideration of additional issues. I would like to work 
with proponents of historic preservation over the course of the year to 
see their needs addressed in the future. This would include similar 
consideration for Historic Battlefield Preservation, which is important 
to other members in this body. I also wish to work with other groups to 
address their concerns about other provisions in the bill having to do 
with formulas. Indeed, this is a measure that should enjoy broad 
support, and I want to continue to work with groups to that end.
  Mr. President, all three portions of the bill will effectively free 
up State resources which in turn may then be used for other pressing 
local needs. The Reinvestment and Environmental Restoration Act is a 
perfect opportunity to reinvest in our nation's renewable resources for 
the benefit of our children's future and our grandchildren's future. It 
is an idea whose time has come. I urge my colleagues to carefully 
consider this proposal.
  Mr. President, I thank Chairman Murkowski, and I thank the majority 
leader, Senator Lott, for all of their help in making this legislation 
possible.
  I ask unanimous consent that the bill and New York Times editorial be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
  [The bill was not available for printing. It will appear in a future 
issue of the Record]

                [From the New York Times, June 16, 1997]

                      Revive the Conservation Fund

       More than 30 years ago, Congress passed a quiet little 
     environmental program that offered great promise to future 
     generations of Americans. Conceived under Dwight Eisenhower, 
     proposed by John F. Kennedy and signed into law by Lyndon 
     Johnson, the Federal Land and Water Conservation Fund was 
     designed to provide a steady revenue stream to preserve 
     ``irreplaceable lands of natural beauty and unique 
     recreational value.'' Royalties from offshore oil and gas 
     leases would provide the money, giving the program an 
     interesting symmetry. Dollars raised from depleting one 
     natural resource would be used to protect another.
       Since its inception, the fund has helped acquire seven 
     million acres of national and state parkland and develop 
     37,000 recreation projects. Its notable triumphs include the 
     Cape Cod National Seashore, the New Jersey Pinelands National 
     Reserve and Voyageurs National Park in Minnesota. But the 
     program fell apart during the Reagan Administration and has 
     yet to recover. Of the $900 million that has flowed to the 
     fund from oil and gas royalties each year since 1980, 
     Congress has seen fit to appropriate only a third, and in 
     some years far less. The rest has simply disappeared into the 
     Treasury, allocated for deficit reduction.
       The biggest losers have been the states. Over time, 
     appropriations have been split about evenly between Federal 
     and state conservation projects. But for two years running, 
     not a dime has gone to the states--again for budgetary 
     reasons. This has been hard on New York, which needs Federal 
     help to buy valuable open space threatened by development in 
     the Adirondacks and elsewhere.

[[Page S11702]]

       Now, quite suddenly, this legislative stepchild has 
     acquired a bunch of new friends. As part of the recent budget 
     deal, Republican leaders agreed to add $700 million to the 
     $166 million that President Clinton has requested for the new 
     fiscal year. The Republicans had been getting heat from 
     governors back home and saw a chance to polish their 
     environmental image. For his part, Mr. Clinton needed about 
     $315 million to complete two important Federal purchases, 
     both strongly supported by this page--$65 million to develop 
     on his pledge to buy the New World Mine on the edge of 
     Yellowstone National Park, the rest to acquire the Headwaters 
     Redwood Grove in California from a private lumber company.
       That would still leave several hundred million dollars for 
     other Federal projects and for the states--but only if the 
     House and Senate appropriations committees honor the outlines 
     of the budget deal and commit to sizable share of the money 
     to state projects. State officials have been descending upon 
     Washington in recent days to plead their cased. Gov. George 
     Pataki has written every member of Congress and, last week, 
     the New York State Parks Commissioner, Bernadette Castro, 
     testified at hearings convened by Senator Frank Murkowski of 
     Alaska.

  Mr. BREAUX. Mr. President, I thank the Senator from Louisiana and 
congratulate her for all the effort she has put forth in bringing this 
legislation to this point.
  I have been in Congress for a long time--something like 26 years now, 
in the House and in this body--and I have never really seen a first-
term Member who has been so dedicated to a major legislative effort as 
has the Senator from Louisiana, Ms. Landrieu, in bringing this 
legislation to the floor of the U.S. Senate. Many Members, on their 
first day, have come in and introduced a bill, issued a press release, 
and then forgotten about it. This has been an effort by the Senator 
from Louisiana, Senator Landrieu, of very carefully prodding and very 
carefully studying and working with Members on both sides of the aisle 
to put together a bipartisan coalition to bring this legislation to the 
floor of the Senate.
  While this is brought to the floor of the Senate in the last days of 
this session, we all know that there will be another day. The 
groundwork that she has laid in putting this package and this coalition 
together is going to be here in the next Congress. So in the next 
Congress we will start not from scratch but from the groundwork that 
she has laid in bringing this legislation to the point it is today.
  I congratulate her for the way she has done it. It is something that 
I have not seen by a new Member of the Congress in all of the years 
that I have been here. It is a major accomplishment on her part. I am 
very pleased to participate in it.
  Just a brief word on the legislation. I think it is a fair thing to 
do. Many non-coastal States have Federal property, owned 100 percent by 
the Federal Government, within their borders. When minerals are 
extracted or oil and gas are found on those Federal lands, the State in 
which those lands are located gets as much as 50 percent of the 
revenue. Coastal States, however, get nothing. That is clearly not 
fair. Offshore mineral development operations have a major impact on 
coastal Louisiana. These operations impact our roads, bridges and other 
infrastructure, our freshwater supply, our housing and other vital 
public resources. It is only fair that there be a reasonable sharing of 
those revenues with states that bear these kinds of burdens. The impact 
coastal states suffer is a burden borne for the good of the whole 
country and, without it, the whole country would suffer.
  Therefore, to share in a true partnership with the coastal States is 
certainly something that this Congress should favorably consider, and I 
think that we will because of what the Senator has been able to do in a 
bipartisan fashion. So while it is late this year, it is early for next 
year. The work that she has done this year will pay off next year.
  Mr. MURKOWSKI. Mr. President, I rise today, along with Senators 
Landrieu and Lott, to introduce the Reinvestment and Environmental 
Restoration Act of 1998.
  This important piece of legislation remedies a tremendous inequity in 
the distribution of revenues generated by offshore oil and gas 
production by directing that a portion of those moneys be allocated to 
coastal States and communities who shoulder the responsibility for 
energy development activity off their coastlines. It also provides a 
secure funding source for state recreation and wildlife conservation 
programs.
  The OCS Impact Assistance portion of this bill is similar to 
legislation I have introduced in prior Congresses and is an issue I 
have worked on for my entire Senate career.
  Title 1 of the bill directs that a portion of the revenues generated 
from oil and natural gas production on the Outer Continental Shelf--or 
OCS--be returned to coastal States and communities that share the 
burdens of exploration and production off their coastlines.
  Offshore oil and gas production generates $3 to $4 billion in 
revenues annually for the U.S. Treasury. Yet, unlike mineral receipts 
from onshore Federal lands, OCS oil and gas revenues are not directly 
returned to the States in which production occurs.
  This legislation remedies this disparity. States and communities that 
bear the responsibilities for offshore oil and gas production will 
share in its benefits.
  This legislation would, for the first time, share revenues generated 
by OCS oil and gas activities with counties, parishes and boroughs--the 
local governmental entities most directly affected--and State 
governments.
  The bill also acknowledges that all coastal States, including those 
States bordering the Great Lakes, have unique needs and directs that a 
portion of OCS revenues be shared with these States, even if no OCS 
production occurs off their coasts.
  Coastal States and communities can use OCS Impact Assistance funds on 
everything from environmental programs, to coastal and marine 
conservation efforts, to new infrastructure requirements.
  In Alaska, local communities could use OCS funds to participate in 
the environmental planning process required by Federal laws before OCS 
development occurs.
  Other rural coastal communities in Alaska will use the money for 
sanitation improvements. While still others, like Unalakleet, will use 
the money to construct sea walls and breakwaters or beach 
rehabilitation--efforts which will combat the impacts of coastal 
erosion.
  This is money that will be used, day-in and day-out, to improve the 
quality of life on coastal State residents--money which comes from oil 
and gas production.
  Further, as the Federal OCS program expands in Alaska, this 
legislation will mean even more revenues to the State, boroughs and 
local communities.
  This is a true investment in the future.
  As Chairman of the Energy and Natural Resources Committee, I know all 
too well that offshore oil and gas production is a lightning rod for 
environmental groups who will go to great lengths to disparage an 
activity that is vital to the long-term energy and economic security of 
this country.
  These groups will likely say that this bill creates incentives for 
offshore oil and gas production because a factor in the distribution 
formula is a State's proximity to OCS production.
  Let us remember, this is an impact assistance bill--revenue sharing, 
if you will.
  States only will have impacts if they have production. The States 
with production, obviously, have greater needs and are most deserving 
of a larger share of OCS revenues.
  Mr. President, let me also remind everyone, that OCS production only 
occurs off the coasts of 6 States--yet the bill shares OCS revenues 
with 34 States.
  There are 28 coastal States that will get a share of OCS revenues 
which have no OCS production. In fact, in all areas except the Gulf of 
Mexico and Alaska there is a moratorium prohibiting any new OCS 
production.
  It is in the long-term best interest of this country to support 
responsible and sustainable development of nonrenewable resources.
  We now import more than 50 percent of our domestic petroleum 
requirements and the Department of Energy's Information Administration 
predicts, in ten years, America will be at least 64 percent dependent 
on foreign oil.
  OCS development will play an important role in offsetting even 
greater dependence on foreign energy.
  The OCS accounts for 24 percent of this Nation's natural gas 
production

[[Page S11703]]

and 14 percent of its oil production. We need to ensure that the OCS 
continues to meet our future domestic energy needs.
  I firmly believe that the Federal Government needs to do all it can 
to pursue and encourage further technological advances in OCS 
exploration and production.
  These technological achievements have and will continue to result in 
new OCS production having an unparalleled record of excellence on 
environmental and safety issues.
  Additional technological advances with appropriate incentives will 
further improve new resource recovery and therefore increase revenues 
to the Treasury for the benefit of all Americans who enjoy programs 
funded by OCS money.
  I will do all I can to ensure a healthy OCS program, including new 
OCS development in the Arctic.
  A number of challenges face new developments in this area--I am 
confident that we can work through them all.
  History has shown us that in the Arctic, and in other OCS areas, 
development and the environmental protection are compatible.
  This bill also takes a portion of the revenues received by the 
Federal Government from OCS development and invests it in conservation 
and wildlife programs.
  Thus, Titles II and III of the bill share OCS revenues with all 
States for such purposes.
  Title II of this bill provides a secure source of funding for the 
Land and Water Conservation Fund. The LWCF was established over three 
decades ago to provide Federal money for State and Federal land 
acquisition and help meet Americans' recreation needs.
  Over thirty years ago, Congress had the foresight to recognize the 
ever growing need of the American public for parks and recreation 
facilities with the passage of the Land and Water Conservation Fund 
Act.
  That landmark piece of legislation was premised on the belief that 
revenues earned from the depletion of a nonrenewable resource need to 
be reinvested in a renewable resource for the benefit of future 
generations.
  This rationale is as valid today as it was in the mid-1960's.
  To accomplish this goal, the Land and Water Conservation Fund Act 
directs that revenues earned from offshore oil and gas production 
should be spent on the acquisition of Federal recreation lands by the 
land management agencies.
  The act also creates a state-side matching grant program.
  The state-side matching grant program provides 50-50 matching grants 
to States and local communities for the acquisition and construction of 
park and recreation facilities.
  The state-side program has a truly unique legacy in the history of 
American conservation by providing the States with a leadership role in 
the provision of recreation opportunities.
  Through the 1995 fiscal year, over 3.2 billion in Federal dollars 
have been leveraged to fund over 37,000 State and local park and 
recreation projects.
  Yet, despite these successes, the President had not requested any 
money for the state-side program for the last 4 years.
  This is a program supported by this Nation's mayors, Governors, and 
the recreation community.
  The state-side matching grant should not have to justify annually its 
existence with congressional appropriators.
  Title II makes this program self-sufficient and provides secure 
funding from OCS revenues.
  Title III of this bill provides funding for State fish and wildlife 
conservation programs.
  In Alaska, with its unparalleled natural beauty, fishing and hunting 
are two of the most popular forms of outdoor recreation.
  The bill directs that a portion of OCS revenues should go to the 
States for wildlife purposes.
  The money would be distributed through the Pittman-Robertson program 
administered by the United States Fish and Wildlife Services.
  With the inclusion of OCS revenues, the amount of money available for 
State fish and game programs would nearly double.
  This is a no-tax alternative to the Teaming with Wildlife proposal.
  States will be able to use these monies to increase fish and wildlife 
populations and improve fish and wildlife habitat.
  States also could use the money for wildlife education programs.
  I am proud of this proposal which is a win-win for the oil and gas 
industry, the States, environmental and conservation groups, and all 
Americans.
  This bill will ensure not only that Coastal States have money to 
address the effects of OCS-activities but that all States have funds 
necessary to provide outdoor recreation and conservation resources for 
all of us today to enjoy.
  As we end the 105th Congress, I can pledge, as Chairman of the Energy 
and Natural Resources Committee, that the enactment of this bill will 
be one of my highest priorities next year.
  Mr. LOTT. Mr. President, it is with great pleasure that I join my 
colleagues, Senators Landrieu and Murkowski, in introducing the 
Reinvestment and Environmental Restoration Act.
  Mr. President, since the inception of the oil and gas program on the 
Outer Continental Shelf (OCS), states and coastal communities have 
sought a greater share of the benefits from development. And why 
shouldn't they? These communities provide the infrastructure, public 
services, manpower and support industries necessary to sustain this 
development.
  Currently, the majority of OCS revenues are funneled into the Federal 
Treasury where they are used to pay for various federal programs and to 
reduce the deficit. While funding programs and reducing the deficit are 
certainly important, I believe that some percentage of the revenues 
should be reinvested in that which makes them possible.
  Our bill does that. The Reinvestment and Environmental Restoration 
Act diverts one-half of the OCS revenues from the Federal Treasury to 
coastal states and communities for a multitude of programs: air and 
water quality monitoring, wetlands protection, coastal restoration and 
shoreline protection, land acquisition, infrastructure, public service 
needs, state park and recreation programs and wildlife conservation.
  This bill allows states and communities to use these funds in 
whatever manner they deem appropriate. In Pascagoula, for example, 
authorities might choose to restore and secure the shoreline where 
years of sea traffic have taken their toll. Further north in Vancleave, 
they may choose instead to refurbish the roads and bridges that carry 
the heavy machinery coming and going from the coast. This bill provides 
a framework within which these localities can make the right decisions 
for their citizens and environment.
  Mr. President, I have been working on this issue for many, many 
years. As a coast dweller myself, I know the impact that the oil and 
gas industry can have on communities and the importance of reinvestment 
in these areas. This is not to say that the industry mistreats the 
states; on the contrary, they work very hard to comply with stringent 
environmental regulations and to take care of the community as best 
they can. The OCS Policy Committee said in 1993 that, despite the oil 
industry's best efforts, ``OCS development still can affect community 
infrastructure, social services and the environment in ways that cause 
concerns among residents of the coastal states and communities.''
  I know that there is no way to totally eliminate this impact on 
coastal communities. I also know that, while the benefits of a healthy 
OCS program are felt nationally, the infrastructure, environmental and 
social costs are felt locally. Our bill would put money back into the 
communities that need it most.
  It would also put money back into the environmental resources of the 
area. Exploration for non-renewable resources and stewardship of 
coastal resources are not mutually exclusive, but must be carefully 
balanced for both to be sustained. It is important that our wetlands, 
fisheries and water resources are taken into consideration and afforded 
adequate protection.
  In addition to propping up the states and coastal communities, our 
bill also provides funding for the Land and Water Conservation Fund 
(LWCF). Over 30 years ago, Congress set up this fund to address the 
American public's

[[Page S11704]]

desire for more parks and recreational facilities. This bill makes the 
program self-sufficient, providing secure funding from the OCS 
revenues. This is an investment in our future--our land, our resources 
and our recreational enjoyment.
  Mr. President, our bill makes yet another investment with these OCS 
revenues--an investment in fish and wildlife programs. With the 
inclusion of OCS revenues, the amount of money available for state 
programs would nearly double. This is money that can be used to 
increase populations and improve habitat for fish and wildlife. It 
could even be used for wildlife education programs.
  Mr. President, this bill was carefully crafted to strike a balance 
between the needs and interests of the oil and gas industry, the 
states, and the environmental and conservation groups. It's a good 
package that will benefit all Americans, not just those who live and 
work in coastal areas. It will benefit hunters and anglers. It will 
benefit bird watchers and campers. It will benefit all Americans who 
take solace in the fact that the oil industry is taking care of the 
communities that support it.
  I appreciate the hard work of my colleagues and look forward to 
advancing this important legislation in the 106th Congress.
                                 ______
                                 
      By Mr. WELLSTONE:
  S. 2567. A bill to ensure that any entity owned, operated, or 
controlled by the People's Liberation Army or the People's Armed Police 
of the People's Republic of China does not conduct certain business 
with United States persons, and for other purposes; to the Committee on 
Finance.


    trading with the people's republic of china military act of 1998

 Mr. WELLSTONE. Mr. President, today I'm introducing a bill 
that would bar firms owned by China's People's Liberation Army and 
People's Armed Police from operating in the United States and prohibit 
the import into the United States of products made by these firms or 
the export of products to these firms. It would also prohibit extension 
of credit to or ownership interest in Chinese military companies. The 
bill contains an exemption for humanitarian aid, waiving these 
prohibitions if the President determines that a transaction involves 
items intended to relieve human suffering such as food, medicine or 
emergency supplies.
  My bill is based in part on H.R. 4433 introduced in the House on 
August 6, 1998 by Representatives Gephardt, Bonior, and Pelosi, who I 
want to commend for taking this bold and important human rights 
initiative.
  Before I get into the key question of why I'm introducing this bill, 
I would like to touch on the question of the extent of PLA and People's 
Armed Police commercial relations with the United States. To begin 
with, I should stress that there is uncertainty about the extent and 
nature of activities of companies linked to Chinese military and 
security forces in the United States. For example, a Rand study last 
year estimated that there are ``between 20-30 PLA-affiliated companies 
operating in the United States, although there are certainly more that 
have not yet been identified.'' It added that one of the major 
obstacles to identifying these companies is that they ``often 
consciously disguise their military background by using offshore 
holding companies and unfamiliar names.''
  Nevertheless, while there is much we don't know, there is some hard 
data available on PLA and People's Armed Police business dealings with 
the United States. In June, 1997 the AFL-CIO's Food and Allied Services 
Trades Department issued a report providing a wealth of detailed 
information on these business dealings. The report, based on extensive 
research, found twelve companies incorporated in the United States 
owned by the People's Armed Police and various elements of the PLA, 
including the General Staff Department and the Navy. In addition, the 
report cited seven PLA companies that had been dissolved after their 
officials had been accused of smuggling AK-47's into the United States 
in 1996--an episode I will discuss later. For each company, the report 
provided addresses and dates of incorporation, and for some companies 
the names of registered agents, officers, and directors.
  The AFL-CIO report also provided detailed data on the exports to the 
United States of twenty-five People's Armed Police and PLA companies 
during 1996. The companies included not only major PLA components such 
as the General Staff and General Logistics Departments, but also some 
owned by various PLA military regions. All told, these companies 
exported 34 million pounds of products to the United States, including 
furniture, chemicals, rain gear, toys, sport rifles, aircraft engines, 
and fish. According to an AFL-CIO official, PLA companies were the 
largest exporters of fish for U.S. fast-food restaurants. Finally, the 
report contained a listing of U.S. companies that had purchased these 
products. In testimony before the Senate Foreign Relations Committee 
last November, an AFL-CIO official pointed out that several well-known 
U.S. concerns had purchased products directly from PLA companies.
  While it is not illegal for the People's Armed Police and PLA 
companies to operate in the United States, on at least one occasion a 
major PLA company participated in a clearly illegal activity. In May, 
1996, federal law enforcement agencies carried out a sting operation 
connected with seizure of 2,000 fully automatic AK-47 weapons from 
China. Since 1994 Chinese gun exports to the United States have been 
illegal and this was the largest seizure of fully automatic weapons in 
U.S. history. One of the two Chinese companies involved, Poly 
Technologies, is the most successful PLA-controlled company. Poly is 
run by China's princelings, family members of top Chinese civilian and 
military leaders. Poly's president is the late Deng Xiaoping's son-in-
law and a retired PLA Major General. The Chairman of Poly is the son of 
the late Wang Zhen, who was China's vice-president and a retired 
General. While China experts doubt there was high-level collusion in 
the smuggling of AK-47's, a federal law enforcement officer noted that 
those involved were ``in a position to deliver substantial arms and are 
not low-level flunkies.''
  Mr. President, I now want to turn to the key question of why I 
decided to introduce this bill. Why is there a need for such 
legislation? Because companies owned by the PLA--the Chinese 
Government's main and indispensable instrument of repression--are 
permitted to operate in the United States. Because the American people 
are unwittingly purchasing products exported to the United States by 
companies owned by the PLA and the People's Armed Police. Because the 
American people would be outraged--as deeply outraged as I am--if they 
knew they were subsidizing those responsible for massacring students, 
workers, and other demonstrators for democracy in Tiananmen Square on 
June 4, 1989, those who have occupied Tibet for almost 50 years, 
brutally oppressing its people and seeking to erase their unique, 
cultural, linguistic, and religious heritage. And because they would be 
outraged--as deeply outraged as I am, that their government is not only 
doing nothing to stop this, but is opposing efforts to end PLA and 
People's Armed Police profit-making in the United States.
  Mr. President, you may well ask what is the People's Armed Police. 
The People's Armed Police, who are under the operational control of the 
PLA, are an internal security force of over 1 million troops, one of 
whose main purposes is to suppress the legitimate protests of the 
Chinese people. For example, the People's Armed Police is often used to 
quash the peaceful protests of Chinese workers.
  Last year the People's Armed Police was used to brutally break up 
protests by thousands of laid-off state enterprise workers in Sichuan 
province. Hundreds of these workers, who took to the streets because 
company officials embezzled their unemployment compensation, were 
reportedly beaten by the People's Armed Police and several 
``instigators'' were arrested. Chinese officials were said to have 
ordered hospitals not to treat wounded demonstrators, comparing them to 
``counterrevolutionary thugs'' who ``rioted'' at Tiananmen in June 
1989. What were the laid-off workers seeking that provoked such a 
vicious crackdown by the People's Armed Police? Just that the 
government provide them with the subsistence they are entitled to and 
that corrupt company officials be punished.

[[Page S11705]]

  How can we continue to subsidize the thugs who repress Chinese 
workers?
  The People's Armed Police also man the guard towers of the Laogai, 
China's massive forced labor camp system--the largest in the world. The 
Laogai is China's version of the Soviet gulag. The Laogai is comprised 
of more than 1,100 forced labor camps, with an estimated population of 
6 to 8 million prisoners. Prisoners are overworked, denied medical 
treatment and tortured.
  How can we continue to subsidize those who guard slave laborers?
  The People's Armed Police and the PLA are the key agents of 
repression in Tibet. The People's Armed Police have been filmed in 
Lhasa, the capital of Tibet, beating monks and nuns peacefully 
demonstrating for their rights. This past May, the People's Armed 
Police and PLA soldiers reportedly fired on 150 Tibetan political 
prisoners who staged a demonstration in Tibet's main prison and the 
police later stormed the prison and arrested the demonstrators. Chinese 
officials were apparently offended when the political prisoners flew a 
Tibetan national flag during the demonstration.
  How can we continue to subsidize those who deny Tibetans fundamental 
freedoms, beat and torture them, and seek to destroy their unique 
culture and religion?
  Mr. President, this is shameful and it must be stopped. Would we have 
allowed Stalin's NKVD or Hitler's SS to subsidize their heinous 
activities by running profit-making entities in the United States and 
exporting goods to us and buying goods from us? Of course not. Why then 
do we allow the likes of the PLA and the People's Armed Police to 
profit from commercial relations with us and why does the 
Administration oppose efforts to put an end to this?
  Mr. President, the Administration in the past has justified the 
unjustifiable by arguing that imposing sanctions on PLA and People's 
Armed Police companies would be an ``impossible task'' for U.S. law 
enforcement agencies, risk retaliation against major U.S. exporters, 
and harm our efforts to develop a military-to-military dialog and 
relationship with China.
  While I believe these arguments don't hold water, they have been 
overtaken by events. In July, President Jiang Zemin ordered the PLA and 
the People's Armed Police to end the ``commercial activities'' of their 
subordinate units. There are some questions about the extent to which 
Jiang's orders will be carried out and over what time-frame. Tai Ming 
Cheung, a noted expert on China's military, foresees some shrinkage of 
the military-business complex, but predicts that it will ``remain 
powerful and more focused.'' Some China experts estimate that as much 
as one-third of total defense spending derive from profits from PLA 
businesses and it would obviously be difficult for the government to 
compensate the military for loss of this funding stream.
  Be this as it may, the fact remains that it is now Chinese government 
policy to end the commercial activities of the PLA and the People's 
Armed Police. I believe that the Senate should do all we can to help 
Beijing by passing my bill, which seeks to cut U.S. commercial ties 
with the PLA and the People's Armed Police and to end their business 
activities in the United States. Since we would be cooperating with 
Jiang's policies, the Administration can no longer point to alleged 
harmful effects on our military-to-military dialog or Chinese 
retaliation against U.S. exporters. Moreover, we would have reason to 
expect that the ability of U.S. law enforcement agencies to implement 
the sanctions contained in this bill would be enhanced since PLA and 
People's Armed Police business activities would be illegal both in 
China and the United States. Jiang Zemin presumably would have 
incentives to end or at least circumscribe Chinese military and police 
business dealings with and in the United States and, perhaps, even 
cooperate with U.S. law enforcement agencies.
  While no one can predict how successful Jiang will be in eliminating 
or even in cutting back China's military-business complex, we must act 
to end U.S. subsidies to those who beat, torture, and imprison those 
who bravely fight for freedom and democracy. By contributing to PLA and 
People's Armed Police coffers we act in complicity with those who 
repress workers, run slave labor camps, crush religious freedom, quash 
Tibetans and other minorities seeking to preserve their identity 
culture and religion. We betray those who laid down their lives at 
Tiananmen Square, inspired by American principles of democracy and 
individual rights and we betray those brave dissidents who rot in 
Chinese jails or toil in forced labor camps, whose only crime was to 
fight for the ideals all Americans hold dear. It is time to end this 
complicity, end these betrayals of our friends.
  I urge my colleagues to support this bill.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2567

       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 ``Trading With the People's 
     Republic of China Military Act of 1998''.

     SEC. 2. FINDINGS AND POLICY.

       (a) Findings.--Congress makes the following findings:
       (1) The People's Liberation Army is the principal 
     instrument of repression within the People's Republic of 
     China and is responsible for massacring an unknown number of 
     students, workers, and other demonstrators for democracy in 
     Tiananmen Square on June 4, 1989.
       (2) The People's Liberation Army is responsible for 
     occupying Tibet since 1950 and implementing the official 
     policy of the People's Republic of China to eliminate the 
     unique cultural, linguistic, and religious heritage of the 
     Tibetan people.
       (3) The People's Liberation Army has operational control of 
     the People's Armed Police, an internal security force of over 
     1,000,000 troops, whose primary purpose is to suppress the 
     legitimate protests of the Chinese people.
       (4) The People's Liberation Army is engaged in a massive 
     effort to modernize its military capabilities.
       (5) The People's Liberation Army owns and operates hundreds 
     of companies and thousands of factories the profits from 
     which in some measure are used to support military 
     activities.
       (6) Companies owned by the People's Liberation Army and the 
     People's Armed Police export to the United States such 
     products as toys, clothing, frozen fish, lighting fixtures, 
     garlic, glassware, yarn, footwear, chemicals, machinery, 
     metal products, furniture, decorations, gloves, tents, and 
     tools.
       (7) Companies owned by the People's Liberation Army and the 
     People's Armed Police regularly solicit investment in joint 
     ventures with United States companies.
       (8) The People's Liberation Army and the People's Armed 
     Police have established at least 23 different companies in 
     the United States over the past decade.
       (9) The people of the United States are unaware that 
     certain products they purchase in retail stores are produced 
     by companies owned and operated by the People's Liberation 
     Army or the People's Armed Police.
       (10) The purchase of these products by United States 
     consumers places them in the position of unwittingly 
     subsidizing the operations of the People's Liberation Army 
     and the People's Armed Police.
       (11) The Government of the People's Republic of China, with 
     the assistance of the People's Liberation Army and the 
     People's Armed Police, continues to deny its citizens basic 
     human rights enumerated in the Universal Declaration of Human 
     Rights, persecutes those who seek to freely practice their 
     religion, and denies workers the right to establish free and 
     independent trade unions.
       (b) Policy.--It is the policy of the United States to 
     prohibit any entity owned, operated, or controlled by the 
     People's Liberation Army or the People's Armed Police from 
     operating in the United States or from conducting certain 
     business with persons subject to the jurisdiction of the 
     United States.

     SEC. 3. COMPILATION AND PUBLICATION OF LIST OF PEOPLE'S 
                   REPUBLIC OF CHINA MILITARY COMPANIES.

       (a) Compilation and Publication.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary of Defense, in 
     consultation with the Secretary of the Treasury, the Attorney 
     General, the Director of Central Intelligence, and the 
     Director of the Federal Bureau of Investigation, shall--
       (A) compile a list of persons who are People's Republic of 
     China military companies and who are operating directly or 
     indirectly in the United States or any of its territories and 
     possessions; and
       (B) publish the list of such persons in the Federal 
     Register.
       (2) Periodic updates.--Every 6 months after the date of the 
     publication of the list under paragraph (1), the Secretary of 
     Defense, in consultation with the officials referred to in 
     that paragraph, shall make such additions to or deletions 
     from the list as the

[[Page S11706]]

     Secretary considers appropriate based on the latest 
     information available.
       (b) People's Republic of China Military Company.--For 
     purposes of making the determination required by subsection 
     (a), the term ``People's Republic of China military 
     company''--
       (1) means a person that is--
       (A) engaged in providing commercial services, 
     manufacturing, producing, or exporting; and
       (B) owned, operated, or controlled by the People's 
     Liberation Army or the People's Armed Police; and
       (2) includes any person identified in Defense Intelligence 
     Agency publication numbered VP-1920-271-90, dated September 
     1990, or PC-1921-57-95, dated October 1995, or any updates of 
     such publications under subsection (c).
       (c) Updating of Publications.--Not later than 90 days after 
     the date of enactment of this Act, and every 6 months 
     thereafter, the Defense Intelligence Agency shall update the 
     publications referred to in subsection (b)(2) for purposes of 
     determining People's Republic of China military companies 
     under this section.

     SEC. 4. PROHIBITIONS.

       (a) Officers, Directors, Etc.--It shall be unlawful for any 
     person to serve as an officer, director, or other manager of 
     any office or business anywhere in the United States or its 
     territories or possessions that is owned, operated, or 
     controlled by a People's Republic of China military company.
       (b) Divestiture.--The President shall by regulation require 
     the closing and divestiture of any office or business in the 
     United States or its territories or possessions that is 
     owned, operated, or controlled by a People's Republic of 
     China military company.
       (c) Importation.--No goods or services that are the growth, 
     product, or manufacture of a People's Republic of China 
     military company may enter the customs territory of the 
     United States.
       (d) Contracts, Loans, Ownership Interests.--It shall be 
     unlawful for any person subject to the jurisdiction of the 
     United States--
       (1) to make any loan or other extension of credit to any 
     People's Republic of China military company; or
       (2) to acquire an ownership interest in any People's 
     Republic of China military company.
       (e) Exports.--It shall be unlawful for any person subject 
     to the jurisdiction of the United States to export goods, 
     technology, or services to, or for any person to export 
     goods, technology, or services that are subject to the 
     jurisdiction of the United States to, a People's Republic of 
     China military company.
       (f) Exception for Humanitarian Items.--Subsections (a) 
     through (e) shall not apply with respect to a transaction if 
     the President--
       (1) determines that the transaction involves the transfer 
     of food, clothing, medicine, or emergency supplies intended 
     to relieve human suffering; and
       (2) transmits notice of that determination to Congress.

     SEC. 5. REGULATORY AUTHORITY.

       The President shall prescribe such regulations as are 
     necessary to carry out this Act.

     SEC. 6. PENALTIES.

       Any person who knowingly violates section 4 or any 
     regulation issued thereunder--
       (1) in the case of the first offense, shall be fined not 
     more than $100,000, imprisoned not more than 1 year, or both; 
     and
       (2) in the case of any subsequent offense, shall be fined 
     not more than $1,000,000, imprisoned not more than 4 years, 
     or both.

     SEC. 7. DEFINITIONS.

       For purposes of this Act:
       (1) People's Armed Police.--The term ``People's Armed 
     Police'' means the paramilitary service of the People's 
     Republic of China, whether or not such service is subject to 
     the control of the People's Liberation Army, the Public 
     Security Bureau of that government, or any other governmental 
     entity of the People's Republic of China.
       (2) People's Liberation Army.--The term ``People's 
     Liberation Army'' means the land, naval, and air military 
     services and the military intelligence services of the 
     People's Republic of China, and any member of any such 
     service.
                                 ______
                                 
      By Mr. JEFFORDS (for himself and Mr. Dodd):
  S. 2568. A bill to amend the Internal Revenue Code of 1986 to provide 
that the exclusion from gross income for foster care payments shall 
also apply to payments by qualifying placement agencies, and for other 
purposes; to the Committee on Finance.


  exclusion for foster care payments to apply payments by qualifying 
                          placements agencies

  Mr. JEFFORDS. Mr. President, today I am introducing a bill that will 
eliminate unnecessary distinctions drawn by the Internal Revenue Code 
for the tax treatment of payments received by families and individuals 
who open their homes to care for foster children and adults. Currently, 
the law allows an exclusion from income for foster care payments 
received by some providers, while denying eligibility for the exclusion 
to other foster care providers.
  My bill expands the law's exclusion of foster care payments. Under my 
bill, foster care payments to providers made by placement agencies that 
contract with, or are licensed by, State or local governments will be 
eligible for the exclusion, regardless of the age of the individual in 
foster care. This bill is a companion to H.R. 3991, introduced by 
Congressman Jim Bunning of Kentucky. By simplifying the tax treatment 
of foster care payments, the bill will remove the inequities and 
uncertainties inherent in the current tax treatment of foster care 
payments.
  Under current law, foster care providers are permitted to deduct 
expenditures made while caring for foster individuals. Providers must 
maintain detailed records to substantiate these deductions. In lieu of 
this detailed record keeping, section 131 of the Internal Revenue Code 
allows certain foster care providers to exclude from income the 
payments they receive to care for foster care. Eligibility for this 
exclusion depends upon a complicated analysis of three factors: the age 
of the person in foster care; the type of foster care placement agency; 
and the source of the foster care payments.
  For children under age 19 in foster care, section 131 permits 
providers to exclude payments when a State (or one of its political 
subdivisions) or a charitable tax-exempt placement agency places the 
individual in foster care and makes the foster care payments. For 
persons age 19 and older, section 131 permits providers to exclude 
foster care payments only when a State (or one of its political 
subdivisions) places the individual and makes the payments.
  This bill will simplify these anachronistic tax rules by expanding 
the tax code's exclusion to include foster care payments for all 
persons in foster care, regardless of age, even if the foster care 
placement is made by a foster care placement agency and even if foster 
care payments are received through a foster care placement agency, 
rather than directly from a State (or one of its political 
subdivisions). To ensure appropriate oversight, the bill requires that 
the placement agency be either licensed by, or under contract with, a 
State or a political subdivision thereof.
  Increasingly, State and local governments are relying on private 
agencies to arrange for foster care services for children and adults. 
While foster care for children has been in existence for decades, 
foster care for adults is a more recent phenomenon. Sometimes referred 
to as ``host homes'' or ``developmental homes,'' adult foster care 
facilities have proven to be an effective alternative to institutional 
care for adults with disabilities. My home State of Vermont, at the 
forefront of efforts to develop individualized alternatives to 
institutional care, authorizes local developmental service providers to 
act as placement agencies and to contract with families willing to 
provide foster care in their homes. The tax law's disparate tax 
treatment of foster care payments, however, impedes alternative 
arrangements. Persons providing foster care for individuals placed in 
their homes by the government can exclude foster care payments from 
income. For providers receiving payments from private agencies, 
however, the exclusion is not available (unless the individual in 
foster care is under age 19 and the placement agency is a nonprofit 
organization). These rules discourage families willing to provide 
foster care in their homes to persons placed by private placement 
agencies, thus reducing the availability of care alternatives. Because 
of the complexity of the current law, providers often receive 
conflicting advice from tax professionals regarding the proper tax 
treatment of foster care payments they receive.
  Mr. President, this bill will advance the development of family-based 
foster care services, a highly valued alternative to 
institutionalization. I urge my colleagues to support it.
  Mr. DODD. Mr. President, I am very pleased to rise along with my 
colleague, Senator Jeffords, in introducing a critically important 
piece of legislation that will ensure fair treatment for individuals 
and families who provide invaluable care to foster children and adults.
  Presently, foster care providers are permitted to deduct expenditures 
made while caring for foster individuals if detailed expense records 
are maintained to support such deductions.

[[Page S11707]]

However, section 131 of the Internal Revenue Code permits certain 
foster care providers to exclude, from taxable income, payments they 
receive to care for foster individuals. Who specifically is available 
for this exclusion depends upon a complicated analysis of three 
factors: the age of the individual receiving foster care services, the 
type of foster care placement agency, and the source of the foster care 
payments.
  Section 131 presently permits foster care providers to exclude 
payments from taxable income only when a state, or one of its political 
divisions, or a charitable tax exempt placement agency places the 
individual and makes the foster care payments for children under 19 
years of age. However, for adults over the age of 19, section 131 
permits foster providers to exclude payments from taxable income only 
when a State, or one of its divisisions, places the individual and 
provides the foster care payments.
  Mr. President, it is time that we remove the inequities and needless 
complexities of the current system. States and localities across the 
country are increasingly relying on private agencies to arrange for 
foster care services for both children and adults. However, some foster 
care providers are understandably reluctant to contract with private 
placement agencies because current law requires such providers to 
include foster care payments as taxable income. In contrast, current 
law permits providers who care for foster individuals placed in their 
homes by government agencies to exclude such payments from taxable 
income. Current law, therefore, discourages families from providing 
foster care on behalf of private placement agencies, thereby reducing 
badly-needed foster care opportunities for individuals requiring 
assistance.
  The bill Senator Jeffords and I introduce today will greatly simplify 
the outdated tax rules applicable to foster care payments. Under our 
legislation, foster care providers would be able to avoid onerous 
record keeping by excluding from income any foster care payment 
received regardless of the age of the individual receiving foster care 
services, the type of agency that placed the individual, or the source 
of foster care payments. To ensure appropriate oversight, this bill 
will require the placement agency to be licensed either by, or under 
contract with, a state or one or its political divisions.
  Mr. President, this legislation accomplishes what current law does 
not--consistent and fair treatment of families and individuals who open 
their homes and their hearts to foster children and adults.
                                 ______
                                 
      By Mr. KOHL (for himself, Mr. Reid, and Mrs. Feinstein):
  S. 2570. A bill entitled the ``Long-Term Care Patient Protection Act 
of 1998''; to the Committee on Finance.


             long-term care patient protection act of 1998

  Mr. KOHL. Mr. President, I rise today to introduce the Long-Term Care 
Patient Protection Act of 1998, along with Senators Reid and Feinstein. 
I am pleased to introduce this legislation on behalf of the 
Administration.
  Recently, the Department of Health & Human Services Office of 
Inspector General issued a report describing how easy it is for people 
with abusive and criminal backgrounds to find work in nursing homes. On 
September 14th, the Senate Aging Committee held hearings on this 
disturbing problem, where we heard horrifying stories of elderly 
patients being abused by the very people who are charged with their 
care. While the vast majority of nursing home workers are dedicated and 
professional, even one instance of abuse is inexcusable. This should 
not be happening in a single nursing home in America.
  Senator Reid and I have already introduced legislation, the Patient 
Abuse Prevention Act, to require background checks for health care 
workers. Those with prior abusive and criminal backgrounds would be 
prohibited from working in patient care. I am pleased that the 
Administration has also recognized the importance of addressing this 
problem, and I have been glad to work with them in this effort. While 
the bill we introduce today on the Administration's behalf is not 
perfect, I believe it is another important step in our efforts to pass 
strong patient protections.
  Mr. President, it is estimated that more than 43 percent of Americans 
over the age of 65 will likely spend time in a nursing home. The number 
of people needing long-term care services will continue to increase as 
the Baby Boom generation ages. The vast majority of nursing homes do an 
excellent job in caring for their patients, but it only takes a few 
abusive staff to cast a dark shadow over what should be a healing 
environment.
  A disturbing number of cases have been reported where workers with 
criminal backgrounds have been cleared to work in direct patient care, 
and have subsequently abused patients in their care. Just last year, 
the Milwaukee Journal-Sentinel ran a series of articles describing this 
problem. This past March, The Wall Street Journal published an article 
describing the difficulties we face in tracking known abusers.
  These news stories are only the tip of the iceberg. Unfortunately, it 
is just far too easy for a worker with a history of abuse to find 
employment and prey on the most vulnerable patients. The OIG report 
found that 5 percent of nursing home employees in Maryland and Illinois 
had prior criminal records. And it also found that between 15-20 
percent of those convicted of patient abuse had prior criminal records. 
It is just too easy for known abusers to find work in health care and 
continue to prey on patients.
  Why is this the case? Because current state and national safeguards 
are inadequate to screen out abusive workers. All States are required 
to maintain registries of abusive nurse aides. But nurse aides are not 
the only workers involved in abuse, and other workers are not tracked 
at all. Even worse, there is no system to coordinate information about 
abusive nurse aides between States. A known abuser in Iowa would have 
little trouble moving to Wisconsin and continuing to work with patients 
there.
  In addition, there is no Federal requirement that nursing homes 
conduct a criminal background check on prospective employees. People 
with violent criminal backgrounds--people who have already been found 
guilty of murder, rape, and assault--could easily get a job in a 
nursing home or other health care setting without their past ever being 
discovered.
  The Administration's bill that we introduce today builds upon the 
extensive work that Senator Reid and I have done to address this issue, 
and incorporates some new ideas as well.
  First, this legislation will create a National Registry of abusive 
nursing home employees. States will be required to submit information 
from their current State registries to the National Registry. Nursing 
homes will be required to check the National Registry before hiring a 
prospective worker. Any worker with a substantiated finding of abuse 
will be prohibited from working in nursing homes.
  Second, the bill provides a second line of defense to prevent people 
with criminal backgrounds from working in nursing homes. If the 
National Registry does not include information about the prospective 
worker, the nursing home is then required to contact the state to 
initiate an FBI background check. Any conviction for patient abuse or a 
relevant violent crime would bar that applicant from working in nursing 
homes.
  Let me be clear: I realize that this legislation is not perfect. I 
have significant concerns about several unresolved issues that I 
believe must be addressed. We must continue to work on minimizing costs 
and determine a fair and reasonable way to distribute those costs. We 
must ensure that the system is efficient and effective, with a quick 
turnaround time and accurate information for providers. And I believe 
that we must apply these requirements to other health care settings 
besides nursing homes. It would do little good to ban these people from 
working in nursing homes, and still permit them to work in home health 
care.
  Senator Reid and I have worked for a long time with patient 
advocates, the nursing home and home health industries, and law 
enforcement officials to address these issues. I have been very 
heartened by their enthusiasm and willingness to work with us in this 
effort. It is in all of our best interests to pass legislation that is 
strong, workable, and enforceable.

[[Page S11708]]

  Despite the unresolved issues I have mentioned, I am introducing the 
Administration's legislation today because I believe it will provide a 
strong incentive for everyone to stay at the table and resolve these 
issues. All of us--the President, Congress, health care professionals 
and consumer advocates--we all share the common goal of protecting 
patients from abuse, neglect and maltreatment. We must keep working 
together to create a viable national system that will prevent abusive 
workers from working with patients.
  Although the remaining days of this Congress are few, we all need to 
come together once again to reach consensus on the remaining issues and 
prepare to move this process forward. This legislation gives us an 
opportunity to act now. I look forward to continuing our work on this 
issue, and I welcome comments and suggestions for improving the bill.
  Mr. President, I want to repeat that I strongly believe that most 
nursing homes and their staff provide the highest quality care. 
However, it is imperative that Congress act immediately to get rid of 
the few that don't. When a patient checks into a nursing home, they 
should not have to give up their right to be free from abuse, neglect, 
or mistreatment. They should not have to worry about dying from 
malnutrition and dehydration.
  Our nation's seniors made our country what it is today. Before we 
cross that bridge to the next century that we have all heard so much 
about, we must make sure we treat the people that brought us this far 
with the dignity, care, and respect they deserve. I look forward to 
working with my colleagues and the administration in this effort to 
protect patients. Our Nation's seniors and disabled deserve nothing 
less than our full attention to this matter.
  Mr. President, I ask that the text of the bill be printed in the 
Record.
  [The bill was not available for printing. It will appear in a future 
issue of the Record.]
  Mr. REID. Mr. President, I rise today to join my colleague, Senator 
Kohl, in introducing the ``Long Term Care Patient Protection Act of 
1998''. This legislation represents our latest step in a series of 
efforts to institute greater protections for nursing home residents.
  Over the past year, Senator Kohl and I, along with our colleagues on 
the Senate Special Committee on Aging, have worked to ensure that 
seniors are not placed in the hands of criminals in nursing homes. The 
disturbing problem of nursing home abuse by workers with a violent or 
criminal history was brought to our attention just over a year ago. 
Shortly thereafter, Senator Kohl, Grassley, and I introduced S. 1122, 
``The Patient Abuse Prevention Act.'' This measure would require 
criminal background checks for potential long-term care facility 
workers and would create a national registry of abusive health care 
workers.
  This past July, Senator Kohl and I sponsored an amendment that would 
authorize nursing homes and home health agencies to use the FBI 
criminal background check system. This amendment is an important step 
towards our goal of mandatory background checks, and I am proud to 
report that this language was included in the Commerce, Justice, State 
Appropriations Bill.
  Upon our request, the Senate Special Committee and Aging dedicated a 
hearing to the issue of criminal background checks for long-term care 
workers. At this time, the Office of the Inspector General (OIG) at the 
Department of Health and Human Services released a report entitling, 
``Safeguarding Long Term Care Residents''. The year-long investigation 
by the OIG spanning facilities across the country produced the very 
recommendations Senator Kohl and I have been advocating for over a 
year. Specifically, the OIG concurred with our proposal to develop 
criminal background checks, and to create a national registry for 
nursing facility employees. Their findings were consistent with our 
position that a criminal background check system could help weed out 
potential employees with a history of abuse and prevent them from 
working with patients.
  Recently, President Clinton acknowledged the need for tough 
legislative and administrative actions to improve the quality of 
nursing homes. Using our original legislation as a guide, the 
Administration drafted a proposal to address the crucial issue of 
criminal background checks for nursing home workers. I am pleased that 
the Administration has recognized the need for criminal background 
checks and has modeled its initiative after our legislation. I am 
introducing the ``Long-Term Care Patient Protection Act of 1998'' on 
behalf of the Administration because it builds on our extensive work in 
this area and represents an important step in the right direction.
  The ``Long-Term Care Patient Protection Act of 1998'' would create a 
national registry of abusive workers. Further, the bill would expand 
the existing State nurse aide registries to include substantiated 
findings of abuse by all nursing facility employees, not just nurse 
aides. States would be required to submit any existing or newly 
acquired information contained in the State registries to the national 
registry of abusive workers. This provision is crucial because it would 
ensure that once an employee is added to the national registry, the 
offender will not be able to simply cross state lines and find 
employment in another nursing home where he may continue to prey on 
vulnerable seniors.
  Another important portion of the bill outlines the process by which 
nursing homes must screen prospective employees. According to this 
legislation, all nursing homes must first initiate a search of the 
national registry of abusive workers. In cases where the prospective 
employee is not listed on the registry, the nursing home would be 
required to conduct a State and national criminal background check on 
the individual through the Federal Bureau of Investigations.
  Finally, nursing homes would be required to report to the State any 
instance in which the facility determines that an employee has 
committee an act of resident neglect, abuse, or theft of a resident's 
property during the course of employment. The OIG at the Department of 
Health and Human Services reported that 46 percent of facilities 
believe that incidents of abuse are under-reported. This provision 
would ensure that offenders are reported and added to the national 
registry before they have the opportunity to strike again.
  One of the most difficult times for any individual or family is when 
they must make the decision to rely upon the support and services of a 
long-term care facility. Families should not have to live with the fear 
that their loved one is being left in the hands of an individual with a 
criminal record. No one should have to endure the pain and outrage of 
learning that their loved one has fallen prey to a nursing home 
employee with a violent or criminal record. At last month's Aging 
Committee hearing, we heard the real life nightmare of Richard Meyer, 
whose 92 year-old mother was sexually assaulted by a male certified 
nursing assistant who had previously been charged and convicted for 
sexually assaulting a young girl. We can and we must work to prevent 
tragedies like this one from occurring again in the future.
  Americans over the age of 85 are the fastest growing segment of our 
elderly population. There are 31.6 million Americans over the age of 
sixty-five, and as the baby boom generation ages, that number will 
skyrocket. Over 43 percent of Americans will likely spend time in a 
nursing home. As our nation seeks ways to care for an aging population, 
we must establish greater protections to ensure that our seniors will 
receive the best care possible.
  I have visited countless nursing homes in my home state of Nevada. 
During these visits, I have always been impressed by the compassion and 
dedication of the staff. Most nurse aides and health care workers are 
professional, honest, and dedicated. Unfortunately, it only takes one 
abusive staff member to terrorize the lives of the residents. That is 
why we must work to wed our the ``bad apples'' who do not have the best 
interest of the patient in mind. I urge you join Senator Kohl and me in 
our efforts to provide greater protections for all nursing home 
residents.
                                 ______
                                 
      By Mr. LIEBERMAN:
  S. 2571. A bill to reduce errors and increase accuracy and efficiency 
in the administration of Federal benefit programs, and for other 
purposes; to the Committee on Governmental Affairs.

                          ____________________